Maverick spend not a "major issue" for buyers

31 January 2007
More news

31 January 2007 | Paul Snell

Controlling maverick spend remains a minor issue for procurement professionals managing indirects, a report claims.

A study, published last week by research firm NelsonHall, revealed that over half of companies thought reducing costs and managing large numbers of suppliers were the bigger challenges of indirect procurement. Only 23 per cent of the 326 global companies surveyed said controlling maverick spend was a major issue. The report claimed this was because companies were prioritising improvements in supplier management instead.

The report also said that a lack of investment, expertise and interest meant indirect procurement was still at "a low stage of process maturity". In most companies it is not centralised, with only a third of firms using a shared service centre. This is despite 70 per cent of companies indicating their wish to implement one before the process is outsourced.

The survey claimed that outsourcing the whole indirect procurement process was still rare, a finding that echoed previous studies (News, 4 January). Sourcing and category management is often separated from the purchase-to-pay process, with specialist providers in each area.

Reducing process costs (84 per cent of companies), accelerated sourcing times (79 per cent) and the improved ability to manage supplier performance (78 per cent) were cited as the top three reasons for outsourcing indirect procurement.



SMjan2007

LATEST
JOBS
Swindon, Wiltshire
upto £40K base (+ Paid overtime and corporate benefits)
Honda Manufacturing Ltd
Kew gardens, Richmond upon Thames, London (Greater)
£37,000 - £42,500 per annum pro rata, depending on skills and experience
Kew Royal Botanic Gardens
SEARCH JOBS
CIPS Knowledge
Find out more with CIPS Knowledge:
  • best practice insights
  • guidance
  • tools and templates
GO TO CIPS KNOWLEDGE