5 steps-to-smarter-spending

Five Steps to Smarter SpendingA Hands On, How To Session for the Procurement Practitioner

Rob BernshteynChief Executive Officer650/[email protected]

Charlotte LawsonPurchasing Manager904/[email protected]

mailto:[email protected]


consumers employees

procurement

How do I spend smarter

and save?


and save?


and save?


and save?


and save?


and save?


and save?


and save?

executives

consumers employees

procurement executives

consumers

employees

executives

procurement

consumers employees

procurementdecisionmakers


and save?


and save?


and save?


and save?


and save?


and save?

How DO I spend smarter

and save?

How DO I spend smarter

and save?

Today’s WorkshopWe are going to show you how you can achieve these results:

Improve purchasing process efficiencies by 30%.

Drive 100% spend under management and 100% user adoption.

Identify new suppliers, deals and discounts to save upwards of 11% of total spend per year.

Produce immediate savings by shaving a minimum of 40% off of your purchasing support costs.

5 Best Practices for Spend Management

1. Build a foundation for success. 2. Make it easier than any alternative.3. Crowd source savings. 4. Benchmark against real transactional data. 5. Take advantage of what the cloud has to offer.

A Lesson In Efficiency

Inefficiency, time-consumption, frustration

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Step 1: Build a foundation for success.


WHY?Success – or failure – is dependent on the foundation you have in place.


• The foundation defines:– The costs of supporting spend management

• How many people are needed• Do you need Hardware?• Will you need to maintain and upgrade the system?

– The focus of the purchasing team• Paper pushing or strategic value?• Fixing errors or finding opportunities?• Status quo or innovation?

How to DO it • Review your existing process

– How is it performing? How much does it cost to support the existing system?– Are there areas that can be streamlined by automation? Are there unnecessary manual

steps that are slowing down the process?• Define your process roles and responsibilities

– Should procurement be pushing paper? Or is there time better spent elsewhere?– How can employees be educated and empowered to take action?

• Know your options– What kind of solutions are available? On-premise? SaaS? Cloud?– Do you have any specific technology requirements? Will you have to integrate with

other systems?– What are your long term goals? What solution can grow with you as you evolve and

innovate?• Try and buy

– How can you test the system?– Who will be involved in the process? What is their feedback on the change?– Which will give you the best value, not just for the price but for improving the process?

A Lesson In Spending Surprises

Unreliable, unreputable suppliers

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Step 2: Make it easier than any alternative.

WHY?Step 2: Make it easier than any alternative.

In order to get spend under management spend MUST happen within the process.

Step 2: Make it easier than any alternative.

• According to Aberdeen Group, best-in-class organizations that utilize easy-to-use expense management systems experience:– 51% lower processing costs than enterprises without solution in place– 41% faster time to complete a single requisition or expense report

than organizations not utilizing an end-to-end tool– 21% quicker approval time than enterprises without an end-to-end

solution

How to DO it • Learn from employees

– Let them give you feedback, hold a town hall or conduct a quick survey – Understand why they work outside of the process and what they are

comfortable with• Educate employees

– Make purchasing policies visible and easily accessible– Send things back – but with clear instructions on how to do it right

• Empower employees– Use role based permissions and give them access to the system– Let them handle one-off requests

• Remember to KISS– Give them a familiar experience– Don’t make it painful and time consuming

A Lesson In Bargain Shopping

Deals, discounts, savings

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Step 3: Crowd source savings.

WHY?Step 3: Crowd source savings.

It is impractical and inefficient for procurement to be involved in

EVERY transaction.

Step 3: Crowd source savings.

• In the online world, everyone can:– Find the materials and supplies they need– Comparison shop– Find a good deal and save

• Purchasing resources are limited– Educate and empower employees– Stop getting involved with every ad-hoc request– Focus on the big initiatives

How to DO it • Manage ALL purchases through the same process

– Familiar, easy, consistent user experience– 100% visibility across all purchases and expenses

• Let employees make educated decisions– Pre-negotiated, preferred vendor prices – Search for same product from other suppliers

• Integrate feedback and ratings– Let them know which suppliers are reliable– Collect insight on new potential sources of good deals

A Lesson In Measuring Impact

Accurate, action oriented reporting

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#4 Benchmark against real transactional data.

WHY?#4 Benchmark against real transactional market data.

It’s impossible to improve spending practices and savings WITHOUT

knowing where you stand.

#4 Benchmark against real transactional market data.

Why is this important?

• Benchmark and KPI s provide critical insight into;– savings as a percentage of spend– average requisition approval time– percentage of requisitions rejected– percentage of purchase orders revised– percentage of non-matched invoices

How to DO it • Define what you want to measure

– Which performance measures are you accountable for?– What metrics can you impact?

• Understand where / how data is captured– What systems measure which activities?

• Collect and Monitor– Collect metrics on regular intervals– Trend metrics over time to identify change points

• Test and Measure– Implement calculated changes

A Lesson In Cloud Computing

Robust, results driven solutions

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#5 Take advantage of what the cloud has to offer.

WHY?#5 Take advantage of what the cloud has to offer.

One of the few opportunities where you can demonstrate INSTANT results.

#5 Take advantage of what the cloud has to offer.

Lower upfront costs = Immediate Savings

Lower ongoing maintenance costs = Long Term Savings

Faster time-to-value = Bigger Impact

Automatic updates = Continuous Innovation

How to DO it

• Focus on YOUR business– If spend management solutions are not your core business, don’t

waste your time– Find an expert who can guide you with the right technology and best

practices• Move to the Cloud

– Implement and innovate faster– Take the burden off of IT – no hardware, no software

• Consider a Phased Approach– Start with key departments – Leverage that success across the organization

Summary

consumers employees

procurementdecisionmakers


and save?


and save?


and save?


and save?


and save?


and save?


and save?


and save?

5 Best Practices for Spend Management

• Build a foundation for success. Improve purchasing process efficiencies by 20%.

• Make it easier than any alternative. Drive 100% spend under management and 100% user adoption.

• Crowd source savings. Identify new suppliers, deals and discounts to save upwards of 11% of total spend per year.

• Benchmark against real transactional market data.

• Take advantage of what SaaS has to offer. Produce immediate savings by shaving a minimum of 40% off of your purchasing support costs.

A

Q&&

Rob BernshteynChief Executive Officer650/[email protected]

Charlotte LawsonPurchasing Manager904/[email protected]



5 steps-to-smarter-spending

Technology