Strategies: What is Digital Procurement

Digital Procurement concept via Smartphone

Digital procurement, the next step in the procurement field; but what exactly is procurement? For businesses, procurement is an important process; but the term can be confusing to some people. As a matter of fact, procurement is often used interchangeably with purchasing (as we already covered here).

To quickly recap, purchasing is the process of buying goods or service. Procurement is the umbrella term which focuses on the whole procedure of ordering and acquiring goods.

With that short revision finished, let’s go briefly go into the topic of digital procurement, or e-procurement.

Digital Procurement

It should not be a surprise that the procurement business has gone digital. E-procurement has automatized and sped up the procurement process for organizations. Instead of filling up documents after documents, the entire spending process is done proactively! This eliminates a lot of tedious documentation in the procurement process and reduces costs.

What was mentioned describes procurement transformation, a particular organizational change management. This transformation allows businesses to improve their procurement and supply-chain process through efficiency.

Procurement

In order maximize efficiency and minimize the cost, it is necessary for e-procurement service providers to computerize the tasks. Through this, the previous offline tasks that were being assigned to be done over and over again can effectively be finished.

Adding to that, there are three incentives to use e-procurement. These incentives are collaboration between buyer, seller, and service provider; mechanized processes; and resources to have a deeper understanding of the procurement process and informed decisions.

Buyer/supplier in a different country? No problem, distance will not be an obstacle as digital procurement allows procurement deals to happen in no time. This is enhanced as e-procurement providers can offer support through supply of buyer/seller information, and receiving information for improvement on their services.

The Essence Of Digital Procurement In this Era

Technology & procurement

It probably can not be emphasized enough, but the greatest impact of digitization is speed increment. Everything progresses much faster with the automated procurement processes implemented. This is due to the database to database connections, which are essential; and as it’s computerized, free of human error!

We can already see a trend which is pushing for further growth towards a more e-procurement-esque world through the innovation of supporting technologies. One could even say that this is just the beginning for digital procurement in a long, and winding journey.

Not only is it still in the early stages, competition is everywhere. New businesses that would offer a digital procurement service will be noticed by bigger service providers, thus becoming competitive targets. With disruption in various fields in recent years, this is too be expected.

Applying Digital Procurement

Digital procurement seems like an all-in-one fix for the troublesome work faced in the procurement field. With the only limitation being the current technology (which is currently improving), it seems this fix could be the next step in evolution for the field of procurement.

With e-procurement, businesses that wish to fulfill procurement needs from other businesses has never been easier! Here at Lapasar, businesses having trouble in finding a proper supplier can visit our marketplace. With a rating system in place, procurers are able to find suppliers who genuinely want to do business with each them, and skip on the worry of an a bad deal.

Have a business and need procurement? Why not try it now?

References:

http://blogs.worldbank.org/governance/future-public-procurement-era-digitalization

https://www.cips.org/documents/knowledge/procurement-topics-and-skills/11-continuous-improvement/continuous-improvement/procurement_transformation.pdf

https://medium.com/@sksbg/the-evolution-of-procurement-in-the-digital-era-ec2b39ed666c

https://www.procurementleaders.com/blog/guest/game-theory-a-game-changer-for-procurement-682124#.XHeCa4gzbIU

https://www.sdcexec.com/sourcing-procurement/blog/21031970/are-we-ready-for-digital-procurement

Leave a Reply

Your email address will not be published. Required fields are marked *