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Published on: June 18, 2009
Type of content: WHITE PAPER
Format: Unknown
Length: 9 pages
Price: FREE

Overview:
Corporate sourcing and procurement organizations should always look for opportunities to introduce efficiencies, reduce costs, as well as negotiate desirable terms with vendors and suppliers. These opportunities are revealed in a number of different ways, such as demand aggregation, improved supplier performance assessment, assurance of regulatory compliance, determination of rebates and refunds, and identification of noncompliant spend.

However, few companies have the ability to gain a comprehensive perspective of the products and services purchased and their associated providers. This confounds the ability to identify opportunities for improvement, and wasteful and duplicate spending can continue unabated. The difficulty in gaining this enterprise-wide perspective is complicated by a number of factors, such as:

• There are often multiple systems used during the procurement process.


• Different vendors and providers use variant product and service identifiers and descriptions.


• Often, transactional data associated with purchasing is missing important characteristics that are used to influence and inform both the strategic and the operational decision-making processes for procurement.

In this paper, we look at the business drivers and organizational objectives of a spend analysis program, and then consider establishing performance indicators and associated metrics for managing the efficiencies and realizing cost savings.