How Online Purchase Orders Perpetuates Better Workflow
The popularity of online consumer purchasing sites, such as Amazon and eBay, is changing how some companies do their own purchasing. Sure, some are buying from consumer sites, but online purchase orders have become popular, too.
Your company needs to take a closer look at purchasing.
You know what a purchase order is, but does your company use them? Many companies, especially smaller ones, feel issuing purchase orders makes buying too complex and cumbersome. While purchase orders improve spend management and give managers more control (usually in advance), there is still opposition.
Workflow management is a key feature that assures management control and oversight of spending, placing works-in-progress in front of the right person at the proper time. Companies like the peace-of-mind that comes from having a system where “paperwork” cannot fall through the cracks or be lost on someone’s busy desk.
Purchasing is such an important business function that you’d think most businesses would be pretty good at it, yet just looking at the companies we know personally proves this just isn’t so. While some have excellent purchasing systems, more have nary a purchase order issued and lose money and control because of it.
Why you need the right purchasing system
Getting online purchase orders right is the first step in getting the entire purchase-to-payment system right and perpetuating better workflow in the organization. That might mean an automated, online system that gives companies insight and control they probably lack (unless they are already using such a system).
A good system is more than just a replacement for paper. That is because any electronic system can be guided by company policies and best practices that create efficiency and drive the online purchase order system in ways a manual system just cannot accomplish.
Rules for vendor selection, special pricing and even customized online catalogs can be built into the online purchase order system. This speeds order creation, ensures accuracy, and makes it easier for companies to earn vendor volume discounts.
The online purchase order system is integrated with an online payables system, allowing purchase orders to be matched with the invoice, submitted for approval and ultimately paid. Workflow is managed so the right information is always in front of the right person at the right time—another way to improve efficiency.
The purchasing and payables systems also work with tools for managing employee business expenses and other non-purchase order buying. The availability of smartphone cameras makes it possible to use receipt photographs—which are easily stored and transmits electronically—in lieu of maintaining files of paper receipts.
Using mobile expense reporting applications, travelers can sometimes have their expense report completed even before they return to the office. That convenience, along with automatic flagging of unusual expense activity and the ability to enforce business policies, makes the systems popular with employees and management alike.
Still, it all starts with purchase orders, one of the most basic of business documents. Bringing the purchasing process online saves time, money and improves worker satisfaction and productivity. Simply not having to deal with “all that paper” is enough to bring smiles to the purchasing and accounting departments.
Creating an integrated purchase-to-payment system, therefore, is straightforward and provides an opportunity to examine and improve business practices in ways that bring everyone onboard.
The future of company purchasing
Nobody will confuse payable management with the thrill of ringing the bell on the day a company goes public. Or even the warm feeling that comes from closing out the books. However, companies that do not get payable management correct may never get to the public or happily close the books.
So spending some time to make payable management work properly can help a company, and particularly a small business, to be a success. Doing the basics, such as payables, right can be part of a culture where the “small stuff” matters and workers concentrate on what really contributes to business success.
Payable management is a good process to take online, particularly if invoice presentment can be implemented as part of the system. Whether submitted electronically or via scanner, once the invoice is in the same place—and no longer maintained as paper—the system is bound to be better than the manual system it replaces.
Being able to pay the bills without having to open envelopes, lick stamps and fill up binders is one sign that a small business is fully benefitting from technology that used to be reserved for the Fortune 500.
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