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The Case for Spend Analysis
The document discusses how procurement officers can avoid malpractice through effective spend analysis. It states that economic pressures require deeper cost cutting while maintaining service levels and vendor relationships. It then presents spend analysis as key, outlining the formula of visibility, analysis and process leading to success. It details how spend analysis provides visibility into spending and allows benchmarking and best practices analysis to drive better terms. Process is also important to identify needs, manage contracts and service levels. Spend analysis is positioned as the foundation for best-in-class procurement.
The Case for Spend Analysis
- 1. How To AvoidProcurement Malpractice ©ALL RIGHTS RESERVED - Confidential ©ALL RIGHTS RESERVED - Confidential 1 1
- 2. Procurement in 2012 •Economic forces are driving the need for deeper cost-cutting measures • Procurement officers must shore up suppliers and vendors so as not to cause disruptions to service levels or product delivery –at margins that support company growth! • To deliver anything less would be Procurement Malpractice • Now, more than ever, investing in Spend Analysis is key ©ALL RIGHTS RESERVED - Confidential ©ALL RIGHTS RESERVED - Confidential 2 2
- 3. Strategies for ProcurementSuccess The spend analysis formula: Visibility + Analysis + Process = Success ©ALL RIGHTS RESERVED - Confidential ©ALL RIGHTS RESERVED - Confidential 3 3
- 4. Strategies for ProcurementSuccess: Visibility • Spend Analysis will give you the visibility you need • Do you know? - What am I really spending? - With whom am I spending it? - Am I getting what’s been promised to me? ©ALL RIGHTS RESERVED - Confidential ©ALL RIGHTS RESERVED - Confidential 4 4
- 5. Strategies for ProcurementSuccess: Analysis • The next step in spend analysis is to analyze the information • Some helpful filters: - What is my aggregated spend with a single supplier? - How can I benchmark across pricing trends? - What are my best practices for managing category sourcing enterprise wide? - What else do I need to know to drive the best terms? ©ALL RIGHTS RESERVED - Confidential ©ALL RIGHTS RESERVED - Confidential 5 5
- 6. Strategies for ProcurementSuccess: Process • Vendor complexity and business volatility means increased pressure in choosing suppliers • Enterprise-wide spend analysis processes can drive value to the supplier relationship • Processes should span identifying needs, contract execution and managing service-level agreements (SLAs) • It’s all about creating a balance between cost and value ©ALL RIGHTS RESERVED - Confidential ©ALL RIGHTS RESERVED - Confidential 6 6
- 7. Avoid Procurement Malpractice • Spend Analysis is the foundation upon which Best-in-Class procurement is built • Rigorous spend analysis drives value across your organization, your suppliers and your customers • Don’t commit procurement malpractice, begin your spend analysis today ©ALL RIGHTS RESERVED - Confidential ©ALL RIGHTS RESERVED - Confidential 7 7
- 8. Contact Us 217 N. Jefferson Suite 400 Chicago, IL 60661 Phone: 312-373-3100 For more information on BravoSolution’s spend analysis tool, visit BravoSolution.com. ©ALL RIGHTS RESERVED - Confidential ©ALL RIGHTS RESERVED - Confidential 8 8