Overcoming Procurement & Inventory Management Challenges in Manufacturing with Business Process Automation

Overview

Leading manufacturing enterprises attribute their operational success to well-optimized procurement processes. One of our global agrochemical manufacturing clients, a distinguished producer of fertilizers and agricultural supplements, sought to enhance procurement and inventory management efficiency. With a workforce exceeding 40,000 and operations spanning Asia, the Middle East, and Asia Pacific, achieving seamless procurement across multiple locations was a critical necessity.

Challenges

Limited Stock Visibility

Inability to physically assess warehouse inventory across multiple countries.

Inefficiencies In Data Collection

Dependence on manual processes resulted in delayed decision-making.

Unpredictable Material Shortages

Procurement managers struggled to forecast material requirements before stock depletion.

Lack of Expiration Tracking

Absence of an automated system to monitor raw material expiry dates.

Challenges in Cost Optimization

Difficulty in identifying competitive procurement opportunities and optimizing raw material expenses.

Solution Approach

  • Workflow Automation
      • Automated product tracking upon arrival with seamless issuance of Goods Receipt Notification (GRN).
      • Instant alerts for quality checks and production readiness across relevant departments.
  • Data Analytics & Intelligent Alert Mechanism
      • Custom dashboards provided procurement managers with real-time tracking of stock availability and material requirements.
      • Automated alerts notified inventory managers before raw materials were depleted.
      • Expiration tracking system ensured raw materials were utilized efficiently before reaching expiry.
  • Gen-AI Powered Procurement Optimization
      • AI-driven tools facilitated the identification of optimal raw material sources and warehouse locations.
      • Automated cost assessment, material categorization, and logistics planning optimized procurement efficiency.
      • AI-powered insights enhanced procurement route optimization, reducing overall logistics expenditures.

Results

Enhanced Procurement Management

  • Automated purchase requisition (PR) process: Procurement managers could efficiently enter material quantities and assign shipping destinations.
  • Intelligent approval workflows: The system routed PRs for confirmation, enforced approval conditions, and triggered automatic notifications for approved PRs.
  • Real-time inventory updates: Procurement data dynamically adjusted based on approved PRs, ensuring up-to-date stock management.
  • Smart PR governance: The system enabled automatic cancellation of redundant PRs and restricted cancellations after PO generation.

AI-Driven Cost and Procurement Optimization

  • AI-assisted sourcing: Identified alternative suppliers to mitigate procurement delays.
  • Optimized logistics planning: Ensured seamless shipment tracking and delivery confirmation.
  • Advanced cost analysis & forecasting: AI-driven insights facilitated cost-saving strategies and efficient vendor comparison.

Efficient Inventory Tracking

  • Automated stock monitoring: The eProcurement system provided real-time inventory tracking, allowing timely PR creation.
  • Enhanced decision-making: Custom dashboards offered comprehensive insights into PR status, stock levels, and approval workflows.

Seamless Vendor & Operations Management

  • Centralized vendor management: The platform streamlined communication between vendors and internal departments.
  • Integrated procurement workflow: Eliminated inefficiencies by reducing dependency on multiple platforms.
  • Optimized verification processes: Departments could validate procurement details before final approvals, ensuring accuracy.

Conclusion

Through the implementation of KodeFast’s Business Process Automation solution, our client achieved a 2% increase in annual savings and an 11% reduction in costs. The automation of procurement and inventory management significantly enhanced efficiency, decision-making, and cost-effectiveness, leading to optimized operations across their global manufacturing network.