Explore the financial and organizational benefits of extending your eProcurement investment to IT purchasing.

The IBM eProcurement Value Assessment Methodology

IBM Global Sales & Distribution

According to a Worldwide Research conducted by the School of Management of the Politecnico di Milano University (MIP) on 70 Large Enterprise Clients, 71% of the Procurement organizations interviewed use eProcurement to buy indirect materials, while only 40% of them use eProcurement to buy IT Products or Services.

Organizations not buying IT products and services via eProcurement reported that they see eProcurement to be beneficial mostly for low purchase value / high frequency / low descriptive complexity transactions, such as Office Supplies, Maintenance, Repair and Operational materials.

The IT eProcurement Value Assessment Methodology developed by MIP proves that there are relevant benefits in buying IT via eProcurement, both in terms of savings (financial) and spend control (organizational).

IT eProcurement Benefits At A Glance• Increase efficiency in IT procurement procedures and process.

• Increase transparency in procurement processes.

• Reduce maverick buying toward lower total cost of ownership • Reduce the IT supply base to a smaller set of strategic suppliers.

Use of eProcurement

Use of eProcurement for IT

When an agreement for a fully customized assessment is reached, an interview is scheduled with the customer CPO, IT or Category Manager to gather the available IT purchasing information required. Since all required data may not be available, the eProES system is designed to compensate for gaps by making intelligent estimations based on the customer’s industry, company size and other critical parameters.

After the information is collected, it is entered into the eProES system that processes the information using advanced proprietary Expert System modeling formulas to generate the final output.

The IT eProcurement Value Assessment Methodology has been developed to enable customers to evaluate the benefits deriving from eProcurement adoption for IT purchases.

The methodology follows 4 main steps and it is supported by the eProcurement Expert System (eProES) tool for collecting, analyzing customer information and generating customized customer reports.

The process begins with the IBM Representative collecting basic customer information to create a preliminary value assessment. The initial report is based on general industry data and is intended to provide the customer with a preview of the reporting format and the key output elements.

The eProES Value Assessment System is based on the following key customer priority parameters:• Efficiency• Control • Transparency• Decentralization• Supply Base• Maverick Buying Reduction

eProES 4 Phase Approach

© Copyright IBM Corporation 2008

IBM Corporation New Orchard Road Armonk, NY 10504 U.S.A.

Produced in the United States of America 01-09 All Rights Reserved. IBM, the IBM logo and ibm.com are trademarks or registered trademarks of International Business Machines Corporation in the United States, other countries, or both. Other company, product and service names may be trademarks or service marks of others. References in this publication to IBM products or services do not imply that IBM intends to make them available in all countries in which IBM operates.

The final customized value assessment illustrates the customer’s current IT eProcurement maturity level along with both financial savings and organizational improvements that can potentially be realized by leveraging eProcurement for IT purchasing.

The customized value assessment reports are delivered to the customer in an open presentation format that can dynamically be updated as more customer information becomes available and can be re-used based on the customer’s needs.

Take the next step to fully realizing the benefits of your eProcurement investment for IT purchases. To learn more about the IBM eProcurement Value Assessment Methodology please contact your IBM representative or visit: http://www.ibm.com/easyaccess/b2b

Sample Value Assessment Financial Output

Sample Value Assessment Organizational Output