Quick Survey
I was talking with some folks today about Purchasing versus Contracting. I have worked in a lot of places and only one had a consolidated group (which, even then, was technically segregated). So, I’m interested in your feedback. Thank you!
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2 Responses to “Quick Survey”
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It is split in my company. The CIO doesn’t know much about sourcing/procurement…he sees it as a way to squeeze vendors each budget year. Consequently, the CIO’s “contract management team” (aka IT vendor management) is following 10 year old contract management business processes, renewing every license as it comes up. There is no investment in a CMS (except if you call it a Cabinet Management System), and there is zero procurement automation. Oh, and they don’t have an asset management system/process/team either. So, they are constantly renewing licenses they don’t need. Each person on the team literally has 40 different tasks on their to-do lists. The application development and infrastructure teams select their vendors and send contracts to the IT VM team to contract.
The “procurement team (aka Strategic Sourcing) has a CMS fully integrated into its eprocurement package. They run auctions, eRFxs, and automate the source-to-pay process completely. They build a collaborative plan with their customers and through mining spend data. Some of it is relatively new, so there are adoption issues, but its learning curve related.
It would be easy for the sourcing team to take on the IT world with a few tweaks to handle certain processes.
Interesting!
Most companies have at least a 50/50 split regarding deal types (IT vs rest-of-company). Which means that your IT Vendor Management group has about 50% of the annual quantity of deals and your Strategic Sourcing group has the other 50%. Where does the Strategic Sourcing group sit (under what business unit do they report)?
I think you’re right, though. In many situations, combining the two is possible. If staffed appropriately and given the ability to actually “do” the job.