8 Reasons why your organization needs procurement-as-a-service

Although often used interchangeably with “purchasing”, procurement-as-a-service (PAAS) extends far beyond purchasing in the business landscape. Whereas purchasing involves the process of paying for goods or services after these have been selected, PAAS takes this to a whole new level. 

Put simply, it all starts out with intelligence gathering to identify bottlenecks and potential for cost reduction. This is followed by pinpointing relevant suppliers who could be selected to perform a third-party business function. Then, a supplier is chosen and their solutions are implemented whilst monitoring and evaluating the results. 

PAAS as an industry is growing rapidly and is currently valued at around $6.3 billion. This figure is expected to more than double over the next 10 years and is worth considering seriously if you want to streamline your business operations. 

To find out what elements PAAS consists of, why you should implement it at your business, and who you can turn to for your PAAS needs, keep reading below.

Key elements of the procurement-as-a-service model

The PAAS model is complex and involves several “layers” or “elements” to ensure it is implemented in organizations effectively. Whether you’d like to boost customer satisfaction, reduce administrative bottlenecks, eliminate or reduce certain costs that put a strain on your bottom line, or you’re simply looking to improve overall business performance, PAAS is worth considering. Here are the key components that it consists of:

  • Service layer: the service layer of PAAS looks at a business’ service provision standards and processes. The operating models, if you will. It also takes into account the talent or people who implement these processes as well as the levels of automation that may currently exist, which are backed by industry-specific expertise. 

 

  • Technology layer: this layer focuses on current technology and supporting technological infrastructure to determine where processes and even talent development can be streamlined further through automation and the implementation of different platforms. 

 

  • Intelligence and analytics: intelligence and analytics are another core component of PAAS because without evaluating the success or performance of a given business strategy that’s designed to lead to improvements in various areas of business, it would not be possible to identify opportunities, trends, and areas for improvement. 

 

  • Compliance and risk management: all business organizations operate within specific and mandatory regulatory frameworks, which they must abide by. But compliance is only one side of the coin. Risk management or mitigation must also be analyzed effectively to minimize it as far as possible and to prevent it from escalating. 

 

8 Reasons why your organization needs procurement-as-a-service

Now that you know what the core components of PAAS are, it’s also worth exploring why you would wish to implement it in your organization. Here are eight reasons you should seriously consider when making this decision.

  • Agility

Agility is the opposite of being static, stuck, cornered, or even stagnant. It involves the ability to move, flow, and adapt to the changing tides and times so that your business is not only buoyant but also to ensure that it far outsails the competition. As such, by implementing PAAS or using PAAS services at your organization, your capacity for agility will get an instant boost.

  • Cost reduction

Apart from agility, there is also the highly important consideration of cost reduction. No business wants to lose revenue when this can be prevented. However, operationally speaking, it’s not always easy to identify bottlenecks and leakages from within. Often, an external expert and analytical perspective are required and this is where PAAS comes in once again. 

  • Boost service stack

Organizations that offer services and which also implement effective PAAS solutions can also boost their ability to offer a more diversified service stack. What does this mean? It means that more complementary services can be offered to your clientele, which can help keep customers from seeking solutions elsewhere as your business will provide one platform which a range of services can be sourced from.

  • New products and expertise on demand

Meanwhile, organizations that offer tangible products for sale can boost their production and operations processes to streamline operations and once again reduce costs through the implementation of PAAS. Through such streamlining, businesses are better able to offer expertise as and when a customer needs it, thus offering much greater levels of value.

  • Strategic sourcing

Sourcing materials or even solutions to more streamlined operations is not an easy task. It’s important to consider customer demand and preferences (e.g. eco-friendly materials or eco-friendly manufacturing processes) in the entire value chain of your business operations. Hence, sourcing is increasingly becoming more strategic and is a crucial benefit of implementing PAAS as one of its core functions.

  • Analytics and category insights

Outsourcing your business needs to a PAAS service provider also means that organizations will be better positioned to have actionable insights and valuable data on which to base their current and future decision-making. PAAS is a highly valuable analytics process as well that drives decisions and better responses to market changes and trends.

  • Integration of delivery, technology, and talent

Overall, PAAS integrates delivery, technology, and talent to provide a complete and holistic solution to your business needs. If one of these factors was removed, there would be a disbalance or disharmony in the system. Consequently, focusing on all three areas simultaneously means greater output at a lower cost with improved business outcomes.

  • Value delivery

Finally, PAAS is highly capable and strategically positioned to boost an organization’s value delivery. Much growth has been observed in terms of customer satisfaction after PAAS strategies have been implemented and this leads to repeat business that is good for the bottom line. 

What can you expect from StorsenDigital’s PAAS offering?

At StorsenDigital, we believe in giving each of our clients the highest value possible for their needs. We ensure that we provide specialized PAAS services and activities for various departments in your organization. These can range from IT, administration, professional services, facilities, and more. So, how do we do this? 

Our process is highly detailed and created to give you optimal results. We begin with market research and analyses. We then spot potential suppliers and engage in negotiations with them. After this, framework agreements are created. We also create an approved list of vendors and cooperate with your sales and production departments. Technology-wise, we perform standardized tasks in SAP HANA, RFP, and RFQ. 

But there’s more! We also request proposals and evaluate quotations; develop and manage contracts; obtain invoice approvals and fulfill payment terms; establish good relationships with suppliers, and a whole lot more.

If you’re unsure of where to start, then your next step should be to get in touch with us. We’re just a click away and ready to help take your business far ahead of the competition by streamlining your business operations so that you get maximum output that positively affects your bottom line. 

Published On: December 14, 2022
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