Nowadays, a great deal of companies are feeling the pressure to strategically and efficiently update their procurement services, but there's a lack of real information out there on how to go about that. Even though dealing with and managing suppliers is such an important aspect of business, it's often overlooked in favor of more goal-oriented and profit building activities. This means that many chief procurement officers and their employees find themselves overworked and overwhelmed trying to maintain innovative strategies with a constantly changing marketplace and have no idea where to turn for answers.
Luckily, a relatively new field is expanding to address those specific needs. It's called procurement BPO (business process outsourcing) and it serves to partner with companies to handle vendor management on their behalf, lessening the burden on everyone. For understaffed and overstressed CPOs, it's a perfect solution in a lot of ways.
There's constant pressure in the field of procurement to constantly watch the bottom line. Lowering costs and cutting out spend inefficiencies is first and foremost for many, but many find that there's only so far they can go with the resources they have. When you factor in outside concerns like a struggling, yet recovering, economy and a nationwide skills shortage, you begin to realize that the challenge can be too great for a single in-house department.
When you outsource these concerns, however, you're putting your needs in the hands of experts who not only have the specific skills required, but also have the capacity to handle those types of requests with ease. Aside from merely cutting down on vendor spending, you're also spared the cost of hiring and/or training full-time employees with the same skills and expertise.
Finding a good vendor can take a great deal of time, especially in an underwhelming market. These contacts and networks can be hard to cultivate for under-resourced businesses that simply don't have the time it takes to find and meet the right suppliers. If nothing else, your services can often suffer for a simple deadline – the difference a few months without supplies, goods or services can make can be overwhelming and can waste a great deal of money and resources on its own. Not to mention, the sooner you can begin producing year-over-year savings, the better.
A procurement BPO agency could be worth its weight in gold on their contacts and networks alone. When you partner with them, they already have reliable vendors at the ready with proven track records and they specialize in quick onboarding because they understand how important speed and agility is to business.
One of the major concerns of CPOs everywhere is lack of resources. They simply don't have the reach to extend themselves as far as they'd like to go, and this can put a strain on the organization. While they do everything they can in terms of procurement strategy, the business world is constantly accelerating and needs are constantly changing and this means that keeping vendor management in-house becomes an increasing burden for most.
A BPO comes in handy in more ways than one, as you can see, but perhaps the greatest aspect is what it saves in terms of your most valuable assets. With scalability, flexibility, resource management competencies and strategic skills, they're able to take the pressure off of your business and manage everything themselves. They are constantly adapting their strategies as well, to ensure that not only are unexpected changes dealt with with care, but also so you're always getting the benefit of their intense research and knowledge. This means your employees and their skills can be put to better use in areas that increase the value of your organization, allowing you to focus primarily on your strategic goals.