Introduction
Procurement, a vital function within any business, demands high levels of accuracy, predictability, and agility. However, it often faces significant challenges that can hinder efficiency and effectiveness. The integration of automation into procurement processes can provide a transformative solution, addressing these challenges and enhancing overall performance. This article explores how automation can resolve six major procurement challenges, ensuring that businesses remain resilient and capable of rapid adaptation in a dynamic market environment
Why business executives like BPA
A recent Pipefy survey found that while many business leaders still see cost savings as a key benefit and driver for business process automation technology, better decision-making, competitive advantage, and efficiency were also important.
More than 70% of directors and over 80% of executives said efficiency was a main reason for process automation. Achieving productivity motivated 64% of C-suite executives and 77% of directors. More than half of both groups cited error reduction as a motivation.
Main reasons for process automation software adoption
| Driver | C-suite | Director |
| Increase efficiency | 79% | 71% |
| Improve productivity | 64% | 77% |
| Reduce errors | 59% | 52% |
| Create more time for employees to focus on value-creating work | 54% | 38% |
| Conserve IT resources | 52% | 45% |
| Cost savings | 46% | 56% |
| Need to scale processesor workflows | 34% | 35% |
How does this affect procurement challenges?
Growing interest and investment in BPA software benefits procurement teams. Procurement teams become more resilient by simplifying automation and making workflow changes simpler with these technologies.
Avoid manual invoice processing, data visibility, blind spots or bottlenecks, delayed payments, missed deadlines, and data input mistakes.
Advantages of business process automation
Two-thirds of executives and more than half of directors said business process automation technologies improved data and decision-making. More than half of both groups thought BPA tools improve agility.
| Benefits | C-suite | Directors |
| Better data and decision making | 66% | 52% |
| Improved agility | 55% | 51% |
| Better collaboration | 55% | 48% |
| Cost saving | 54% | 61% |
| Better ability to measure KPIs and metrics | 48% | 45% |
| More consistent process outcome | 41% | 52% |
The top 6 procurement issues
Procurement involves people, procedures, and systems regardless of organisation size. Due to their complexity, procurement procedures can be prone to six well-known issues:
| Challenge | Root cause |
| 1. Too much manual work | Broken workflows, dependence on spreadsheets and emails |
| 2. Process or workflow gaps | Legacy systems, tech stack complexity |
| 3. Failure to respond quickly to change | Rapidly evolving workflows or processes |
| 4. Not enough resources | IT bandwidth and/or backlogs |
| 5. Data or collaboration silos | Lack of visibility, lack of integration |
| 6. Difficulty making informed decisions | Obtaining accurate or relevant data is time consuming |
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Saving the day with digital automation
Inefficient and inaccurate procurement practices can hurt corporate performance.
Procurement automation and digitalisation may turn antiquated systems and inefficient procedures into a future-proofed procurement operation that produces long-term business value.
Reduces manual work inefficiencies and faults
If procurement is broken, teams may do unneeded manual effort. Multiple spreadsheets and interminable email threads or decentralised communication channels are indicators of a failed procurement process.
Excessive spreadsheets and inboxes indicate laborious activity behind the scenes. Spreadsheet/email data silos, collaboration hurdles, and failed handoffs are common.
Missing or partial data causes several delays. As things travel through the workflow, costly mistakes and rework are typical because emails and spreadsheets use unstandardised and decentralised data.
These issues divert time and energy away from value-driving tasks including market analysis, pricing negotiation, vendor management, and quality control.
These laborious procedures are easier to automate when procurement is digitised and centralised. Lead times improve, mistakes are minimised, and procurement teams may focus on cost-cutting and revenue-generating operations.
Connects workflow gaps
Choppy connections between parts, systems, and apps sometimes cause communication or job handoff gaps. Legacy system inefficiencies and interruptions lead to missed deadlines, late approvals, and a lack of visibility and responsibility.
Manual workarounds are available, but maintaining a large tech stack might hinder discovering a better method to operate.
Tech stack complexity was a major impediment to process automation deployment for 32% of directors and 27% of C-suite executives, according to a Pipefy poll.
No-code process automation streamlines, weaves, and strengthens the various moving pieces, processes, and people without setting stiff, inflexible criteria that can’t keep up with business changes. No gaps, pauses, delays, or complication result from this more coherent, organised, linked, and responsive work and information flow.
Management of change simplified
Business procedures grow like anything else. Their methods may alter when someone finds a better approach. Sometimes modification is needed because new applications and systems are introduced to the tech stack or legacy components are customised.
Processes change with corporate strategy and market changes. When team size or structure changes, processes must be adjusted.
These external influences affect procurement procedures substantially. Since procurement ensures the firm gets the goods and services it needs, teams must respond quickly and effectively.
Digital procurement lets procurement teams adapt rapidly. This applies especially to no-code procurement tools. The business team that knows the process best may make various workflow modifications and automations without costly customisations.
Addresses resource shortage
Managing developing procurement processes affects more than just procurement staff. Customisations also stress IT and development teams. When the procurement team’s demands change or supply chains break, they may be diverted from other business objectives to fix or adapt the procurement process.
Automating tedious labour and upgrading procedures wastes developer resources, adds to the IT backlog, and reduces developer bandwidth, which 64% of IT executives say is the biggest impediment to new technology adoption.
Digital processes designed and maintained with no-code automation allow IT and business teams deliver solutions fast and securely utilising an IT-sanctioned toolkit. With full IT control, business teams may make some changes and respond faster to market developments, new opportunities, competitor activity, and consumer feedback.
IT teams can handle complicated procurement procedures without adding staff or customising stack components, which is costly. Digital procedures are easier to standardise, making security and compliance enforcement easier and reducing shadow IT and manual workarounds that raise risk and mistakes.
Removes data and collaboration silos
A team with limited bandwidth managing a tech stack of several apps, platforms, spreadsheets, and databases can fragment data and create communication silos. In addition to the everyday burden of manually processing and handling innumerable requests, mistakes, delays, disruptions, and unregulated expenditure increase.
Procurement automation connects people, processes, and tools seamlessly. Digital automation software unites the various moving elements into a unified, digitalised system, making it simpler to link, view, and control procurement activities. Information flows effortlessly between people and tools.
Better decision-making for procurement challenges
Speed and attention distinguish a firm that keeps up with competition from one that leads. Decision-making accuracy and efficiency make the difference.
Complete data analytics rapidly, identify patterns, root causes, and abnormalities quicker than previously. Generative AI gives procurement teams fast access to KPIs and other indicators, making them strategic partners and value orchestrators.
Future prospects
Under 25% of procurement teams have a long-term digital strategy, according to Gartner. This data shows that most procurement teams are unprepared for the next big upheaval and misses opportunities to save costs, preserve resources, and boost efficiency.
Any period can bring unprecedented change. Digital procurement allows companies to capture new possibilities and adjust to market changes now and later.
Conclusion
In conclusion, the automation of procurement processes addresses many of the inherent challenges, transforming them into opportunities for efficiency, agility, and improved decision-making. By reducing manual work, connecting workflow gaps, simplifying change management, addressing resource shortages, eliminating data silos, and enhancing decision-making, procurement teams can significantly enhance their performance and strategic value. As the business landscape continues to evolve, the adoption of digital procurement strategies will be crucial for maintaining competitiveness and achieving long-term success
