In many ways, an organization’s supply chain is its backbone, and if your backbone isn’t strong and resilient you’ve got problems. Case in point: Target, which suspended operations in Canada after experiencing problems across their supply chain for more than a year.
Thankfully, many companies aren’t in that dire of a situation. The art of keeping your supply chain healthy is increasingly more science than art, and advances in areas such as e-sourcing are helping companies bring more flexibility to their supply chain to control cost, risk and quality to a greater degree than ever before.
Here are a handful of ways e-sourcing gives organizations some much-needed breathing room.
- Supplier Diversification: No one sets out to create an inflexible supply chain, but many companies accept rigidity as the price of reliability. This often encourages procurement teams to concentrate their sourcing needs within a small handful of suppliers, actually increasing supply chain risk. E-sourcing tools can help by significantly easing the process of identifying and vetting new suppliers. E-sourcing tools integrate every step of the sourcing process within one application, providing a clear trail from project creation to contract deployment.
- Contract Management: It seems like an obvious to-do: always read the fine print. But in an effort to expedite operations and reduce paperwork, many businesses fail to carefully review contracts with their suppliers. This leaves many buyers vulnerable when they can’t afford any room for error, like during product launches and holiday seasons. E-sourcing tools have dramatically simplified the contract management process, replacing rounds of drafts, appended terms and revisions. This enables businesses to rapidly ramp up when needed, unencumbered by the administrative overhead that accompanied yesterday’s sourcing process.
- Cost Savings: In the past, procurement leaders were discouraged by the difficulty of comparing qualitative and quantitative data around supplier proposals. With e-sourcing tools, businesses can quickly track large amounts of supplier information, from sell-side responsiveness and pricing to delivery reliability. E-sourcing tools allow organizations to better compare supplier quotes and fine tune their supplier mix.
In today’s economy, flexibility and agility are important concepts for the health of your supply chain. E-sourcing tools are one way to bring flexibility to complex global operations without sacrificing quality or control. Whether a company is trying to diversify their supplier base, increase production or strategically source key materials, the advantages of e-sourcing create stronger, healthier supply chains.