The Real Reason You Need to Improve Procurement

Austin, TX
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From rebuilding cities to transforming education, procurement is the foundation for getting things done.

Roy Spence, founder of the Purpose Institute, determined that a key differentiator of truly exceptional organizations is their ability to articulate a clear purpose and let it drive everything they do. Procurement’s purpose doesn’t just equate to more accurate project projections or budget control. Procurement is no longer about just managing contracts.

Purposeful procurement initiatives empower cities and counties to get real work done. Procurement enables the completion of road and public transportation projects, education curriculum overhauls, and basic water infrastructure modernization. Procurement drives improvements that will redefine entire generations’ access to critical resources, improve quality of living for thousands (or millions) of people, and reinvigorate communities eager to recover from the recession.

In recent years, public sector procurement departments have been credited with:

Like Kevin Beardsley, director of Virginia Beach City Public Schools, once said, “We’re not just buying stuff; we’re doing our part to educate children.”

Government procurement is the key to keeping our communities strong. That’s why cities, counties and even higher education institutes striving to transform business processes need to demand procurement reform first and foremost. Fortunately, NASPO, the national organization of our state procurement leaders, indicates an immediate move in that direction. There will always be laws and regulations adding complexity to procurement processes. However, the more we can simplify and automate functions that we can control – vendor management, solicitations and contract management – the better positioned we are to expedite projects critical to community and citizen vitality.

For example, many organizations still rely on ERP systems for procurement, though it’s becoming evident that ERP procurement modules are not fine-tuned enough to provide adequate support for expanding procurement programs. While ERP will always play a leading role in public sector IT, these systems were never truly designed to fulfill primary public sector-centric procurement functions. That’s why eProcurement solutions that complement – not replace – ERP systems are the ideal approach to sustainable procurement practices.

Although ERP systems can technically reach across every organizational function, they tend to rely on a modular structure that fragments departments – and data. This hinders critical information flow between procurement and its internal customers, which more often than not proves detrimental to strategic and cooperative project planning and implementation efforts.

eProcurement systems, on the other hand, utilize intuitive, data-rich software designed specifically to unify project planning and procurement efforts. Their quick implementation structure and quick response capabilities facilitate the real work that cities and counties need to do now to modernize cyber and physical infrastructure that will sustain population growth and increased utility, transportation, and education resource demands. They offer complete tracking and reporting functionality. Plus, coupled with the more comprehensive data sets available through ERP systems, eProcurement solutions can allow all parties – not just procurement – to monitor real-time progress on all projects.

Purpose provides a path to performance – even in procurement – and procurement sets the pace for progress. The better equipped procurement professionals are to do their jobs, the better equipped your entire organization will be to create jobs, educate citizens and build sustainable communities long term. Any investment in the modernization of procurement technology systems is an investment in the modernization of your city, county or higher education institute.

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Calculations are based on documented Periscope Holdings customer savings and research from Aberdeen.