These 6 Tips Can Get Academic Institutions Started with Cost Savings
In the last several years, an increasing number of large educational institutions have taken to cost savings. While it is an applaudable initiative, the concerned department should be wary of the nuances of corporate discipline entering academia. In this article, we share six tips to better cost savings in academic institutions from a procurement point of view.
6 Tips for Universities to Get Started with Cost Savings
Aggregate & Standardize Spend data
Spend data exists in several different places. It needs to be standardized, aggregated, and combined with other information to create a true picture of total spend. A good way to create an inventory of possible spend data sources is to walk around and interview a large sample of spenders. What do you buy? How do you buy and pay for each thing? Any visibility into spending—even if incomplete—can yield great cost savings or valuable delivery opportunities.
Adopt a Holistic Approach
Many colleges and universities operate as microcosms, providing services internally that most corporations would purchase. Be sure to look at spend holistically. Considering both internal and external spending may yield substantial outsourcing opportunities.
Time your Initiative
Time your spend classification analysis. You can schedule them either during winter or summer breaks. During the academic season, procurement can make the most of stakeholder participation in sourcing and other value-generating initiatives.
Procurement function in academic institutions needs to build a strong partnership with the information technology department. With the technology department, the procurement function can scale up the spend-data extraction process. The idea is to pull fresh spend data extracts by running a simple query. Please note that training should be given to more than one person for backup.
Automation Vendor with Vertical Experience
Look for automation solution providers with a history of working with large academic institutions. Their knowledge base and models will be ready for incorporation except for a few changes and adjustments. An automation vendor can evaluate spend data, standardize suppliers’ names, and identify supplier relationships to generate complete views of spending.
Recruit sourcing team members thoughtfully. Concentrate on identifying key influencers and community leaders who have a record on helping successful implementation of procurement technology. Proper implementation leads to real cost savings and increases stakeholder value.
We believe that if you follow the above six tips, you can drastically improve procurement to impact cost savings in your academic institution.