8 signs your organization needs procurement orchestration

Business moves fast, and it’s your job as leader in finance and purchasing operations to keep your teams unblocked from growth.

However, many organizations still struggle with outdated, informal procurement practices that hinder performance. Worse, even when companies are working within what they think are modern, up-to-date methodologies, approvals and operations still take far too long, within opaque data and process siloes, and with key stakeholders simply confused as to what they should be doing and when.

If this feels familiar, it might be time to leverage the collaborative power of procurement orchestration.

What is procurement orchestration?

Procurement orchestration is the coordinated integration of all processes leading into an organization’s procurement strategy, through a dedicated platform for optimizing procurement workflows. Essentially, it is the most effective way for modern businesses to streamline their procurement activities and maximize value.

This article will help you identify if your organization is ready for procurement orchestration by taking a look at eight key signs to look out for.

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8 signs an organization needs procurement orchestration

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The 2022 Gartner Accelerating the Digitization of Procurement Survey found that 59% of procurement leaders feel that leveraging up-to-date technology will make an overall difference in organization performance. 

However, many companies are still early in their digital transformation, and struggle to know how and when to best make investments in foundational procurement technology and methodology.

Here are some signs to look for that may indicate now is the time to adopt procurement orchestration for your team.

1. Lack of visibility into spending

One of the top indicators that your organization needs to adopt procurement orchestration is when you or your team lacks clear insight into the process of spending. When procurement cannot easily track and manage how funds are being used, or resources are being allocated, it can lead to budget overruns and inefficient processes. 

Procurement orchestration provides comprehensive dashboards and real-time insights, ensuring every dollar is spent contributing to the company’s growth.

2. Inconsistent procurement processes

Inconsistencies in the purchasing process across departments can lead to confusion, delays, and errors. Without a standardized approach, different teams may follow their own procedures—or even go around the procurement process altogether. This can lead to inefficiencies, increased or duplicative costs. 

With the unified, fully transparent and simple processes offered by a fully orchestrated procurement platform, you can experience a unified process, which leads to consistency across spend. 

Finance will thank you at the end of the month.

3. High incidence of rogue spending

Rogue spend is when employees make unauthorized purchases outside of approved channels. This is the bane of procurement’s existence, as this not only affects budgets at the end of the month, but can lead to highly risky compliance-related issues. 

Yes, this is a result of a lack of clear procurement policies or centralized systems in place. When the process is confusing or unclear, employees go rogue. 

The clear, user-friendly and centralized intake pioneered by Zip, embedded within the world’s leading procurement orchestration platform, effectively and elegantly solves this problem, by bringing all purchasing and purchase requests into one place. 

This allows your team to enforce strict controls and approval workflows, reducing unauthorized spend and improving financial governance.

4. Difficulty in managing supplier relationships

With incredible gains in AI-powered process guidance for routine tasks of procurement, more time and effort can be invested in the relationship-side of purchasing. 

Maintaining healthy vendor relationships becomes a key component of procurement’s workflow, and if you find difficulty in supplier communication, contract management or performance tracking, this is a clear sign you need procurement orchestration.

A structured and orchestrated approach helps streamline supplier interactions, enhancing collaboration and ensuring better outcomes for everyone involved.

5. Frequent procurement errors and inefficiencies

A chief concern for procurement leaders are problems along the process, particularly errors such as incorrect orders, duplicate errors, and missed deliveries. Many of these issues are caused by routine, manual tasks and a lack of oversight along the process.

Of course, AI-powered processes can help alleviate many of these problems by leveraging automation throughout intake, sourcing, and each of the broader procurement and approval processes. 

Procurement orchestration adds a collaborative, automated layer that reduces human error, keeps data consistent across workflows, and ensures that procurement activities are executed flawlessly—and in the open.

6. Long approval cycles

Lengthy procurement approval cycles are a frequently cited headache across companies.

For example, AI and workflow automation leaders Instabase found themselves blocked by manual processes cutting into their high-growth operations. Accounting Lead Arne Mandell described the system as a "worst-case scenario," where the team struggled with matching POs and invoices, and faced exhausting challenges in vendor management and approval tracking.

Leveraging the parallel, orchestrated approval workflows of Zip helped Instabase reduce approval cycle times by 71% in just one quarter. That’s how you make employees happy.

7. Poor compliance and risk management

Non-compliance with legal and regulatory requirements can pose a significant risk like fines and reputational damage. Additionally, poor risk management can often lead to bigger issues if you’re not careful, like fraud and contract breaches. 

Before these kinds of missteps become part of your business, consider procurement orchestration. A fully integrated and transparent workflow enforces compliance through automated check and balances, ensuring all procurement activities adhere to established standards. 

When your legal team has visibility and orchestrated tool integrations, automated compliance becomes part of the process.

8. Inadequate reporting and analytics

Fast-paced decisions require accurate and timely data and reporting. If you struggle with generating comprehensive reports and analysis of procurement data, you won’t be able to make the nimble, fleet-footed, but informed decisions required for an effective procurement strategy.

Procurement orchestration tools like Zip can provide powerful reporting and analytics, encompassing every element and cross-functional workflow throughout the process. Ensure you’re operating at peak performance with the power of procurement orchestration.

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Top risks of continuing with an informal or unstructured procurement process

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Continuing to operate according to your standard, outdated procurement methodologies isn’t just bad business, but it can expose your company to several risks.

• Financial risks: Without structured procurement, it is challenging to control spending, leading to increased costs and budget overruns. Informal processes often result in unplanned purchases, higher prices, and missed savings opportunities.
• Compliance risks: Non-compliance with procurement policies and regulatory requirements can result in legal issues, fines, and damage to your organization's reputation. An unstructured process lacks the necessary checks and balances to ensure compliance.
• Operational risks: Inefficient procurement processes can cause delays in obtaining necessary goods and services, disrupting operations and affecting overall productivity. These inefficiencies can lead to lost revenue and diminished competitive advantage.

What you gain with procurement orchestration

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The benefits to an integrated, coordinated, and orchestrated procurement system are vast and varied, and can be measured by more than just faster cycle times—though that is an excellent quantifiable metric! Here are some more benefits:

Optimized spend management 

Procurement orchestration provides visibility and control over spending, enabling you to optimize spend management and achieve cost savings. It ensures that every procurement decision aligns with your organization’s financial goals, with every dollar serving a clear purpose.

Enhanced compliance and risk mitigation

Automated compliance checks and risk management workflows reduce the risk of fraud, errors, and regulatory breaches. Procurement orchestration ensures that all activities comply with legal and internal standards.

Improved supplier relationship management

With structured processes and better communication tools, procurement orchestration enhances supplier relationship management. It facilitates collaboration, ensures timely deliveries, and enables better contract negotiations.

Increased operational efficiency

By automating routine tasks and streamlining workflows, procurement orchestration increases operational efficiency. It reduces the administrative burden on employees, allowing them to focus on strategic activities.

Better financial control and reporting

Advanced reporting and analytics tools provide real-time insights into procurement activities, enabling better financial control and decision-making. You can track performance, identify trends, and make data-driven decisions to optimize procurement.

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Easily implement procurement orchestration with Zip

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Zip is the industry leader in procurement orchestration, revolutionizing the way employees engage at intake, automate routine tasks, and coordinate cross-functional processes throughout every procurement-related workflow.

• Universal intake for purchasing requests: Simplify the initiation of procurement requests with one-front door for intake, ensuring employees always make their requests the right way.
• Dynamic low and no-code approval workflows: Customize approval workflows to fit your needs without extensive IT involvement, ensuring flexibility and alignment with organizational goals.
• Powerful dashboards for spend insights: Gain real-time visibility into spending and procurement, empowering informed decision-making and optimized spend management.
• Pre-built integrations for ERP systems: Seamlessly integrate procurement processes with your existing ERP systems, ensuring data integrity and operational consistency.

These features and more explain why Zip adoption leads to immediate workflow improvements and significant improvement in cycle times, along with improved visibility, control, and efficiency in your procurement process.

‍Request a demo today to find out how Zip can transform your procurement operations and drive your organization toward great efficiency and results.