Spend management refers to an overall approach that encompasses spend analysis, sourcing, procurement, receiving, stock management, settling payments and management of related accounts. At the heart of good spend management are great processes. Companies achieving spend management excellence have progressed through three stages to get superb results from their source-to-settle processes:
Controlled – business and operational controls mean that spend management is approached consistently
Built on best practice – having established control the organisation seeks to employ proven best practices
Delivered sustained performance – adopted best practices become a part of “business as usual” and the organisation continues to make improvements in spend management
The 3i’s of a spend management project lifecycle
There are a number of challenges in achieving spend management excellence whether you are just looking at the options (including e-procurement) or you have established processes and systems that you want to make work more effectively for you. The overall goal of spend management excellence is deliver sustainable value from your source-to-settle processes. The specific challenges depend on where you are in your spend management project lifecycle.You may need:
Insight into what you need to achieve your spend management goals
Implementation support for changes which deliver sustainable improvements in performance
Improvements in your existing spend management processes and systems
Use the questions below to assess where you are in the lifecycle.
If you want to achieve excellence then you will most likely need to kick off a project to get you there.The 3i approach is designed to fit with your requirements whether you’re just starting out, trying to assure the success of implementation or looking to improve.
Objectives of spend management
Whether you call yourself a spend manager or a procurement professional or something else you probably share the 5-key objectives of procurement professionals*:
Improve efficiency of requisition to pay process
Improve compliance (contract, process, price)
Improve visibility of spend
Lower transaction costs
Increase spend under management
Are your processes and systems helping you to achieve these objectives?
Our Health Check can provide valuable insight into just how effective your organisation is in Spend Management. This is a holistic health check which includes the following dimensions professionally assessed by our Spend Management Excellence team:
Benefits of the health check:
A valuable visual snap-shot of your spend management performance
Identifies areas of strength and areas where improvements should be focused
Allows the creation of an action plan and an ongoing mechanism for tracking progress
Can be used for internal/external benchmarking
Built on years of experience in assessment of business and process excellence
In short the health check will indicate how your spend management people, processes & technology compare to “best in class” – the detailed version could help you to create an action plan to improve your spend under management saving £000’s.
