About this Article
A strong procurement process is vital to achieving great outcomes in your SaaS negotiations. Here at Vendr, we've got your back with our powerful workflows designed to streamline your purchasing journey.
Our workflows serve as your trusty guide, mapping out each step and approval required for various types of purchases. In this article, we'll delve into the best practices for crafting your internal procurement process and seamlessly integrating it into our Vendr workflows.
Overview
To build your company's procurement process using Vendr, you will:
Align on a process of tasks and approvals
Build your workflow plan
Track your agreements in Vendr
Vendr provides you with pre-built templates to make getting started easy.
Before the Workflow: Confirm Process and Scope
For a New Purchase:
How critical is this tool to the business?
Are you using another product to address a similar use case? If so, why is your current product not sufficient?
Is it replacing other tools?
This is important for timeline and onboarding/sunsetting purposes.
Have you evaluated competitors?
We suggest evaluating at least three competitors in the space (3 bids and a buy)
What types of data will this product have access to and is that compliant with your business?
For a Renewal:
How is the tool performing? Is it meeting your business needs?
Is the use case still relevant to your business as it is today?
Do you have usage analytics? Do you understand the correct volume to be purchased?
Answering these questions will help you narrow down your specific needs, levers, and timing for the purchase, saving you time and energy. It is after this scoping phase that the tool owner will initiate a purchase request workflow and kick off the procurement process.
Building your Workflow
Intake
The intake form is the first thing a requestor sees when they begin a new purchase or renewal request. It is required for them to fill out so keep this in mind when building your intake form.
Build probing questions into your intake form to save time down the road.
Tip: There is a balance to strike when creating your intake. You want to collect the necessary information required for approvers without blocking the requester’s ability to submit the intake.
What is the business use-case?
What is the budget and expected TCV?
Will this tool integrate with other systems within the organization?
Does this tool access or process personal identifiable information (PII)?
What is the expected usage/license count needed?
Tip: Your Vendr workflow is customizable based on conditionals and responses. Make sure you use it to your advantage!
Initial Approvals
After you’ve created your intake form and are ready to build steps into the workflow, an initial approval step should be created for the requestor to seek approval from the head of department, budget owner, or procurement lead.
Having these reviews at the beginning of the process will create more structure and efficiency in your procurement policy and help to avoid rogue purchasing habits.
Guiding questions to ask at this stage:
Who will be able to initiate requests for purchases? Will you limit it to department heads or will you enable all tool owners?
Will all purchases require department head approval before moving forward?
When will the budget be determined?
We suggest having budget confirmed prior to submitting a workflow so that it doesn’t slow down the process.
Commercial Negotiations & Internal Reviews
Once the purchase has received initial approval, commercial negotiations and internal reviews should begin. The designated legal and security approvers should review their requirements and provide feedback and approval. Your workflow template(s) can be built to accommodate any number of setups and can be adjusted at any time as your organization or process changes. However your process is built, Vendr recommends all three pillars (legal, security, finance) in every purchase to ensure that risk is evaluated and compliance is met.
Guiding questions to ask at this stage:
Who will own the legal, security, and finance approvals?
Pro Tip: Create approval teams for steps where more than one approver may be assigned.
Will you engage with legal in tandem with supplier negotiations or as a final step after commercial negotiations are completed?
Will there be a threshold where finance approval isn’t needed (e.g. <$10k)?
Pro Tip: Use conditional logic to send the workflow down a path when the cost is above a certain threshold and down a different path if it's below that threshold.
What documents and questions will be required for each function’s review? Are these requirements included in the corresponding workflow steps?
Pro Tip: Build a checklist in each step that outlines the needs for that approval group.
What approvals can run concurrently with negotiations and which will occur subsequently?
How frequently will these reviews take place (e.g. a security review every 3rd year)?
Internal Reviews - Best Practices
Legal
Legal
Document your legal non-negotiables (indemnification for IP infringement, limitation of liability, payment terms, auto-renewal policies, etc.) so you can send to the supplier upon engagement to speed up the legal review process.
Common legal requirements:
Copy of the existing agreement (For renewals)
Draft Order Form
Governing Terms & Conditions or MSA (if applicable)
DPA
Items to look for on the initial order Form:
Is the legal entity and billing contact correct?
Have your non-negotiables been addressed?
Does the Order Form reference standard terms or a custom MSA (if applicable)?
Security
Security
Have an understanding of what data the supplier will have access to (PII, employee data, customer data, etc) in order to hone in on the compliance items you’ll need.
Common security requirements:
SOC2
ISO 27001 certification
TPSA
Custom InfoSec questionnaire
CAIQ or CAIQ-Lite
PenTest
Finance
Finance
As a final step, we recommend having the purchase be approved through a “Final Finance Approval” step to ensure that the negotiated cost is within budget.
Install purchase thresholds (e.g. VPs approve purchases below $100k, CFO approves purchases $100k and above, etc) to prevent bottlenecks
Build your workflow so that all preliminary approvals are completed before the final finance step; this will ensure that the approver has a total picture of the purchase
Supercharge your workflow with our integrations
Supercharge your workflows with our contract management integrations. These allow you to work in other systems in while continuing to move the Vendr workflow along.
The DocuSign integration allows you to upload and sync agreements like NDAs, MSAs, and contracts to and from DocuSign without having to leave Vendr. Please note that the integration only works for DocuSign envelopes that are stored in your DocuSign account. It does not allow you to sync documents from your supplier’s DocuSign account.
The Ironclad integration allows you to connect your workflows in Ironclad directly to Vendr in order to accelerate approvals. This allows you to keep all of your agreements, intakes, and approvals in sync across both systems. Signed contracts are automatically pulled back into Vendr and extracted for maximum efficiency.
Webhooks are particularly useful for asynchronous events such as a step being completed or a document being uploaded. You can listen for events in workflows and use them to trigger actions in other systems like Slack or Jira.
Now that you're set up for success, next we'll share best practices for how to deploy Vendr to your organization!