Once you’ve established that it’s time to move to a cloud solution for procurement, (Article 1) you need to research your options. The options can be overwhelming. There are multiple solutions on offer which all promise similar outcomes. The first step is to find a solution which has credibility in the marketplace. Gartner’s Magic Quadrant research includes annual evaluations of software solutions. This is a good place to start. Something not normally stated in Gartner’s reports but which should definitely be taken into consideration, is whether there is support in your country for the technology solution. 

Shortlist the solutions recommended by Gartner for your requirements. Be clear about what solution you need. Procurement modules can be implemented separately or as a whole, generally as source to pay or procure to pay. The source-to-pay solutions would cover a wide range:

• sourcing in order to put a contract in place
• contract creation and lifecycle management
• procurement call‑offs and once‑off buys.

To ensure the solution works, you would need a supplier registration portal and a supplier portal. This is built into the solution, but you’ll need to double-check whether it’s included in your license fee.

We recommend that you map the end-to-end process of what you require before evaluating systems. Make a wish list of everything you want the system to do; think what is absolutely critical for your organisation, and what is a ‘nice to have’.  What are the features and functions that the technology offers versus value creation?  The return on investment could be evaluated, but basing an ROI on the manufacturer’s claims is too simplistic.  References from local companies would be a far better source of truth.

Future plans for improvements should also be considered.  Will the software enable you to mature over time? Gartner’s analysis is a credible source for longevity plans of software providers.

After considering the above, you will be ready to request formal proposals from the technology partners on your shortlist.  

When is the right time to move your sourcing or procurement process to the cloud? How much will it cost? And will it be worth it?

We get many clients asking us about the benefits of cloud procurement solutions and, particularly, whether they should move from an ERP system to the cloud. There certainly are benefits to the move. These include real‑time communication between buyers and suppliers, supplier portals, integrated team communication, and convenient buying solutions for end users.

The main question that needs an answer is, is it the right time to move?  

If you answer YES to one or more of the questions below, it is the right time!

1. Is it difficult to locate your signed supplier contracts – especially the long‑term contracts?  
2. Do your tenders take weeks to conclude?
3. Are your internal auditors giving you warnings about governance in the tendering process?
4. Do suppliers complain about the fairness of the tender award?
5. Is it difficult to work out if suppliers deliver quality work on their products or services?

Depending on the cloud solution, all of these can be improved.  But how easy is it?

To make an informed decision, one should be aware of the challenges and costs involved.  

Many clients assume migrating to the cloud is just a ‘click’ away. This assumption is like the analogy of the iceberg. The cost of cloud solutions is driven by factors hidden from view when navigating the ‘ocean’ of cloud technology. The following costs should be taken into account with your business case:

• implementation costs
• integration costs
• licence fees
• adoption costs.

Determining the cost of an implementation is often underestimated.

Integration is probably the most fraught with difficulty and depends on the extent of the integration between the ERP(s) and the cloud solution. Smooth sailing is only ensured by the expertise of your cloud‑implementation partner.  

Do not forget about license‑fee costs for both you and your suppliers. Suppliers can boycott the system if they end up having to pay licence or training fees to submit their bids.  

Most importantly, the adoption costs should be kept in mind. Adoption costs should cover all stakeholders in your supply chain – your end users, suppliers, as well as the procurement, sourcing, contracts, and accounts payable departments, stores, logistics and legal teams. Without change management for the entire supply chain, supplemented by thorough training, the cloud solution may be ignored and shelved by the organisation.

Leigh Weimer is a principal consultant at Supply Chain Partner where she focuses on digital business transformation in sourcing and procurement. Being a lateral thinker with the ability to analyse problems, providing and implementing workable fit‑for‑purpose solutions, she is passionate about assisting clients during this process. Leigh is equipped with an MBA and a 20-year track record across multiple sectors: manufacturing, mining, pulp and paper, health, retail, petroleum and chemicals. Her expertise ranges from inventory and warehouse management, strategic sourcing, and procurement. 

Why is it that business intelligence seems, in many cases, to not add much intelligence into anything a business does?

Let’s first start with the definition of ‘business intelligence’ as commonly acknowledged and accepted:

Business intelligence (BI) comprises the methodologies and technologies used by organisations for the analysis of data with the purpose of turning this data into meaningful information. These analytics typically include generations of reporting, dash-boarding and scorecards.

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Doing procurement implementations takes us all over the globe.  One of our star team members, Leigh Weimer, writes about her recent business trip to China and shares some handy tips which might help prepare you should you visit that part of the world.

Doing business in China – tips from Nanjing

Despite hours of planning for a five -week business trip to Nanjing, there were many aspects of the trip that I wasn’t prepared for. Here are a few tips for future travellers.

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Interview with Chimae

We sat down with our director and procurement guru Chimae Gonçalves and asked a few pertinent questions around procurement technology implementations:

Calming the storm

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My business partner and I are very passionate about procurement… It’s such an exciting area to be in because you can touch a whole ecosystem of suppliers, buyers and users.

Listen to the full interview with co-founder and director of Supply Chain Partner, Chimae Goncalves.