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IT Challenge: Addressing procurement software quality control concerns

In this IT Challenge, learn how to maintain quality control standards when switching to automated procurement.

The SearchManufacturingERP.com IT Challenge of the Month for June 2012:

My organization is considering procurement software to automate our materials purchasing, but we’re concerned that quality control may suffer from automation. Do you have any advice for maintaining quality standards when moving to an automated system?

Do you have a solution to this challenge? Have you encountered a similar issue at your business? If so, please contact the SearchManufacturingERP.com editors and share your suggestions or experiences. 

IT Challenge respondents will receive a free copy of a new book from SAP Press.

And be sure to check back here all this month -- we'll be posting solutions from experts and readers as we receive them.

From industry expert Steve Phillips:

Most organizations install procurement software to streamline and improve the quality of existing work procedures. When the automation project is not properly managed, however, the opposite can occur. Unwanted issues may include sub-optimization of business processes, a step backwards in productivity and potentially, a major disruption to business operations and customers.

The key is to integrate the procurement software tools with your current or desired business practices. Adopt a process orientation that includes getting key stakeholders involved from the beginning; understanding current processes, issues and opportunities; agreeing on new process designs that will employ the new system; creating performance measurements that encourage the right behaviors; documenting new workflows; and providing thorough end-user training. By following these processes, organizations can not only maintain but improve their quality standards.

From industry analyst and CEO of Constellation Research Ray Wang:

The challenge when moving to automated procurement is the human element. Before considering moving to any system, take a use case-driven approach to map out the key scenarios. Lay out the rules that matter, i.e. sourcing quality, defect rates, discount factors, shipping costs, availability and substitutability. It’s important make sure that the key use cases are in place, then to figure out the exceptions. Lay out the key use cases first and get agreement among the procurement team to make sure everyone's on the same page. Once that is in place, the core rules will be set. Then when it’s time to go to the exceptions, the team will be able to map out the requirements. Abstracting this out into rules will do a few things:

1. Document the current state.

2. Determine inconsistencies and exceptions. You'll want to minimize these and understand why their happening

3. Design the future state.

This can be done before any software purchases. Keep in mind, the tool only does what it is told it to do.

Next Steps

How to choose the right e-procurement software for your company

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