We’d love to say that the hottest, spiciest topic of the moment is IT procurement, but that would be a lie. Which is a shame, because a solid, effective IT procurement strategy is one of the hottest and spiciest things you can do to supercharge your business objectives.
What’s an IT Procurement Strategy For?
An IT procurement strategy aligns with the overall strategy of a business. In essence, a robust IT procurement strategy ensures that you place the right IT in front of the right people at the right time, and at a fair cost. Plus, following what the business wants or needs to achieve, now and/or future.
Sounds simple, right? It’s simple, but also kind of not.
That’s because your shiny IT procurement strategy not only has to take care of what you buy, but how you buy it. It’s not (just) what you do. It’s the way you do it.
An IT procurement strategy will take on the flavor of your broader business procurement strategy. Depending on your overall business goals, there are many established flavors to choose from.
Here are two of the most common non-guru procurement strategies:
Environmentally Preferable Purchasing (EPP)
EPP, aka Green Purchasing, is a commendable strategy that seeks to reduce the negative impact—or increase the positive impact—of the stuff you buy. EPP makes you assess the products you purchase and the suppliers you buy from, and evaluate what kind of impact they have on the planet and the people that live on it. It seeks to optimize your supply chain for sustainability.
EPP is no bad thing as a flavor of IT procurement. The IT industry pushes a quadrillion new products in tiny time cycles, leaving a mountain of energy consumption, leached heavy metals, and e-waste. With a green-flavored IT procurement strategy, you can do your bit for the planet by exploring:
- Total product lifecycle
- Using refurbished or remanufactured products
- Supply chain transparency: is the person that made your phone paid enough to feed their kids?
- Storage management
- Reducing power consumption
- Extending fleet life
Cost Reduction
A cost reduction procurement strategy does what it says on the tin. It seeks to reduce the costs of whatever the business buys or does, without affecting performance. Cost reduction isn’t achieved solely by throwing metaphorical toys out of the stroller until a supplier drops their price, although that helps. It also covers things like cutting unnecessary costs of purchasing, improving the authorization process to eliminate maverick spending, improving the speed and effectiveness of the hiring process, and looking at product alternatives.
A cost reduction-flavored IT procurement strategy is way more exciting than it sounds. This is because you can use IT to streamline the buying process for the whole business. Won’t you be the star!
You can also:
- Juggle with cheaper’n’greener energy efficiency.
- Configure IT to help your people work smarter and faster, increasing their capacity and productivity and thus reducing costs per head.
- Find cost effective ways to redeploy device spares rather than replace them. We’re thinking Mobile Device Management, Device Lifecycle Management, and Onboarding Automation, but then we would, wouldn’t we? We love it.
Other exciting flavors of IT procurement strategies include:
- Risk management: you can have special fun with compliance here.
- Supplier optimization: all the sourcing, negotiating, qualifying, and contract management fun you can eat.
- Total Quality Management: you’ll explore how the IT you source can minimize error and maximize improvements for your whole organization.
What Makes an IT Procurement Strategy Effective?
One thing an effective IT procurement strategy is not, is a 543523-page document that the printer coughs up and then is left to turn into cheese in the paper recycling bin. That’s just a sad waste of a tree. Instead, bless your strategy with these shiny elements, and you can’t go far wrong:
It’s a Living Thing
It’s not quite a Frankenstein, but your IT procurement strategy is something that should be alive. Changed and amended over time to consider things such as pandemics, supply chains, and other wigglies so that it always remains relevant to your business. It must be reviewed regularly to make sure it’s still consistent with the overall procurement strategy and business objectives.
It’s Measurable
How do you know it’s working if you don’t measure the outcomes of your strategy? You’ve identified how your strategy will contribute to your business goals, but now you’ll need to find a way to find out if they do.
Don’t pick so many key performance indicators that your head explodes, but do choose some measurable activities that fit the flavor of your strategy. For instance, if you’re going green, you could choose to measure:
- Energy savings.
- Percentage of your suppliers with CSR credentials over time.
- Ratio of retained vs. replaced devices over time.
People Know About It
Strategies are only effective if they’re communicated to your IT colleagues, and they understand them. They’re even more effective if it’s a team effort, with your team involved in putting the strategy together. This creates a sense of ownership of the strategy.
It Aligns with IT Governance
Your IT procurement strategy (of whatever flavor) should fall in line with IT governance. IT governance usually covers the big stuff, such as ensuring IT supports and is optimized for the business. It also evaluates IT’s performance against its objectives.
If you’re wrestling with a particularly recalcitrant IT procurement strategy, we have a ton of ideas to help you choose the direction that’s right for your business. Give us a call. We’re friendly folks.