No matter the industry, the foundational elements of the procurement process are very similar. In strategic sourcing, there are three basic steps that must be undertaken for any project. In the research step, the current state of the organization and supply industry is assessed. Next is to evaluate, in which the ideal future state is determined and suppliers are evaluated based on their ability to deliver against these goals. Lastly, the structure phase is when the action plan to achieve the “to-be” state and the supply relationships are finalized.
Despite the comfort of this process, the pandemic challenged procurement in many unseen ways, producing new kinds of working. By implementing best practices gleaned from top organizations, procurement can weather any storm.
R&D Procurement Best Practices
Procurement automation. The procurement process is marked by many routine, time-intensive tasks prone to errors and bottlenecks. By automating the procure-to-pay (P2P) process as much as possible, errors can be reduced and procurement can be freed to focus more on strategy. Automation also makes it easier to pivot from on-site to remote work.
Procurement digitalization. Procurement has evolved from paper and pencil to e-procurement (the purchase and sales of supplies, equipment, or services through a web interface or other networked system with limited supplier management) to digital procurement (which includes additional analytics, automation, and data-driven optimization). Implementing a P2P or source-to-pay (S2P) platform improves process transparency, spend visibility, cost reduction, contract management and compliance, and reduces long-tail spend.
Supply chain risk reduction. The pandemic showed how crucial it is for life sciences organizations to be able to quickly address back-order issues, increased lead times, and qualification of new suppliers. By forecasting demand, ordering in bulk instead of just-in-time, and keeping multiple, qualified suppliers in play, supply chain risk can be reduced.
Help the lab reduce time to market. R&D procurement is uniquely suited to help the lab spend more time on the bench, resulting in faster time to market for new products. Scientists spend 4 - 8 hours per week searching website by website for their lab supplies. This does not include time spent by the lab manager and/or procurement on the purchase order, order tracking, and payment processes. Through procurement automation and digitalization, sourcing can help lab managers significantly reduce the amount of time spent obtaining supplies. Further, by enhancing a P2P / S2P platform with an eCommerce marketplace such as ZAGENO, the ordering process can be as Amazon-like as possible, offering cart-building from over 30+ million SKUs across 5K+ suppliers streamlined into one monthly invoice. By helping scientists instantly access in-stock, vetted products from qualified suppliers, procurement can help reduce the product life cycle in uncertain times.
Supplier diversity. Procurement can aid the organization by providing them access to diverse suppliers such as small-business enterprises (SBEs), minority-owned enterprises (MBEs), woman-owned enterprises (WBEs), as well as businesses owned by LGBQT, veterans, and those with disabilities. Not only are diversity, equity and inclusion (DEI) practices morally and ethically the right thing to do, infusing the vendor base with diversity helps fuel innovation and creativity in the supply chain.
In these uncertain times, R&D, life sciences, and biopharma organizations must rely on procurement more than ever to stay agile, flexible, and ready to meet new challenges on the quest to achieve those eureka moments that help the world.