It’s no secret that procurement teams are no longer the only ones doing the decision-making when it comes to corporate purchasing. Today, cloud vendors specifically target business leaders by selling them with quick implementations and standard cloud contracts.
While this has given more freedom to individual business units, it’s created a challenging situation for teams who want to stay lean by choosing the best software with the most value (a.k.a. everyone).
Procurement is still a very real and necessary part of the business. The problem is, many procurement teams often lack the tools and knowledge necessary to help business leaders make effective cloud purchasing decisions, causing unnecessary overspend and increased risks.
That’s why–like much of the tech being purchased throughout the company–the best procurement software tools are shifting to the cloud. There are a number of reasons for this shift, including:
- Relatively low cost (especially when compared to on-premise solutions)
- A quicker, streamlined implementation
- The ability to “try before you buy”
- Unprohibited growth
But the best procurement software isn’t just about paying your bill online or acting as the “hall monitor” for the rest of the company. It’s about providing the greatest value at all levels—the highest utilization for employees, combined with the lowest or most reasonable cost to the organization.
Characteristics of the Best Procurement Software
In a study of companies and publicly available cloud policies, Gartner concluded that “technology procurement teams need to be empowered to help the business through the cloud procurement process if they are to be the trusted advisors for the business leaders in their organizations.”
To do this, they must be “managed through a robust, cloud-specific governance process.”
It’s become increasingly apparent that finding a SaaS solution for procurement is necessary to uplevel your team’s procurement capabilities and value add. As your team joins the cloud revolution, here’s what to look for in securing the best system:
1. It prioritizes value over cost savings.
Modern procurement teams are moving beyond the idea of simple cost savings to provide deeper overall value to the company. This could mean scaling back to a more standard version of the software because the needs of the business have changed, or it could very well mean going with a higher-cost option because it increases employee productivity ten-fold.
Either way, procurement experts are the humans in this equation—the ones who can step back and weigh the need with the cost to arrive at the best outcome.
To do this, they need a system that’s going to evaluate the numbers from every angle, from the total cost to the number of users to redundancies. Mere cost savings should be the “price of admission” for any procurement software. The best procurement software goes a step further to measure real-time utilization, gauge employee sentiment, and help you make an accurate recommendation to leadership.
2. It gives you deep data for better understanding and negotiation.
One of the benefits to investing in cloud-based software is the ability to swap the outdated on-prem solutions and tedious spreadsheets of yesteryear for an automated system that works in real-time to show you a complete picture of your SaaS spend.
The implications, risks, and costs of modern tech solutions are bigger and more complex than they used to be, warranting systems and data sets that provide deeper knowledge and procurement insight. The best procurement software for SaaS should be able to show you:
- All SaaS apps being purchased via your accounts payable or employee expense data
- Renewal timelines for every owned SaaS app
- Spend, utilization, and employee feedback by application
- Overlapping apps, over/underutilization, multi-channel spend, and operational burden
3. It provides you with a holistic picture of your company’s SaaS usage.
Companies already have enough data silos to break down. In the modern age, the smartest business leaders seek out systems that show them a complete picture of their data from the start instead of trying to make it work between spreadsheets, reports, and multiple systems and regretting it later.
The best procurement software gives you one system of record to manage SaaS vendors and arm you with the data you not only need for increased visibility but to accurately negotiate future contracts with confidence.
4. It frees you up to focus on bigger initiatives.
If procurement specialists are focusing more and more on ways they can provide value back to the business and work more strategically with departmental leaders, manual tasks and unfocused discussion must be streamlined. To be able to accurately lend themselves to being a full-service concierge for the business, procurement teams must be given the data (and therefore the time back) to focus on proactive SaaS strategy.
Becoming a “trusted advisor” is a far-off goal for those still running reports and chasing down business leaders throughout the company for answers. The smartest SaaS solutions for procurement will aggregate all of this data and more into a comprehensive dashboard and even alert you when something is out of order—so you can get back to providing experienced guidance on a regular basis.
SaaS: The Procurement Game-Changer
There’s too much smart technology available today to warrant getting hit with auto-renewals and overutilization fees. Companies that will separate from the pack are not only the ones focused on reducing SaaS spend, but procuring the best and most valuable apps necessary to uplevel their business.
Yes, the emergence of cloud-based apps has brought about much change for the procurement industry. But with the right tools, it’s also the business function that’s poised with the greatest opportunity to deliver the most value.
Zylo is the leading procurement management system that brings SaaS application spend, utilization, and employee feedback together in one system of record to:
- Discover all of the SaaS applications being purchased.
- Manage SaaS vendors in one system to fuel strategic and proactive renewals.
- Measure real-time utilization and employee feedback to determine each app’s value.
- Optimize SaaS spend and utilization across the entire organization.