Purchasing Supply Chain Software
Purchasing supply chain management software is challenging as just like the supply chain, it includes a number of moving parts, departments and changing regions. When you migrate to a new software platform, all your stakeholders are affected. Why do we buy software in the first place? The purchasing decision is not really about the software itself. It’s about the issue that the software will solve, or at least, you hope it will solve. In the context of a complex supply chain, here are some common goals which those in the position to purchase software wish to achieve:
- Increased efficiency through the automation of a pre-existing manual business process
- Offer new functionality, helping you do more or increase your organization’s quality of service
- Compliment current software platform, so that well-functioning pre-existing systems can live-on
- Futureproofing, ensuring the software spend down the line is minimized
Traditional supply chain ERP software is corporate organization outward focussed with a high emphasis on stakeholder integration and collaboration. You need to consider a product that will not only integrate into your organization’s business processes, but also those of your suppliers, vendors and other partners which you interact with on a regular basis. Some important considerations for a potential ERP implementation include:
- How employees within your organization will use the software
- How they do those activities and processes today
- How your partners including vendors and logistics service providers interact with you today and if it will change their process. Will they have the desire to / do they possess the ability to interact with the software you are looking to procure.
Some organizations look at purchasing software from a procurement perspective. Their procurement teams might create an RFP and will have particular requirements. They will research potential providers and consult with different departments in a cross functional approach. Ultimately, a document will be created, outlining what they are looking for in a vendor, potentially in the form of a balanced scorecard. From there they will shop around for that software.
Another option is for the supply chain organization within the company to own the software purchasing decision. The organization is familiar with how they get products from purchasing to logistics to customer service to planning: all of those departments will be considered in some way. This organizational focus is in a better position to represent the specific needs of the various business functions. While the procurement approach is often more concerned with making the most feasible financial decision. Of course, the best approach to a major supply chain software procurement decision would be a combination of the two methodologies.