Are manual purchasing procedures hindering your business's growth? Is outdated procurement processed, burdening your enterprise with unnecessary costs, delays, and bottlenecks?
It’s certainly time to change your SaaS software procurement process. If you are not leaping towards automation and sticking to conventional methods, you are missing opportunities to boost your revenue and productivity.
Automation, speed, and efficiency are vital for success and advancement in today’s business world. Relying on manual and outdated SaaS purchasing processes can hinder growth, cause operational stagnation, shadow IT, and increase costs.
As per the reports by Camunda, as many as 51% of automation initiatives aim to boost business efficiency.
This article explains the challenges of an outdated procurement process and how to revolutionize software procurement. Explore the benefits of automated workflows and discover how they can catapult your business to new heights of productivity.
Software procurement process - A Walkthrough
It is an approach to strategically purchasing software solutions to meet specific operational needs within an organization. It is a complex journey that includes analyzing organizational needs, exploring potential solutions, vendor selection, negotiation, and software implementation.
This organized strategy guarantees that the acquired software aligns with corporate objectives, meets quality requirements, and complies with relevant regulations.
The following are essential steps in the software purchase process:
- Identifying software requirements
- Assessing options based on function and fit
- Choosing Vendors
- Negotiating beneficial contracts
- Ensuring smooth onboarding and integration
- Constant assessment and monitoring of software performance
- Proactive vendor management
The software procurement process ensures that all the teams within an organization have access to suitable applications to perform their tasks and increase operational efficiency.
5 Major Challenges in Traditional Software Procurement Process
Traditional/Manual software procurement processes can limit the efficiency and outcome of businesses. From delays, errors, and overspending to the risk of shadow IT, the traditional procurement process necessitates adopting more streamlined and modern software procurement processes.
1. Delays and bottlenecks
Delays and bottlenecks are a big challenge in the traditional software purchase process. The procurement procedure comprises several stages, approvals, and decision points, which can lead to unnecessary delays.
Manual procurement involves long approval processes, time-consuming evaluations, complex decision-making hierarchies, or unclear roles and responsibilities within stakeholders that further aggravate and hinder software procurement.
2. Lack of transparency
60% of business leaders say the lack of transparency between finance and procurement functions and suppliers introduces risk.
A lack of transparency is a critical challenge in the software procurement process. Misunderstandings can emerge when stakeholders, particularly decision-makers and end-users, lack visibility into different procurement phases.
This even contributes to procurement requests getting lost in the middle, making it difficult for procurement requests to move from start to finish. Thereby, it further hinders the team members' collaboration, leading to inefficiencies in the overall process.
3. Lack of flexibility and adaptability
Traditional procurement processes often lack the flexibility to adapt quickly to changing business goals or technological advances. Process rigidity makes it difficult to absorb new solutions swiftly, stifling innovation and preventing businesses from staying nimble in a volatile business environment.
4. Rise of Shadow IT
Shadow IT is when users purchase products without the approval of the IT team. It can result in security risks, data breaches, and challenges in managing a cohesive and compliant IT infrastructure. The inadequate and delayed procurement procedure is one of the primary causes of shadow IT.
As per G2 Track, 79% of employees said the most significant threat of introducing new technologies without IT’s approval is risking the company's security.
In manual processes, purchase requests frequently get lost, leading to buying delays. This will annoy the requester, and they might buy the product independently with a business credit card. In the future, this will result in additional spending and compliance concerns.
5. No visibility and control over the process
Traditional processes frequently lack comprehensive visibility and control over the entire software purchase process lifecycle. This oversight can further hinder software solutions' effective and timely procurement.
From the first request phase to implementation, the lack of centralized oversight leads to approvals, negotiations, compliance, governance, and strategic decision-making challenges.
What is the difference between the traditional and modern procurement processes?
The traditional procurement process is manual and time-consuming, whereas the modern one is automated, quick, and streamlined. Here is a table showing the difference between the two:
Why must you switch to an automated software procurement process?
Here are a few key reasons why switching to an automated SaaS procurement process can make your business more agile and successful.
According to a 2022 Hackett Group Study, procurement teams that utilize technology more efficiently can manage 27% more spend and generate 2.4x ROI from cost savings.
1. Quicker request approval cycles without bottlenecks
Automated procurement workflows automatically speed up request approval by routing requests to the right stakeholders. The process becomes more agile by automating notifications and proactive triggers, minimizing manual evaluations, and preventing bottlenecks.
This results in faster decision-making, increased productivity, and a smooth transition from request to approval.
2. Centralized visibility and complete transparency
Automated procurement workflows enable comprehensive visibility, preventing lost requests and allowing for real-time tracking. Notifications keep stakeholders informed throughout the process, encouraging proactive participation and fostering accountability.
Automated routing and escalation systems improve visibility and accountability, allowing for more rapid procurement.
3. No manual intervention is needed
Procurement workflow automation eliminates the need for manual involvement in the approval process. Requests are automatically sent to the appropriate stakeholders, and alerts guarantee that actions are taken promptly.
This eliminates the reliance on manual evaluations, lowering the risk of errors and expediting the SaaS procurement process without humans needing continued inspection.
4. Pre-built workflows save time and increase productivity
Pre-built workflows include predefined steps and activities, which saves time by eliminating the need to set up processes from beginning to end. These processes are created according to the best standards, ensuring efficiency and consistency.
Teams can readily establish standardized processes by leveraging pre-built workflows, decreasing time spent on manual configuration and enhancing overall productivity.
5. Enhanced vendor relationships
Automated workflows help to improve vendor relationships by improving communication and processes. On-time approvals and efficient procurement cycles allow businesses to meet vendor expectations and commitments.
The transparency given by automated workflows fosters confidence among companies and vendors, resulting in better and more productive partnerships.
6. No more decentralized procurement and increased spending
Automated workflows avoid decentralized procurement by providing distinct approval channels. Requests are routed through authorized channels, which prevents individual departments from making independent purchases.
This centralized approach improves expenditure management, reduces the danger of unnecessary purchases, and allows for a more strategic and cost-effective procurement procedure. Overall, it assists businesses in avoiding wasteful spending and maintaining financial discipline.
CloudEagle - The go-to software procurement tool for organizations
CloudEagle is a cutting-edge SaaS procurement software built to streamline enterprises' SaaS procurement processes. CloudEagle's extensive set of features automates and enhances procurement processes, ensuring a quick and efficient purchasing procedure.
Workflows are available to expedite the approval process; your team doesn't have to chase stakeholders for approvals. Each stakeholder will be notified via Slack and email. You can also create a private Slack channel for collaboration.
Gain real-time visibility into SaaS procurement, enhancing transparency and accountability. Track request origins and activity status for informed team communication.
CloudEagle offers assisted buying by leveraging SaaS buying experts to negotiate with vendors. This guarantees that the right products are acquired at the best prices, saving your procurement team time and effort.
Our buyers have years of negotiating experience and access to the latest pricing benchmarks, ensuring that you pay the right price for the product as your peers.
You can get our expert assistance and take the lead during negotiations, or let our experts do all the heavy lifting for you while you can focus on your strategic tasks; the choice is yours.
CloudEagle's vendor recommendation engine facilitates quick vendor research, speeds up the decision process, and allows users to locate the top vendors quickly, compare prices and reviews side-by-side, and read testimonials from their customers. All are embedded within the CloudEagle platform.
Intake forms and Slack for procurement
Custom intake forms tailored to software or hardware acquisition requirements increase flexibility. Configurable workflows related to the form are automatically triggered when a request is submitted.
CloudEagle's procurement integration is seamless, allowing users to raise purchase requests directly from Slack. Stakeholders are instantly notified, and a private Slack group for collaborative decision-making is automatically created.
Whether you choose to augment your procurement team or outsource to CloudEagle, the platform ensures streamlined operations, cost-effective purchasing, and greater productivity.
Slackbot for procurement
Though Slack integration, CloudEagle enables your team to raise purchase requests from Slack without visiting the platform. A new private Slack channel will be created for each request, enabling faster coordination and informed decision-making.
The entire software procurement process can be completed in quick time without delays or bottlenecks. It frees up time for your procurement team and enables them to focus on their strategic tasks.
In conclusion, businesses must shift from manual to automated software procurement procedures to thrive in a changing competitive environment.
Traditional methods have flaws like delays, a lack of transparency, and inefficiency. Comparing traditional and modern approaches underscores the superiority of automation, agility, and transparency. Switching to automated processes results in faster approvals, centralized visibility, and improved vendor relationships, preventing decentralized expenditures.
CloudEagle stands out as the best solution, with streamlined procurement workflows, vendor research tools, and robust Slack integration.
CloudEagle improves savings and optimizes the software procurement cycle as an impetus for stress-free SaaS buying.
Schedule a free trial today for efficient, cost-effective, and efficient procurement.