eProcurement And ERP Solutions

ERP Solutions

Though many sectors in the United States are stabilizing, the economy, for the most part, seems to be in shallow water. Constrained budgets around the country are pushing the movement for systems that provide the best return on investment (ROI). Projects that derive value with minimal resources are becoming crucial. If there was any a time for procurement to take center stage, it is now.

Cloud Computing and Purchasing

Cloud computing is dynamic and helps in streamlining business processes and systems in several ways. For government reform, cloud based procurement solutions hold the key to automate the purchasing departments. Technology has become a priority in modern day business, because with budget cuts, we have to rely on someone to do the work that your staff did initially. Technology is the backbone of increasing efficiency in every aspect of business management, and eliminating human errors and wastes in government spending. Take the state of Michigan for an example. Rick Snyder, the Governor of Michigan, is tech-oriented and believes that improving IT systems and applications will result in increased productivity in both the public and private sector. So when the state announced its budget last year, it came as little to no surprise that $48 million were allocated to either replace or upgrade the obsolete computer systems.

Just like Michigan, the budgeting and finance committees across the US are increasing investment in IT overhaul. But then there’s the issue of which technology to overhaul first. Enterprise Resource Planning (ERP) solutions were, for the most part, considered as a viable investment for IT and finance. Fast forward to today, the associated costs and time consumption are starting to sink in. In fact, most organizations have put their ERP solutions to rest and have implemented eProcurement solutions to yield instant effects. The public sector of the United States needs IT reform to optimize transparency and efficiency without incurring major costs. In this case, eProcurement is clearly the winner!

Why eProcurement is Better in Today’s Economy than ERP Solutions

Municipalities, cities, counties, and states are facing the battle of financial burden, and expensive ERP solutions are not helping their case either. Hence, the trend has shifted to systems that provide instant returns. eProcurement solutions can implemented within a matter of months, making the ROI almost immediate. On the other hand, implementing ERP solutions takes years, if not months, with user and software issues here and there. Before you know it, the long projects are taking longer to finish, while incurring significant costs down the road.

eProcurement is the most effective cloud technology when it comes to spend control. Not only does it help in automating the manual processes, eProcurement also helps in saving costs through maverick spend reduction and strategic sourcing. Statistics reveal that public sector organizations that implement eProcurement experience 20 to 30% savings. The cost of ERP solutions doesn’t help either. The price tag can go all the way up to $250 million, where eProcurement solutions can be bought with a small fraction of that number. On top of that, ERP solutions do not provide flexibility in compliance and supply management like procurement software solutions do!