The growing importance of technology within organisations has led to many non-IT professionals becoming involved in IT procurement – particularly line of business heads.
Speaking at Computing’s Tech Marketing & Innovation Forum 2016, Mark Carter, enterprise marketing leader of Netscout, said that IT decision makers now collaborate with an average of six different functions for procurement, and that nearly half of all technology spend is under control of line of business heads.
Computing and sister site CRN have undertaken a comprehensive research programme with the aim of having a better understanding of the procurement process, from both the buyers’ and sellers’ perspectives.
The findings have been written up in a report entitled Buying and Selling Enterprise Technology in the era of Cloud and Digital Transformation.
For the purposes of the research, the cycle of technology procurement was broken down into four, individual stages. In chronological order, they are:
- The identification of a need
- Matching solution to need
- Shortlisting vendor/channel partner
- Final choice
When buyers were asked who was involved at each stage of the process, it was clear that the IT director or head of IT had the greatest overall involvement, and remained as important in the final stage as they were in the first stage. The only time that the profile of IT director drops slightly is the “matching solution to need” phase.
Meanwhile, business department or unit heads’ involvement steadily decreased; in the first stage 42 per cent of buyers said they were involved, but by the final stage this went down to 22 per cent. It is during the third stage, when companies are shortlisting vendors or partners that their influence declines significantly, as the importance of commercial/procurement teams, project managers and senior business managers increases.
Meanwhile, perhaps unsurprisingly, the finance director’s influence grows in the final two stages, and by the time the process reaches stage four, they are the third most important person involved.
The findings indicate that while traditional patterns of procurement are changing, the IT director and IT manager are still the key figures in each stage of technology procurement. However, sellers need to keep in mind that business heads still play an important role in the process – particularly at the start when needs are still being defined. This is why they should reach out to other relevant departments, not just IT.
When asked about the next three years, the majority of buyers either agreed or strongly agreed that IT procurement will be the responsibility of the IT department. However, 39 per cent agreed that responsibility for IT procurement would be shared more by other departments, and 30 per cent agreed that there would be more involvement from the purchasing department. The majority of buyers (61 per cent) said that in the next three years, more decisions would be taken at a business leadership level.
The research also found that the smaller an organisation, the more likely it was for IT to have pushed out procurement to the relevant lines of business. But this doesn’t necessarily diminish the role of IT – a point that many interviewees and panelists who took part in the research emphasised. They said that taking away certain elements of the procurement from their schedules enabled them to focus on the requirement for strong governance, as well as integrating and supporting the technology.
Original article by Sooraj Shah