3 Ways Procurement Adds Value to Any Organization

It’s time to give procurement the recognition it deserves and change the reputation of this function.

It’s true there are times where you have to say “not yet,” perhaps due to budgets or timing. And managing change and adoption of new tools can be a lofty task. But Procurement ultimately has one goal: Enable the entire organization to accomplish their goals efficiently.

Effective procurement isn’t a burden to a company, it’s a strategic advantage that can add tremendous value. And we’re talking about a lot more than just savings. So it’s time to change the perception and illustrate how good procurement can drive the business forward, rather than hold it back.

Here are 3 ways procurement can add value to an organization and be a catalyst for success.

1. Empower Teams to Be More Productive

In today’s fast changing world, procurement has evolved from a cost savings machine to a powerful facilitator of productivity.

Strategic procurement equips employees across every department with their preferred tools so they can maximize productivity and realize their full potential. With the right resources in place, folks can focus on their core competencies and minimize distractions from administrative work or time spent doing manual tasks. Procurement itself can also take the onus off of department leads or executives as the primary negotiator, giving them time back to do the work they were hired to do. 

Having their dream tools in a team’s tech stack makes them significantly more likely to adopt and utilize them. Since they’re excited to use the tools they love, the learning curve and onboarding will be faster and easier, making the team more effective. But that’s not the only way to leverage adoption to foster productivity. We know people are resistant to change. However, Procurement has the power to reduce the friction. Regardless of whether they want or know how to use new resources, integrating them into the existing workflow and excellent change management will massively impact productivity.

Manual processes can also slow down an organization, so outsourcing or standardizing the procurement process can free up time and create better visibility into spend, contracts, renewal and opt out dates, usage, and more. Specifically, automating approval workflows speeds up the requisition and approval process, reduces room for error, and enhances overall efficiency. Tighter processes and better visibility will massively impact employee productivity. And productive teams ultimately contribute to the business’s overall success. 

2. Improve Company Culture

Procurement may not initially seem to be directly related to culture, but the function actually plays a big role in the values among an organization. Here are a few examples:

Increased Morale

When employees have the tools they love and are less bogged down by administrative tasks, they’re not just more productive, they’re happier. When employees see the organization is committed to streamlining workflows and providing cutting-edge resources, it improves morale and satisfaction, which is crucial for a business.

An Emphasis on Innovation

Since procurement can arm teams with world-class tools, it fosters a culture of excellence and continuous improvement. Procurement’s job isn’t just to find resources, it’s to promote innovation and push suppliers to advance in their products, processes, and services. This, in turn, encourages the same innovative mindset within the organization.

Promoting Transparency

For most companies, especially those in tech, transparency is a leading value they want to instill throughout the company. When the Procurement process is transparent, with clear updates on vendor selection and purchasing, standardized workflows, and available pricing and contract terms, it builds trust within the organization, fostering a culture of openness and accountability.

Prioritizing Diversity & Inclusion

DE&I has become another top of mind value for modern businesses. Promoting diversity and inclusion among suppliers is a great way to echo the internal company values externally. By choosing to work with suppliers that embrace DE&I, procurement contributes to an inclusive culture.

Better Communication & Stakeholder Feedback

It’s no secret that Procurement often lacks trust with their stakeholders, and most people are looking to change that, but it has to start with Procurement. Establishing frequent, focused communication with other departments and leaders ensures that stakeholders can share feedback and promotes open communication. When Procurement asks the right questions and practices active listening, they can gain a deeper understanding of each department’s or leader’s goals and challenges and react accordingly.

3. Enable Collaboration Through Self-Service Procurement Tools

Proactive Procurement places a major emphasis on empowering their stakeholders to self-serve because it improves the process and experience of buying tools. It’s also a great way to get buy-in and build relationships with internal folks who will be long-time partners.  

Particularly with the increase of remote and global workplaces, it’s crucial to leverage Procurement tools that are self-serve so everyone can collaborate asynchronously and have better visibility. A self-serve tool will allow employees to easily make resource requests, track the updates of a request, and check for duplicate tools or ones already in use by another team. It also ensures seamless collaboration with other important stakeholders like the legal department, IT, finance, and executive team, who all have an important part in the approval process.

Modern, consumer-grade tools, such as Intake Management, Contract Management, and Supplier Relationship Management, or ideally a tool that offers all of those capabilities, can fuel real-time collaboration among teams and leaders to ensure everyone is aligned and informed. With the right resources, Procurement pros can manage vendor relationships, streamline communications, and track KPIs with ease.

While cost savings and avoidance is still a table-stakes outcome of procurement, there’s so much more added value potential, like enabling each team to be more productive, improving company culture, and promoting collaboration. Proactive procurement doesn’t just save the company money, it ensures long-term success and turns buying into a competitive advantage.