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Buy and sell can go side by side


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THERE is tremendous activity in the healthcare sector at the moment. In South Africa there is action on the labour front, in the UK there are challenges in implementing electronic patient records and in the US there is fierce debate about the government’s plan to provide universal healthcare access.

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Buy and sell can go side by side

  1. 1. Buy and sell can go side by sideGREGG BARRETTTHERE is tremendous activity in the healthcare sector at the moment. In South Africa thereis action on the labour front, in the UK there are challenges in implementing electronicpatient records and in the US there is fierce debate about the government’s plan to provideuniversal healthcare access.What are some organisations in the healthcare sector doing to better position themselves todeal with this changing and challenging environment? OptumHealth, a division ofUnitedHealth Group, one of the largest health and wellness companies in the US has madeinvestments in Contract Lifecycle Management (CLM) and “integrating” buy-side and sell-side agreements.Do you want to integrate buy-side and sell-side agreements? Here is the rationale. Typically,buy-side and sell-side contract departments are separated in organisations and use differentprocesses and systems to obtain the same outcome – an executed contract.However, the more important goals include management of the performance, delivery,payment and compliance obligations agreed to. The obligations relating to buy-side or sell-side agreements are managed in a similar manner so it makes sense to have them in acentralised system. Also, when it comes to the data, one company’s buy-side contractmanagement is another’s sell-side so there is no compelling reason to separate the two.If you take the approach of integrating all your enterprise contracts into a CLM solution, thebenefits you’ll immediately recognise are savings associated with:1. Having closely aligned and streamlined processes for buy-side and sell-side contractmanagement that align with overall corporate strategy.2. Providing executive-level visibility into every contract enterprise-wide.3. Integrating contract data with customer relationship management (CRM) or financialsystems to automatically maintain master supplier and customer profile records thus ensuringaccuracy of data and elimination of duplicate data entry.4. Automated event management and other date-driven “action items” that can be driven andmanaged uniformly in a single solution.5. Business intelligence/streamlined reporting that will provide management with the rightoperational and strategic data to make better decisions (seeing the whole picture, not just oneside of the business).6. A complete book of business in a single CLM solution for reporting and retrieval purposesto reduce the costs associated with looking disjointed to customers, suppliers and corporateexecutives when searching for contracts data real-time.
  2. 2. 7. Complete and accurate data for sales forecasting and expenditure budgeting.8. Value created by linking buy-side and sell-side relationships and transactions when yoursuppliers’ goods and services are transactionally linked to your customers through contracts:-  For example, it will be extremely valuable to know which suppliers are also yourcustomers.- Where a specific part/product/service from a supplier is refined by your firm and made intoa deliverable consumed by the same entity.-  When there are issues in a buy or sell relationship, it’s critical to know the full impact.9. The ability to strategically govern and manage adherence to approved standard terms andconditions and templates at an enterprise level for buy-side and sell-side contracts.10. Having complete and accurate data to identify and monitor business relationships andsensitive or high-profile relationships and their key metrics, ultimately to renew andcapitalise such high-value contracts.It’s sometimes easier said than done to integrate these two sides of contracting. However, it isimportant to ensure that from a project structure standpoint, the steering committee comprisesmembers from the buy and sell sides of the organisation.But the chairperson must be chosen from the finance department since this sector has a bigstake in the success of both groups.There’s also the question of which goes live first – buy-side or sell-side?Traditionally, buy-side has seen a higher return on investment than sell-side but morerecently, the metrics are similar for both groups. It doesn’t really matter which side goes livefirst, but perhaps deciding who does could be based on the following.-  Which group is ready?-  Which group wants to go first?-  Which group has the budget?-  Which group’s deployment appears to be simpler? (It’s better for Phase 1 to be simple, notcomplex.)Irrespective of which group goes live first, it is strongly recommended that both groups’requirements are taken into consideration before you move forward. More importantly,
  3. 3. ensure that the full scope of the deployment (i.e. all the requirements and objectives) isknown upfront as it will affect the design and deployment, even for the first group.By combining buy-side and sell-side contracts into a single repository, you can providetremendous value to your executive leadership in the areas of compliance, reporting andsavings.