Author: Chris Cannon

With worldwide IT spending expected to reach over five billion dollars in 2024, organizations are looking for ways to cut the budget and contain costs. In many cases, one of the most impactful ways of doing this is by tightening up the information technology procurement process.

Information technology procurement focuses on acquiring the necessary services and products to enhance business functionality. This can include Network, Cloud, UC, Maintenance, Support, Managed and professional services, Software and Hardware.
From defining your business’s IT needs to negotiating with potential suppliers, it consists of multiple stages designed to ensure cost-effectiveness and avoid possible risks during implementation.

A well-executed tech procurement process empowers you to effectively manage your inventory of IT assets, thereby reducing the risk of redundancy and service interruptions. Ask these essential questions to improve, revamp, or establish your information technology procurement process.

#1. How does your information technology procurement process align with your business goals and expectations?

Before you start your procurement process, you need clearly defined requirements, goals, roadmap and strategy. This is critical to ensure all your stakeholders are on the same page regarding budget, long-term plans, willingness to transition, ease of adoption, and other relevant factors when setting your goals.

While it can be tempting to move full steam ahead with new tech, thinking the ROI will be worth it, this can often result in headaches later.

Asking key questions — Does the technology considered drive efficiency? Does it support business goals? Or does it create needless complexity? — can help steer the decision process and keep long-term goals at the forefront.

 

#2. What are the risks associated with the information technology procurement process?

Like any other area of your business, the information technology procurement process has some risks. Budget overruns are generally a top concern, as are potential risks like hidden fees, unforeseen expenses, or inaccurate estimates. However, the overall risks aren’t just financial.

Vendor reliability and stability are an inherent risk, as being dependent on external resources can mean issues like delays or poor performance are out of your immediate control and take longer to rectify. Vendor lock-in is also a concern, as your flexibility to change the agreement’s terms may be limited, resulting in increased costs over the long term.

Other risks to consider when building your information technology procurement process include data privacy and security handling, potential challenges with tech integration, meeting regulatory compliance standards, possible scope creep, and more.

By understanding the risks as you begin creating your strategy, you can put guardrails in place to mitigate them should they occur. 

 

#3. What criteria should you use to vet potential vendors?

Depending on your organization’s needs, you may have some criteria that a potential vendor must meet—like how they will ensure regulatory compliance, financial stability, global reach, etc.  However, on a more general level, there are some questions and criteria you’ll want to ask a potential vendor, no matter your industry.

Start by considering the vendor’s reputation, including whether it has a reliable track record. Look for case studies, reviews, testimonials, or references that illustrate business outcomes.

Next, you’ll want to assess their experience in your industry and how well their solutions align with your business needs. Ask how they support you during and after your deployment, including if you have a dedicated point of contact and the SLA.

Finally, you’ll want to discuss the cost of their services, including upfront and ongoing costs. Look carefully for any potential hidden costs, transition expenses and payment terms.

Get the Support You Need to Navigate the Information Technology Procurement Process

By considering these questions and understanding some of the best practices as you build your information technology procurement process, your team will be equipped to make informed decisions that lead to successful business outcomes.

These questions are just the start. Sign up for the guide below to ensure you’re using your internal resources effectively and getting the right solution at the right terms and price.