e-Procurement tools preferred to ERP systems
E-Procurement is an essential part of the Purchasing professional toolbox with nearly 90 percent of large companies being equipped with a dedicated tool. 86 percent of the Trending in Procurement panel say their company has deployed an e-Procurement tool. Of these, 60 percent indicate that the type of tool deployed is an e-Procurement module developed by a specialized e-Procurement provider, 20 percent list an e-Procurement module that is part of an ERP system and the remaining 20 percent use another type of tool (primarily internal developments).
The preference of Purchasing Departments for specialized e-Procurement solutions as compared to ERP functionalities is based on several factors: faster deployment and return on investment, procurement expertise and a better coverage of procurement functional requirements. “E-Procurement tools are designed to support corporate procurement strategy. Fully automating the Procure-to-Pay process enables Procurement Departments to create value by improving the control, transparency, tracking and visibility of company spend.” says Gérard Dahan, General Manager EMEA for Ivalua.
Other findings include that for a majority of Purchasing professionals, e-Procurement solutions are primarily designed to manage indirect procurement, thus 82% of the panel uses e-Procurement tools for managing indirect spend only.
Finally the business benefit most frequently cited by the survey panel, derived from the implementation of an e-Procurement solution, is an increased visibility into the overall purchasing process, from the purchase requisition to the invoice processing (Procure-to-Pay process). This greater visibility into company spend improves the knowledge of company purchases, assists in optimizing the supplier panel, allows the aggregation and sharing of orders, highlights savings opportunities by spend categories or by supplier and, in the end, helps obtain the best commercial conditions during negotiations with suppliers.
Ivalua recently unveiled these results of its quarterly survey Trending In Procurement on Purchasing Departments’ priorities and focus of for their e-Procurement strategy.