In a 2015 study by Nielsen, 66 percent of respondents were willing to spend more money with a brand committed to social responsibility. Across all industries, consumers are especially concerned with ethically sourced goods. But for many companies in the supply chain, sourcing remains one of the most difficult processes to audit and keep track of. Not only does this hinder a company’s ability to ensure ethical practices, but it also makes the sourcing process less efficient and more expensive than it needs to be. However, many businesses are turning to eSourcing software, procurement tools and procurement software to solve this issue.
What is e-Sourcing and How is it Different From eProcurement?
ESourcing is simply sourcing with the addition of technology, such as the internet and software, to carry out most of the processes involved. This helps businesses more easily keep track of their suppliers and provides more visibility into your procurement operations. But then you might be wondering what the difference is between sourcing and procurement tools.
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 RFxs; 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 some love in our e-Sourcing tools comparison.
Top 5 eSourcing Software Tools
Like we mentioned earlier, businesses can optimize their sourcing process by using the various types of e-Sourcing tools that are available. These tools 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 solution, we gathered the five best eSourcing management software tools:
This vendor offers all the features necessary when it comes to e-Sourcing. First, Jaggaer offers advanced spend analysis tools to help businesses utilize every chance to save money and improve spending. This product allows users to see total spend, spend by category, spend by supplier, number of invoices and more.
Then, Jaggaer provides a sophisticated RFx tool, which allows users to automate many of the processes related to sourcing. It includes a portal for suppliers where they can fill out questionnaires to be automatically analyzed by the system’s scoring component. Lastly, this product supports contract lifecycle management. Contracts are easily accessed from a centralized location, facilitating collaboration and compliance. This feature also contains full and partial contract templates to speed up contract creation time. Updates can be configured to appear on a user’s dashboard to alert them to metrics such as performance as well.
GEP offers a suite of different tools to help businesses manage their sourcing process. Like Jaggaer, GEP offers complex spend analysis software. As a solution native to the cloud, GEP specializes in providing real-time data on spending, gathering information from all your sources. GEP is also able to clean this information to make sure the data is accurate to provide reliable visibility. Use GEP to gain valuable insight into metrics such as spend by region, spend by supplier, overall spending trends along with other important benchmarks. Further, users can configure alerts when spending reaches a certain limit and access the system on any internet capable device.
Additionally, GEP offers tools to manage your various RFx. The interface is simple to use and understand but provides in-depth functionality. It can be configured to your existing sourcing processes in just a couple of weeks before it’s up and running. Then, you’re able to host sourcing events such as online auctions. All sourcing activities are housed in one place and many can be partially or fully automated using GEP.
For instance, once the sourcing process is complete, functions related to contract management are triggered. Furthermore, GEP offers tools to monitor supplier performance using assessments, alerts and reports.
Offering both eProcurement and e-Sourcing, Coupa helps you go from initial spend analysis to contract management using various apps to support each process. Coupa’s spend analysis includes pre-built reports which allow users to track metrics like savings, time to invoice and more. But users can also create custom reports through an incredibly user-friendly interface.
Coupa’s sourcing management application helps users execute sourcing events and get the most from each potential sourcing opportunity. Users can configure alerts for things like increased spend and contract expirations. This app also provides insights into your expenditures, including purchase orders, invoices, etc. Coupa provides RFP/RFQ templates to work with so that the once time-consuming process takes far fewer resources. 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 e-Sourcing platform is accessible via mobile devices, so you can check in on your suppliers and their bids at any time.
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 percent 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 RFxs 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.
Zycus also provides an entire suite of e-Sourcing software to help with other aspects of the procurement process, such as spend analysis, invoice management, contract management and supplier management.
Ivalua provides one of the best collaborative eSourcing tools out there by utilizing many features offered by project management software. Key stakeholders can collectively record the necessary requirements during the initial supplier requirements gathering phase. This helps ensure no requirement gets forgotten. Workflows can also be configured to support the way you already collaborate with your teams. For instance, users can set up tasks and dependencies to make sure the ball stays rolling.
Additionally, Ivalua offers real-time reverse auction capabilities. What’s unique about Ivalua is 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. Users can receive alerts when suppliers have placed a bid or sent a message. And like Zycus, Ivalua offers what-if simulation to help sourcing agents make the best business decision.
Moreover, Ivalua provides a BOM lifecycle manager tool to manage your sourcing process and bill of materials in the same place. This allows you to see supplier performance in relationship with your product, which may be helpful as you assess your partnerships.
Sourcing is one of the most important processes when it comes to helping your business maintain a competitive advantage. That’s why it’s crucial to find the most advanced and streamlined method of performing this process. Implementing an eSourcing tool is an excellent solution to this challenge.
Now that you’re familiar with what the best e-Sourcing companies have to offer, it’s time to finalize your list of requirements and compare systems. Creating a list of requirements is a necessary step in finding the perfect eSourcing software for your business. It should include the features, functionality, preferred deployment method and other aspects needed from your next software system in order for it to be successful. Check out our free procurement software requirements template to jumpstart your selection.
In addition to fostering ethical business practices, what do you hope to gain with a new eSourcing tool? We love to hear from our readers so let us know by leaving a message below!