In my last blog, I wrote about what exemplifies the necessity of the intelligent spend management – the “why”. Today, I will write about the priorities. After all, if everything is important then nothing is important. So, the key is to “prioritize”.
Business leaders are looking for opportunities to continuously improve in today’s increasingly complex world. Leaders must manage strategic priorities in a manner that strikes a balance between spending on growth and controlling spend as they respond to the demands of a fast-moving digital and global economy.
We believe following are the commonly attributed strategic priorities in sourcing & procurement – the “what”.
Cash Is King
Greater emphasis on cash flow requirements
Develop suitable response under various stress test scenarios
Convert fixed to variable cost, where possible
Intelligent auditing of payables and receivable transactions
Optimize total cost of ownership
"20% lower Annual Service and Maintenance Cost (% of rev) for organizations where cost and financial analysis is regularly conducted to track expenses associated with an asset, and analyze variances" – SAP performance benchmarks
Collaboration & Automation
Planning collaboration to improve visibility into availability of supply
Need for real-time collaboration with internal and external supply chains
Minimization of labor-intensive invoice error and exception handling processes
"27% lower BI Report Failure for organizations where periodic database automation is in place, where daily maintenance tasks for databases require no human interaction" – SAP performance benchmarks
Sustainability & Purpose
Purpose-driven brands perceived as having greater value, customers more loyal and employees more engaged
Institutional investors increasingly taking sustainability and purpose into account in their investment decisions
Goals to use sustainable and diverse suppliers
"82% lower Number of Fatalities / 100 M Exposure Hours for organizations where the EH&S system centrally tracks information, including suppliers’ dangerous goods and hazardous materials management " – SAP performance benchmarks
Virtual procurement aided by digital tools brings in threat to information security
Audit supplier cyber security capability to evaluate the degree of risk
Collaborate with IT to ensure information security, data protection and privacy