Advantages Of Automating Your Supply Chain

How do you manage your supply chain? For business, supply chain management is essential for the timely delivery of inputs and fulfillment of customer orders. Some businesses do this in-house, however, more and more businesses are outsourcing this service to experts in supply chain management software as a service.

Software as a service, SaaS, is a method where businesses access applications and their services over the internet as opposed to complex software and hardware maintenance. It’s an on-demand service where you pay as you use it. For most organizations, Supplier Management Software is an efficient way to manage and control their supply chains.

As you work with your suppliers, keep the following in mind:

  • Analyze which suppliers are critical – Work with them on strategies to improve their performance.
  • Establish clear objectives – This helps to align your goals.
  • Keep communication channels open – Ensure your team and suppliers have access that helps in decision-making.
  • Build trust – Before launching a new system, get input from existing suppliers to allay any doubts and work on any issues that may occur.
  • Review and improve – Make sure you are constantly monitoring your system and giving feedback. The system should be a win-win for all parties using it.
  • Use detailed agreements – This reduces confusion and disputes by noting down what is expected out of the partnership on issues such as; service description, price, delivery terms, and payment terms.

Advantages of Supplier Management Software

Relationships are the lifeline of a business. Buyers and sellers in the marketplace need to interact on a seamless platform to achieve mutual growth. This SaaS helps to automate the whole process reducing manual intervention and improving efficiency. Below are some of the benefits of employing supplier management software:

  1. Increased efficiency – The system features automate tasks such as order entry, invoice reconciliation, and discrepancy resolution. This helps to reduce the workload where staff can be redeployed to other critical areas of the organization. It also provides the added benefit of efficiency in operations.
  2. Improved supplier performance – Automating your supply chain improves the communication avenue with suppliers which enhances collaboration. The business is also able to gain an overview of its inventory in real-time with the added benefit of gauging the strength of each contractor in meeting their needs. Supplier quality is also improved as the system helps identify problem areas in the relationship and their ability based on past performance data.
  3. Improved customer satisfaction – The transparency provided by the system on inputs and outputs enables the organization to better manage customer expectations. This helps to build loyalty in the organization’s ability to fulfill their orders as per their stated turnaround time with the benefit of increased sales.
  4. Improves risk assessment – In 2021, the Suez canal was obstructed by a merchant ship that was buffeted by strong winds blocking the passage for days. The losses occasioned by this on the global supply chains were quite immense leading to shortages of basic commodities. The data generated from this system can be analyzed to determine where disruptions can occur affecting the company’s operations.
  5. Improved forecasting and decision making – Data gained from this system enables supplier assessment providing a clear understanding of what your suppliers’ strengths and weaknesses are. This is critical to ensuring supply chain disruptions don’t negatively affect your company’s operations.
  6. Decreased cost – The platform provided by this software can help you develop a mutually viable relationship with your most valuable suppliers. Through reduced lead times and increased productivity, a business can sustain supplier relationships that can deliver cost savings in the long run and curb availability problems and delays.
  7. Strengthened supply chains – Streamlining the supply chain process results in better coordination and inventory management. This gives a business a competitive edge by enabling them to meet customer demand and provide up-to-date information on their orders through built-in functionality that allows real-time response.


In today’s competitive marketplace, automation can give you an edge by increasing efficiency through reduced lead times, improving supplier performance, increasing customer satisfaction, and heightened flexibility from the availability of real-time actionable data. The pay-as-you-go model provides enterprises the benefit of freeing up resources to re-invest in their business. As you start on the automation journey, establish clear objectives with your suppliers that you are willing to work with for a mutually beneficial outcome.

Related Articles

Leave a Reply

Back to top button