Spend Management

[dimpy.handa]

Spend management is the way in which companies control and optimize the money they spend. It involves cutting operating and other costs associated with doing business. These costs typically show up as "operating costs" 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 inputs (raw goods and materials used in the manufacture of products), indirect material (Office supplies and other expenses that do not go into a finished product) or services (temporary and contract labor, print services etc), a company needs a mechanism by which they are not only able to save money but control costs.

 

[swatiraohnlu]

Most recently, companies have been utilizing new tools such as e-sourcing (for bidding and reverse auction), e-procurement (to control and monitor purchasing activities and contracts), and e-spend analytics (to gain insight into how much money is being spent on what types of services or products). Some tools are also addressing the entire spending chain, or purchase-to-pay cycle. These tools promise, not only to automate paper intensive and manual processes, but also to help monitor and control spending activity and to create an integrated process in which each activity feeds into another. Spend management is about creating long-tern and sustainable savings.

 

[dimpy.handa]

In an enterprise, spend management is managing how to spend money to best effect in order to build products and services. The term is intended to encompass such processes as outsourcing, procurement, e-procurement, and supply chain management. Since the "spend manager" could have a significant impact on a company's results, it has been advocated that this manager have a senior voice in running the company.
Ariba is considered the leader in selling software for spend management. It says that its Enterprise Spend Management (TM) Suite encompasses analysis, sourcing, buying, contracting, invoicing, and managing the workforce