Unleashing The Power Of Automatic Sourcing
AUTOMATIC SOURCING
When you think of an effective source-to-pay (S2P) solution, what likely comes to mind are simple basics such as robust finance controls and integrated enterprise resource planning (ERP). However, now increasingly popular element of any S2P system is automated sourcing.
By taking closer look at this valuable feature of S2P solutions, companies can uncover the tremendous potential of automation and discover how it can help streamline the entire procurement process. Automation can also act as key component to success in the contemporary digital era.
Gaining an Overview
When considering using automated sourcing within S2P, company must really gain an understanding of how the whole process works. This is especially true for executives within the finance department. What are the core functions of automated sourcing and how does it istreamline the entire S2P process? The key element is that it eliminates the need for manual entry which helps remove the burden of errors and clerical overheads.
In practice, automated sourcing encapsulates intelligent object recognition and cross-referencing technology. As such, it enables companies to quickly understand the basics of each transaction in terms of what supplier, product, or service is being requested and when the delivery deadline is. To put this into perspective, consider web-based ordering system. The technological backbone of the system can be used to submit product requests, display relevant images and data, evaluate project risks, and automatically generate purchase orders.
The Benefits of Automation
The clear benefit of automated sourcing is the ability to leverage an S2P solution that is custom-tailored to the companies procurement needs. Thanks to the intelligence of automated software, every transaction is analysed within the context of the companies specific procurement policies. This helps to ensure compliance with the organisation?s spending regulations and contracts.
By freeing up time and resources, automated solutions can help to achieve considerable cost savings. Here, an additional layer of accuracy is achieved through the implementation of sophisticated algorithms. Automated spending rules can be particularly useful when it comes to maximising value from companies spend, and this helps to lower any potential associated risks.
Adopting Automated Sourcing
For any company that is interested in leveraging the power of automated sourcing within their S2P solution, the first step must be to understand the architecture of their current systems. This involves both formulating an understanding of the companies data structure and assessing how this can be used to leverage automated solutions.
To ensure effective implementation, processes such as evaluating the supplier base, evaluating compliance and risk, and verifying the accuracy of any data are essential. rudimentary stage of optimisation is also required. This encompasses critical tasks such as automatically analysing purchasing data and using this to inform decisions and trends by developing critical insights into ways of negotiating better contracts with suppliers.
Finally, success applies across the entire supply chain. Real-time access to data and analytics helps to ensure that vendors can be paid in timely and efficient manner, while all relevant stakeholders are able to have open, transparent, and collaborative relationships. Formal communication protocols can also be established to facilitate informed decision making and effective dispute management.
Key Takeaways
For any company exploring the advantages of automation within S2P solutions, the power of automated sourcing should not be underestimated. By leveraging the intelligence of automated software within the context of the companies procurement policies, considerable cost savings and improved accuracy can be achieved.
The key is in understanding the ingredients involved in successful implementation. This starts with having an understanding of the companies data structure. From there processes such as negotiating better contracts with suppliers, automatically analysing data, establishing effective communication protocols, and verifying accuracy can all play role. Ultimately, this can lead to the successful adoption and integration of automated sourcing.
