In a general sense, IT procurement is the process of acquiring information technology (IT) assets to seek organizational success. However, the process itself goes beyond simply buying assets.
Your IT procurement strategy should comply with your company’s goals at every moment so that you don’t spend money unnecessarily. You must understand certain factors before seeking IT procurement services, and we’ll cover all of them today.
Keep reading if you want to learn everything about IT procurement and how to implement it in your business, starting today!
What Is IT Procurement?
Let’s start with the basics. “IT Procurement” is the process of buying/sourcing IT assets. What is your goal? In essence, it should be to help your business achieve its project goals with the help of the IT services and products you got.
There are many processes involved in IT procurement, including:
- Assessing your company’s needs
- Contacting suppliers
- Managing your procuring contracts
- Sourcing your assets
- Ensuring the assets help your business succeed
In essence, IT procurement also involves administrative and strategic tasks through:
- Request for Quotations (RFQs)
- Request for Proposals (RFPs)
- Request for Information (RFI)
It may not seem like it, but IT procurement can drive your business’s success and transformation in the long run. Once you identify how your IT assets will help your business thrive, you will better know how to manage your next investments.
Companies can either do the IT procurement process themselves or through a service/automated software. Some data management and analysis tasks are rather complex, so companies tend to outsource those to professionals or software.
Should You Hire IT Procurement Services?
It depends on your needs, goals, and budget. If you want the best results possible, IT procurement services will be the most efficient way to get started.
Some procurement processes take even days to complete by yourself. Remember that this process involves several tasks that rely on gathering information, talking with suppliers, and filling out paperwork.
However, if you hire IT Procurement services, you can complete every task without spending all your time and resources on them; you can focus on other tasks that are vital to your company.
Hiring IT procurement services will help you organize your resources better to be more efficient and achieve your organizational goals.
Considering IT Procurement Policies and Obstacles
As with many other things, you will encounter obstacles when drafting your IT procurement project. To avoid as many problems as possible, you must create an IT procurement policy to address some common problems that may arise and how you will solve them.
Some of the factors you can address in your IT procurement policy include the following:
- User Requirements: You must first identify your organization’s current needs in the most accurate way possible. Any knowledge gap could cause problems with your supply chain managers, which will, therefore, cause problems with your organization.
- Funding: You can have a rather effective IT procurement strategy, but you must back it up with proper funding. Make sure to evaluate your budget and how much you will need to achieve your business goals through IT procurement tasks.
- Company Requirements: Ensure your IT procurement teams understands the needs of your company regarding IT assets. The slightest mistake could lead to too many resources or a few. You must be as clear as possible when stating your company’s needs.
- Time Frames: While time is of the essence in most companies, try to avoid setting overly-tight deadlines, as that could cause problems with your current and potential IT vendors. You will be good to go if you set realistic expectations.
How Does an IT Procurement Process Work?
Now, let’s cover all of the steps your IT provider must follow to ensure your company gets the right solutions to achieve its short-term and long-term goals.
The first step is, undoubtedly, the most important one of the processes. You must identify what your IT requirements are.
Do you need new IT solutions? Which ones do you need? Those are the two main questions you must ask yourself (and your team) to determine where you can focus your budget.
You can seek help from your internal teams to get as much feedback as possible regarding your company’s current needs. Once you understand what your company needs to thrive in the IT department, you can go to the next step.
Here, your teams will use different investment analysis techniques to measure the opportunities and risks of your IT solutions. Remember that you must draft and review your IT investment business case to state why your company needs those assets.
As long as you’re clear on why your company needs certain assets, it will be much easier to approve your investment request by the approving authority, which will then get you started on the IT procurement process.
Now that you’re ready to start the procurement process, you must evaluate and choose suitable suppliers for your company. If you already have particular vendors, you must evaluate whether they’re still a good option for your company.
On the other hand, take this stage as an opportunity to build relationships with new vendors to achieve a higher performance grade.
RFPs, RFQs, Tenders, and Bids
If you’re planning on making a direct purchase, you can use an Expression of Interest document. First, you can prepare an RFP, RFQ, and any other request you may need for your potential suppliers. The requests must include details surrounding the assets you’re planning to acquire, the delivery/service requirements you have in mind, the pricing structure, the evaluation criteria, and other financial terms you may need.
Negotiations and Choosing Vendors
In some cases, your bidding suppliers could request additional information about your needs so that they make an accurate bid. When you receive all the proposals from your potential vendors, you (and your team) must take the time to evaluate all of them and make a list of the right bidders.
Feel free to negotiate the terms for specific deals to get a more relevant result for your company. Then, after you’ve evaluated all the bids and shortlisted the best bidders, choose the best option to sign your IT procurement contract.
Making Your Purchase
Once you have a vendor, you can prepare your order, which must include the following:
- Specifications for the Product or Service
- Terms and Conditions for the Product or Service
You can also include other obligations or terms to this order as long as you consider them appropriate.
Integrating Your New Assets
Once the vendor receives your receipt and delivers the requested solutions to your company, make sure to pay for them as agreed and implement these procured solutions according to your needs.
Even though you’re finished integrating your IT solutions, it continues beyond there. You must get your IT provider to monitor the performance of all the solutions and the internal team. This monitoring will allow you to measure your Return on Investment (ROI) possibilities, which will pave the road for future IT procurement processes.
Once you evaluate your metrics and see that your current solutions worked perfectly, you can also take those results to optimize the procurement process. This is one of the most important parts of the IT procurement process, so make sure you don’t miss it.
What Are Some IT Procurement Tips You Should Keep in Mind?
There are some factors you may want to consider if you want to make the most out of your IT procurement process.
In essence, you must focus on achieving your business goals through the IT solutions you’re acquiring. While many companies focus on short-term results, keep in mind that most IT procurement solutions are meant to cover long-term company needs.
Keeping your long-term needs in mind will ensure you don’t waste as many resources on your IT solutions as you would think.
Another thing you must keep in mind is risk. A vital factor in drafting an IT procurement process is evaluating all your risks and finding ways to avoid or mitigate them. Some strategies you can consider include assessing potential losses, planning future projects beforehand, and creating strategies to reduce the impact of any risk.
All these things can be achievable by conducting a full-risk analysis for your company.
Finally, consider getting input for your stakeholders, as that will allow you to understand your organizational needs and budget further. Moreover, make sure to strengthen your provider/vendor relationships so that you can make the most out of your purchase.
The IT procurement process is easier to understand than many people make it to be, but you must understand that it involves a considerable amount of time and funding if you want to get the right results.
Moreover, monitoring your results will ensure that you don’t have any issues optimizing your future procurement processes. The best way to address this is to work with someone who can provide professional IT procurement services for your company.
If you want to stop worrying about drafting the right steps for your next IT procurement project, our team at CNG IT can help you. Get a quote today, and make the most out of your business.