Making Procurement Automation Your #1 Focus: Why It Matters
Three Reasons Why Procurement Automation Must Be a Top Focus
Like many people coming out of college, Snow Rutkowske didn’t know exactly what she wanted to do after she graduated. Procurement automation wasn’t necessarily on her mind.
But she knew one thing for certain. “I needed a job,” she quipped.
Fortunately for Snow, she quickly landed at Huron Consulting. Over the last 16 years, she has carved out a career that has been rewarding for her and the clients she advises.
After leaving Huron to work in procurement at Illinois Tech for a few years, Snow returned. She is now a senior director of Huron’s higher education consulting group with a focus on spend management.
Her focus is primarily on projects related to procure to pay, assessment, transformation, strategic sourcing, and the cost saving side of patients and contract negotiations.
Snow recently met with PaymentWorks to share some of the expertise and wisdom she has collected since entering the world of procurement.
As the conversation concluded, Snow offered three reasons why a procurement team should focus on automation tools.
Snow speaks from both the practitioner and consultant perspective. She knows exactly procurement and vendor desk staff have to endure with manual procurement processes.
Alternately, she knows what leadership teams need and want to hear in order to make decisions about investing in vendor management.
That’s why this is a great blog that teams can use to form a business case to present to leadership when advocating for procurement automation software.
Why is procurement automation so important? We know you know this, but it bears repeating. Especially if your team is nervous about automating and/or you need to make a case to your leadership about investing in procurement automation software.
Imagine a world where manual tasks like purchase order creation, invoice processing, and supplier onboarding are automated. No more tedious data entry, endless paperwork, or delays or fraudsters getting ahold of sensitive information due to human error.
Procurement automation simplifies these tasks, enabling staff to focus on strategic activities that add value to the organization.
Increased Efficiency. With manual tasks taken care of, procurement professionals can focus on activities that add value to the organization, such as negotiating contracts and building relationships with suppliers. This shift allows for optimized processes and better outcomes.
Cost Savings. By eliminating errors, duplicate payments, and maverick spending, organizations can reduce financial leakage. Furthermore, automation provides better spend visibility, allowing organizations to identify cost-saving opportunities and negotiate favorable terms with suppliers.
Supplier Management. Real-time data and analytics enable businesses to assess supplier performance, track delivery times, and monitor contract compliance. This allows for data-driven decisions, identification of top-performing vendors, and proactive issue resolution.
In other words, procurement automation is a game-changer for businesses. By embracing automation, companies can unlock the full potential of their procurement function, drive strategic growth, and stay ahead in a rapidly evolving business landscape.
Human resources doesn’t refer only to a department. In this case, human resources refers to the actual humans performing the day-to-day work of organizations.
They are precious and can sometimes be very hard to come by. Workers get burned out. It’s incumbent upon leaders to do what they can to keep their team from being overstretched, Snow said.
That’s where vendor automation can help.
Tasks that are more transactional can be automated. This gives employees more time and energy to focus on doing things that brings satisfaction and joy to them.
Furthermore, vendor automation tools free up your employees to work on high-level, high-impact tasks. These are tasks that move your team and larger organization to higher levels of profitability and efficiency.
However, it’s important to note that automation for procurement can be met with some initial resistance–even when it’s designed to benefit those who are resistant.
For example, when Snow first shared with her team at Illinois Tech that the organization would be investing in technology to automate some of their task-oriented work, there was, understandably, a bit of apprehension.
They voiced their concern by asking, “Well, what am I going to be working on?”
But as they stopped doing the day-to-day transactions and got into the more strategic areas, the satisfaction level of her team increased. They became a lot more engaged and found their jobs more fun.
“That is something I think we could all use more at work,” Snow said. “Automation was a help, not a hindrance.”
Echoing the benefits of procurement automation is the finance team at the University of Virginia.
Take it from Adeline Coe, UVA’s Interim Assistant Director of Procurement & Supplier Diversity Services. She recently rhapsodized about the high-level projects her team could work on when they reach their ideal payables strategy with the help of automated procurement processes.
Similarly, Amanda Lockhart Davis, UVA”s Director of Financial Disbursements, sees the importance of procurement process automation.
Remember the importance of your human resources? That’s Amanda’s top priority once her finance processes are fully optimized.
She recently told us, “I measure my success in seeing someone who started as a File Clerk or Document Specialist go on to a senior position because there was growth and opportunity. My vision is to orient my team and all the teams that touch it.”
The freedom to focus on all kinds of high-impact initiatives is available to you when you begin to implement procurement automation.
Automation is here to stay. That should be clear by now as the 21st century moves into its third decade.
But for businesses that have been slow to incorporate vendor automation tools, it may be tempting to try to catch up all at once.
Not so fast, says Snow. Vendor automation is a marathon, not a sprint.
Instead of going from zero to 100, follow Snow’s advice. Try a little bit at a time. This will prevent the kind of shock to your team’s system that may set it back in the long run.
Remember, your team may feel nervous about implementing automated procurement processes. That’s exactly what Snow experienced.
Do not let this resistance deter you. However, do proceed at a mindful pace.
“Any little automation is the right direction and the right step,” Snow said. “And you often find that when you get started you’re going to realize, ‘Oh, it’s not as difficult as I thought’ and you’re going to realize its value. Everybody around you is going to realize its value and that would then propel to even more automation.”
Snow also offers an important reminder. Progress is not necessarily linear, it’s exponential.
“The more automation that you do, the more benefit and return you get,” she said.
In other words, making even a few small changes will serve your team. Those small changes then compound to provide even more benefits.
Plus, as you start implementing automation tools, you and your team will gain momentum and confidence to continue automating your processes.
When Snow was working at Illinois Tech, she had to deal with a problem common to many universities as well as businesses: limited resources.
As a result, she needed to figure out how to get more done with less. That’s where automation played an important role.
With a team of only five people across procurement and accounts payable combined, their time was very valuable. Adding automation became a necessary tool to alleviate work anxiety.
“I wanted to make sure that we were able to automate and get our precious time out of just typing data from paper into a system so we can have more time and dedicate energy and resources to more strategic initiatives,” she said.
“We wanted to transform ourselves from, ‘Oh, they’re just a box that we need to get checked.’ Or, ‘Oh, they’re a gauntlet that we have to run through.’ To, ‘Oh wow, they’re a true partner. I want to reach out to them because they are going to be able to help me solve my problems, or they make my life easier.'”
To make things easier at Illinois Tech, Snow began looking at ways to automate vendor onboarding, the vendor data validation, and the payment information validation, among other things.
“I made the pitch to help the university with that automation to shore up our risk management and compliance and help us all sleep better.”
When it comes to getting leadership buy-in for investing in procurement automation software, Snow knows her stuff.
She describes the process she used for her leadership Illinois Tech, which can help inspire your team’s approach as well.
Snow’s approach to gaining leadership support and buy-in looks like this:
We have a whole arsenal of support for you and your team. Whether you’re in the trenches of a manual, ad hoc procurement process or you’re moving quickly to your ideal vendor management state, we have resources to help you get to the next level.
Get all of Snow’s best advice here.