Regulating Indirect and Direct Spend for a Financial Services Provider
Engagement Overview A leading financial services provider wanted to enhance business efficiency. To develop a cost model for the realistic apportionment of costs incurred for each product and sub-products that are part of the operation, the financial services provider approached SpendEdge to help them leverage cost benefit analysis based solutions. Through the course of this […]
A leading financial services provider wanted to enhance business efficiency. To develop a cost model for the realistic apportionment of costs incurred for each product and sub-products that are part of the operation, the financial services provider approached SpendEdge to help them leverage cost benefit analysis based solutions. Through the course of this engagement, a detailed quantitative analysis of various cost factors within the supply chain network was carried out to identify the indirect and direct spend categories.
About the Client
A leading financial services provider employing over 3500 professionals across various economies. The company is based out of the United States.
The financial services provider was facing challenges in identifying the most cost-effective blend of counter-measures to save themselves from any potential loss. Additionally, they wanted to enhance value for stakeholders by discovering, acquiring, developing, producing, and marketing financial services profitably.
How SpendEdge Helped the Client?
Step 1: Identified price drivers for each cost category
Identifying and understanding the drivers for each cost category helped the client increase focus on developing a robust cost benefit analysis model that would best suit their organizational needs.
Step 2: Filtered and grouped raw data into distinctive segments
This step involved the segmentation of raw spend data into different sub-categories, which acted as a starting point to identify different spend categories.
Key questions answered in this cost benefit analysis engagement include
Benefits of the Engagement
With the help of SpendEdge’s cost benefit analysis, the financial services provider understood the economic impact of inappropriate business decisions. Additionally, the client uncovered major opportunities for improving their sourcing strategies by controlling indirect and direct spends.
Why leverage cost benefit analysis?
It is essential for financial services providers to analyze cost and inventories in today’s competitive scenario. Moreover, as businesses grow, their sourcing needs become more complex, making it a necessity to analyze delivery times, maverick spends, and cost elements across the supply chain. Cost benefit analysis helps firms make the best use of the suppliers and their capabilities.
Today, every business decision is greatly influenced by cost benefit analysis. Such is the importance of cost benefit analysis in identifying business risks and analyzing spend categories. However, it is up to an individual firm to decide and incorporate this capability. Failing which, financial services providers may run the risk of wasting valuable time and money by captivating on the least profitable tasks.