Wouldn’t it be easier if there were some kind of treasure map for finding the best suppliers? As much as we all wish that X marked the spot, the reality is that sourcing suppliers is a little more complicated than that. But like a lot of today’s problems, someone thought “Wouldn’t this process be easier if we made software to help us out?” And so sourcing software development began.
Start comparing sourcing software with the Procurement Management Product Guide.
What is Sourcing Software?
Sourcing software, also known as strategic sourcing software, eSourcing or e-sourcing software, falls under the category of eProcurement. Unlike eProcurement software, however, it doesn’t help you manage the entire procurement process. Instead, it focuses on the identification and selection of suppliers. It achieves this by making collaboration easier, managing documents such as RFPs and providing a platform for making easy comparisons.
What are the Common Features of Sourcing Software?
One of the most important things to look for in sourcing software is whether or not it supports real-time capabilities. The best decisions are made when you use the most up-to-date information. If you’re evaluating sourcing software for your business, make sure the vendors you approach have features that support real-time updates.
Collaboration is key to any sourcing project. Poor collaboration can be the source (get it?) of a lot of pain throughout the process. Since a lot of people will be affected by your supplier decision, it’s good to keep people in the know from the get go.
Sourcing software can be used to maintain a high level of collaboration throughout the entire sourcing process. With a centralized portal, everyone who needs/wants to view bids, quotes and proposals can do so. This helps prepare everyone for meetings in which supplier options are discussed. In fact, it helps shorten those meetings (thank God) because everyone gets the same information at the same time beforehand.
Several sourcing software vendors provide a built-in communication system with the portal as well. This makes collaboration even easier, by allowing everyone to discuss the suppliers as their information comes in. In addition, all of the communication made within the system is stored (like with any communication system) so you can go back and read what others had to say. But the best part of a communication system might be that it reduces the need for meetings, since most of the discussions can happen directly in your sourcing software.
It may look more like a pharmaceutical acronym than a sourcing one, but eRFx is incredibly important to the process. It stands for electronic request for “X,” and encompasses RFBs, RFQs and RFPs (“X” relates to the B, Q or P). This feature organizes and stores your RFBs, RFQs and RFPs.
A good sourcing software helps you take care of the process from beginning to end, from writing it up to sending it out. Whether it’s a short one-pager or a long, complex document, it should essentially be able to create the eRFx by itself. you can start any sourcing project with an eRFx management feature.
After sending out an eRFx, get ready to be inundated by bids, quotes and/or proposals. You need a way to keep all of these ordered and organized so you don’t lose anything. Enter document management.
As soon as you receive a document from a supplier, your sourcing software collects it and stores it with all of your other documents. Thanks to document management features, all of your bids, proposals and quotes are automatically collected in the system in real time. This eliminates the possibility of misplacing a document. After all, as luck usually has it, whenever you misplace a document it usually belongs to the supplier with the most promise. When it’s managed in your sourcing software, however, you just have to scroll down to find it.
Side-by-Side Comparison Tool
After you receive all of your potential suppliers’ bids, quotes and proposals, it’s time to start comparing them. Usually, since proposals, quotes and bids come in different formats from different suppliers, it’s difficult to make a direct comparison. But sourcing software makes it easy.
The best sourcing software vendors compile these suppliers’ information and lets you compare them side-by-side. This is a lot easier than trying to decipher the differences in formats, and much less time-consuming than making your own comparison table. With the inclusion of a side-by-side comparison tool, the entire sourcing process can be completed in your sourcing software.
Most systems should come with integration capabilities, and sourcing software is no different. Although you’ll probably want to integrate it with some of the usual suspects, such as ERP and BI, there are other systems with which integration is just as helpful.
ESourcing Forum recommends that one of the sourcing software integrations you put it place should be contract management. “The ideal eSourcing tool interacts well with other crucial elements of the process, like your contract management system. The sourcing process should automatically flow into contract creation, and past contracts should be highly visible to provide insight while new bids are being collected.”
The last of the common sourcing features we’re highlighting is reporting. A common feature among all software nowadays, reporting is how you find your insights. Whether you’re finding assessing your ROI or comparing suppliers, reporting can provide the insights that tip the scale in favor of choosing a particular supplier.
The one thing you need to be sure of is that your sourcing software can pull in real-time data. This is important for when you’re evaluating suppliers. If you don’t have updated data, you may be missing some crucial information that could make or break a supplier decision.
What are the Best Sourcing Software Vendors?
There are a lot of sourcing software vendors to choose from, so we created a shortlist of our top rated sourcing software.
Coupa’s cloud computing procurement and sourcing software includes all the features you need from an eProcurement and sourcing system. Catering to global eCommerce, Coupa has the ability to facilitate transactions in multiple currencies and languages.
Built for small- to medium-sized businesses, Procurify focuses on ease-of-use and visibility for all of your employees. In addition, it provides cost management software and integrates well with other systems.
Spend Map Purchasing from Palmas Development Corp. was created for mid-sized and large businesses. For those that like deployment flexibility, SpendMap is available both on-premise and as a hosted SaaS solution.
Verian prides itself on providing an intuitive interface similar to online retail sites. Appealing to employees of every level, the system is easy to use while retaining powerful features. Verian also helps customers gain greater negotiating power with suppliers, while increasing vendor accountability.
The eProcurement and sourcing software from b-pack easily integrates with ERP and financial systems. One of the main focuses for b-pack is to help drive collaboration among procurement teams while centralizing all of their purchasing activities.
The Ivalua eProcurement suite consists of 5 modules that facilitate different parts of the procurement process. Ivalua emphasizes helping you protect your business by improving compliance with your suppliers’ negotiated contracts.