Procuring the right IT assets for your business is essential for its growth. Many things must be considered before purchasing IT assets. The process of procurement is not just about buying the assets, but also about choosing the right vendor for your business.
When creating an IT procurement strategy, there are various aspects to consider, such as the type of technology you are going to invest in and your business requirements, the vendor selection process, contract terms and conditions, and post-purchase care and maintenance.
IT procurement process
The process of acquiring IT assets can be simplified with the help of an IT partner who specialises in IT procurement. Managed services providers who follow the IT procurement steps below can assure you of strategic sourcing of high-quality IT hardware, solutions, and services for your organisation.
The IT procurement process includes the following 7 steps:
1. Identify your business needs
The first step in the procurement process is to determine your company’s specific needs. IT services can affect every part of an organisation, you need to conduct a comprehensive analysis and assessment of how your company currently uses technology, what technologies are in use, and how they are currently implemented. This will help you to identify any existing gaps in service or areas where new technologies can improve efficiency and productivity, as well as set your budget for your IT procurement.
You may need to involve employees from a variety of departments, including IT, HR and finance, to identify all of the technologies and services that are currently being used across your organisation, as well as customers, contractors, suppliers, etc.
2. Approve and authorise purchase request
Before beginning the IT procurement approval process, you must first review your IT investment business case and find justifications. Project teams can then use investment analysis techniques like cost-benefit analysis to measure procurement benefits and risks to gain approval. The approving authority then can give the go-ahead to begin the procurement process.
3. Vendor research and selection
Once you’ve identified your company’s specific needs, you need to research potential suppliers who can provide the services you need. Forging a supplier relationship with the right vendor for your business is crucial, as choosing incorrectly could have serious consequences, such as paying more for products or services than you should, or assets not being delivered promptly.
You can also look at your existing vendor relationships to determine whether they could assist with your new needs. For example, if your company already uses software solutions from a specific vendor, they may have other software licenses that meet your needs. You may want to create a Request for Proposal (RFP) for certain services. An RFP is a helpful tool for collecting information from vendors and creating a standard process for reviewing different bids for the services you need. An RFP will help you to identify your needs and requirements, which will help to standardise the vendor selection process and collect information from a variety of vendors so you can make the best decision.
4. Negotiate contract terms
Once you have decided which supplier to work with, you must negotiate your contract terms with them. This phase is critical because you want to agree on a price that is fair for both parties and that both parties are happy to work with. You may decide to negotiate a contract for specific services. In either situation, there are some important steps to take when negotiating an IT contract.
Pricing is just one of the areas that contracts cover. The entire project – terms, conditions, and delivery durations – should be taken into account. You should keep a copy of your contract in case anything is not up to your standards. You should also be aware of the contract type you choose. There are many different types of contracts, including fixed-price, time-and-materials, and cost-reimbursable contracts. Be sure to select a type that fits your company’s needs.
5. Finalise purchase order
A purchase order is created to purchase the goods or services from the supplier. In most instances, the PO goes through a separate approval process to ensure that all transactions meet requirements and look for potential problems or inaccuracies. Procurement then sends the purchase order to the supplier for fulfilment.
6. Receive, review, and reconcile IT goods
The procurement team receives and inspects the assets after they are delivered to ensure the quality and accuracy of the purchase. If the order does not meet expectations, the supplier may offer to make adjustments or return the shipment.
Once the delivery has been verified, the procurement team matches the shipment, invoice, and PO to ensure that everything matches and the supplier invoice can be submitted to finance for processing.
7. Ongoing contract management
The post-close operations and purchasing analysis are part of the procurement team’s responsibilities. Record-keeping, reporting, spend analysis, supplier evaluation, contract management, and supplier onboarding (where contracts are completed or terminated) are all examples of what they might do.
IT procurement made easy with Virtu
Keeping up with constantly evolving technology is a challenge, but with IT procurement consulting services, you can get the latest technology you need to keep your company competitive. Virtu IT procurement consulting experts can assist you in making smart decisions about what technology your company should purchase, as well as ensuring that your existing IT systems are compatible with new products.