7 Golden Rules for e-Procurement Success - A ‘How-to’ Guide for making e-Procurement work for your business

7 Golden Rules for e-Procurement Success A ‘How-to’ Guide for making e-Procurement work for your business www.basware.com Basware ebook 7 Golden Rules for e-Procurement Success Contents Living up to the promise 3 Rule #1: Know your stakeholders 5 Rule #2: Be clear about what you want 6 Rule #3: Accept no compromise 7 Rule #4: Set quantifiable objectives 9 Rule #5: Get process-wise 10 Rule #6: Don’t overlook the importance of piloting 11 Rule #7: Ensure continuous stakeholder satisfaction 12 Getting e-Procurement right 13 2 Basware ebook 7 Golden Rules for e-Procurement Success Living up to the promise All companies want to gain effective control of what they spend and with whom. Many companies make the mistake of looking at e-Procurement solely as a technology They need to establish robust internal controls, enforce contract compliance and reduce solution. This means they will spend most of their time working at a systems level maverick spending across the organization. The answer for most of these companies focusing on interoperability issues. While this is important, it starts in the wrong place. is to deploy a dedicated e-Procurement solution. In many ways it is better to view e-Procurement first and foremost as a corporate change program. Doing so means that you will naturally focus on people first and The promises of such solutions are high: technology second. In our experience, this is absolutely fundamental if you are to experience the benefits listed above. • Greater spend visibility • Easier cost control We have worked with hundreds of organizations across all major markets and • Improved contract compliance industries over the last 25 years. This has taught us what works (and what doesn’t) • Lower total spend in implementing e-Procurement within today’s businesses. Of course there isn’t room • Higher accountability to convey all that knowledge in a single ebook, but we have distilled the critical success factors we see every day into 7 Golden Rules for successful e-Procurement. These are: The list goes on. However, too many companies who implement procurement software only see a fraction of the benefits they expect. They find that while the solution is 1 Know your stakeholders capable of all the benefits above (and more), other factors come into play that effect 2 Be clear about what you want its overall value. This is because the software is just a part of the overall solution – 3 Accept no compromises (in scope and resourcing) as such it must be placed into a wider business and cultural context. 4 Set quantifiable objectives 5 Get process-wise 6 Don’t overlook piloting 7 Maintain stakeholder satisfaction In the following pages, we’ll look at each of the rules in turn and show how you can ensure your e-Procurement program delivers the benefits you demand. 3 ”Thanks to the Basware solution, we’ve been able to implement a new culture that focuses on procurement as a strategic process. Now, strategic planning for purchases begins at the requisition stage, instead of as a reaction to receiving the bill. It elevates our operations to a whole new level.” Zoltán Werle, Corporate Services Director at MÁV Co., Hungary 4 Basware ebook 7 Golden Rules for e-Procurement Success Rule 1 Know your stakeholders Any e-Procurement program will touch many different From our experience, virtually every successful departments across an organization. As such there will be e-Procurement program has seen the manager in charge numerous internal stakeholders who have an interest in how of the exercise spend considerable time and effort it is implemented and what it will mean for their departments. establishing good working relationships beyond the Ensuring a successful outcome means understanding these procurement department. These include: different groups, not just who they are but what they do, how they do it, the challenges they face, and how they work •  -level finance leaders such as the CFO C with others. By doing so, you can help them understand how and financial director modernizing your procurement system will help them in their • The controllers roles, giving them the information they need to make better • Heads of business units decisions and resolve problems. • Suppliers and partner companies • The IT team Remember, at its heart, this is a change management • Helpdesk, training and other internal support professionals exercise. While theoretically everyone can agree what this will mean, in our experience its implications will often be The focus should be regular face-to-face communication. overlooked in real life situations. We regularly see those It is important to have opportunities to be open and honest managing even quite sophisticated e-Procurement programs about what will happen and what it means. Don’t be stop at simply knowing who the other stakeholders are. It overoptimistic and set unrealistic expectations. doesn’t occur to them to reach out to these people, make the And encourage feedback – it’s important you know what case for change and get their input. Or if they do, this is a these key people are thinking and to get their views. one-time event and the next thing these stakeholders see is the final system being rolled out. 5 Basware ebook 7 Golden Rules for e-Procurement Success Rule 2 Be clear about what you want What’s your vision for e-Procurement? To some, that might So, for example, your e-Procurement vision statement might Hungarian Rail speeds up processes, gains visibility sound a little grand. But having a vision of sorts and writing look something like: through holistic purchase-to-pay automation it down is a critical success factor for almost any change program. “This program will deliver measurable value to the business Hungarian Rail, the Hungarian national railway company, by rolling out best practice e-Procurement and supporting had a vision of transforming its Procurement and Accounts We see significant differences between those organizations processes. In particular, it will help divisions of Acme Payable operations into a complete, end-to-end automated who can clearly articulate their vision for e-Procurement and Corporation to reduce overhead and maximize return on process. Using Basware’s purchase-to-pay solution, the those who cannot. Those with a vision are far more capable their spend and investment. We will achieve this by aligning organization has improved its finance and procurement of building an atmosphere of consensus among stakeholders. the resources and processes of our suppliers, procurement, processes giving it the critical transparency, control and They find it easier to rally support when they need to. finance and the lines of business.” productivity it needs. And they succeed in aligning the expectations of often disparate groups. Importantly, the vision isn’t just valuable at the outset of your Read the full story at e-Procurement project. As a foundation for what comes next, http://www.basware.com/resources/ This is not to over complicate the issue. Your vision statement it will be instrumental throughout the process. It will help you customer-success-hungarian-rail does not have to be complex or long-winded. In fact shorter answer questions such as: is almost always better.