Are You A Part of The One-Third Using Inadequate Tech?

In a 2018 study conducted by PayStream Advisors, now formally known as Levvel Research, over 400 organizations were surveyed to determine the latest trends surrounding procurement management.

During this survey, organizations without cloud-based eProcurement software were asked about their top pain points. One-third of firms revealed that their primary problems were inadequate technology and procedural differences across departments.

And when asked, if an eProcurement solution was not in use, just how were their firm’s monitoring purchases made by members outside the procurement department? The results revealed the following:

46% – Purchase requests are submitted to a manager in individual departments.

40% – Purchase requests are filled out and submitted to a manager in procurement.

14% – Any employee can submit a purchase order directly to a supplier.

Typically, when organizations lack a formal process, they request the employee looking to make a purchase, to check their item against their own budget. If not, they are asked to consult with their procurement manager. While this process is not as effective as an eProcurement system, it’s still a process. This process, however, can be very difficult to maintain and lacks complete visibility and/or control over departmental spend.

 

With too many handoffs in place, the data in the purchase request or PO can be compromised, leaving the overall purchase order lifecycle to greatly extended.

In addition to that, when purchase requesters in different departments have the authority to submit POs directly to suppliers, the organization have a much higher risk of maverick spend. That said, when it comes to a proper purchasing approval process, it’s crucial to find a balance between two critical factors: control and simplicity.

Is your firm lacking a formal purchasing workflow? Contact EqualLevel, a platform bringing sophistication to the procurement space.