#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…
The challenge: Unmanaged Spend The Gartner Group states that ‘Maverick Spend’, or uncontrolled spend…at times referred to as Tail Spend, often falls below the radar of enterprise procurement policies because the transactions that constitute it are relatively small. Yet, cumulatively, these maverick transactions form a substantial sum. In many cases, enterprises are spending more in…
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…
Indirect spend, also known as tail spend, is often an overlooked issue for financial professionals. According to research conducted by The Gartner Group in 2012, “For the average company, a 5% savings on tail spend can be the equivalent of a 10% increase in profit. Eliminating Maverick spend; or ‘uncontrolled buying’, by automating indirect spend…
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…
Prime Advantage, a buying consortium for midsized manufacturers headquartered in Chicago, with 750 member companies and more than 125 endorsed suppliers announced the findings of its 14th edition of the Purchasing and Manufacturing Survey, revealing financial projections and procurement insights from more than 750 U.S. manufacturing companies. One of their key findings of the survey:…
According to the Oxford Dictionary website the origin of a word “maverick” dates back from the 1860’s and stems from the name of a Texas lawyer and land baron, Samuel A. Maverick, who refused to brand his cattle. Today, a maverick is generally someone who does not go along with the group and is viewed…
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