One of the last things organizations want to do is leave money on the table.
One key to saving money for procurement leaders is controlling unmanaged spend, which improves efficiency and eliminates waste. Despite that, procurement professionals report that nearly half of their total spend remains unmanaged, according to a recent study of 725 procurement leaders.
Only 53% of total spend is considered “under management,” and only 19% of respondents said increasing spend under management was a key focus area for the coming year.
Below are some more key findings from the study with insights for your procurement organization. The report by Zycus, a source-to-pay procurement technology solutions, was the result of interviews with professionals from different purchasing roles and responsibilities, including top management consisting of CPOs, VPs and Directors.
Cost savings remain the leading focus area for procurement professionals
The top focus areas for 2017 are cost savings, process efficiencies, collaborating with other business functions, improving supplier performance and supply-risk management. Procurement teams are shifting attention toward external challenges such as rising inflation, but continue to add business value through cost reduction.
Tail spend consolidation is a way to reduce inefficiencies and hidden costs in procurement operations. While these tail spend purchases are usually smaller, all of these purchases combined can account for large portions of procurement budgets that go unmanaged.
Businesses want an “Amazon-like framework” for purchasing
Survey participants were asked to articulate expected changes in their function over the next five years, and 58% reported they are largely focused on technology and automation related advancements, rather than traditional aspects of procurement. Tech enhancements such as integration, ease of use and dashboard reporting topped respondents’ wish lists for innovation, along with an optimized user experience like Amazon.
How Amazon Business can help
With Amazon Business, purchasing teams don’t just get an Amazon-like purchasing tool—they get the Amazon.com shopping experience built for businesses. Amazon Business saves businesses money and time by improving spend control and offering a one-stop destination for spot buys and more strategic purchases. By consolidating spend under Amazon Business, organizations simplify purchasing for buyers and gain access to a competitive marketplace and exclusive business prices.
Create your free business account to access all the benefits of Amazon Business.