A Day in the Life of a Procurement Maverick

A Day in the Life of a Procurement Maverick

Has this ever happened to you?

Procurement Manager (PM): Why did you not use our system to finish the order? 

Procurement Executive (PE): I felt we could speak to the supplier directly, and process the order manually – it would save us some money, and I saved us 50% in this case.

PM: Well, that would be good if we did not spend over 3x trying to save that 50%.


Purchasing from vendors outside of established procurement policies is known as maverick spending. Off-contract spending or purchasing from non-preferred vendors are examples of maverick spending. Maverick spending accounts for anything from 25% to 80% of overall spending across all types of enterprises. These purchases may not have been made on purpose; some may have been made due to real errors or a lack of information. Maverick spending means you won’t be able to take advantage of the deals and discounts you worked so hard to secure. Maverick spending is small leakage from negotiated supplier contracts at best, and unrestrained, rebellious purchasing at worst.

Spend analytics and transactional purchasing system providers tout the reduction in maverick spending as a benefit of their products. In practice, maverick spending reduces the value of predicted sourcing benefits and may erode contracted suppliers’ trust in the buyer’s volume projections. While some ‘maverick spending’ is motivated by ignorance or rogue decision-makers, some stakeholders choose not to use preferred providers for valid reasons and knowing why ‘maverick purchasing’ occurs can provide useful insight into what stakeholders require and why.

How Do You Identify and Help the Maverick?

Enable Visibility into Spend Analytics

The ability to see where your money goes is crucial. After all, what you can’t see can’t be saved or fixed. Do you have any idea how much maverick spending costs your business? Or the non-conformity-prone job areas and budget categories? A thorough expenditure analysis can assist you in identifying gaps in all sources of spend data. You may then determine who, what, and where the problem is and devise a strategy to address it.

Enable Transition from Offline to Online Procurement

The majority of employees do not “go rogue” on purpose or with malice in their hearts. They may simply be unaware of the procurement procedure. Alternatively, people may find it inconvenient and time-consuming. Automation software can be daunting to staff who haven’t used it before. They may also notice lower pricing elsewhere, not realizing the costs of invoice and payment processing, as well as expenditure reimbursement. Regular efforts to explain the “why” and convey the value can go a long way toward garnering buy-in, whatever the cause. Consider organizing (bring your own) lunch and learn sessions, rewarding excellent department or individual successes, and allowing employees to propose vendors and provide feedback.

Choose a User Friendly Digital Procurement Solution

If you’re having trouble with your procurement process, consider using a more user-friendly alternative. On the market, there are numerous automated eProcurement systems that are both economical and simple to use. The goal is to choose a solution that is simple to use and all-encompassing (i.e., it tracks all direct and indirect spending) and interacts with your ERP system. This guarantees that all employees have timely access to the correct information.

Seek Feedback from Your Procurement Team for Continuous Improvement

Organizations are susceptible to procurement mavericks. A well-managed budget, planned procurement workflows, and improved departmental skills will assist organizations in successfully managing their spending and executing processes. In the end, noncompliance with procurement laws and maverick spending costs businesses a lot of money. You’ll gain a greater understanding of why maverick spending occurs, where it occurs most frequently, and, most critically, what solutions you should take to stop it by delving deeper into the purchasing experience and the obstacles and frustrations your employees face.

How Can Your Business Move Away from Maverick Procurement?

Data available from a large EPC company that employs 5000 procurement professionals shows that a switch from maverick spending to procurement automation has resulted in 80% time savings on the purchase requisition to purchase order cycle. To learn how your business can unlock new avenues of efficiency by moving away from maverick procurement to an integrated digital procurement solution, click here

Will Santa Claus Deliver on the Supply Chain Promise this Christmas?

Will Santa Claus Deliver on the Supply Chain Promise this Christmas?

With the Christmas season around the corner, the festive spirit is very much palpable in the UAE. However, the second Christmas through the COVID19 pandemic throws some questions for the global supply chain. Are we bracing up for a shortage of Christmas trees in the UAE this year?

Inventory Shortages Through the Build Up to Christmas

Online buyers saw over 2 billion out-of-stock warnings in October 2021 alone. This number is a good indicator of the demand-supply imbalance and a cause of concern for goods manufacturers, OEMs, and distributors. Consumption peaks around the holiday season represent a vital growth opportunity, especially after insipid demand through the COVID19 pandemic.

Here are some goodies that the global supply chain industry would definitely add to their Santa wish-list to ensure better preparedness in the future.

Demand versus Supply – Manage the Suppliers First

The product journey begins with sourcing raw material at the start of the production cycle. Supply chain complexity increases with the number of vendors. A transparent, seamless, and integrated vendor management system will help manufacturers tide over seasonal peaks and plan better. Just like Santa would plan meticulously to meet the expectations of young children globally, a robust and automated vendor management system improves the chances of meeting demand without hiccups.

A More Visible Supply Chain will be The Perfect Gift from Santa Claus

Supply chain visibility is critical to spotting potential bottle-necks, tracking workflows, and making data-backed decisions. An essential step to greater visibility is digitizing the procurement process and vendor consolidation. The resulting elimination of manual processes allows producers to plan more efficiently and solve supply chain challenges easily. 

Data Analytics and Predictability to the Rescue

Knowing the extent of product demand is the key to shipping the right quantity. This means knowing historical sales data, awareness of supplier capabilities, and building a backup for these products with a suitable replacement – just in case things get out of hand. A transparent and seamless digital solution or ERP that provides this visibility is essential and can be a game-changer in managing expectations, winning a sale, and growing faster.

Making Christmas Arrive Early Each Year

Understanding the various challenges caused by a seasonal surge in demand will help manufacturers and OEMs re-imagine and strengthen supply chain resilience for the future. A partner that provides organizations greater predictability, visibility, cost efficiency, and agility at scale to their supply chain and procurement practice can help reduce the strain on logistics and procurement throughout the year. 
To know more about how Moglix can help you with your Supply Chain issues and overcome the stress of supplying to the holiday season, visit business.moglix.ae for more information.