B2B e-Commerce or e-Procurement is here to stay. Vendors and buyers alike who leverage the power of e-Procurement receive numerous benefits including, among others:
- The elimination of manual processing and B2B processing cycles
- Elimination of Dual-Data Entry (DDE)
- Improved data quality and movement, data mining, and real-time reporting
- Improved demand and supply forecasting
- Management of complex logistics operations
- Improved cash flow
- Better management of contracts
- Improved communications between business partners
Acknowledging that B2B e-Procurement is the wave of today’s procurement practices, I’d like to revisit a topic mentioned in an earlier blog, the Patronizing Partnership, the best way to leverage B2B e-Procurement. The ideal relationship between vendor and buyer is a partnership that is mutually beneficial. In this kind of a relationship, both parties work to ensure that each financially benefits; the vendor makes money and the buyer saves money. In a Patronizing Partnership, buyers and vendors tie their procurement goals together based on economic outcome, coordination improvement, and process collaboration. These goals have energized the B2B eProcurement wave.
A key component of B2B eProcurement is information sharing in which both buyers and vendors alike can readily share information about the entire transaction process from the time the PO is created on line, the order is approved, placed, received, and acknowledged to the time when the item is shipped, received, invoiced, entered into the GL, and paid. During this process, feedback about product quality, contract consistency, and delivery, among others go both ways. In the book, The One-Minute Manager, Ken Blanchard writes that feedback is the breakfast of champions. By sharing information, vendors improve customer service and both parties improve the quality of their relationship and cooperation. Both are winners. Information sharing also champions a high level of trust and performance expectations, because it makes the entire procurement process transparent.
Leveraging the power of information sharing through B2B e-Commerce, vendors and buyers are able effectively to create and strengthen a Patronizing Partnership which is financially mutually beneficial.
How has B2B e-Commerce benefitted your company?