Approval engine: a more streamlined purchasing process

What is an approval engine?

When it comes to software procurement, an approval engine will automatically route a software request to the appropriate decision maker, whether that be the CFO for budget approval, the legal team for a review of the contract, or the IT department for technical and compliance checks.

This process is based on predefined rules and workflows, and ultimately determines who needs to be authorizing a request, and when.

Not only does this simplify the procurement process, eliminating the need for manual intervention – not to mention the delays that often come with it – but it can also be customized depending on:

• The value of the purchase
• The department requesting it
• The type of software – the level of security approval required for a new CRM platform that handles vast amounts of personal data may be different than the approvals needed for a design tool, for example.

How does a software approval engine work?

Once a request to purchase a new tool has been submitted by an employee, the approval engine will automatically route the request to the required stakeholders.

This request may initially be routed to the head of department to confirm the tool is actually required, followed by the finance team to sign off on the cost, before finally requiring approvals by IT, legal or security. At each stage, the necessary stakeholder will be notified to review and either approve or reject the request.

Should a request be rejected, it will go back to the employee that initially requested it, where they may be required to amend the request or provide additional information. If it is approved, the request will progress to the next stage of approvals.

Another way the approval engine works to streamline the procurement process is by mitigating the impact of delays. In the first instance, a reminder will automatically be sent to the necessary person, prompting them to take the required action. Software approval engines can also be set up to give someone else permission to approve a request in the event that the original approver is unavailable, meaning the request may be escalated after a specified amount of time.

See how you can streamline your procurement with Vertice’s easy-to-build customized workflows.

Advantages of using an approval engine in software procurement

With procurement teams under increasing pressure, perhaps the biggest advantage of using an approval engine to automate the software procurement process is the time-savings it inevitably delivers. But it’s not the only advantage. Below, we’ve outlined some of the additional benefits:

• Greater efficiency and faster time to implementation – Not only do procurement teams benefit from a faster and more streamlined procurement process, the end-users themselves also gain access to the tools they need more quickly.
• ‍Ability to scale – As an organization scales, so does the volume and complexity of its software procurement requests. While manual approaches may be possible for companies handling a relatively small number of tools, it becomes virtually impossible to manage – at least without error – as a company increases its headcount and subsequently tech stack. An automation engine can support this growth by expediting decision-making and eliminating human error.
• ‍Full transparency – The larger the company, the greater the need for transparency within the procurement process. As the number of software requests increases, it’s crucial that organizations have visibility into who made the decision at each stage of the process, when the decision was made, and the reasoning. This audit trail not only provides real-time tracking to identify delays or other bottlenecks within the organization, but it also ensures that all procurement decisions are properly documented, making it easier for companies to demonstrate compliance during audits or investigations.
• ‍Improved compliance – The issue with manual intervention is that human error is almost inevitable. Especially as procurement needs grow. By automating the purchase approval process, companies also benefit from improved compliance, which in turn reduces the risk of errors and even fraud.
• ‍Streamlined communication – By providing automated notifications and updates to the necessary employees, approval engines ensure that everyone is informed – and subsequently aligned – on the status of all procurement requests. This in turn improves communication between procurement teams, department leads and other internal stakeholders.
• ‍Better cost control – With software prices increasing by an average of 8.7% each year and as many as 89% of contracts containing auto-renewal clauses, it’s never been more crucial to keep on top of your software spend. Approval engines can help facilitate this by not only preventing unnecessary or unauthorized purchases from being approved, but they can also require multiple levels of approval for higher-value tools.

Accelerate your procurement process with Vertice

With Vertice’s SaaS purchasing platform and Intelligent Workflows tool, you can streamline your software procurement process, saving your team more than 400 hours a year.

To learn how exactly our automated approval workflows can simplify your procurement efforts, take a self-guided tour of our platform here. Alternatively, see for yourself how one IT consulting company halved its SaaS procurement time with Vertice.