Risk can be an inherent part of doing business, but it doesn’t have to be inevitable. There are several things you can do to reduce business risks in 2020. Before you make another purchasing decision, consider these five tips to help you reduce your business risk this year.
Perform a Proper Needs Analysis
Step one is to benchmark the current performance of the department or company to identify the needs and goals to develop the right procurement strategy. A purchasing department will collect various data to determine the overall needs. It may include the current resources and costs for the company. You may also look at the growth projections. In terms of hiring or working with an MSP or VMS, you’ll want to evaluate the strategy for hiring and projects.
Improve Supply Chain Management
Supply chain can mean a lot of things. For many procurement officers, this is about services as well as products. So while you can’t take a literal inventory of the services you need, you can assess where they come from and how effective they are when instituted in your business. Most importantly, you need a sound system to ensure that everything is where it needs to be when it needs to be there.
Create an Efficient Contract Process
In many cases, procurement is all about the effectiveness of the contracts in place. Ensuring that your suppliers provide precisely the products and services they promised comes down to contract management. Making the process efficient from the start will help you track important information at various goalposts along the way. It can help to partner with a VMS to help you organize this process.
Be Aware of Potential Fraud
Procurement, whether it’s for goods or services, sees a lot of company money flow through its processes. Because of that, the procurement department needs to assess every transaction to watch for potential red flags carefully. Purchasing fraud can look like a lot of things, from embezzlement to overpricing goods. Kickbacks are another common area where purchasing departments discover fraud. Fake companies, fraudulent invoking, or even bid–rigging are all examples of fraud that affect procurement.
Form Relationships with the Right Partners
One of the ways to mitigate risk, from efficient contracts to avoiding fraud, is to establish business relationships with the right partners. For example, working with a vendor management system can help you track suppliers and ensure that everyone is meeting the same criteria for working with your company. A managed service provider can handle various aspects of projects. And an RPO can take on the back–office processes of hiring new talent.
About Anserteam Workforce Solutions
Anserteam Workforce Solutions represents North America’s very best staffing agencies aligned together to deliver world-class workforce management solutions. We offer end-to-end talent services that can be customized for any size business, utilizing our Managed Services Provider (MSP) model and Vendor Management Solutions (VMS) technology. Is your organization seeking a WBENC-certified diversity partner to provide measurable results and substantial cost savings? Contact us today.