7 essential steps to modernize your procurement process

Key takeaways: 

• Procurement must be positioned as a strategic partner for success
• Align procurement with finance
• Develop procurement as an art, not a science
• Understand business needs before building procurement processes
• Collaborate with finance from day one
• Use technology to automate and streamline high-volume processes
• Tackle SaaS and cloud costs with a value-driven approach 

Welcome to The Efficiency Code, your guide to unlocking peak performance in finance and procurement. In this series, we decode the strategies of top industry leaders who are redefining efficiency and optimization. From embracing technology to effective spend management, discover how to achieve more with less. Join us as we crack the code to sustainable growth.

In this episode, we welcome Adam Smith, Senior Director of Procurement at NetEase, who shares his insights on evolving procurement from a transactional role into a strategic powerhouse.

With over 15 years of experience working with top companies like Microsoft, Zillow, and now NetEase, Adam offers valuable perspectives on driving efficiency, achieving sustainable growth, and the future of procurement in a fast-paced, tech-driven world.

In this episode, Adam shares practical insights on transforming procurement from a basic purchasing function into a valuable business partner. We discuss everything from managing software costs to building effective partnerships across departments.

Read on (or watch the video above) for Adam’s insights and action tips for procurement and finance leaders. 

Procurement must be positioned as a strategic partner for success

Rather than simply focusing on cost reduction, procurement teams should work closely with other departments to support their objectives. Regular communication with finance, legal, and operations helps ensure procurement strategies align with company goals.

Take Action: Schedule quarterly meetings with department heads to understand their priorities and challenges. This helps procurement anticipate needs and provide timely support.

Align procurement with finance

When procurement activities are spread across different departments, it becomes difficult to track spending effectively. Bringing procurement under finance creates better oversight and improves planning.

Take Action: Build a case for integration with finance by showing how it can improve spending visibility and budget forecasting.

Develop procurement as an art, not a science

While processes are important, successful procurement requires adaptability and creative problem-solving, especially in negotiations.

Take Action: Host negotiation workshops for your team that focus on creative deal structuring. Encourage procurement professionals to think beyond cost savings and look for value-add opportunities like better terms or enhanced services from suppliers.

‍Understand business needs before building procurement processes

Before creating new procurement processes, take time to understand what different teams actually need. This ensures your solutions address real challenges.

Take Action: Meet with each department to learn about their specific challenges and priorities. Use these insights to shape your procurement strategy.

‍Collaborate with finance from day one

Include finance early in procurement discussions, especially during budget planning. This alignment helps ensure spending decisions support company financial goals.

Take Action: Create shared goals between procurement and finance teams, focusing on areas like cost management and accurate forecasting.

‍Use technology to automate and streamline high-volume processes

Use automation tools to handle routine tasks like purchase orders and invoicing. This gives your team more time to focus on important work like building supplier relationships.

Take Action: Choose one repetitive process to automate first. Track the time saved to demonstrate the value of automation.

‍Tackle SaaS and cloud costs with a value-driven approach 

With rising software and cloud service expenses, focus on understanding the value these tools provide rather than just trying to reduce costs.

Take Action: Review your current software subscriptions to identify overlap or unused licenses. Use this information to make informed decisions about your technology spending. 

‍Final thoughts 

Modern procurement is about more than just saving money—it's about helping your organization grow efficiently. By following these steps and using available technology wisely, procurement teams can deliver real value to their organizations.

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