Whilst industry reports are showing over 80% of financial practitioners acknowledge the importance of IT’s role in business growth, FD’s are focussing too much time on the benefits of desktop technology rather than on more efficient methods of getting it there in the first place, says procurement specialist, Probrand
And with IT representing the largest in-direct procurement spend of any organsation, FD’s, buyers and IT departments could be saving time and money on the buying process as well as getting better deals as part of a best practice approach to procurement.
According to Probrand, 62% of financial practitioners do not understand the benefits electronic procurement could bring to their organisation and this is hitting organisational bottom line.
In a recent procurement report by research firm The Butler Group, Mark Blowers said: “Buyers frequently have to phone a number of distributors in order to find where the required product is available, and to ascertain the cheapest price. This can be a time consuming task. The IT Index automates the procurement process leading to significant savings both in time and the amount paid for products. Any organisation with a significant IT budget would benefit from utilising an innovative procurement service.”
Theitindex.co.uk is an award winning internet based IT buying hub that searches over 500,000 line items and daily publishes best price and availability for over 125,000 products. It is accredited by the Institute of Chartered Accountants.
The National eProcurement Project documented that over £2BN could be saved in the public sector alone through electronic methods of transacting goods. This saving comes as e-procurement eliminates the need for buyers to call, manage and manually compare numerous suppliers for best price and availability. It significantly reduces the cost to transact as paper and process are shortened. Plus, internet based e-procurement solutions can offer better priced goods due to the providers reduced overhead costs of trading online.
Probrand’s Stephen Bushell, said: “Spend visibility has never been higher up the agenda. With IT’s important role and related budget share catching the financial eye, the next evolution for practitioners is to understand how to improve methods of securing better IT for cheaper prices. This is about purchasing process.
“With IT bought more efficiently and at cheaper prices, so organisations can actually stretch the reach of their existing budgets to accommodate more advanced and capable IT. Aside from time and fiscal savings, the end result of better IT is that FDs can directly drive the business forward at the same time as maximising budgets. This compliments findings that FDs spend around 30% of their time working with IT heads on strategy.”
Baker Tilly’s John Oates adds: “Inefficient procurement effects the bottom line.
One area where technological advancements are strengthening financial practitioners’ 360 degree view of organisational spend is electronic-procurement.
“A streamlined buying process can reduce costs and effort and improve compliance, leaving time to more effectively provide financial information, insight and visibility across a business.
“The often used fixed price and term tendering is an old and inefficient way of procuring products like IT where cost and availability are changing on a daily basis.
“With structured electronic procurement approaches, practitioners can add value to the bottom line of their own organisation as well as offering clients real-time IT spend analyses to show how well an organisation is buying IT. This adds value to a practitioner’s service offer.”
Peter Robbins, Probrand Managing Director and e-procurement authority to the private and public sectors, said: “Practitioners can help a client police their IT spend and evaluate how they can get best value from their IT budget. More often than not, practitioners simply don’t appreciate the potential impact of user friendly eprocurement tool sets. They can undoubtedly be a recession busting tool.”
“Financial directors and practitioners are the bedrock of successful businesses and we want to help people achieve more sustainable and equitable business."
Probrand hopes to launch a series of informative seminars for financial practitioners later in the year.