Differences between real and potential savings

Often, The real savings are less important than potential savings estimated in the analyses. This “gap” represents a threat to the credibility of purchases that are not capable of achieving all possible savings.

Discrepancies usually occur when The purchasing department establishes a company-wide or Group-wide contract, but that many users within the organization continue to buy from other suppliers.

Why these differences? Olivier AUDINO, President of the consultancy firm Buy Made Easy, sees four main reasons for this: “communication, inconveniences, fear of the unknown, and lack of trust.”

A few strategies to mitigate these “discrepancies”:

1. Monitor expenses to identify variances

Having visibility is key to understanding when and where the discrepancy is happening. Therefore, it will be necessary to have a tool to track expenses. So, in the event that a discrepancy occurs, you will be more quickly in a position to take corrective action accordingly.

Other techniques to save money?

2. Do not hesitate to communicate in the specialized press about your results and your current actions.

During your exchanges with” The Purchase Letter ” or” Purchasing decision ”, it is therefore interesting to involve your internal customers. This type of exchange gives credit to your prescribers, builds team spirit, and empowers employees. After this publication, how can you go back on a savings commitment when the CEO received your publication?

3. Involving stakeholders in the procurement process :
from the RFI, but also for the RFQ and the call for tenders. An easy way to do this is to involve your internal customers in the scoring. supplier surveys. But it is also possible to invite them to participate in the analysis of the request for proposals or the RFQ responses, or even invite them to participate in a negotiation or an auction. There is nothing more motivating for prescribers than participating in a live tender event.

Stakeholder involvement is fundamental.

To achieve a balance between the new contract and the realization of the savings potential, your new supplier should not be perceived by your internal customers as a”Purchasing supplier”.

He should be considered “the supplier of the organization”, the one that the company has chosen collectively.

If the “supplier purchases” perception exists — especially if you have ousted a historic and popular supplier — your prescribers can use any reason they want to prove that choosing the new supplier was a bad decision.

In many situations, stakeholders have the power to help you or prevent you from reaching your savings goals. It is therefore important to work together with them.

Assessing the Maturity of a Purchasing Department in 2022