Using Spend Analysis to make a difference:
Harnessing the Power of Money
One of our customers, Mike Bevis from City of Naperville,
IL, writes about the challenges of spend management which can be
daunting to individual organizations. Effective spend
management requires that the spend data to be in a fit state before
the analysis can begin. This is often a barrier preventing
projects from getting off the ground:
“Until recently it was difficult, if not impossible, to
identify where all the money went, much less direct it towards
desired goals. Technology is changing this. Cities and counties are
beginning to both harness the power of their spending, directing it
in purposeful ways, and making it more visible and accessible to
the public through the use of sophisticated spend
analysis.”
Mike talks about the role of spend analysis and spend management
in both internal procurement initiatives and collaborative projects
with other organizations within a region:
“Spend analysis and particularly the coordination of
spending information, creates opportunities for local cooperation
on new levels. In regions with adequate competition, local
governments and especially co-terminus governments, can combine
their spend to positively impact their ability to deliver enhanced
value.”
“In initial efforts to integrate and channel spending in the
most effective way, the Naperville effort has identified $100
million in savings.”
In a particular scenario, savings were realized through the
coordination of contract approaches where the three jurisdictions
(in this case a city, a school district, and a library district)
would either combine spending on a given commodity or already share
contractors.
In addition to identifying savings and opportunities for
collaboration with other parties, spend analysis provides the
potential for greater transparency and can enhance public
confidence in government.
“The best and highest use of spend analysis may not be cost
savings or even facilitating intergovernmental cooperation. It may
well turn out to be the ability to share spend information with the
public in an immediate and meaningful way.”
City of Naperville have made their spend available via
spotlightonspend:
http://www.spotlightonspend.org/1061/City+of+Naperville,+IL/Spend/Monthly
Read the full article here
TAGS: icma, Naperville, spend analysis, collaborative procurement, purchasing, cooperation, collect, cleanse, classify, enrich, data process, spend data, local government