Best Practices in IT Procurement

Best Practices in IT Procurement

Published by: Sinead Woods
Published date: 3rd Sep 2015

Generally speaking, IT procurement is carried out to acquire the best available IT products, solutions, and systems that can streamline business activity and boost operational efficiency. On the face of it, it sounds like a fairly straightforward job. However, IT procurement can be an uphill task for organizations that fail to realize the value that IT brings to their workflow and cannot establish standards on which IT products and systems should be acquired in the future.

Implementing best practices and standards in IT procurement is a crucial step towards ensuring that the IT department and Information Systems (IS), as a whole, can benefit the organization. Here are three best practices in IT procurement that can help you in setting a benchmark for technology success!

Assessing Cost Drivers

Cost drivers are the elements that help you in finding out the costs of any business activity or process, in this case, associated with IT. Once the cost drivers are identified, the IT procurement department has to decide on how to reduce the costs. This can be a challenge, as avoiding costs in a certain activity or process may lead to downtime, poor integration, or other issues. In order to avoid that, first identify the key cost drivers, their value to the business, and the implications of taking action on them. It’s never a bad idea to test a new system that eliminates certain costs first, before making it live.

Overview the Supplier Relationship

Maintaining the supplier relationship is essential for procurement, even more so when the cost drivers are identified and evaluated. In the past, supplier relationship had a more ceremonial role in business, because if buyers received a better deal from another supplier, they would stop working with the current one.

As of today however, supplier relationship is crucial for corporate success and less confrontational in some manners. Working with a few suppliers that you develop more strategic relationships with, over time, is essential to ensure quality IT products, systems and solutions. Supplier management in IT procurement today should focus on establishing a trustworthy relationship on which B2B progress becomes imminent. In the long run, this approach can help your business secure goods when needed and reduce costs and any instances of delays to ensure that the operational workflow is not compromised.

Implementing eProcurement

Given how rapidly most, if not all, data driven firms today are implementing eProcurement, it is wise to first evaluate the implications. Many CEOs and board members would want to incorporate the most sophisticated technology available that can scale operations and boost productivity. However, only a few of those CEOs and board members are actually able to achieve that.

The reason is because when you are deploying eProcurement as a system, you have to analyze the impact it has on business activity, systems, data, and processes that are interlinked. To achieve this, the CIO, IT purchasing manager, and the IT staff as a whole, has to collaborate on testing, developing, implementing, and eventually, integrating eProcurement in the workflow.

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