Are Approvals Worth Their Hype In Procurement?
The procurement department is usually misunderstood by many in an organization. The reasons are simple – first, they think that there are numerous complex steps involved in the entire P2P process or second, who really keeps a tab on maverick spending?
We know that organizations have started the shift from traditional to digital procurement. Making this shift has benefitted companies and adapting to these technologies has been harder than it looked. But organizations have made this bold move, nevertheless.
Optimizing eProcurement efficiencies will always be a priority and this means that an organization’s procurement function must make sure purchasing costs are kept low.
In larger organizations, purchasing is a complex process. This is especially because procurement staff members are located in faraway locations and their requirements are urgent. For these reasons, having an approval system in place is paramount.
An approval routine will not only help to keep a check on spends but also to prevent fraud. Approvals come into picture when there are plenty of requisitions made and all of them need to be checked for relevancy. With no tab being kept on the requests created, there will be an increase in maverick spending.
Hence, to avoid this, an approval routine is necessary. If organizations have approval routines in place, many unnecessary costs can be avoided and spends can be tracked efficiently. An approval routine should essentially contain the steps the procurement team needs to follow to request, order, receive and pay for goods/materials.
A good procurement solution is the one which designs the solution with an approval workflow in mind. This means, the procurement system should be user-friendly and should be able to create purchase orders efficiently. A competent eProcurement software will not only help in reducing costs but will also increase the overall profitability of your business.
Approvals at every step will help the procurement manager to keep a track on all the requisitions and all purchases will be going through him/her. This will ensure that the organization orders materials only which are necessary and unnecessary spending will be eliminated.
Streamlining purchases is essential for a good approval routine. It is always a good idea to set authorities and spending limitations if there are multiple approvers. Once streamlining is done, it is easier to keep a track of purchases and monitor them. Having a digital procurement system will make it easy for an organization to set approval limits and streamlining purchases.
How can Eyvo help?
Eyvo is experienced in the eProcurement industry for over two decades and we are trusted by our clients for our efficient software. We understand the hierarchy in organizations and our software provides various approval limits to ensure the utmost level of transparency. We give immense importance to approvals and automate the entire P2P cycle so your organization can review all purchases and help in financial forecasting as well.
Contact Us to know more about our software!