eSourcing Solution: 5 Key Considerations Before Selecting a Tool

eSourcing Solution: 5 Key Considerations Before Selecting a Tool

For those of you who still don’t know what eSourcing is, here is a clear definition. “eSourcing is the online automation of the sourcing activities using a secure web-based collaborative tools. The use of  an eSourcing solution reduces costs and supplier risks while increasing profit.”

Now, let me explain why companies need eSourcing more than ever and what the benefits are before discussing key considerations.

In this economy, companies need to implement a sourcing process in order to gain productivity and reduce cost. To do so, considering an eSourcing tool should be a top priority.

Here are some of the advantages an organization can benefit from using an eSourcing solution:

* Reduce Supplier Risks

* Focus on strategic tasks

* Cut costs & Gain Productivity

* Drive Collaboration with Vendors

* Centralize your Sourcing Activities

* Improve Negotiation Power

* Simplify Supplier Selection

Here are 5 key points to consider before selecting an eSourcing Solution.

Vendor Registration

The registration process is an important step in streamlining the sourcing process. The selected solution should facilitate vendor registration in order to minimize risk. Using a supplier portal integrated within the solution is the best way to implement a secure access point for all vendors.

Vendor Selection

Once vendors are registered, an organization has to pick the right supplier. The selection process has a huge impact on your business performance, as you don’t want to select an unreliable vendor. Considerations like delivery delays or the quality of the products shipped should be taken into account.

Vendor Management According to Gartner research, the same analyst that classified b-pack as a Top 5 eProcurement Vendor, “Vendor management is a discipline that enables organizations to control costs, drive service excellence and mitigate risks to gain increased value from their vendors throughout the deal life cycle”.

Once selected, a new vendor should become a part of your preferred vendors. The eSourcing solution software selected should promote supplier relationship management and facilitate the collaboration between the company and vendors.

Vendor Certification & Compliance

The solution selected should provide features to guarantee the certification of each vendor before and after the selection process. You want to proactively monitor vendor certification to avoid issues such as delivery disruption or failure.

Using such a system to guarantee the certification of each vendor at any point in time, you will ensure better vendor compliance, better operation efficiency and better risk management.

A solution should also help businesses consolidate long-term relationships with preferred vendors by constantly ensuring vendor certifications are up to date through renewal process improvements.

Vendor Performance

Vendor Performance functionalities are critical for the success of your eSourcing effort. The solution selected should offer the ability to improve the control of a supplier’s performance using customizable evaluation criteria.

About the Author