MyBiz Solutions Sdn Bhd

Total Spend Management examines and takes advantage of how assets (capital and otherwise) and inventory are procured and managed. It involves cutting operating and other costs associated with doing business. These costs are typically categorised as "Overhead Expenses" or SG&A (Selling, General and Administrative) costs but can also be found in other areas and in other members of the supply chain.

Whether it is the money spent on goods or services for direct costs (e.g Assembly), indirect costs (e.g. Staff and Premises), or services (temporary and contract labor, print services, etc.), companies can implement a mechanism by which they are not only able to save money but control costs.

Total Spend Management presents a holistic view of the activities involved in the "source-to-pay" process. This process includes spend analysis, sourcing, procurement, receiving, payment settlement and management of accounts payable and general ledger accounts.

Spend Analysis is the start of a procurement process that continuously improves and re-evaluates the purchasing activities of a company. It is one component of Spend Management. This takes a commodity-by-commodity look, taking into account business unit, location, and other requirements to find opportunities for economies of scale savings.

Spend Analysis is a continuous process:

1. Assessment of current spend (what is bought where?)
2. Assessment of the supply market (who offers what)?
3. Development of a sourcing strategy (where to buy what, while minimizing risk and costs)
4. Identification of suitable suppliers
5. Negotiation with suppliers (products, prices)
6. Implementation of new supply structure
7. Track results and restart assessment (continuous cycle)

Lack of visibility into timely, detailed, and accurate spend data limits spend leverage, hinders compliance, and causes development of sourcing and supplier strategies in the dark. This limited use of spend intelligence is due in large part to the onerous challenges in acquiring, classifying, and analyzing the data in the first place
 
Spend analysis is appropriate for defining sourcing strategies, increasing spend leverage, and monitoring compliance. Turning spend analysis into a repeatable and automated process opens up new opportunities for leveraging spend data for other business initiatives, such as master data cleanup, equipment standardization and reuse, and, even, merger and acquisition (M&A) support.

Enterprises can, through the use of technology, better plan their spend and effectively source for and procure the best products and services to give their business a competitive edge.