They say you’re only as strong as your weakest link. In today’s dynamic business landscape, the connection between midsized businesses and their partner ecosystems exemplifies this adage. If disruption occurs even in the lower tiers of the supply chain, the entire operation suffers.
To mitigate risk and improve profits, companies have leveraged enterprise resource planning (ERP) tools. These can help streamline operations in their networks and improve efficiency across finance, human resources, supply chain, procurement, and more. Now, ERP can combine with spend-management technology to deliver more insights and benefits to organizations. It’s an ideal way to reduce costs and increase efficiency.
Without a strong sense of spend management, MSPs will struggle to adapt. By working closely with partners and implementing the right strategies and tools, services providers can drive value for customers and themselves.
Expand ERP Solution to Boost Value and Loyalty
Priya Wenzel
MSPs often manage rapidly growing businesses. The National Center for the Middle Market reported that since Q4 2021, U.S. midmarket companies have consistently experienced double-digit year-over-year growth in revenue and employment.
However, successful growth requires more than increasing revenue; it demands connecting intelligent spending to all verticals. This comprehensive understanding of spend has an incredible effect. It allows companies to identify and automate repetitive manual processes, increase productivity, lower supply costs and risks, and drive collaboration between trading partners.
Smart spend-management strategies can pay dividends by building loyal business networks, too. Companies searching for new partners crave transparency and reliability to develop successful long-term relationships. The more that spend is visible, the more value a company can drive. This allows MSPs to foster loyalty with potential partners throughout their network. It sets them up to grow their supplier list.
Use Spend Management to Drive Decisions
Spend management teams — including procurement and supply chain professionals — often are in a pressure cooker.
As they respond to the fast-moving demands of consumers and the global economy, they must gauge the benefits and risks of expansion. To make that possible, the data driving the business needs to come together.
Important opportunities are hidden within spend data. If properly capitalized on, they can give companies an advantage.
The traditional business network has become a “network of networks” that includes suppliers, logistics, finance, talent, channel partners, and more. Fortunately, spend management platforms help companies create a fully integrated system to optimize how they allocate resources. In minutes, businesses can find new suppliers along with important market data, transactional history, and contract terms.
Collecting and using these insights to inform key decisions will be vital for MSPs to help their clients expand and evolve their business networks beyond the siloes and disconnection of previous years.
Tap Into New Technology to Optimize Operations and Reduce Costs
These days, spend management professionals are required to do more than keep a keen eye on expenses. Tools like generative AI can allow procurement and supply chain teams to deal with increasing pressure to manage costs without losing revenue.
Asana’s Anatomy of Work Global Index found that 62% of the workday is lost to repetitive, mundane tasks, such as itemizing receipts, translating a contractor’s job description, or generating catalog descriptions. These are crucial components of business success, but AI and automation can carry out these tasks faster and more successfully.
Informed by data, machine learning, and intelligent insights, procurement and supply chain teams can reduce overall costs and identify places for improvement. These tools can be especially useful in the sourcing process. To recognize new suppliers and ensure they’re aligned with complex requirements before any transaction takes place, AI can automatically find companies that meet specific criteria. This enables sourcing professionals to make decisions with more confidence.
With the right combination of spend-management strategies and tools, MSPs can strengthen their own as well as their clients’ bottom lines.
Priya Wenzel is vice president and global head of partner ecosystem success for Digital Supply Chain and Intelligent Spend & Business Network for SAP. With more than two decades of experience, she excels in forging strategic alliances and fostering relationships.
Image: iStock
