6 tips for getting started with cost savings in higher-education setting

The last several years have seen increasing numbers of universities and colleges adopting the disciplines and processes, of corporate enterprise procurement technology. But it is one thing to decide that enterprise procurement technology is a good thing for colleges and universities, quite another to transport the disciplines from the corporate private sector into the realm of academia. This post provides 6 tips for universities to quick start cost savings through procurement technology initiatives.

• Aggregate & Standardize spend data: Spend data exists in several different places. It needs to be standardized, aggregated and combined with other information to create a true picture of total spending. A good way to create an inventory of possible spend-data sources is to walk around and interview a large sample of spenders. What do you buy? How do you buy and pay for each thing? Any visibility into spending — even if incomplete — can yield plenty of great cost savings or value delivery opportunities.
• Adopt a holistic approach:Many colleges and universities operate as microcosms, providing services internally that most corporations would purchase. Be sure to look at spending holistically, considering both internal and external spending as the analysis may yield substantial outsourcing opportunities.
• Time your initiative: Either way you go, spend-classification and analysis exercises should be timed to occur during winter and summer academic breaks, so procurement can be ready to hit the ground running and make the most of stakeholder participation in sourcing and other value-generating initiatives when they are present during academic terms.
• Develop partnerships with internal stakeholders:Procurement needs to build a strong partnership with the information technology department. Make sure they understand that the spend-data extraction process is intended to be consistent and easily repeatable. The goal: When the time comes to pull fresh spend data extracts, it should be a simple matter of pressing a button to run a script or query and there should be more than one person capable of executing this quickly and effectively.
• Choose automation vendor with vertical experience: Look for automation solution providers with a history of working with institutions of higher learning; their knowledge bases and models will already incorporate common exceptions and other learning that you can leverage. They may also be capable of enriching spend data, standardizing suppliers’ names, and identifying supplier parent-child relationships to generate more complete views of spending by supplier.
• Recruit thoughtfully:Be thoughtful in the recruitment of sourcing team members. Concentrate on identifying key influencers and community leaders who have shown themselves capable of swaying public opinion for causes in which they believe. Procurement technology implementation can only lead to real cost savings and other value if stakeholder communities buy-in broadly to the decisions that sourcing teams make.