Simply put, a strategic sourcing process consists of a supplier’s capability assessment, their qualification, receipt and analysis of commercial bids, negotiation and award. This also involves internal stakeholder collaboration.
eSourcing is a digitalization of the sourcing process and hence must address the above needs.
It is about time organizations realize that adopting online auctions as a means of negotiation for a fraction of their spending does not tantamount to the adoption of eSourcing. Online auctions form just one component of the eSourcing process.

Krinati is meant to simplify the sourcing process


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Five key benefits for a company to resort to eSourcing

  • Greater transparency and governance
    Conducting sourcing events using eSourcing solutions ensures greater control through streamlined workflows. Internal audit teams have their queries easily answered – how many suppliers were invited, who approved the award scenario, why did a supplier decline to participate, was 3-bids-and-a-buy followed, etc.
  • Improved supplier management
    Transparency plays a key role in building supplier relationships. Suppliers are known to trust an online RFP and the market feedback from an online auction. Why? Because they believe it makes a level playing field for all suppliers since all suppliers have access to the same information.
  • Higher savings
    eSourcing includes the use of online auctions – reverse, forward and dutch auctions that are proven tools to negotiate better rates with vendors. Adopting the right process before and after the auction is equally important to ensure aggressive participation from suppliers during a live auction.
    Competitive RFPs can also play a significant role in ensuring competitive bids are received during the RFP process. Suppliers can see their Rank and/or Best Bid as soon as they submit their RFP response and the market feedback gets them to revise and place lower bids.
    Supplier-specific ceiling prices can also be used effectively to get a lower price from new suppliers.

  • Faster cycle times
    Sourcing cycle times are dependent on one, access to past information and templates used and two, automated processes. eSourcing tools should support both of these criteria.
    Knowledge templates should make creating RFPs and Auctions super quick because the questionnaires & pricing tables are made well in advance and not necessarily at the time of the sourcing event.
    Automated comparisons of bids as soon as they are received from suppliers save time for procurement teams, that no longer need to export data into excel every time bids arrive or are revised.
    If the risk to the event – savings vs escalation, line items that haven’t received any responses – can be understood in real-time, that would be a real bonus!
  • Team Collaboration
    Strategic Sourcing is often a team effort. There are multiple stakeholders from quality, manufacturing, and after-sales functions who need to weigh in on the supplier selection process. eSourcing solutions allow for seamless collaboration between teams working on any sourcing event. Effective team collaboration ensures better outcomes for any sourcing event.

Want to understand how the Krinati solution suite can help you ?