As supply chain disruptions continue the procurement function should adapt to improve transparency, build collaborative relationships, and ensure sustainable sourcing practices, resulting in a stronger, more resilient supply chain with Cloud ERP for manufacturing. Manufacturers rely on materials sourced from volatile markets, subject to shortages and price instability amongst other things. Cloud ERP offers the procurement solution for businesses to manage and automate every part of the procurement process, from supplier management, purchase requestions and purchase orders to sourcing and invoicing.
Manufacturers can adopt technologies to enable strategic sourcing to become more predictive, transactions in procurement to be more automated and supplier relationship management to become more proactive. With shifts in the supply chain here’s how Cloud ERP for manufacturing can assist your procurement function to achieve optimum growth and market share:
1. Strategic sourcing with Cloud ERP
With Cloud ERP analytics can be used to improve, classify, and analyze data by supplier and category. This improves item-level visibility across the organization, which is crucial not only for cost-cutting opportunities but for managing inventory and ethical sourcing. A company like Ford for example is working with key suppliers in China, India, Thailand, and South Africa to eliminate over 4900 metric tons of CO2 emissions in the next three years. With technology, manufacturers can accurately monitor suppliers to ensure the right choices are made to meet sustainability goals and preserve resources.
In the last few years, we have seen a fundamental shift in consumer attitudes towards ethical trading and customers are still demanding responsibly sourced products. Manufacturers now need to juggle sourcing ethically alongside securing value for money. To do this they would need technology to gain greater visibility and control throughout the supply chain. Businesses should streamline supply chain processes and engage in more ethical practices that will deliver greater efficiency, improved sustainability, better working conditions and less environmental impact which in turn increases customer loyalty for profitability.
2. Connecting the supply chain with Cloud ERP for tracking and traceability
Our research also shows that 70% of manufacturing businesses experienced supply chain disruptions in the last year and 60% of businesses were unable to engage and collaborate with customers and suppliers in real-time. As a manufacturer you need to ensure that your suppliers bring in raw materials at the right time and in the exact quantities to avoid losses and delays. Complex supply chains have made it more difficult to track and trace products and procurement is heavily reliant on the transparency between the different stakeholders.
Using Cloud ERP, you can manage all supplier and distribution channels in one cohesive system with visibility across your entire network. Traceability across the whole supply chain helps you improve product compliance and quality. Through the ERP system security is enhanced as you can trace if your raw materials and perishable goods arrive on time. Through portals you are also able to better communicate with suppliers and mitigate risk.
3. Digitalization for the factory of future
The procurement function of some businesses is usually managed manually, with heavy reliance on paperwork, phone calls and in-person conversations. However, as teams become remote manual procurement has hampered operations. Now more than ever procurement should collaborate with every part of the supply chain and multiple stakeholders. The increase in remote working has also disjointed this and made it more crucial to have a single source of the truth of information from suppliers and customers.
An investment in a scalable ERP system that can be deployed either in the cloud, on-premises, or both (hybrid) gives manufacturers the choice and flexibility that best suits their needs and budgets. You are able to choose how you want to engage, 24/7, on any device or platform and from any location. This enables businesses to gain a competitive advantage and manage software costs as an operational or capital expense dependent on unique business requirements and budget.
The procurement function has changed rapidly in the last few years and the pressure to stay agile and innovative will not slow down. Therefore, procurement needs resources, processes, and the underlying technology like Cloud ERP to assure high quality performance and impact within the supply chain.
