Local government organisations can save time and money by buying essential items in a more efficient manner. But having visibility into spend means they can unlock even more benefits
Information is key for any business process, and it’s no different for those tasked with procuring essential items for the local government sector, who face a strong mandate to deliver value for money and to meet wider requirements in corporate social responsibility.
But all too often important items – from office technology to furniture, stationery to cleaning products – are bought in a haphazard way, typically from local stores or online retailers, with little consideration as to whether they are buying from the most appropriate supplier or the best price. Often these are bought by office managers or those who have need of that particular item.
Not only does this mean organisations may be paying over the odds or using suppliers that do not meet public sector specifications, it also means procurement teams or managers have little in the way of data that can help inform future strategy.
Better understanding what is being bought, and by who, can help organisations assess what they need and when, and identify whether there is spend that could be reduced or avoided altogether. It also helps with planning; a local government organisation buying multiple items of the same type could end up with excess stock that is wasted, while failing to understand when products are needed runs the risk of them not having the right equipment when it is required.
For many years, local government organisations have struggled with such issues, particularly in tail-end spend essential to the day-to-day running of the organisation but not directly related to frontline service provision.
Digital procurement solutions are helping to overcome this. Amazon Business, for instance, provides a single location to allow authorised employees to make purchases – subject to spending limits – across a wide range of items, at competitive prices and using technology with which people are familiar from their personal lives.
Not only does this encourage adoption and reduce maverick spending, it also provides valuable insight into just what the organisation requires, and when. The Spend Insights feature allows procurement teams or those who head up buying to drill down into data, including what it spends with each supplier and overall spend by category.
Patterns of spending can also be detected, and any abnormal activity flagged. This can help crack down on fraud or abuse, and ensure employees remain within agreed company guidelines.
Amazon Business Insights, meanwhile, provides customisable dashboards which allow teams to track and analyse spend, compare this with buying policies and monitor spend by individual, group, category, department or supplier. Spend data can then be used to help identify opportunities to make savings and agree future budgets and buying policies, as well as enforcing these. Progress towards certain goals – such as using local suppliers or those which possess certain sustainability certifications – can be recorded and monitored.
Having access to previous spend information can also help organisations identify future needs, helping them to plan spending activity and ensuring they have time to obtain the best price. Artificial intelligence (AI) is having an impact here; Amazon Business’s Redefining Procurement report suggests 28 per cent of organisations have implemented AI-powered spend analytics tools to enhance visibility and control.
Accounts teams can access invoices for purchases and match these with payments, allowing for easy reconciliation and identification of any discrepancies. Reports can also be generated by order IDs, purchase order numbers, item details, shipping costs and payment information.
Unity Schools Partnership is one organisation that has been able to bring its spend under control. A group of 39 primary, secondary and SEND schools based in Suffolk, it previously had a disjointed approach to buying, where there was very limited control or visibility of spending at the central trust level.
Partnering with Amazon Business gave the trust greater visibility into what it was spending, which allowed it to consolidate spend across multiple categories, while access was restricted to those using school domain accounts to prevent rogue spending. Amazon Business was integrated with its existing IRIS financial software, freeing up time as a result of not having to upload numerous purchase orders into their financial system each week.
“We use Amazon all the time,” says Michelle Curtis, Senior Finance Officer. “Whether it’s stationery, cleaning equipment, safety equipment – you name it, if we can buy it from Amazon we will.”
“We previously had lots of purchase orders to load into IRIS Financials each week, which, across the trust, could take several hours,” she adds. “When IRIS contacted us about trialling the pilot, it seemed like an easy decision for us. It’s an obvious time-saver and has simplified the process completely.”
The new set-up has saved time for both teachers, who can focus more on pupils rather than ordering equipment, and the procurement team. This means they can focus more on strategic activities, including further refining procurement processes and expanding the use of data analytics.
To find out more about how Amazon Business can help your local government organisation take control of its spending, visit business.amazon.co.uk/en/industries/government