Why Off-the-shelf Purchase Order Software don’t work
Of all the departmental processes that are ripe for automation, the most obvious one is the purchase process. The decisions made here are likely to have cascading effects on the top line and bottom line of organizations. Any delay in the purchase process results in changes to the annual budgets and percolates departmental hiring decisions and profitability. But when you survey the landscape, very few organizations actually use automated purchase software for managing their purchase process. Why is this so?
One primary reason seems to be the inherent nature of the purchasing process. The purchasing process typically encompasses,
- Vendor selection program
- Request for quotations
- Buyer evaluation process
- Purchase request approvals
- Purchase order creation
- Receipt of goods and
- Payment process
Organizations tend to have these stages with different levels of complexity. Some companies have elaborate pre-qualification questionnaires and vetting along with a multi-level approval process just for their vendor selection program while some have this integrated with their quotation requisition process. Many others require the ability to integrate with other financial systems for budget approval limits. SMBs look for products that are easy to set up and get started, inexpensive and customizable to their specific use case.
Another reason happens to be the delicate role played by the purchasing department in the supply chain process of the entire organization. The Purchasing department seems to be sandwiched between Finance on one side, all other procuring departments on another side, and suppliers and vendors on a third side. Any effort to automate or streamline the process requires buy-in from multiple stakeholders and becomes an overwhelming task. Trying to convince with a one-size-fits-all purchase automation software essentially becomes a non-starter.
Purchasing departments would continue with the status quo of having an email-spreadsheet combo however inefficient rather than deal with the complexity of choosing an application that satisfies the requirements of different stakeholders. So is there a way out for purchasing departments to improve their productivity?
Yes, fortunately, there are products and solutions available in the market that can help automate the entire purchasing process. But this cannot be done with off-the-shelf software due to the reasons mentioned earlier. BPM would be an ideal solution in this case. BPM enables the creation of a fully customizable solution with multiple levels of approval and provides the ability to interact with other systems seamlessly. Cloud-based purchase automation software that leverages a multi-tenant architecture and reduces the total cost of ownership is becoming increasingly attractive for SMBs. The BPM software’s ability to interact with home-grown systems as well as third-party accounting and ERP systems helps reduce data entry errors and improves overall cycle time.
Organizations are increasingly looking for specialized products that solve specific pain points but when it comes to solutions spanning multiple functions and departments, a generic solution that can interact with disparate systems may be just what the doctor ordered. The effectiveness of BPM to glue different systems together while providing key functionalities specific to the Purchasing Process is unmatched and turns out to be the solution that provides the best ROI.
Cavintek’s Cflow is a workflow automation software that automates business processes and helps organizations dramatically improve productivity.
Organizations use Cflow BPM Software to automate their,
- Capex requests
- Check payments
- Purchase process
- Sales discounts
- Marketing approvals and much more.
To know more about Cflow, click here or sign up now.