Order management is the backbone of the procurement process. It’s your team’s job to make sure you have the right amount of stock so business runs as planned. Yet there are challenges when the team doesn’t stick together.
It’s hard enough to deal with remote workers when no moving parts enter the equation. And worse for procurement teams, who have the burden of managing big orders from many places.
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Biggest Problems Remote Teams Face
Working with remote procurement teams can cause a lot of headaches. Here are some of the biggest issues procurement teams face. Hint: The solution is often implementing technology and a few ground rules.
- Delays—When there’s no workflow in place, POs get backlogged and can affect your organization’s ability to provide service to customers. A centralized hub allows for accurate records across locations.
- Lack of Consistency Across Teams—Without the right system in place, teams will set up their own methods for ordering and tracking POs. This becomes a problem, as it can create a lack of visibility between departments. Without knowing what remote teams are ordering and from whom, it’s going to be difficult to stick to a budget or forecast your inventory needs.
- Duplication—Without a unified procurement system, it’s hard to keep track of duplicate orders. No insights into what other locations are ordering spells trouble.
- Accidental Orders—Lack of oversight can mean that unapproved POs get sent through to suppliers. So, whether that’s ordering supplies that aren’t needed or sending orders to the wrong supplier, mistakes can add up over time.
- Issues with external communication—Relationships are the core of supply chain management. With remote teams, you risk sending vendors mixed messaging. Without a recordkeeping system for supplier terms and conditions, relationship management is harder than it needs to be.
- Cost control–The cost of goods, services, and transportation are always fluctuating. Working uncertainty into the procurement process and still coming out on top is one of the biggest challenges all teams face—remote or not.
Managing both internal and external communications is key for building relationships with the vendors who most affect your bottom line. You’ll to put up a unified front in cutting costs—whether that’s through consolidating orders or taking advantage of “pay early” discounts.
According to a poll from Statista, lack of visibility and fluctuating customer demand are top concerns. But inventory controls and cross-channel coordination top the list as well.
Supply chain management procedures need to be established and evaluated on a regular basis. All of the concerns highlighted in the above poll affect order management. And as such, you’ll want to streamline ordering and mitigate risks.
Still, it is possible to go too far. The goal of streamlining is to reduce the potential for overspending, deter theft, fraud, and minimize mistakes, not cause a bottleneck.
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Automate Your Processes
Order management demands a step-up. When you’re working with multiple locations, relying on outdated systems like paper POs and manual spreadsheets puts your business at risk.
In procurement, the goal is always to reduce unnecessary expenses, while maintaining the quality and speed that makes stakeholders across the ladder happy with the results.
Most procurement problems can be chalked up to human error, and technology can help. Automating the order process can help you reduce mistakes by putting controls into place.
Automation doesn’t mean robots are coming for jobs. The idea is, if you add procurement software to your process, you’re eliminating the type of work that people generally hate doing. Think—rekeying the same data or relying on manual processes to track complex order systems.
Automation means you’ll have a company-wide order management system. Just a few of the many benefits:
- Built-in regulations
- Eliminate admin time
- Get expenses and POs approved in a timely manner
- Know where requests stand—what needs to be approved, what’s pending
- View suppliers and manage relationships
Implement Uniform Inventory Controls
Financial teams are always looking for ways to keep costs down and increase the amount of working capital. With that in mind, the procurement team and their inventory management skills play major role in boosting bottom lines.
Inventory holding costs can eat up a lot of money—items expire, warehouse space costs money, taxes, and insurance enter the mix, too.
To combat over-ordering and poor planning, teams need to get the hang of demand planning and forecasting. The chart below reveals Hackett Group findings stating that supply chain teams need to embrace analytics within the next couple years.
To optimize inventory levels, teams need to review and track on an ongoing basis. Before setting budgets, you’ll need to do an audit to see what’s available and what needs to be ordered. Successful teams will set a baseline—say, how much was x product used last year? You’ll adjust accordingly.
Technology can help with this, of course, and ProcurementExpress.com allows you to set up budgets and invite colleagues. Different departments can access budgets via cloud-based software, so all relevant team members can view budget status.
PO Management Workflows
POs function as a recordkeeping method, and serve as a contract between buyer and supplier. As such, developing an internal procedure for processing orders is vital.
Here are some steps for implementing a streamlined PO system:
- Assess your existing workflow—This means taking the time to look through your current procedure and understand how things flow. Whether you have a manual order system in place or a poorly implemented digital process, a quick audit will highlight where bottlenecks are taking place.
- Set up a supplier directory—A central directory will provide all locations with the same information. This information includes price sheets, preferred vendors, and a unified item list.
- Set controls–An inefficient authorization process can throw off your entire operation. If you’re waiting on approval signatures or making lots of calls, you risk throwing the whole system out of whack. Make sure only the necessary authorizations are part of the workflow and use your procurement software to set controls and alerts, so nothing slips through the cracks.
- Workflows Enable Easy Submission–Employees can submit POs; managers approve them. Managers get a notification —so an employee from one location can create an order and a manager in another city can view and approve.
- In our system, reports are also stored for review. So, budget holders can check for instances of overspending or poor forecasting. Over time, insights will allow managers to make better decisions and more accurate predictions.
- You can also limit access, restrict or expand budgets, and search through all report data.
Communication Needs Work, Too
Sure, we could cut to the chase and recommend that you start using ProcurementExpress.com to manage remote POs. But you’ll also need to consider adding technology into the mix on all levels. Issues like fractured teams and differing goals can impact team performance.
Teams working on different floors deal with some level of tribalism–which of course, is amplified when you’re working in different cities or even continents.
To combat this, you might want to adopt some project management tools to keep the teams moving through tasks. Or, add a Slack channel for easy communication across locations. Connecting via chat provides an opportunity for small talk with colleagues, you know, like a regular office. It also helps you get questions asked and answered ASAP. When ordering is part of the equation, emails might not be fast enough to get your message out.
As such, you’ll need to get creative when it comes to setting up the right processes for approvals, scheduling meetings, check-ins, and keeping everyone on the same page.
Establish Communication Protocol
Just like setting your ordering workflow, having a method for communication allows you to manage your team. As a manager, you also need to set expectations for assigned tasks. Where should employees submit documents? Will you keep track of everything in a project management app or do you prefer Google Docs?
Document these little procedures and share them with the team, so they understand what is expected of them.
Initially, you’ll need to guide your team. Schedule training for electronic PO submission guidelines and write an SOP for how to communicate with vendors.
Make sure the team understands the goals of the organization and why accurate recordkeeping is a big part of that. If you’re using procurement software, this means processing everything through the system.
Schedule Regular Team Meetings
Tools like GoToMeeting, Skype, or Google Hangouts allow you schedule video calls with your remote colleagues. While weekly meeting may seem like a hassle, they serve as a way to share new ideas and policies with room for a few questions.
Not only does this help ensure everyone is on the same page, it also serves as a way to understand challenges and how things work in different locations.
Make things work for everyone by rotating the times you schedule meetings during the week. A little give and take go a long way in making sure team members feel like their needs are met.
Communication and Visibility: Key Ingredients in Multi-Location Success
We cannot stress the benefit of a PO management software enough. You need a comprehensive order tracking tool that allows you to record purchases—in the cloud, track order status, and receive items. All teams, regardless of location, will have access to the same data. This reduces unnecessary spending, missing orders, and wasted time.
Adding technology into the mix makes it easy to share information and avoid costly mistakes–no matter where your teams are based. That’s the ultimate goal, right? Get Top Rated Purchasing Software & Replace The Purchasing Book.
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