With each passing day, the business world is only growing in scale. This rate of development means that the procurement needs of organizations are not going down by any chance. Instead, as organizations become bigger, their procurement needs increase. To meet with the increasing demands of the procurement departments of various enterprises, the business world is adopting newer and more efficient solutions. Specifically speaking, e-procurement is entering the mainstream at a pace that was unimaginable a few years ago. However, despite the spiking adoption rates of e-procurement systems, certain corporations still possess their reservations regarding such new-age tendering tools. Privacy concerns top the list of problems that critics hold against e-procurement tools. Hosting sensitive information about company contracts on the internet seems like too big a risk to some business-leaders. However, for every naysayer out there, there exists a champion of the concept of an e-procurement system. But, what makes these modern-day tendering tools so scintillating for pioneers in the business world?
What attracts companies to e-procurement systems?
At the end of the day, every business’s primary objective is growth. If a tool enables an enterprise to grow, it is considered useful. Thus, the biggest reason for the cordial response garnered by e-procurement tenders online is that they subject businesses to growth opportunities. Here are six detailed ways in which the above-mentioned phenomenon manifests itself in the business world:-
• E-Procurement processes increment savings: The operational expenditure linked with time-tested tendering models is attributed to several factors. For starters, the paperwork-based model of tendering involves significant manpower. Not to mention that printers don’t run on the willpower of employees. Stamps also cost real money and not the currency used in the latest version of Monopoly. Furthermore, for every stage of the tendering process, traditional models give rise to a new batch of paperwork. However, in the case of an e-procurement system, the above-mentioned costs are practically non-existent. At an individual level, money saved on paperwork doesn’t seem like much. However, on an organizational level, the equation is completely reversed. Even a minuscule decrement in expenditure can impact company revenue in a major way. Furthermore, when cost reductions come with increased efficiency, they create a domino effect that leads to further savings.
• E-procurement processes promote transparency: E-procurement tenders not only promote transparency for the tenderers but also assist purchasers in bringing more clarity into their financial tracks. Since keeping a track of expenditure with an e-procurement system is much easier and less prone to errors than manual accounting measures, it helps companies in maintaining a transparent record of their procurement-related spendings. On the other hand, the highly accessible nature of e-procurement processes encourages tenderers to participate more keenly in bidding wars than they would be inclined to in the case of traditional tendering models.
• E-procurement processes elevate productivity levels: Digitalised systems are often built with productivity as one of the guiding principles. Thus, it is no surprise that e-procurement tenders foster a productive system of tendering. They do so by eliminating the work associated with managing paper-trails and facilitating accessible project information. Furthermore, readily-available communication channels also help e-procurement processes in improving the productivity of ten-dering operations.
• E-procurement processes are paper-free: From an environmental standpoint, paper-free business activities are a huge blessing. The business world is waking to the catastrophic consequences of global warming with each passing day. This realization is exhibiting itself in the emergence of new and eco-friendly business practices. Also, as stated above, paper-free procurement processes are more productive than their paper-heavy counterparts.
• E-procurement processes implement universal standards for tendering: Since companies have procurement needs in multiple sectors, a standardized approach to tendering making things incrementally easier. In the case of traditional tendering systems, universally applicable procurement guidelines are difficult to establish. This is because different tenders comprise the input and workflows of different departments. However, in the case of e-procurement systems, tenders from vastly different backgrounds undergo similar processing standards. This is yet another reason why e-procurement tenders foster a productive resolution to a company’s tendering requirements.
• E-procurement processes accentuate efficiency: Since an online tendering system hosts all in-formation relevant to a company’s procurement needs inside a single platform, it reduces the margin for errors by a significant portion. In other words, e-procurement tenders online are more efficient than traditional paper-based tenders. Furthermore, given the fact that such platforms also store a company’s tendering history in their databases, procurement teams can stay vigilant of their past mistakes. New tenders can always be referenced against similar tenders from the past to identify probable roadblocks.
Notes from the devil’s advocate
Despite serving all the above-mentioned benefits, e-procurement tenders online are far from perfect. They come with real risks that can sabotage tendering processes altogether. For instance, a digital platform is much more susceptible to a privacy breach than a system involving manual input. Furthermore, e-procurement processes are not as detail-oriented as traditional tendering mechanisms. Granted that the increased efficiency in e-tendering outguns the attention to detail in traditional procurement methods, it doesn’t come without compromises. Furthermore, getting procurement teams that are already familiarised with traditional tendering models to sign off on the adoption of e-procurement processes can be a pain for the company’s HR department. Also, online tendering platforms come with a learning curve. To bear the fruits inherent to e-procurement, companies need to train their purchase teams to make the best out of the tools at their disposal. This training doesn’t come without the deployment of time and resources.
The mainstream usage of e-procurement processes is the future, but no one can say with absolute certainty how far away that future is. Thus, for now, it is smart for a company to dive into the realm of e-procurement only when it feels ready to do so. When that time comes, the above-mentioned benefits will follow suit.
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