Source-to-contract (S2C) represents a set of procurement processes employed when an enterprise needs to source a product and service. This process flow starts with the analysis of product/service requirements and then the subsequent development of a suitable sourcing strategy. S2C then entails the proceeding of quotation requests and contract negotiation before eventually awarding the contract to an eligible vendor.
Steps of S2C
A well-thought-out S2C regimen doesn’t just involve devising sourcing strategies and taking care of contract management. Instead, it starts with the spend analysis. The steps of such an S2C flow are as follows.
- The patterns of spend and relevant compliance are analyzed. This groundwork gives the management better visibility of its outlays to identify how, where, and whom they are paying and how effectively all of it works.
- The insight provided by spend analysis is used to establish strategic sourcing practices. Through strategic sourcing, an enterprise finds out suppliers they need to continue working with and those that don’t offer the desired value. Moreover, the enterprise also gets in a better position to decide the most suitable contract terms.
- The last major section of the S2C process is contract management. It is important for ensuring the enterprise fully leverages the value of the contract arrangement. It also plays a part in managing supplier compliance.
The benefit of Implementing S2C Process
The above steps suggest that having a well-thought-out S2C process allows an organization to employ best sourcing practices and make the most of their contract terms, often overlooked in procurement activities.
SimplyPurchasing by Microsys is robust procurement management software that works on many fronts to improve organizational performance. It improves the procurement process and helps to get a better hold of sourcing and contract management. The use of SimplyPurchasing can make the implementation of the S2C process easy.