Procurement's unknown ally?

Marcus Willbourn, Chief Operations Officer, Medius discusses the importance of collaboration between IT and procurement, highlighting the benefits of a successful working relationship.

Our recent CPO Viewpoint research, involving 200 professionals in IT, procurement, sales & marketing and finance, revealed that IT departments are very likely not to follow procurement processes. Earlier this year leading IT analyst, Gartner forecasted that the global spend on technology across vertical industries this year will equal $2.69 trillion. Considering both of these reports it suggests there could be a potential IT spend of $500 billion that flouts corporate sourcing and procurement rules.

IT purchasing can be very complex and procurement functions may choose to leave some of the complex purchasing responsibility to the IT team. However, procurement should still be involved in the purchasing process instilling best practice to ensure value for money, contract terms and the right supplier profile.

“From working closely with clients in a range of sectors, we’ve found collaboration between IT and procurement is possible and also a better way forward”.

Marcus Willbourn, Chief Operations Officer, Medius.

The procurement function is evolving and more often you will find a procurement professional sitting in a specialist department such as IT in order to make sure the correct purchasing procedures are being followed.

Also, it is becoming more popular for leaders of specialist functions to work more closely with procurement providing them with knowledge and experience, helping them to understand the different resources needed and the reasons behind them.

This approach of expanding procurement’s knowledge and experience allows them to become very valuable to individual business functions.

“A client of ours saw the value of letting procurement step into IT to apply extensive contract knowledge and ensure that the organization was entering into terms that it would ultimately benefit from”.

Marcus Willbourn, Chief Operations Officer, Medius.

We've also seen a gradual shift of IT spend moving from CAPEX to OPEX with cloud computing services now more commonplace. The IT function is dealing with a very different landscape including service management and support. This is where procurement can step in and offer their expertise, ensuring that the IT services supply chain has been adequately scrutinised. There is a very real need for IT and procurement to work together as it provides great benefits to both department and the whole business.