Key factors to consider when evaluating a Procurement Solution

Top 5 Key factors to consider when evaluating a Procurement Solution

PurchTips Edition #438

Technology is often seen as the ultimate solution for organizational issues. This is farthest from the truth. The fact is that organizations are systems, made up of technology, people, processes, inputs, outputs, metrics, machines, and environments. The interaction of all these variables must be understood in a greater context relative to the core purpose organizations exists. To create value for their customers and key stakeholders.

evaluating Procurement Solution

The essence of evaluating procurement technology is understanding the intersection and interaction of Business and Technical Requirements. This activity is the domain of skillful Business Analysts. The fact is that very few people of technical backgrounds understand business and procurement requirements and very few people of business and procurement backgrounds have a deep understanding of technical requirements of procurement solutions. A skillful business analyst is responsible for building essential synergies, translation, and understanding of business, procurement and technical requirements.

The following are key factors to consider when evaluating Procurement Solution:

1.) Enabling Customer Specifications and Requirements: Effective business analysis must be conducted to ensure that procurement technologies enable all processes and systems assets to realize a total adherence to customer requirements. Careful solicitation of the nature of these requirements must be made, and solutions must be evaluated on the degree to which they can enable the procurement function to realize customer specifications and requirements.

2.) Enabling the core Strategic purpose of the Procurement Function: All procurement solutions must be evaluated on the degree in which they support the following aspects of the procurement mandate.

  1. Manage Send
  2. Support Operations
  3. Protect their organizations from Risks.

3.) Simplicity, Easy of Use, and Robustness: Business Analysts must assure that all procurement solutions are evaluated for ease of use and effectiveness. This can be realized by requirements solicitation using user cases.

4.) Resistance to Change: The resistance to change must be understood while evaluating a procurement solution. The fact resistance to change is natural and effective strategies must be deployed to get buy-in for new procurement solutions. Change Management Strategies are critical when evaluating procurement solution.

5.) ROI: All procurement solutions must be analyzed for Return on Investment via a complete Cost-Benefit Analysis. ROI must be realized in a short payback period to be worthwhile. It is important to select only essential features or those that enable the procurement function to realize its mandate. This way excess dollars are not spent on unnecessary features.

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Copyright 2019. This article is the property of the Next Level Purchasing Association and may not be copied or republished in any form without the express written consent of the Next Level Purchasing Association. Click here to request republishing permission.

By David Millington, SPSM, SPSM2, SPSM3 - Director of Education (Next Level Purchasing Association)

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