Little over a year ago I came across a blog-post titles ”Why Procurement is Meant to be Hated”; the posts author argued that it was the purchasing function’s mission to have people stop buying things.
The reality is that the purpose of procurement, a centralized service in the business, is to monitor and control all purchasing decisions, from a new pen through to a new building. The system should be painful to both suppliers and users, ensuring that both sides try and avoid interaction unless completely required. In this way procurement helps to focus spending on what is really required and removes spending on items that are just “wanted” because its not worth the effort.
What the author (albeit with his tongue firmly planted in his cheek) chooses to ignore is the fact that e-procurement is everything but a poorly functioning company branded web-shop. On the contrary; an e-procurement solution should enable the buyer (the employee) the opportunity to easily compare and purchase goods and services with an open mind.
Sad to say; many e-procurement solutions are still only poorly functioning webshops – and the end-users (and purchasing functions) treat them as such. End-users; trained to lovemark brands and vendors; rather browse vendor catalogs than search for needed goods regardless of supplier.
So stop pitching e-procurement as a place to “shop” for goods and services; start to sell it as a product comparison web site. E-procurement is not an Amazon, it’s a Pricerunner. And if you’re shopping for an e-procurement solution; make sure that the solution includes a search engine that enables users to find necessary goods and services instead of popular suppliers or vendors.
October 23, 2008 at 8:42 am
Most of the Procurement softwares are very expensive to afford specially for a small companies.
October 23, 2008 at 2:42 pm
You are right of course – but I think its important to note that there is basically a provider for anyone, keeping in mind that you get what you pay for.
On demand is of course where it is at for the SMB segment. Companies like Coupa offers an excellent feature set when related to the price tag.
http://www.coupa.com
One issue I would imagine SMBs struggle with is the actual value assessment and ROI calculations associated with buying into eprocurement. This is of course a classic catch-22 since the needed input might be missing due to lack of visibility in the procurement area.
At the very least this insight is exactly what you will get from eprocurement so there really are no reasons not to go for it in my opinion.