Sachin Sharma, founder of ProCare Desk, walks through how to modernize procurement for growing companies. Move past email requests and spreadsheets. Use PO automation, budget matching, and three-way invoice matching integrated with accounting systems.
Most growing companies fail once or twice to kind of build a procurement process within their company. And if you're responsible for building a procurement process or setting up a procurement team, this video is for you. Because I'll share my learnings over a period of years in terms of what a outdated process looks like, what a modern approach looks like, and what tool sets you need to enable the purchasing within the organization. So whether you are a controller of a growing company, you're a CFO of growing company, or procurement team lead of a growing company, this video is for you. Because in this video I'll kind of break down these three things. If you're joining me for the first time, welcome. My name is Sachin. I'm the founder of ProCare Desk where we help growing companies control spending as well as have better cash flow visibility. So what is an outdated procurement process looks like? Right? Three things. Number one is you're probably doing everything via emails. The requests are moving in a manual process, right? So whether Slack, text, email, name it, but there's no system for you to kind of do that. So things get lost in ether when things doesn't get approved on time and so on. Number two is probably using spreadsheets for tracking your purchase orders. So what you're buying, what invoices you're receiving and so on. Problem with spreadsheets is it gets outdated pretty quickly and you can't scale them. You're just probably one error away where somebody messes up the whole sheet and the data is unusable. Right. Number three is manual matching. So having an invoice either routed for approval or matching the invoice with the purchase order manually. Your AP team or procurement team is spending hours doing that. That is what an outdated process looks like. So before we get into tools and all, I just want to talk about what a modern approach looks like, how you should approach building a procurement process within your organization. So let's talk about couple of things here. Number one is you want to focus on having visibility and not enforcement. Yeah, it sounds weird, but let me talk about that. What I mean, so when you build a process for enforcement, you're looking at, hey, who can approve what, how many times, how many approvals do we really need before people can buy something? And all the visibility, focus more on how do we make sure people know what's in their budget, what they can or cannot buy and shift the accountability of purchasing to them. Right? Treat them like adults. That's kind of what visibility means. Having a proactive process, having more visibility into what they have spent and what their budget is. That's number one. Number two is setting up approvals that match the needs of your business. A lot of times what happens is companies just follow best practices. Oh, we gotta have two approvals for every purchase. Like does your business run that way? Like for example, if you are in construction, your people are in the field, they need approvals pretty quickly, otherwise things slows down. You are actually, you know, and you're not counting on the loss of productivity if the crew is sitting there just waiting for materials. So you have to look at a process that suits the needs of your business when it comes to purchase approvals. Number three is you gotta have a process that talks to your accounting system. You want to avoid any sort of manual data entry or double data entry. A lot of times we see you have an invoice process, you have a PO process which is outside your accounting system. And once all that is done, you got to go then put the data back into your accounting system. Right. As an example. So those are, I would say approach wise is how I would approach it. Now what tools I would use to automate my process, right? So number one is I would have a PO automation tool. So I don't want my team to go and use spreadsheets, emails and so on. Put a system, whatever that is, that allows them to put in a request for what they need to purchase and automate as much as you can. So there's no manual intervention to send the PO to the vendor or things like that. Number two is I will do automated matching with the budget. So I'll make sure that the system talks to the budget that we have in place so that we can check in real time do we have the money before we actually think the purchase. And it avoids a lot of problems, right? Budget overruns being one of them. But having or avoiding those awkward conversations at the end of the month and say, geez, we overspent again. Right? So that's number two. And number three is I will set up a three way match process that is automated. I don't want my team to spend time on taking an invoice, manually matching with the po, manually matching with the receipt. I will set up a system that automatically matches that for me and only alerts me when there is an exception or something that needs to be done on that invoice. Otherwise everything should flow seamlessly and into my accounting system. Right. So if you are building a procurement department in, you know, 2025, 2026, this is what I would do. I would focus on visibility, not enforcement. I'll make sure my approvals are simple. I'll make sure that I have a system that talks to my accounting system so that it avoids any double data entry. If you are looking to improve your procurement process, click on the link below and one of our product specialists can walk you through how a modern procurement system can help you modernize your procurement process. Thanks for join me today and I'll see you in the next video.
