How Guiding Buying Increases Contract Compliance

Cost reduction continues to be a primary focus for procurement leaders, with 78% of respondents to the Deloitte 2018 CPO Survey identifying cost reduction as a top priority.

With cost savings being a top priority, contract compliance is always front of mind for procurement teams and wisely so. If users across the company are not using the e-procurement solution to order the goods and services they need and therefore complying to the contracts procurement has negotiated, it doesn’t matter how well price negotiations have gone or how favorable contracts are.

Why is user adoption so challenging?

Many organisations find that user adoption is an uphill battle because they are trying to drastically change how people are used to working. Users simply want the goods and services they need to do their jobs quickly and easily, and they will choose whichever buying method achieves that goal. The key for user adoption is to configure and implement an e-procurement system that makes buying on-contract the fastest and simplest way for people to get what they need (an approach we call WeProcurement^TM). It is up to procurement organisations to make the entire experience simple and intuitive for users and guide them through the "preferred supply" process, which includes:

• Preferred products

• Preferred suppliers

• Preferred channels

If you do this, you will find 100% user adoption comes naturally.

How does technology support user adoption?

Procurement systems are getting more sophisticated every day, leveraging emerging technologies like artificial intelligence, machine learning, and predictive analytics to further streamline the buying process and offer the best buying options in real time. The strategy is to make the tool and process so intuitive that users do not have to understand a single thing about procurement to make the right buying choice every time. One example of this technology in action is guided buying.

What is guided buying?

Guided buying refers to technology that “guides” users through the entire buying process by steering them in the right direction for preferred spending and delivering assistance as they navigate the e-procurement solution. It starts by presenting users with icons for commonly ordered items (e.g. IT equipment, office supplies, trade show materials). Then it offers users help to choose preferred vendors and the best priced options, and flags policy violations upfront, instead of the requisition getting rejected after submission. Not only does this help people buy on-contract, it also reduces involvement of procurement professionals for non-strategic purchases.

What are the benefits of guided buying?

Guided buying increases user satisfaction by greatly simplifying the buying process, while delivering the benefits procurement needs:

• Increased contract compliance through high levels of user adoption and policy compliance

• Cost savings from increased usage of preferred suppliers and more on-contract spending

• Consolidated buying options by combining different buying sources into one area (e.g. catalog search, free-text forms, external web search, etc.)

• Decreased maverick spend by giving people an easy, fast, and compliant way to buy

• More time for procurement professionals to focus on strategic initiatives. 

So, guided buying is basically a better user interface, right?

Wrong. From the user perspective, it may appear to just be a sleek, efficient tool (which is exactly what you want), but those of you in procurement will know the truth – the real power in guided buying is the data model it’s built on. Guided buying is based on a flexible product master data model in the back-end of the e-procurement solution that allows procurement departments to build a database of products with each product having multiple suppliers, prices, units, etc. Then a highly intelligent algorithm automatically selects or suggests the best option of available products to the end user based on various circumstances that factor into the decision – location, price of day, delivery reliability, etc. If you’ve read our other blogs, you know that this rings true with our stance on that data: data is everything. Data is the basis of the future and the only way to create a perfect e-procurement world today.

How does Basware use guided buying?

Basware is integrating this technology with a guided purchasing section for infrequent e-procurement users, who are logging into the e-procurement tool less often and need to quickly and easily find products and services. From the guided purchasing section, users have direct access to items that are most frequently ordered and/or the items they are most likely to need based on buying trends and patterns. This section contains guided purchasing shortcuts that can be linked to Basware Marketplace using keywords, free-text forms, and external web shops. These shortcuts are defined by the organisations’ purchasing managers..