There are a variety of reasons why a company may make an acquisition. If a company is growing quickly, one of the most compelling reasons to make an acquisition is it can accelerate growth. Whether it’s talent or innovations, an acquisition in this type of scenario can shorten the amount of time it takes to hit the next milestone.
Although that scenario makes acquisitions sound very appealing, it’s important to understand that they’re by no means a guarantee of success. In fact, the majority of acquisitions fail. That truth spans from the smallest of businesses to huge corporations. So even though acquisitions offer so much potential, why is it rare for them to be truly successful?
The issue of acquisition failures comes down to a few issues. Those issues include incorrectly identifying targets, taking the wrong approach to financing and not properly integrating an acquisition. Since there are some very real challenges that stand in the way of making an acquisition successful, we want to cover the four most important elements entrepreneurs need to evaluate to get the results they actually desire from an acquisition:
The Right Timing
Many people underestimate just how big of a role timing plays in whether or not a startup is successful. Timing is just as important for acquisitions. A business needs to be at the right stage for an acquisition to work. One of the biggest mistakes a company can make is doing an acquisition because they think it will fix their weaknesses. If a business isn’t currently in a position of stability, they shouldn’t be thinking about an acquisition.
One of the reasons entrepreneurs should always think big is there’s a lot of risk involved in bringing a vision to life. As a result, there needs to be a very big upside. This same principle applies directly to acquisitions. Bringing two businesses together will need to create significantly more value (and definitely not less).
Opportunity to Negotiate
It’s important for an acquisition to be a good deal. That’s why there needs to be room for negotiation. Not only is negotiation important on the financial side of things, but if a company that’s being looked at for an acquisition isn’t willing to do any negotiating, chances are they’re going to drag down the entire acquisition process.
A Clear Way to Integrate
Even if the first three elements are in place, it’s still vital to have a clear way to integrate the acquisition. Without a clear vision for integration, an acquisition is almost guaranteed to fall short of expectations.
While there’s still no way to guarantee that an acquisition will be successful, focusing on these four elements is the best way for an entrepreneur to make an acquisition work as expected.
Anyone who has come into contact with spend analytics knows they can provide clear information on spending activity. While that can be useful, the reason companies should care about these types of analytics is the information they can offer goes beyond just spending. Specifically, it can help a company increase productivity. It can also boost savings by making it possible to streamline existing purchase-to-pay practices.
How exactly can spend analytics help your business increase savings and streamline its practices? The answer is by identifying some specific areas that can be improved, which are:
Contracts are crucial for enterprises. Without them, there wouldn’t be a way to cement the relationships that enterprises have with their suppliers. Given that suppliers are the source of goods and services that enterprises require to remain functional, it’s easy to understand why contracts are something that need to be taken seriously. Although contracts serve a very important function for enterprises, that doesn’t mean they’re always handled properly.
In recent years, purchasing departments have begun to play a more significant role within many organizations. A big driver of this shift has been the realization by companies of all sizes that purchasing can actually provide a competitive advantage. As a result of this increased significance, it’s important for companies to understand how to properly measure purchasing performance.
E-procurement can provide numerous operational benefits to hotels that make the transition to this type of system. To help demonstrate exactly why automating inventory and procurement should be a top priority for hotels as 2015 winds down and 2016 gets nearer, we want to highlight the most significant benefits:
Although the summer is already behind us, there’s still a good amount of time left in 2015. If you want to make most of the remaining months of this year, one thing to focus on is becoming the best purchasing manager possible. Because this is a role that continues to receive more attention and responsibility, you may already be feeling a substantial amount of pressure.
While there are times when pressure becomes too much, it’s something that can also be very motivating. If the amount of pressure you’re experiencing is motivating you to become the best purchasing manager you can be, we have a handful of tips that can help you work towards that goal.
Keep Things in Perspective
Even though it may sound like New Age advice, keeping the various professional obstacles you encounter in perspective can truly help your performance. Staying focused on what matters the most and finding small but meaningful ways to improve will add up to a significant change.
Stay on Top of Changes
Technology means that changes and developments across industries are moving faster than ever before. As a result, purchasing managers can benefit from carving out time each week to keep up with new issues and trends. Consistently doing this will give you a strong, strategic understanding of where your company is moving.
Make Diverse Interactions a Priority
Just as staying on top of what’s changing can be very beneficial, getting different inputs on what people truly want from procurement can help you focus your attention on the right tasks. That’s why it’s worth making a concerted effort to regularly speak with a diverse spectrum of professionals both inside and outside of the company.
Use the Best Tools Possible
If you put the three items we covered above into action, you will see a boost in your performance as a purchasing manager. But if you want to perform at your absolute best, there is one more key step that you need to take. That step is to take advantage of everything that quality purchasing software has to offer.
The reason that purchase order software can revolutionize your performance as a purchasing manager is it provides all the functionality that’s needed to supercharge procurement. Specifically, you’ll be able to easily automate any purchasing process that you want. This in turn will help eliminate the need for paper.
Instead of feeling basically helpless in regards to budget thresholds, using software means that you will have the ability to enforce approvals and put an end to maverick spending. All of this streamlining and enforcement will save you a ton of time every single week.
What’s even better is you can reap all the benefits of this type of software without needing IT support. And to top things off, you’ll be able to leverage vendor pricing through the use of historical data. The ability of our software to help purchasing managers be the best at what they do is why over 1,000 professionals like you have given it a top usability rating.
In general, the sales cycle for B2B offerings is significantly longer than it is for B2C. From initial contact through pitches to negotiations, there’s a lot that has to get done in order for a deal to close. Because there are already so many potential roadblocks in place, it’s important for a company to provide as much support as possible to their salespeople.
By providing all the support that’s needed, companies can ensure that they’re not causing any inefficiencies that make things even more challenging for their salespeople. While salespeople will still have to contend with challenges like making it clear why a specific offering is superior to that of a competitor, not having internal hurdles to overcome can provide a significant boost.
To ensure that there aren’t walls between sales and management which are hindering the ability of the former to make deals, let’s take a look at three ways workflow automation can be successfully used:
Provide Smart Deals
One of the reasons that it’s typical for B2B sales to take longer is because price is something that’s almost always negotiable. From more complex packages to higher volumes, buyers want to be sure that they’re getting the best deal for their money. Since a lot of back and forth is already going to accompany this process, companies don’t want to create even more of it for their salespeople.
Instead, eliminating the need for drawn out internal discussions can give salespeople the flexibility to push for a sale and successfully close. With an automated approval workflow, salespeople can have the confidence to strategically discount without worrying about offering something that is going to make their manager unhappy.
Process Special Requests
Price isn’t the only element of B2B negotiations that often requires approval. There are a wide range of things that may come up which will require a salesperson to seek approval from their manager. If you want to ensure that getting special requests approved doesn’t stand in the way of a deal, an automated workflow is essential.
Dynamic Management of Inventory
One big consideration for B2B buyers is how quickly a solution can be delivered. If two offerings share many of the same features but one provider is able to deliver significantly faster than the other, the buyer is probably going to err on the side of speed. Utilizing automation in regards to inventory can help a business be as aggressive as possible with their delivery timelines.
It’s worth noting that the type of automation discussed above can benefit a business in other ways as well. For example, purchasing managers can use purchasing software to streamline their purchasing process and increase the overall efficiency of everything related to procurement.
The hotel industry has gone through some major changes in recent years. Not only has it had to adapt to the Internet, but it has also had to find ways to stay competitive in an environment with increasing pressure from sources other than traditional hotels.
Even though the changing landscape has presented very real challenges for hotels across the entire industry, the ones that have continued to thrive share some key characteristics. Specifically, the hotels that keep making progress are those that have embraced what technology can do for them.
Although it would be easy to only view technology in a negative light as a result of the additional competition it has created, savvy hotels have taken a different approach. Instead of trying to resist the major ripples created by technology, they’ve found the best ways to harness the technology that’s available.
Technology Can Play a Key Role in Procurement Growth and Efficiency
Since technology is having a major impact across most industries, those in procurement should take a cue from the hotel industry and take advantage of what’s available. Specifically, purchasing managers can gain a lot from using purchase order software. With help from purchasing software, procurement professionals will no longer need to stress over things like enforcing budget thresholds.
Instead, they’ll have the tools that are needed to make this process a breeze. The reality is that’s just one of numerous examples of the way that the right software can help optimize procurement activities. While this type of software is very powerful, what makes it especially compelling is that it can be used without the need for IT support. And to top things off, the cloud functionality of purchasing software means that data is easy to access, completely secure and backed up at all times.
An Important Takeaway for Salespeople and Customer Service
This isn’t an issue that’s only relevant to procurement. It’s also a topic that salespeople and customer service can learn from. For salespeople, the lesson is to keep an eye out for ways to make the lives of prospects easier. By actively looking for solutions instead of just trying to sell a product, salespeople can frame their offerings in a manner that is much more compelling to purchasing managers and other professionals within an organization.
The lesson for customer service is similar to that of salespeople. When someone calls a customer service representative, it’s generally because they have a problem that needs to be solved. Customer service professionals can get a leg up by always having their eyes open for the most efficient way to tackle problems. By being open to even better ways of doing things, members of the customer service team can make things easier for themselves and others.
Contact us today to learn more about how Bellwether Purchasing Software can assist your company in automating your purchasing processes. We offer a Free Live Demo and Free 30 Day Trial, no credit card needed.
The simple answer to the question posed by the title of this post is very important. The more detailed answer is it’s one of four main areas of a business that can help drive growth. To fully understand the role that procurement can play in growth, we’re going to start by looking at the other three areas, and then dive into exactly what can be done within procurement to help a business grow.
Because operations generally make up a significant portion of a business, there are lots of areas for improvement. It’s common for various gaps and inefficiencies to come up as a business expands. By first identifying those shortcomings and then finding ways to eliminate them, the operations of a business can be streamlined in a way that will put it in the right position to grow.
Create a Sales System
When a business is just getting off the ground, it’s standard for the sales team to rely on best practices. While taking that approach can secure some early wins, really nailing down sales is often a process of trial and error. The need for trying different things is why many businesses keep a fairly loose sales process. Although that can work for awhile, it eventually leads to a bottleneck.
In order to move past that bottleneck, it’s important for businesses to take what they’ve learned about effective sales and put an actual system in place. Taking the time to put this kind of system in place will not only benefit the existing sales team, but it will also support growth by making it easy to bring on new sales talent in the most efficient way possible.
Focus and Scale Marketing
In most cases, marketing follows a similar path to sales. After a period of figuring out what works, marketing is usually able to hit its stride. But in order to really drive growth, marketing needs to take its efforts to the next level by mapping out what’s going to be done over the next year. By thinking in terms of quarters instead of weekly or monthly campaigns, marketing can reach the point where it’s able to drive significant growth.
Simplify and Empower Purchasing
Now that we’ve covered the other three areas of a business that can drive growth, we want to take a look at how procurement can do so as well. When done in the most efficient way possible, procurement can help a business maintain an optimal budget. To make this happen, purchasing managers need the right tools. By taking advantage of cloud purchasing software, purchasing managers can ensure that everything from streamlining purchasing process to enforcing budget thresholds is within their control.
One of the reasons that procurement has moved into the corporate spotlight in recent years is because more organizations are realizing the direct impact it can have on profitability. Thanks to that direct impact, companies are putting a lot of focus on ensuring that the fundamentals of procurement are being handled in the best way possible. Although it’s frustrating for a company to learn that suboptimal procurement practices have been costing them money for an extended period of time, the upside is that once these issues are addressed, a business can get on the right track and stay there as they continue to move forward.
When a business starts looking into their existing approach to procurement, one question that often comes up is what fundamentals need to be in place in order for everything to operate as efficiently as possible. As we’ll see shortly, there are actually several answers to that question. The link that ties them all together is the need for them to be manageable and scalable. While best practices are important, they only have an impact when there is a reliable way to utilize them daily.
Purchasing Software is the Best Way to Optimize Procurement
Since most procurement departments can tell stories about things getting off track despite having strong guidelines in place, purchasing software is a welcome solution for small and mid-market businesses. What makes this kind of software so powerful is it can take the procurement practices your business wants to follow and ensure that they are in place on a daily basis. And because this type of software is so easy to use, your entire business will be able to enjoy both optimal procurement practices and maximum productivity.
Because this type of software has the ability to deliver very big benefits, many people want to know exactly what kind of features it offers. The first key feature is the ability to automate purchasing processes. Not only do customized work flows greatly increase efficiency, but they also eliminate the need for procurement departments to use large amounts of paper.
The second important feature of purchasing software is being able to set and actually enforce budget thresholds. Instead of constantly being distracted by maverick spending, purchasing managers using quality software can focus on the tasks that will have the biggest impact on their company’s bottom line.
Several other features worth mentioning are the ability to use this software without IT support, having access to historical data to leverage vendor pricing and excellent usability that makes it easy to get everyone within a company to start using the software. The combination of all these features is why purchasing software is a great fit for any company that wants to enable procurement to play a direct part in growth.To see all the features we just covered in action, be sure to head over to our Free Live Demo page or sign up for a 30 Day Free Trial- no credit card needed.