Have you ever noticed how much talk there is about spending cuts, and how little there is about driving consistent savings by getting better control over purchasing patterns?
That’s always puzzled me.
If you’re like most folks, you’ve probably been in more budgeting meetings than you care to count.
Isn’t it interesting how much of the budgeting conversations always center on cutting back expenditures or reducing spending by X% this year ?
You know what’s even more frustrating? Many companies have these same tired discussions about spending cuts every single year. All in the interest of savings , right?
Well, how come the savings never seem to come, or never really seem to be what they should be year over year?
It’s because it takes more than a slash and trash mentality to get the job done. Consistent, significant savings will never come until an organization learns how to get control over its purchasing patterns.
Hold on. I know what you’re saying right now. Easier said than done, right? Well, consider this.
Better control is one of the chief reasons you should automate your purchasing process.
A purchasing system can automate your purchasing routine from requisition to reporting, capturing all your spending data in a single location, so you can finally answer questions like:
- Which vendors are being used? Are we getting the best pricing?
- What’s being purchased? When? By which departments or employees?
- Is there maverick or unnecessary spending? How much, and who’s doing it?
This type of panoramic view of your entire spend helps you know what’s really going on, enabling you to modify and better direct purchasing patterns.
Using the automated system to more effectively police those purchasing patterns, you can consolidate spending with the suppliers that offer the best value, making spending compliance the norm.
Purchasing systems not only help you understand how much is being spent, they also help you identify the most cost effective ways to execute your spending, so you can direct purchasing demand toward the most attractive spending scenarios.
If you pursue this approach and take it seriously, the natural result is consistent savings. Not just once, but again and again, year after year.
Which means there will be less of those painful, frustrating meetings about spending cuts.
