Three ways supplier and contract management can take your procurement strategy to the next level

By Lewis Joshi, Business Development Executive, Proactis

It’s been an interesting few months during which I’ve spoken with many organisations about how they can adapt to change and take their Procurement function to the next level – it’s been great to see the determination and resolve of Procurement professionals to evolve, solve problems and drive more value into their organisations.

Whether you’re in real estate, property, facilities management, retail, care or not for profit, we have identified three ways that supplier and contract management can help strengthen your organisation.

Increased agility
When our environment changes over night, or a new business need arises, procurement must be able to move quickly to neutralise risk and support the organisation by continuing to deliver high value using the supply chain – the delivery of PPE was a very real example of this.

A cleaner, more rationalised supply directory can support speedy decision making as you can view every supplier and their goods, services, locations, certifications, specialties and contacts in one place – which is vital when you need to call on your supply base at short notice. And the ability to send out supplier-wide communications and customisable electronic questionnaires with automated response summaries enables the quick assessment around risk and supplier delivery capabilities.

When contracts are paper-based and held in office draws, or stored disparately in people’s inbox, access becomes even more difficult when a shift in operating model occurs - just like in recent times with a move to remote working. A consolidated, digital repository therefore gives ultimate agility regardless of staff location.

Natural integration with a finance/ERP solution like Infor Sun, Unit4, MRI (amongst many others) strengthens agility deeper into the organisation as supplier data is consolidated, supplier invoice queries are more quickly resolved, and PO-flips enabled for more efficient processing.

Consolidated and rationalised data, combined with visibility enables procurement to move with change without cracks appearing. This also all helps with supplier experience and relationships.

More time for strategic procurement
Spending time on the front-line supporting internal functions with their procurement needs; driving on-contract spend and purchasing through approved suppliers; negotiating greater value from contracts and stronger supplier evaluation becomes more of a reality when efficiency is increased.

One of the areas that Proactis customer JLL was most excited about was a strong supplier engagement strategy where suppliers can self-serve with on-boarding, keep their profiles and catalogues up-to-date, and follow a streamlined quoting process. With all contracts in one place, important details are accessible, and teams are alerted whenever action is needed. Plus, all purchase activity is automatically gathered so analysis of supplier performance and buyer commitments is relatively easy.

All said and done, this means less administration for your Procurement team!

Continuous improvement
Visibility of all contract details means you can stay ahead of renewals and, coupled with stronger supplier relationships and more time for being proactive, allows you to negotiate greater value year on year. Contract visibility and a single rationalised supplier directory provides the opportunity for on-going consolidation of tail-end spend and when added to visibility of supplier performance against contract commitments, gives the opportunity for increasing levels of value to be created.

Integrated Source-to-Contract and ERP systems offer consistency of insights for both procurement and finance, plus a better supplier experience across Source-to-Pay, therefore further enabling the opportunity to generate and amplify value and reduce risk in the supply-chain. It’s interesting when you consider companies such JLL who referenced disconnected systems as a key blocker for not being able to improve their business and evidence to their clients that they are staying ahead of the market.

So that’s my take – procurement is coming of age and has a real opportunity to demonstrate just how valuable it is in supporting change and helping its organisation grow.