Despite the fact that both sourcing and procurement deal with suppliers and purchasing, the two involve very different processes. Sourcing consists of spend analysis; finding suppliers; managing RFIs, RFQs, RFPs and RFx’s; managing contracts; and supplier relationship management (SRM). The sourcing process ends before the procurement process begins, as procurement involves the purchasing and ordering of goods and services from those suppliers.
Although sourcing isn’t a commonly overlooked process, it doesn’t receive as much attention as procurement does, despite being just as responsible for cost savings. We’re setting out to change that today by giving sourcing and, specifically, eSourcing some love.
Businesses optimize their sourcing process by using eSourcing tools, which aid in managing the entire process from beginning to end. Whether you’re a procurement professional in need of a better sourcing process or simply exploring how to improve your supply chain strategy, eSourcing tools just might be what you’re looking for. To help you find the right tool, we gathered the top 5 eSourcing tools:
Despite the fact that Prokuria’s name is eerily close to the word “procurement” (it’s almost like they did it on purpose), the system is one of the best eSourcing tools out there. Providing functionality for the entirety of both the sourcing and procurement processes, Prokuria’s platform is a great solution for businesses that want to centralize the two.
Some of Prokuria’s best features are related to RFPs/RFQs and reverse auctions. Creating and sending RFPs and RFQs is made simple thanks to a one-page setup featuring a standard template. After you send them to your chosen suppliers, real-time supplier tracking helps you manage reverse auctions. With this functionality, you can see which suppliers opened your RFP/RFQ, which declined it and which submitted a bid. You can then compare those bids head-to-head in a single dashboard.
Another solution offering both eProcurement and eSourcing, Coupa helps you go from initial spend analysis to contract management. Coupa provides insights into your expenditures, including purchase orders, invoices, etc. Similarly to Prokuria, Coupa provides RFP/RFQ templates to work with, so that the once time-consuming process takes far less time. That said, you can use the system to create custom RFPs/RFQs as well. You can then copy it later if you want to use the same format.
Additionally, the platform is accessible via mobile devices, so you can check in on your suppliers and their bids at any time.
As you can probably guess based on the name, eBid eXchange is one of the eSourcing tools that emphasizes supplier selection and online bidding functionality. In addition to providing online auctions, the platform makes managing bid documentation and distribution more efficient thanks to drag-and-drop features.
You can use eBid eXchange to improve collaboration as well. Your sourcing/procurement team can each submit a bid score for each supplier directly in the system. This way, everyone can see what the rest of the team thinks about each bid.
Zycus iSource is a system that helps reduce costs for its users. Not that the other vendors on this list don’t, but Zycus has some impressive numbers to show. Specifically, that its users save 15 – 45% per sourcing event. One of the factors in those savings results from drag-and-drop RFx creation. This helps speed up the process of creating custom-built templates, so you can send out your RFx’s quicker.
Interactive what-if evaluation capabilities help plan for the future, so your supplier analysis isn’t solely based on opinions, which can be biased one way or another. Automated supplier ranking further automates the supplier review process, reducing the time it takes to come to a decision.
Ivalua provides one of the best collaborative eSourcing tools out there. Key stakeholders can collectively record necessary requirements during the initial supplier requirements gathering phase. This helps ensure that no requirement gets forgotten. Flexible workflows in the system also offer collaborative opportunities.
Similar to Prokuria, Ivalua offers real-time reverse auction capabilities. What’s unique about Ivalua is that it provides multiple auction types, so you’re not stuck with any one auction process. In addition, you can initiate an auction from RFQ bids as they come in.
Bonus! Top 3 Contract Management Tools
Contract management is an essential final step in the eSourcing process. It keeps your contracts organized, so you can always check back to make sure that your suppliers are fulfilling all of the obligations that you laid out during negotiations. While many of the vendors above include contract management functionality, these systems go a little more in-depth. With this in mind, here are our top 3 contract management tools:
Novatus is a cloud-based contract management platform that handles all types of contracts. Useful for more than just sourcing and procurement, Novatus is also useful for general operations, legal and sales.
Ivalua makes another appearance in this article — this time for its contract management system. The software provides a structured framework that brings together all of your contracts and allows for collaborative authoring of every contract.
After being acquired earlier this year, Iasta’s contract management solution will soon be integrated with Selectica’s eSourcing tools. For now, at least, the software is one of the best for managing compliance. This makes it one of the best for businesses that have to meet lots of compliance standards.