October 15 by Alex Gammelgard
When you scale from a four-person procurement team to a global operation in just a matter of years, how do you manage the growth in buy-side contracts? For Salesforce, the answer was right under their nose.
On Monday, I attended the Dreamforce session, CRM for the Buy-Side, which was led by Linda Chuan, Sr. Director of Global Corporate Services & Strategic Sourcing at salesforce.com. During the session, Linda shared why procurement is becoming a critical area of focus for Salesforce, and what Salesforce Procurement achieved leveraging the power of their own platform.
Procurement Represents a Huge Market Opportunity For Salesforce
As a platform company, Procurement — a $6B market — represents a huge opportunity for Salesforce sales teams. However, there was even more of a pressing need for Salesforce to innovate internally.
While salesforce.com grew 30% a year as a company between 2009 and today, procurement resources and process stayed the same. This meant that the effectiveness of procurement had a ceiling. At Salesforce, procurement meant multiple spreadsheets, data reentry and manual data transfer from a project-tracking tool, to a contract repository, to a savings/metrics/reporting tool. With all the manual labor involved in tracking and managing supplier relationships, there was no way to keep up with the long-term growth business plans.
Fortunately, when you work at Salesforce, moving from spreadsheets to the cloud is easy. In order to meet and support the needs of the business, Salesforce looked to the platform—along with ISV partners—to develop a better path from Procure-to-Pay.
Salesforce Realizes The Importance Of Empowering Procurement
For many procurement teams, the biggest challenge in adopting new solutions is convincing the organization they deserve it! Sourcing and procurement are often looked at as “below the line” functions, so they are not a priority when it comes to resources. But, as Linda shared, it makes no sense to keep procurement in the past when other teams experience so much benefit from being on a mobile-first, cloud platform like Salesforce.
Another selling point is the growing importance of delivering a seamless customer experience. Once you engage with your customers, the next thing you have to do is deliver on the products and offerings. If procurement isn’t equipped to reliably deliver, it’s impossible to be a truly customer-focused company. At some point, an inventory error, missed shipment, or sub-par product will let your customer down.
How Salesforce Runs Sourcing On Salesforce
Once Salesforce committed to empowering procurement, building the complete supplier solution was relatively easy. Salesforce partnered with DocuSign and Apttus Supplier Relationship Management (SRM) to provide Procurement everything they needed to generate incredible savings.
With Apttus, procurement gets a full view into operations via comprehensive dashboards on; open projects, RFPs, RFIs and RFQs by category, region, location, and team member, and insights into the top 10-20 critical suppliers. Some of the other key capabilities included:
- Buy-side contract management with integration to Microsoft word
- Self-service supplier request portals
- Built in collaboration via Chatter and Salesforce communities
- Supplier scorecards and corrective action requests (SCARs),
- Benchmarks against KPIs
- Issue and dispute management
- Integration with DocuSign for expedited signature
And because the whole solution sits on Salesforce, all of that power is available in real time, and on any mobile device.
Why Salesforce Is The Perfect Tool For Procurement
The Salesforce platform enables innovation across every department—and now procurement is another part of the package. I assume, as Salesforcee realizes value from their own solution, offering this package to the market at large will become more of a priority (and hopefully more companies will realize that their spend team deserves all the same innovations Sales and Marketing have been enjoying for the last 5 – 10 years of innovation.)
If you’re interested in learning more about Salesforce for Procurement, check out Apttus SRM or come find us at Dreamforce, where you can see a demo of Apttus Supplier Management.