Emergency Proof Your Procurement Processes
In March 2020, Pedernales Electric Cooperative (PEC)—the largest electric cooperative in the United States, servicing more than 346,000 accounts in Central Texas—had to go from being fully in-office to fully remote virtually overnight, like many organizations across North America during the COVID-19 health crisis.
Procurement has historically been one of the last organizational functions to migrate to the cloud. Fortunately, PEC was already in the midst of digitally transforming their paper and email-based workflows and was able to accelerate their eProcurement adoption to successfully work from home (and ultimately see a 150% increase in the RFPs they were able to run in 2020).
Less than a year later, in February 2021, Texas was at the center of an unprecedented winter storm that left more than 4.5 million homes and businesses across the state without power for several days. Between February 11 and 18, PEC line worker crews completed 16-hour shifts to restore power to the citizens of Central Texas. The Texas State Senate adopted Senate Resolution 85 to honor the frontline workers who responded to the power crisis.
In times of calamity—whether it’s a natural disaster, a pandemic, an economic crash or something else entirely—organizations rely on their procurement teams to source the goods and services they need to weather the storm (sometimes, in the case of PEC, quite literally). PEC’s adaptation to two major crises in less than one year serves as a reminder to procurement and sourcing professionals everywhere that COVID-19 isn’t the last emergency you’ll need to tackle head-on.
Of course, there’s no way to predict what kind of crisis your organization will need to face next. After all, who among us could have predicted that a global pandemic would impact our lives the way that it has? But there are steps you can take now to emergency-proof your procurement operations and workflows for whatever the future holds.
Reevaluate “Patchwork” Systems
As organizations across North America needed to make quick changes to respond to the COVID-19 health crisis and adjust to remote work, many procurement teams found themselves stitching together a myriad of tools and software inadvertently creating a “patchwork procurement” process. That is, instead of using one centralized tool for all procurement activities, these organizations use a patchwork system of software and tools that have been molded to fit the needs of procurement.
Here are some tell-tale signs that you might be leveraging patchwork procurement:
- You receive requests through a Google form
- You accept vendor submissions through email
- You evaluate bids and RFPs using Microsoft Excel or Google Sheets
- You store contracts in a shared drive or Dropbox
Patchwork procurement might seem like a step in the direction of truly digitized procurement, but it’s actually a liability in an emergency. The more systems you use, the more you are at risk of duplicating processes, misplacing files, opening the door for human error, or even increasing the risk of your organization being the subject of cyber attack or a personal data breach. When you are racing the clock to find new vendors during times of supply chain disruptions, or re-prioritizing your pipeline to address urgent requests, you don’t have the time to triple check your (and your evaluators’) work. Not to mention, patchwork procurement systems can lead to a confusing and inconsistent vendor experience, time wasted training non-procurement users on disparate systems, and a lack of transparency and visibility for your stakeholders.
To better prepare for future emergencies, it’s time to reassess your patchwork procurement processes. eProcurement can help, but not all platforms are created equal. In order to evaluate sustainability over the long haul, it’s worth considering how well the technology you’re evaluating helps you do the following:
- Connect, digitize and manage your operations end-to-end, from intake to contract management
- Centralize your project pipeline, so everything is easily accessible in one place
- Make processes intuitive and easy-to-use for all internal clients
- Accelerate, rather than impede, project lifecycles
- Provide full transparency and robust reporting
Develop Your Vendor Database and Improve the Vendor Experience
Remember at the beginning of COVID-19 when things like PPE and hand sanitizer were practically impossible to source? Organizations such as St. Joseph’s Health System had to get creative when overbed tables went out of stock nationwide because so many long-term care facilities could no longer allow communal dining; thankfully, classic folding TV tables—a lead St. Joseph’s Health System found thanks to the recommendations from their established vendors—did the trick when in a pinch.
The way you approach your relationships with vendors is key to navigating any future emergency-related supply chain disruptions. Investing in a vendor database that contains a pre-existing pool of qualified vendors, and can suggest vendors based on commodity codes, can help with this process of developing and managing relationships with a wide variety of vendors.
Improving your vendor experience is also key. Is finding information, submitting complete responses, and getting help when they need it straightforward and easy to do? Are you able to easily create and publish public notices and addenda to your open opportunities? Ensuring these boxes are checked will result in a more frictionless experience for your vendors.
Efficiency and Adaptability are the New Normal
In a recent survey conducted by Bonfire, when public sector procurement professionals were asked what their team’s biggest priority for 2021 was, 27% of them said increasing the speed and efficiency of their process—making it the number-two priority for procurement teams, right after cutting costs and reducing budget.
To address the initial emergency response during COVID-19, almost every procurement team across North America had to adjust their processes to source goods and services as fast as possible amidst constantly changing conditions. The value of an adaptable and agile process goes beyond emergency procurement, too. PEC, for instance, once needed to award a contract the same day before energy prices changed. Features in their eProcurement software allowed the PEC procurement team to send out NDAs and confidential files to each vendor individually, enabling a successful 18-hour turnaround time.
The pandemic demonstrated that, when push comes to shove, procurement can act fast—and it looks like those expectations are here to stay. The Bonfire survey data also found that 28% of procurement professionals believe their stakeholders and internal clients expect faster results now than they did before COVID-19. For both the public and private sector, the “next normal” of procurement must involve re-examining your operations, making them faster and more agile for the long-haul—not just in emergencies—to meet these new expectations. The result will be a faster, stronger and more productive organization now, and prepared for any emergency in the future.
The reality is that COVID-19 has transformed the path of procurement and sourcing forever. Procurement teams around the world had to adjust to unprecedented challenges, such as navigating supply chain shortages, introducing new technologies, and working from home for possibly the first time. Sourcing professionals can’t just wait for things to go “back to normal,” considering the past year brought to light many gaps to procurement emergency preparedness. The steps your procurement team takes now to learn from the COVID-19 health crisis are imperative to preparing your organization for future emergencies.