Digital Procurement Strategy: Guidelines for Success

Introduction

For decades, traditional procurement strategies have focused on cost savings using manual, outdated methods. This was evident in the early days of globalization when procurement leaders sourced goods and services from different countries to save money.

But this led to supply chains being stretched too thin.

During the pandemic, organizations learned that focusing only on cutting costs was harming their supply chain resilience. They had little control or transparency over their supplier operations and struggled to source materials when suppliers couldn’t meet commitments.

This emphasized the importance of transitioning to a digital procurement approach, which involves creating a reliable and flexible supply chain that considers potential risks to ensure timely access to goods and services — and uses new technology to move faster and plan ahead.

Keep reading to learn how the right digital procurement strategy can transform your processes, drive efficiency, and improve supplier management.

How to Execute a Resilient Digital Procurement Strategy

Digital procurement helps you:

Reduce your reliance on manual work
Standardize your processes
Increase team efficiency
Reduce overall risk

In the current supply chain landscape, those benefits are invaluable.

To create a successful procurement and contract management strategy, leaders must analyze existing data and manage suppliers, vendors, and third-party providers while monitoring their performance and accounting for risks. To do this effectively, they need easy access to relevant data.

Here’s how you make that happen.

Unify Your Tech Stack

You can onboard as many software solutions as you want to refine your digital procurement strategy. But if all those programs remain disconnected, they do you no good. You’ll still have gaps in your user experience and supplier management.

Instead, improve your procurement processes by investing in a technology solution that connects with your existing systems and integrates into them for unified data.

Assemble Data in One Place

Think of all the systems you use to log supplier data, manage contracts, track payments, and measure supplier compliance. Too often, none of the systems share information with each other.

The result?

Important data stays locked away in each platform.

Ditch the siloed systems. Store and manage data in a single location, such as a contract repository. This gives everyone easy access to supplier contract data when needed and provides a single source of truth on which to base procurement decisions.

Standardize Your Processes

The procurement landscape moves too fast and throws too many curveballs to repeat everyday tasks and risk mistakes. Save time and reduce errors by establishing standard processes and automating everyday tasks.

With the right technology, you can streamline your procurement contracting processes by:

Digitizing and setting up contract templates
Using approved languages for fasting drafting
Establishing workflows to pull in other users for a project automatically

Increase Collaboration

Procurement processes rarely take place within a single department. A solid digital procurement strategy crafts ways to improve collaboration across the enterprise and move projects forward.

Use digital solutions to efficiently work with the various teams that drive procurement functions, reduce friction, and manage supplier relationships.

Proactively Protect Your Business

If you’re still using manual methods to gauge contract risk or track supplier compliance, you’re setting yourself up for a crisis. There’s simply no way to effectively track everything by hand.

Digital procurement contracting solutions allow you to spot incorrect or problematic contract language, unmet obligations, and critical supplier details. That ensures you only work with suppliers and terms that meet your business standards.

Improve Procurement Contracts with AI

Procurement contracts should contain specific obligations to ensure supplier cooperation with regulators. Artificial intelligence powers your digital procurement strategy by giving you the ability to negotiate smarter, reveal missing clauses, and unlock value from your contracts at scale.

With contracting AI, you can:

Speed Vendor Negotiations — Quickly analyze supplier agreements to ensure the language meets your organization’s standards.
Increase Supplier Visibility — See exactly what supplier details are in your contracts, and increase your access to accurate supply data.
Keep Deliverables on Track — Automatically monitor contract obligations to validate that all parties fulfill their promises and pivot if necessary.
Improve Cost Savings — Carefully track renewal dates and deadlines to avoid duplicate payments and invoicing issues.
Strengthen Vendor Relationships — Use insightful performance data to improve vendor communication and champion supplier management.
Ensure Compliance – AI can compare procurement contracts against a standardized contracting clause-template library, flag business risks, and make suggested amendments.

Transform Your Contract Procurement Strategy

Procurement teams need to be able to react quickly and pivot within the ever-changing procurement landscape.

Sirion’s AI-native CLM empowers you to take a strategic, efficient approach to procurement as you gain visibility into your entire supplier ecosystem and better manage suppliers.

Schedule a demo with our team to see the platform in action.