When departments place orders outside the system, exactly what is actually supposed to be protected is lost, namely transparency and compliance. The solution lies not in more approvals, but in better structures.
In many companies, procurement is still viewed as a balancing act between two seemingly contradictory goals. On the one hand, there is the desire for speed. Departments want to order quickly, projects must meet deadlines and operational teams need materials or services without long waiting times. On the other hand, there is the right to control. Compliance requirements, approval processes and supplier checks should ensure that procurement is transparent and compliant with regulations.
These two goals are often seen as opposites. The faster a process becomes, the greater the risk of loss of control appears. And the more processes are controlled, the slower they become. In reality, however, this conflict usually does not arise as a result of speed itself, but as a result of poorly designed processes.
Many purchasing organizations have built up structures over the years that are primarily designed to minimize risks. Several approvals, detailed tests and extensive documentation ensure that procurements remain traceable. These mechanisms perform an important function. At the same time, they often significantly extend the time between demand and order.
This creates an area of tension for specialist areas. Projects are under time pressure and require quick decisions. However, when procurement processes require multiple coordination loops and administrative steps, purchasing quickly acts as a brake factor. As a result, teams search for their own solutions, contact suppliers directly or organize procurement outside of established processes.
Ironically, this very attempt to increase speed often results in less control. Orders are created outside the planned structures, transparency is lost and compliance rules are becoming more difficult to enforce.
Most delays in purchasing are not caused by actual procurement. They are caused by the complexity of the ordering processes. Suppliers must be searched for, offers are obtained and compared, internal reconciliations take place and new creditors are created in the system.
This results in a disproportionate amount of effort, especially when it comes to indirect demands and one-off purchases. A small order can require several days of coordination and administrative work, even though the actual procurement value is manageable.
The problem is therefore less in control itself, but in the way control is organized. If processes contain many individual steps and responsibilities are unclearly distributed, the time until the order is placed is automatically extended.
Companies that specifically redesign procurement processes show that speed and control do not have to be a contradiction. A clear structuring of processes is crucial here.
Standardised procurement can be greatly simplified, while complex or strategic procurements continue to be reviewed more intensively. At the same time, clear transparency about requirements and suppliers helps to make decisions faster without sacrificing compliance.
Another important lever lies in reducing operational complexity. When fewer suppliers need to be managed and administrative steps are simplified, the time between demand and order is automatically reduced.
Many organizations are beginning to holistically analyze their procurement processes. This shows where waiting times arise and which steps are actually necessary.
A common approach is to treat one-time purchases and rare needs differently than strategic purchasing projects. Especially with these smaller purchases, creating new suppliers and fully implementing a classic purchasing process often causes more effort than benefit.
This is where models come in that reduce administrative complexity and at the same time create clear structures. One example of this is the 1-creditor model. Companies create a central creditor in the system and can process various one-off or indirect purchases through this one supplier.
Pedlar follows exactly this approach. Companies integrate Pedlar into their system as a creditor and can then process many unstructured procurements via this central point of contact. In the background, Pedlar takes over operational procurement with the respective suppliers and organizes orders and reconciliations.
For the company, the process remains significantly leaner. At the same time, procurement remains completely visible and comprehensible within the existing system. Control and compliance are maintained, while operational processing is significantly faster.
The idea that speed automatically leads to less control is often based on the assumption that processes only become more secure through additional testing. In practice, however, it has been shown that well-designed structures are often both faster and more controlled.
When procurement processes are clearly organized, responsibilities are clearly distributed and operational complexity is reduced, an environment is created in which orders can be triggered more quickly and remain more transparent at the same time.
For purchasing organizations, this means an important change of perspective. Speed and control are not mutually exclusive. Rather, they are two results of a well-structured procurement process.
Would you like to know how the single-supplier model can also work in your company? Arrange a conversation now!
