Services Spend — Beyond Contingent Labor: Achieving And Implementing Savings Across Previously Unmanaged Categories
Jason Busch, Executive Editor, Spend Matters
In recent years, many procurement organizations have begun to examine the opportunity to consolidate their contingent—and even statement of work (SOW)—buying activities under a single buying umbrella. But in today’s environment, services procurement in non-contingent categories can have potentially an even greater impact from both cost and non-cost perspectives. Spend Matters research suggests that in categories such as marketing and print it is often possible to achieve 10%-20% total savings without changing vendors. Furthermore, in certain categories where companies have not yet specified service levels or consolidated their spending with specific providers, 25%–50% savings is not uncommon. In the legal spending arena, for example, some organizations we’ve spoken with have discovered that savings on the order of 10%-40% are often possible in targeted spending areas (e.g., patent filing work, paralegal support, etc.) without jeopardizing preferred-provider supplier relationships in key areas. Procurement organizations that actively manage non-contingent services categories also plan and budget more effectively by deploying new engagement and performance-based management approaches with vendors, building greater overall transparency and visibility.
Download the second paper in the Services Spend Compass to learn more about the non-contingent services opportunities and Spend Matters’ recommendations for achieving increased levels of savings, transparency and supplier performance across a range of categories in this area.
