With the state of the US economy understandably taking centre stage in the ‘honeymoon’ period of his presidency, Barack Obama and his team are looking for money wherever they can find it, and first in the firing line are the contracts made within public procurement practices. Having already highlighted a potential $40billion annual saving, Obama has called a review of government spending and contracting.
It’s an exercise, albeit on typically a rather smaller scale, that is being replicated in many organisations where the focus on spend and contract management has been allowed to soften while the good times were rolling.
And it brings the need for adequate processes and systems very much to the fore. We have seen the floodgates open recently in terms of the number of organisations looking to generate rapid savings through sourcing, and we have been able to help contribute to over £10m of savings in the UK alone since the start of the year on behalf of our sourcing clients. But what must not be forgotten is the need to invest in the internal systems that then ensure those paper savings are translated into real bottom-line reduction by controlling purchasing behaviour across the enterprise.
Successful sourcing activities tee up the savings, purchase-to-pay solutions put them in the bank!
