8 Software Procurement Best Practices You Must Know

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The relationship between organizations and the software procurement process has recently become indispensable with the adoption of new technologies to boost an organization's productivity.

In the earlier stages of technological transformation, companies still preferred manual software onboarding and manually keeping track of data in spreadsheets, with little emphasis on vendor relationship management.

While these methods might have seemed right at first glance or were suitable initially, the transformation has progressed, so nobody has time to wait for SaaS application access to start their work.

New employees want SaaS access as early as possible after onboarding. Thus, the need for an efficient and fast onboarding system arises, making procuring and enabling new software essential to maintaining a smooth workflow without any trouble.

So, what's the best way to overcome this tedious process and introduce something new that changes everything?

For an effective resolution, establishing a structured software procurement process is critical. Dive into this article for comprehensive insights into the procedures and specifics.

Keep reading.

Software Procurement - What If You’re Doing It Wrong?

Many organizations are unwittingly adhering to outdated and manual methods for software procurement, thus inadvertently committing substantial errors in their approach. Failing to embrace automation in software procurement impedes efficiency and introduces a higher risk of inaccuracies and oversights.

Adopting SaaS procurement software yields significant advantages, optimizing the efficiency of SaaS procurement processes within organizations.

Manual procurement becomes impractical and inefficient as the use of multiple SaaS applications grows. The increasing popularity of SaaS procurement solutions effectively addresses these challenges and is gaining widespread adoption.

For instance, when the average size of a large organization has reached over 250 employees, and, on average, employees use 100 to 150 SaaS apps daily, manual methods take hours and even weeks to grant access successfully. It is ineffective and requires manual intervention from IT and HR Teams.

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Avoiding manual software procurement processes is generally recommended for several reasons:

• Manual software procurement processes slow down critical software acquisition.
• Its time-consuming nature hinders swift decision-making.
• It poses a higher risk of errors and oversight with human-dominant intervention.
• The lack of transparency in manual procurement makes tracking progress difficult.
• Manual processes increase the risk of non-compliance, leading to legal consequences.
• Collaboration issues arise, causing miscommunication in the procurement process.
• Managing vendor relationships becomes challenging with manual methods.
• Difficulty in maintaining a comprehensive audit trail impacts accountability.
• Manual processes are less scalable as the organization grows.
• Data security is compromised when handling sensitive software information manually.
• Generating meaningful reports and analyzing trends is hindered by manual procurement.‍

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What is the Right Procurement Process?

The right software procurement process is undoubtedly anchored in adopting modern technology, explicitly leveraging procurement software solutions and automated workflows. Organizations can transform their software acquisition procedures from manual to automated procurement systems.

Approximately 79% of Chief Procurement Officers (CPOs) concur that the primary objective in acquiring new IT is effectively balancing quality technology with cost-effectiveness.

Organizations should, therefore, turn to better SaaS procurement methods to streamline and enhance efficiency in the procurement process.

The right procurement process, through the integration of software solutions and automation, not only accelerates the acquisition of software but also transforms organizational agility, resilience, and competitiveness in the ever-evolving landscape of technology.

When an organization implements software procurement best practices for a more streamlined and responsive approach, it brings about the following changes:

• Procurement software solutions offer a centralized platform where stakeholders can streamline the entire procurement lifecycle.
• Automated workflows ensure that each step is seamlessly executed, reducing the risk of errors, delays, and oversights inherent in manual processes.
• These solutions empower decision-makers with real-time insights, allowing for informed and swift decision-making.
• Automated procurement enhances collaboration between departments, vendors, and stakeholders and fosters a more transparent and efficient procurement ecosystem.
• The process enhances efficiency by streamlining workflows, reducing human error, and accelerating acquisition.
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8 Clever Software Procurement Best Practices

1. Have a clear understanding of the team’s requirements

One of the fundamental aspects of successful software procurement is having a clear understanding of your team’s requirements. You can do it by engaging with stakeholders to identify their specific needs and objectives.

When establishing a comprehensive list of requirements, you ensure that the software solution aligns with your organization’s goals and enhances operational efficiency.

This foundation step lays the for a targeted procurement process, reducing the risk of investing in software that does not meet essential business needs.

2. Thoroughly vet your vendor before selecting them

Selecting the right vendor is pivotal to the success of software procurement. To mitigate vendor-associated risks, you must thoroughly vet potential vendors, which involves evaluating their track record, reputation, and financial stability.

Key things to check

Additionally, emphasize scrutinizing their compliance with industry standards and regulations. When you opt for a diligent vendor assessment, it helps select a reliable partner, ensuring that the software solution meets technical requirements and aligns with ethical and legal standards.

3. Get IT and finance teams involved during RPP/RPQ processes

Collaboration between IT and finance teams is essential during the Request for Proposal (RFP) or Request for Quotation (RPQ) processes. IT teams can provide technical insights, ensuring the software meets technological infrastructure and compatibility requirements.

On the contrary, finance teams can contribute their expertise to assess the financial viability of the proposed solutions, ensuring that the procurement decision is economically sound and aligns with the organization's overall financial strategy.

Understand the basics of RFP/RFQ at a glance,

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4. Maintain complete transparency over the procurement process

Transparency is vital to building trust and ensuring accountability throughout the procurement process. Keeping stakeholders informed about the progress, challenges, and decisions made during procurement fosters a collaborative environment.

Transparent communication also helps in addressing concerns promptly and making well-informed decisions. By maintaining openness, organizations can navigate the procurement process smoothly and build strong relationships with internal and external stakeholders.

5. Seek expert negotiation help if your team lacks bandwidth

Developing effective negotiation skills is a critical aspect of software procurement best practices. If your team lacks the bandwidth or expertise, consider seeking assistance from negotiation experts.

Engaging professionals who understand the intricacies of software licensing, pricing structures, and contract terms can significantly improve the outcome of negotiations.

It ensures that your organization secures the best possible deal while minimizing potential risks and optimizing the overall value of the software investment.

Utilize CloudEagle's SaaS buying experts for vendor negotiations, guaranteeing optimal purchases at the most favorable prices and alleviating the time and effort burden on your SaaS procurement team.

Key benefits of having CloudEagle as your expert negotiator

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6. Streamline contract lifecycle management

Efficient contract lifecycle management is essential for the long-term success of software procurement. Establishing transparent contract creation, negotiation, approval, and monitoring processes helps avoid delays, minimize risks, and ensure compliance.

By streamlining the contract lifecycle, organizations can proactively manage vendor relationships, address issues promptly, and optimize the utilization of software licenses throughout their lifecycle.

7. Leverage automated software procurement solutions

Automation plays a crucial role in enhancing the efficiency and accuracy of software procurement. Leveraging automated software procurement solutions streamlines repetitive tasks, reduces errors, and accelerates the overall procurement process.

Automated tools can assist in vendor evaluation, documentation, and compliance tracking.

By incorporating technology, organizations can make the procurement process more agile, allowing teams to focus on strategic decision-making rather than administrative tasks.

Various software procurement solutions are available in the market, one significant example being CloudEagle, which offers a comprehensive set of features from SaaS management, and procurement to user management and IAM.

8. Stay within the budget

Staying within the budget is fundamental to implementing software procurement best practices. Establishing and adhering to a clear budget helps prevent overspending and ensures that the organization maximizes the value of its investment.

Regularly monitor expenditures and be prepared to adjust the budget based on unforeseen circumstances or changes in the project scope.

Effective budget management contributes to the organization's financial health and supports responsible resource allocation in alignment with strategic goals.‍

CloudEagle: The Only Software Procurement Solution Your Team Needs

Optimize your organization's SaaS procurement process for time, cost savings, and enhanced visibility using CloudEagle's outstanding procurement workflows. CloudEagle's procurement workflows stand out with customizable forms, RFP templates, versatility beyond SaaS, and multi-channel notifications (Slack, Gmail, in-app).

CloudEagle provides a 30% reduction in SaaS spending, saves 500+ hours annually, and ensures 100% visibility in procurement.

CloudEagle Procurement Software Solution Offerings,

• No-Code Workflows: Overcoming the challenge of tracking down multiple individuals for procurement approvals, no-code workflows in CloudEagle notify approvers, maintain an audit trail, and seamlessly progress to the next step, eliminating manual follow-ups.

• Ready-to-Use Workflow Templates: CloudEagle provides a variety of ready-to-use templates tailored for common scenarios such as renewals, purchases, and billing to avoid the hassle of creating new workflows for each instance.
• Custom Intake Request Forms: Recognizing diverse information needs for various purchase requests, CloudEagle offers customizable intake request forms, ensuring the capture of pertinent details for both SaaS and non-SaaS requests.
• Slack-Enabled Workflows: Prevent procurement request updates from getting lost in emails. Users can utilize Slack to initiate purchase requests, receive updates, and establish private channels for collaborative efforts.

• CloudEagle integrates with Slack to streamline SaaS requests and approvals, boosting daily productivity by 2x and saving 25% on coordination time.
• It helps initiate renewal workflows with CloudEagle weeks before contract expiry, creating dedicated Slack channels for real-time communication, document sharing, and comments.
• CloudEagle simplifies procurement requests via Slack, reducing steps and turbocharging the SaaS buying process.
• You will receive real-time procurement updates through Slack notifications, eliminating email clutter and expediting approval.
• CloudEagle sends instant alerts for billing anomalies and underused apps, with weekly and monthly digests for efficient record-keeping and audits.
• You can refer to past Slack discussions for informed decisions during buying or renewal cycles, avoiding the need to start from scratch.
• Fastrack Vendor Research: CloudEagle eliminates the time-consuming task of researching software products and enables users to find vendors efficiently, providing comprehensive information, including peer reviews, side-by-side comparisons, and pricing plans.

You must read about the five compelling reasons why organizations are choosing CloudEagle to streamline the SaaS procurement process.

• On-Demand SaaS Buying Team: For those with limited negotiation time, CloudEagle's SaaS buying experts leverage usage insights and benchmarks to secure the right product at the right price, offering assistance when needed.
• The expert team ensures comprehensive vendor coverage effortlessly, with expert support for pricing uncertainty and negotiation assistance.
• This process accelerates your RFP process using ready-to-use templates, simplifying customization for business and SaaS needs.
• They negotiate for cost savings effectively by leveraging app usage insights and tailoring strategies based on licenses, subscription duration, and usage needs, ensuring the best value for your investment.

Besides procurement services, the tool helps you manage all your software contracts in one place and streamlines different interconnected processes.

CloudEagle does the following aspects of contract management:

• Centralized Storage: The platform keeps all your contracts and invoices in one secure location, preventing loss or misplacement in emails or personal drives.
• Metadata Extraction: It helps you extract essential metadata from contracts for easy access and organization, ensuring key information is readily available whenever needed.
• Renewal Notifications: You can receive timely notifications about contract renewals via email and Slack, providing insights and ample time to renegotiate or explore new options.
• Automated Workflows: You will never miss a contract renewal with CloudEagle's automated workflows. Initiating renewal processes 90 days in advance and assigning tasks to the right stakeholders ensures a seamless renewal process.
• Efficient Contract Management: CloudEagle streamlines contract management by centralizing contracts and invoices, eliminating the hassle of searching emails or shared folders.
• Information Extraction: It extracts vital contract details such as renewal dates, billing frequency, and auto-renewal status. CloudEagle's single-dashboard view makes it easy to track SaaS vendor information and manage contracts effectively.

CloudEagle streamlines procurement for businesses with:

• Cost Savings: Leverage data for informed decisions, benefit from pre-negotiated discounts, and reduce overall costs.
• Customizable Forms: Customize intake forms for precise requirements, optimizing negotiation and securing favorable deals.
• Time Efficiency: Automate SaaS buying tasks, streamline approval processes, and free up procurement teams for strategic work.
• Visibility: Real-time progress updates via Slack and Email ensure transparency, accountability, and accelerated procurement.
• Versatility: CloudEagle's workflows extend beyond SaaS, accommodating various product types for diverse procurement needs.
  

Learn from Terry Larock, Head of Procurement at Tipalti, about top software procurement practices. Hear about his successful experiences in SaaS procurement and gain insights into enhancing negotiation skills for professional success.

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Conclusion

Software procurement processes have become a strategic move for organizations. While numerous methods exist to optimize prices and streamline processes, all the systems are based on the fundamental strategies discussed in this article.

Implementing a software procurement solution has several benefits, such as eliminating manual process inefficiencies, analyzing spending habits for increased productivity, and improving internal and external communication.

Understanding and implementing the following eight software procurement best practices is essential for optimizing the efficiency and effectiveness of your procurement processes.

By adhering to these software procurement best practices, organizations can navigate the complexities of software procurement successfully and ensure long-term value, security, and alignment with business goals.

Many organizations have already streamlined SaaS procurement using CloudEagle's platform and services.

After using CloudEagle, Diego Coria, representing Nowports, expressed his sentiments.

Book a demo with CloudEagle and see how it can transform your software procurement process.

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