In this blog Daniel Ball, Director at Wax Digital looks at the relationship between procurement and IT departments.
Our recent CPO Viewpoint Research involved 200 professionals and revealed that it is common practice for departments not to follow procurement processes. The research also identified that IT teams are the main culprits when it comes to maverick spending.
Many companies work hard to get all departments to follow procurement processes all the time, but 1 in 3 IT professionals make their own spending decisions, leading to maverick spend affecting IT budgets and potentially increasing supplier risks.
“78% of IT respondents told us that they see procurement’s formal tendering processes as an obstacle to timely and efficient spending, which could suggest why they are so keen to avoid them where possible“.
Daniel Ball, Director, Wax Digital
The research also revealed that IT and procurement functions are guilty of having different spend priorities – IT teams concentrate on infrastructure and security, whereas procurement finds front-end technology such as devices and hardware more important.
Additionally, the research acknowledged that IT is not a fan of procurement processes, which they deem as unnecessary ‘red tape’. However, it is very important for them to work closely together as it can bring considerable spend management benefits to the business as well as both functions.
Here are our three top tips to help the two departments cooperate:
- Both functions need to decide on clear and mutual spend priorities.
- Align IT’s annual objectives with procurement saving targets.
- Re-evaluate the ‘red tape’ processes and make them easier wherever possible.