Automating purchasing limit checks

Purchasing limits: an open order also uses part of the pool

Two departments plan purchases from the same approved pool. Each still sees an available limit, because the report counts invoices and leaves out orders already sent to suppliers. The person approving the next purchase does not know the pool is almost used up. The company agreed that approved orders count towards the next request, so a report from invoices alone does not show what the company wants to control.

The approver sees on the request which pool the purchase comes from and which documents already use it, and can go back to a specific order. Finance also sets how cancellations and partly fulfilled orders count, and the report shows the entry that changed the pool.

What automated purchasing limit checks cost and when they pay back

The count covers the work around each case: searching, reading, writing and handing over. What remains is the time to check the result, 15% of today's work in the scenario. Before the quote we measure both times on 20 to 100 cases the team has already handled, in a free test that takes 5 working days.

The amounts in the example are hypothetical, and the arithmetic is the same for every pool. The payback scenario counts the time of approvers and finance at 200 requests a month.

When your current system is enough

Finance systems often have budget control with a configurable set of documents that use up the pool. If yours supports it, configuration and a view on the request are enough. If the report is built from exports into a spreadsheet, the way the tables are joined needs checking, as the purchasing summary in Excel describes. An automation makes sense when requests, orders and invoices sit in different places and the approver puts the picture of the pool together by hand. A shared view must be current at the moment of the decision, so it shows when the data was last refreshed.

Where to start

The first scope covers one pool and the departments that use it. The wider purchasing scope is described on AI in purchasing. We build this kind of system as part of our AI automations. For the free process review, a description of one case from the last few weeks and the tools it went through is enough. You do not need to send confidential documents, and you receive a written plan within 2 working days.