Overview of the Global IT industry
Globally, digital disruption has forced IT companies to enhance their technological capabilities and improve the time to market for their service offerings. Therefore, to stay competitive in the market, leading businesses have been compelled to improve pricing models and M&A strategies to transform their operations and business models. The industry comprises of services that enable IT companies to create, manage, optimize, and access information. The growth of the IT industry can be attributed to factors such as government reforms to increase the spending on technology and rising opportunities in the IT sector. Although the IT industry is witnessing promising growth, some factors that may curtail the growth of the industry include:
- Human resources: As budgets become tighter and workloads increase, several IT companies have started facing challenges when it comes to hiring more employees. Due to the presence of numerous players, IT companies have started worrying about retaining their employees as the chances of attrition levels are higher. Moreover, IT companies are also facing the need to invest highly in human resources to cater to the rising demands of the target audience.
- Innovations: With the advent of new technologies, prominent IT companies have started facing the need to reinvent themselves and stay relevant in the market space. Moreover, it becomes essential for the IT companies to invest highly in research and development to ensure their presence in the IT industry.
To address such challenges and analyze the spending patterns, leading IT companies are adopting spend analysis solutions. A spend analysis solution helps businesses effectively monitor and keep track of their spend and gain better visibility into the spend performance. Furthermore, with the help of such solutions, IT companies can efficiently manage their organizational spend and identify critical savings opportunities to reduce maverick spend.
The Business Challenge and Our Journey
The client, a renowned IT company, wanted to gain an understanding of the current state of spend and the spending patterns in the organization. A prominent IT company wanted to manage their organizational spend and identify critical saving opportunities. Moreover, with the help of spend analysis solution, the IT company wanted to track the fluctuating commodity prices based on underlying cost drivers and their prices.
To identify the potential bottlenecks in the IT industry, the procurement experts at SpendEdge carried out extensive research comprising interviews and discussions with leading stakeholders in the IT industry. Furthermore, the experts also compiled information from a wide array of reliable sources such as paid industry databases, company presentations, and trade shows.
The spend analysis solution offered by SpendEdge helped the IT company compare their spend with that of the competitors. The client was able to identify the potential bottlenecks in terms of savings leak and purchasing overlaps and make accurate and confident decisions. Moreover, the solution also sought ways to discover and control maverick spend and identify and prioritize saving opportunities.
Fundamental questions answered in this spend analysis solution include:
The spend analysis solution offered by SpendEdge helped the client devise a short-term and medium-term spend strategy and improve the overall process efficiency. In addition, the engagement also helped the client in the IT industry access and organize spend data and develop robust sourcing, budgeting, and product strategies.