Today’s installment of Whitepaper Wednesday is written by Erick Opdenbosch, SPSM. Please help me welcome back Erick for his third contribution to the Purchasing Certification Blog!
Welcome to another installment of Whitepaper Wednesday here on the Purchasing Certification Blog. Today, I will be reviewing a whitepaper entitled “eSourcing from the Supplier’s perspective: Improving Bid Submissions and Event Outcomes” from Denali.
For the past 15 to 20 years, the Internet has brought many benefits to the purchasing profession. It is common to implement electronic solutions for supplier evaluation, bidding, and cost analysis. Sometimes, even though the technology seems like a great tool, it is the way it is used that does not yield the desired outcome. As for eSourcing, there are still struggles with user adoption and supplier participation because of the way suppliers are pulled into the new process. This whitepaper becomes handy because it focuses on how suppliers view eSourcing technologies and the way the process can be improved so that bid submissions can be optimized.
The whitepaper claims that “the supplier’s perspective is important because their understanding of and satisfaction with each eSourcing event directly affects the quality of bid submissions and overall outcomes.” Indeed, when a RFx process is not done properly, all the benefits that can be brought by implementing an technology-driven event, such as fair competition, lower market and sales expenses, access to new customers, validated competitiveness, and reduced negotiation time can barely be accomplished. As the whitepaper says, “Suppliers can be frustrated and dissatisfied, which begins a downward spiral of weakened communication and trust that eventually leads to weaker event results.”
How can you improve the process? The whitepaper, which gathered information from eSourcing tools and interviews with suppliers, brings some practical, yet basic, best practices. I won’t cover each of them, but I will address the ones that I found to have the greatest impact.
1. Have detailed RFx requirements. What if you had to extend the due date of a bidding process because the RFx was not complete? Not very professional right? The whitepaper explains that “when requirements are accurate, detailed, and specific, suppliers are able to submit a more competitive bid.” It is the buyer’s responsibility that all the specifications, including quantity, delivery date, and shipping location, are clear and complete.
2. Post-bid feedback. The whitepaper argues that the buyer should provide feedback to both winners and non-winners. It is helpful to give an idea to the winners on what they did well “and assist them in replicating the good work.” On the other side, non-winners will get to know what they can improve in order to “provide more competitive future submissions.”
Regardless of if it is through an electronic tool or not, the final goal of a RFx, as proposed in the whitepaper, is to have “more competitive, high quality, and accurate bids from suppliers.” It is important to remember that supplier collaboration in today’s world makes the difference. By mutually sharing strategies, investigating risks, looking for improvements, and considering suppliers as an extension of the business, companies should be more profitable. I believe the whole purpose of this whitepaper is to encourage collaboration between buyers and suppliers.