Many products can now only meet customer expectations when combined with software and services. This is changing manufacturers’ demand portfolios. Purchasing therefore urgently needs to professionalize and optimize its service procurement. This requires a powerful Einkaufscontrolling. With the help of modern systems, the problem can be quickly brought under control.
Whereas service purchasing used to play only a modest role in many companies, especially in the manufacturing industry, the situation has changed significantly in the meantime, as the outsourcing of service-intensive and/or non-core competencies has made it urgent to professionalize and optimize service purchasing. This requires efficient purchasing control that comprehensively describes the status quo, identifies potential, supports the derivation of procurement strategies and measures, reports on implementation, and recommends corrective measures in the event of deviations from targets.
Purchasing control systems such as the web-based software WebCIS 4.0 from SoftconCIS are available on the market to provide the necessary support using appropriate big data/predictive analytics, algorithms, artificial intelligence, and other digital tools.
The first prerequisite for a targeted and efficient approach to purchasing is transparency in the procurement portfolio. SoftconCIS’s information systems for purchasing controlling and strategic purchasing enable valid analyses that record and structure the volume of accounts payable in terms of procurement objects (goods and services) and procurement sources (suppliers) and limit it to the reduced purchasing volume in accordance with the business order. Pure FI postings are automatically assigned to product groups using a self-learning analysis tool. Here, a keyword catalog that expands according to requirements helps to suggest the appropriate assignment and to establish a product group system even where there are no orders. If necessary, the system is supported by specific human experience. Further information for purchasing controlling is provided by system-supported contract management.
Prerequisite: objective metrics
Services are required by internal customers from all areas of the company and as a service offering, either separately or in conjunction with tangible products. As an extremely heterogeneous procurement segment, it includes categories such as consulting, procurement service providers, facility management, IT and communications requirements, engineering services, temporary labor, marketing services, mobility, and training, among others. In addition, there are a variety of suppliers such as IT service providers, media agencies, security companies, management consultancies, etc. In order to be able to subject these procurement objects to a controlling process – from planning and control to reporting – it is essential that there is horizontal networking between the demanders and the purchasing department throughout the entire procurement process. This cooperation must result in a sufficiently detailed service description that leaves no room for misunderstandings on the part of the supplier about the service to be provided. This service description must contain all objective metrics that can be evaluated by the system and also allow the achievement of objectives to be verified in the case of subjective parameters. The complexity of some procurement situations – especially when combining material products with services – requires trusting cooperation between the demanders and the purchasing department in order to ensure that objectives are achieved in the interests of the company.
Supplier management
In addition to services as procurement objects, suppliers are the second area of focus in purchasing controlling. A comprehensive supplier evaluation prior to service provision (delivery potential) and a supplier assessment after service provision (delivery performance) must include not only the standard parameters of quality, costs, service, quantity, and adherence to delivery dates, but also flexibility, innovation, risk, sustainability, and compliance, as is the case with production materials.
By processing internal and external measurement data specifically tailored to the evaluation of services, the software supports the evaluation of historical developments, the benchmarking of comparable providers, and the utilization of bundling potential. Anomalies such as the interaction of small orders and a large number of order items, unstructured payment terms, or the use of free text for repeat purchases provide indications of opportunities for standardization and automation, as well as the use of catalogs and framework agreements.
Since in indirect purchasing (non-production materials) and especially in service purchasing, the proportion of maverick buying and the complexity of procurement processes signal potential for improvement in many companies, SoftconCIS’s purchasing information systems provide all the information necessary to achieve lean, agile, and legally compliant procurement processes.
It reveals where purchasing is involved and where it is not, where actions are taken without documented orders, where orders are only delivered after services have been rendered, and which cost centers are particularly conspicuous. Tracking order changes is one of the most time-consuming activities in indirect purchasing.
The software enables all changes since an order was created to be tracked in terms of value and quantity at the touch of a button. In addition, parameters such as the framework agreement quota and the degree of utilization of framework agreements and electronic catalogs, the measurement of throughput times, and the number of process steps provide helpful information for improving efficiency. If you then want to check compliance with process reengineering measures, the system is able to track the implementation and realization of savings potential. The information provided shows where savings have been achieved compared to submitted offers or budget reductions.
Problem: Services
Services represent a special segment in companies’ procurement portfolios and are often characterized by a sprawling number of suppliers. Reducing the number of suppliers to a few, but more efficient ones, enables an improvement in negotiation potential through increased volume and the design of more efficient processes.
The web-based purchasing control system WebCIS 4.0 from SoftconCIS offers a wide range of services, the use of specialized algorithms and artificial intelligence, both stationary and mobile on a wide variety of end devices such as laptops, tablets, and smartphones, the best conditions for qualified purchasing specialists to identify and exploit value creation potential in service procurement with its support.
