Maverick spend doesn’t promote efficient Procure-to-Pay processes or strategic supplier relationships since it takes purchasing outside the realm of your company’s e-procurement system. It doesn’t promote contractual compliance and it undermines trust and transparency. Whether you call it maverick, indirect, rogue or tail spend, “it’s the same challenge and leads to the same results–wasted money…
In Part I of this series, “Does Maverick Spend Undermine your Indirect Spend“, we discussed how being a maverick can sometimes be good in business, but ‘not’ when it comes to procurement. Maverick spending is a major challenge for finance professionals, with recent studies showing that, on average, one-third of all purchases in organizations are…
How does a Maverick affect your organizations bottom line? Being a maverick can sometimes be good in business, but not when it comes to procurement. Maverick spending is a major challenge for finance professionals, with recent studies showing that, on average, one-third of all purchases; specifically Indirect Spend within organizations are made without the…
In past blog entries related to Maverick Spend, we’ve really only discussed spend compliance and process compliance from an internal viewpoint, but suppliers (Supplier Compliance) are also part of the equation. When buyers use spend analytics to identify non-compliance, many root causes tie back to suppliers, such as: incorrect catalog/PO pricing relative to contracts incorrect…
Maverick Spend How It Happens and How to Counteract Procurement is rising on the priority lists of both corporations and governments. The two foremost examples are: – In December 2014, the US government reported a reduction of more than USD 55 billion in contract savings in fiscal year 2013 over the…
Why the need for Punch-out? In a word: efficiency. Buyers want to buy with little to no error. Sellers want to sell with as little “friction” as possible in the process. If an organization needs to buy the same products or services from an established vendor repeatedly then, eCommerce Shopping or Punch-out makes perfect sense. Punch-out…
Being a maverick isn’t always a bad thing. In fact, the ability to think outside the box and innovate is a desired employee trait in most industries. BUT, what happens when procurement managers go rogue? They try to act as mavericks and reach out to suppliers that aren’t part of the company’s list of pre-approved…
‘Maverick spend’ is the expense resulting from purchases made within an organization by circumventing pre-established procurement policies and other standard corporate procedures. Such rogue spending and lack of automation can cause serious losses to a company’s bottom line. As illustrated by data from APQC’s Open Standards Benchmarking in procurement, organizations that do not take steps…
According to ProcurementBulletin (PB), a web magazine devoted to helping supply chain professionals stay informed, eighty-five percent (85%) of maverick buying (uncontrolled buying) is not uncommon. In other words, very few companies have an e-Procurement system that captures the benefits of a sourcing initiative, for example contract usage and compliance. The result is maverick buying…
