What are the 3 new generation procurement tools you should know about?

New generation procurement tools
Updated on January 6th, 2022
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Integrating disruptive procurement tools into e-procurement platforms is key to helping procurement teams reach the increased level of performance that is expected of them. That’s why it’s important to learn about the possibilities that this new generation of procurement tools has to offer.

What these tools have in common is the sophistication of the data processing and optimising the benefits from supplier relationships. They provide purchasing teams with greater agility and added intelligence in managing their projects.

Within this next generation of promising procurement tools, three types stand out in particular for their ability to improve the procurement department’s capabilities: Supplier Relationship Management (SRM) software, spend analysis tools and performance measurement modules.

Procurement tool No. 1: SRM software for a 360° view

A Supplier Relationship Management (SRM) programme is a procurement system offers features that give the team a bird’s-eye view of everything that involves suppliers:

  • Tender management;
  • Referencing;
  • Document management;
  • Monitoring and assessment;
  • Risk control.

This comprehensive data overview and accompanying dashboards put the company in a better position to quickly address the ups and downs of supplier relationships. This innovative tool for organising accounts and contacts with real-time access helps to significantly streamline the sales process. The company is thus able to:

  • Detect weak signals of economic downturn or change in quality;
  • Identify and capture innovation as early as possible;
  • Ensure consistency in the execution of contracts.

This makes SRM purchasing software a strategic ally for companies and e-procurement. A Supplier Relationship Management programme improves their ability to maintain a high level of customer satisfaction and to adapt to new business practices. It is part of the next generation of procurement tools that ensure better profitability and a positive customer experience.

Procurement tool No. 2: a spend analysis tool to better track spending

Data dispersion is a recurring problem for many purchasing departments. Their lack of collaboration hinders their ability to analyse costs and therefore hampers accurate decision-making. How can teams gather and analyse data on spending? With dedicated management software.

A spend analysis purchasing tool is a programme that is specifically dedicated to collecting and archiving all the company’s data on spending in a single database. It contains all the data needed to track purchases and purchase orders. This allows a member of the procurement department to accurately monitor the company's spending and how it changes. This cost tracking tool directly contributes to the expansion of procurement marketing.

The second advantage of this family of procurement tools is data processing. These next-generation tools use artificial intelligence to clean up and enrich data on spending. They provide procurement teams with increased support for decision-making for all spending categories and types of suppliers.

These programmes store and process data, giving teams access to the information they need to implement an effective purchasing strategy. The procurement manager can use this analysis to recommend ways of reducing spending within the company.

Procurement tool No. 3: a performance management module to promote savings made

Procurement departments have not always considered it a priority to promote the results of its actions. Yet an overview of the company’s strategies is needed in order to understand which ones work and which ones have not generated enough benefits.

The performance measurement module is a next-generation procurement tool that highlights results and demonstrates the value of the procurement department. This performance evaluation tool provides a new perspective on the effectiveness of a strategy and allows the team to adjust its trajectory if necessary. If the actions taken have yielded positive results, highlighting the reasons for their success is always recommended.

Promoting the advantages of effective vendor management has three benefits:

  • Recognition of the work done by the procurement teams;
  • Tracking savings over time for each item;
  • Linking improvements in customer satisfaction with the related procurement decisions.

Procurement performance management tools document the real benefits of supplier agreements with unparalleled accuracy. This gives teams analytical feedback on the impact of their strategy. This solution provides additional room to manoeuvre when negotiating business agreements in the future.

Procurement goes digital

There are, of course, lots of other new generation procurement tools that can improve the day-to-day work and performance of procurement teams. The key is to know that they are out there, and to identify the ones most suited to the company's situation.

Procurement is becoming increasingly digital, in step with the practices and expectations of the company's customers. The procurement department must be able to monitor, with the same level of scrutiny:

  • Innovations developed by the company's suppliers;
  • Disruption from procurement software publishers.

The future of procurement is obviously not limited to tools, even if they are on the cutting edge. The optimisation of supplier relationship management, promoting “Made in Europe” solutions, and the rise in the consideration of CSR criteria are some of the fundamental trends that are changing the face of procurement today.