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Consolidate Your Supply Chain For More Equitable Business Says CSA Waverley

BY: Matt Royle | Category: Technology | Submitted: 2010-04-13 06:42:29
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Article Summary: "As the business environment continues to wrestle with IT buying in a volatile marketplace, this article considers an emerging approach that promises to unlock savings in time and money, ultimately adding value to the bottom line. It explores and concludes that organisations with a large selection of IT suppliers can benefit fro.."


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Amidst testing times every walk of business, private or public sector, is being asked to streamline approaches or re-engineer processes to save time and money. One area that continues to test many organisations is IT procurement. Follow us at twitter.com/csawaverley

End users, specifiers and buyers alike are finding the IT market is a highly volatile and dynamic environment in which to make best value purchases consistently. This is dictating that vast swathes of time are consumed in managing allied suppliers, manually comparing prices and securing product that is in stock. This is before the additional layer of procurement administration and invoicing is considered.

There is no doubt about it that as organisations continue to chase best prices in an ever changing market, the likelihood of achieving best prices is a difficult one.

The market is, however, changing and fast. More entrepreneurial organisations are adopting a cutting edge yet common sense framework style model that saves time and money whilst freeing internal resources up to focus on core strategic moves and IT development. This outsourced managed approach in turn adds considerable value to the bottom line without the ever too common redundancies.

With a consolidated supply chain, organisations put out to tender a relationship that demands a catalogue of products as part of a managed service structure that meets EU procurement directives. The winning supplier adopts sole status and then manages the entire end-to-end procurement process - from purchase to delivery, implementation, imaging, assetting and maintenance.
Importantly, as the supplier purchases large product volumes across its client portfolio, so the prices it achieves are better than those the customer can obtain directly. From a consolidated supply chain perspective this means consistently better value. But are organisations ready for such a move?

A more streamlined approach to the supply chain not only devolves the risk of the supply chain from customer to supplier but it also significantly reduces accounting administration to one monthly invoice rather than myriad invoices from multiple suppliers. This is to the benefit of the customer's cash flow and a reduced procurement overhead.

This centralised approach improves the agility of an organisation by freeing up management time and stretching the reach of corporate IT budgets. It also provides for a CSR methodology as it can help achieve greater green IT compliance. A consolidated approach that proliferates procurement and managed services can ensure IT is recycled, re-used or appropriately disposed of within the terms of an agreement. This is an area that often creates enormous management challenges for overstretched multi-tasking IT managers and lifting this operational burden as part of a structured SLA can be highly rewarding.

The recessionary times are undoubtedly prompting teams to rethink their approach to buying IT through a more rationalised process. Forward thinking organisations are starting to switch on to the bottom line benefits of a streamlined and consolidated supply chain approach but it is paramount that suppliers are appropriately assessed to ensure they are up to the role. Proof of large corporate technical expertise and directly associated managed services should be the norm.

Whilst a consolidated trend is emerging it is however against the common cultural grain of managing multiple suppliers for perceived consistent value. Such an approach should not be seen as a risk but as a reward. The returns can be considerable and as more organisations enjoy cashable and non-cashable savings that help maximise internal resources and overheads, so this model will become more the norm. Early adopters are sure to be the long term winners.

Steve Nicholls is a consultant at CSA Waverley
www.CSAWaverley.com

About Author / Additional Info:
Steve Nicholls is a consultant at CSA Waverley, explore more thought leadership at www.csawaverley.com

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