Five Tips For Startups Wanting To Improve Their Procurement Processes

From small operations to large-scale organizations, here are some ideas that you can make use of in your workplaces.

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While the COVID-19 pandemic created multi-layered hurdles for entrepreneurs and business startups over the past 12 months, it presented –and continues to offer– unique opportunities for innovation and learning.

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Only established as a group purchasing organization specializing in healthcare procurement last September, in the heart of regional and global lockdowns, the company I work for, Rafed, has relentlessly embraced and developed processes and practices to leverage the ever-changing landscape in which we operate.

By focusing on the provision of a centralized cost-effective solution for our partners and customers, we have built structures, and honed them daily over nine months, to deliver a cost saving of more than AED30 million to our leading partners.

And while we operate on a large scale for a startup, our processes and practices can be deployed by entities of all sizes, from small operations to large-scale organizations. Here are some ideas that you can make use of in your workplaces:

1. Small gesture, big impact It goes without saying that employees must remain at the heart of all considerations; maintaining positive morale is crucial in collective team success. And procurement is no different. A healthy working environment is vital in building efficient and productive teams. In our current environment, work from home (WFH) policies have significantly reduced face-to-face time, escalating the importance of effective remote working management. With barriers between office and home vastly redefined in the WFH scenario, periods of increased workloads may negatively impact personal lives, and maintaining morale is essential to keep teams’ heads in the game. Motivation in complex and subjective but small gestures count; sometimes, a simple thank you goes a long way.

2. Get personal with suppliers It’s not enough knowing a company’s catalogue; you need to get to grips with the people behind the product, and ensure they align with your ethos and vision. Misalignment will trickle down, and negate customer experience. Regular check-ins will build increased understanding and familiarity– it takes time to work efficiently, even with the right partners. Ask questions about their facilities and infrastructure, query any contingencies they have in place to adapt to changing flows of supplies- you must maintain a supply chain that supports your needs and objectives. Get personal to achieve it.

3. Know your market It is alarming how many companies claim to be experts in fields when their knowledge is regularly beyond basic. Specialists know specifics and boast deep knowledge of “nuts-and-bolts” operations and changing market conditions. The pandemic has underlined the vital importance of proactive supply chain management, and staying ahead of market trends to ensure a protected national stockpile of key products. I recommend startups explore opportunities to look local and work directly with manufacturers whenever they can; it is the simplest avenue to minimize supply chain complexity, streamline processes, and ensure flow.

4. Anticipate client needs While anticipating the unpredictable -in an era of unprecedented unpredictability– is no small feat, processes that build customer data collection will support long-term projections and supply, minimizing small-term reactions. Be agile to adapting conditions by establishing a supply chain which supports the needs of your customers, and is built to last. Data will fuel your ability to secure the best prices in the market and ensure procurement efficiency. Starting as you mean to go on will result in continued cost savings, enhance efficient procurement and distribution processes, and instill confidence to focus on the bigger picture- strategic business growth. Technology is an enabler, so commit to regular explorations of solutions and analyze functionalities that save time, collect data automatically, and streamline processes. Trial and select solutions based on need.

5. Streamline approvals One mistake new startups often make is implementing overly complex approval processes to control spend. Fiscal responsibility is a must but avoid unnecessarily convoluted processes; instead, strive to eradicate weaknesses and remove barriers before they exist. A good rule of thumb to avoid over-resourcing is for processes to involve as few people as possible.

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Theyab Al Mansoori

Written By

Theyab Al Mansoori is Supply Chain and Operations Executive Director at Rafed.

Rafed aims to ensure the availability and quality of healthcare supplies and products for Abu Dhabi’s healthcare sector, which include pharmaceuticals, equipment, diagnostics and consumables, and to reduce operating costs for healthcare providers.

As a Group Purchasing Organization, Rafed specializes primarily in healthcare procurement, which includes supplier sourcing and contract management, procurement ordering services, warehousing, and distribution.

Rafed was developed by Abu Dhabi Developmental Holding Company (ADQ), one of the region’s largest holding companies with a broad portfolio of major enterprises spanning key sectors of Abu Dhabi’s diversified economy.