Why do I need a spend management methodology?
We believe spend management is a cyclical process that is critical to the overall success of your business. By implementing cost reduction strategies which control and optimize the money your company spends on transportation, IT and telecom, you can create long-term and sustainable savings - dollars you can spend more wisely in other areas.
Unfortunately, most companies aren't sure how or what to change in their current purchasing process to reach this level of effective spend management. That's why NPI has developed Level 5™ Spend Management.
What is Level 5™?
The Level 5™ Spend Management methodology is a collection of cost control processes, best practices and benchmarking tools used to deliver our transportation, telecom and IT spend management services for procurement and outsourcing. It's also used to arm our clients with the power to optimize their corporate purchasing spend beyond engagements with our team. Our methodology is delivered in three defined phases - Analyze, Advise and Execute.
Modeled after the Software Engineering Institute's (SEI) Capability Maturity Model Integration method for product development, Level 5™ is a proven and rigorous approach to achieving fair market value for your technology and transportation purchases.
How does this differ from Ariba spend management and other technology driven tools?
At NPI, we focus primarily on the processes that drive transportation, telecom and IT vendor cost reductions through proven best practices in procurement, including third party procurement and pricing verification. In addition to teaching our clients how to optimize their internal processes for measurable results, we combine procurement cost reduction strategies with our own unmatched pricing insight. Because we see thousands of vendor deals annually, we understand the pricing and contract flexibility that can be leveraged for your company.
Why do we call it Level 5™?
The traditional purchasing hierarchy consists of five levels: business justification, technical requirements, vendor selection, legal terms and conditions and pricing. Today's companies fall short at many of these levels, but none more so than pricing.
Level 5™ Spend Management drives purchasing effectiveness at each of these levels, with a concentrated focus on price benchmarking. The result? Our clients reach the highest level of purchasing effectiveness and that translates into sustained savings, expense reductions and vendor partnerships that are strategically aligned to your business goals.
Interested in benchmarking your pricing against real-time market data? Click here to receive a complimentary savings evaluation or sign up for our NPIQuarterly newsletter.
