Four Steps for Strategic Collaboration Between Marketing and Software Procurement

We welcome this guest post from Jasleen Goindi, Intern (Consulting), at GEP. Jasleen is a full-time MBA student at Michigan State University, pursuing a dual specialisation in marketing and supply chain. 

The impact of digitisation is being felt across all areas of business. Marketing, for example, has two operating streams that work in entirely different ways and use entirely different methods. Traditional promotional agencies, billboard ads, physical catalogs, etc., which were once the most sought-after and spent-after tools by any marketing division in any firm, are no longer the primary methods – and for valid reasons. Consumers are now better equipped with better information, making smarter decisions. They must be sought after in a very different manner and through very specific channels, rather than through traditional and generic media. Sure, traditional methods are still valid, but their purpose has seen a massive change. These tools and media are now often ancillary and serve more as a reminder for action than inducing the need for action itself.

Therefore, marketing teams across organisations are exploring new methods to reach out to their consumers, and this move has also impacted procurement teams in those organisations. While marketing procurement teams traditionally oversaw acquiring marketing tools and optimising marketing spend, IT procurement teams must now also lend their expertise to the movement of digitisation in marketing procurement, especially software procurement teams.

The change that marketing procurement is undergoing is evident. Most firms are right in the middle of it. IT procurement teams are now involved in the procurement of marketing tools; however, most of these engagements are last-minute projects. This creates many unnecessary tight deadline ad-hocs for software procurement teams. Apart from a need for more robust planning, the digital nature of marketing tools (data management, analytics, SaaS or cloud-based platforms, etc.) confirms that IT procurement is well positioned to lead the procurement cycle for these technologies.

The approach to consolidating marketing technologies under IT procurement can be broadly explained in four steps:

  1. Information Gathering: This involves multiple steps and iterations. The key to success here is the identification and collaboration between multiple entities. The stakeholders, suppliers, marketing and IT procurement teams must all be aligned and involved. The primary sources of data will be the contracts (MSA, SOWs, Lease Orders, etc.), spend reports, and market research.
  2. Database Creation: Once the key entities have been aligned, data points must be identified and information extracted. At first, the scope of the information extracted should be wide and spread out. The key parameters to include in your database are terms of agreement, renewal terms, tentative renewal date, points of contacts, spend trends, scope, and the current categorisation based on functionality. The database and metrics should be continuously refined, broadened or narrowed down depending on the needs, short-term and long-term plans, and any other constraints.
  3. Analysis: The analysis is what will pave the road ahead for the consolidation objective. Analysing spend, supplier concentration, stakeholder preferences, and other qualitative aspects is critical. Putting all the different analyses together to form a holistic picture is what takes time and effort, but what also makes the difference.
  4. Pipeline Creation: This is where the insights from the analysis step are used to identify opportunities for synergies and optimisation. Once the synergies have been identified, a detailed strategic and tactical roadmap should be developed. This roadmap should define a pipeline of projects with a timeframe and action associated with each technology in the database above. The fourth step is ongoing and continuous. The pipeline needs to be revised periodically to ensure the IT procurement team is up to date, to allow for better planning and optimisation opportunities.

As simple and straightforward the four-step process might look, the first two steps are cumbersome and require a lot of effort and diligence. The last two steps require a thorough understanding of the business process, and the impact of changes on each process and entities involved.

It is important to understand that the consolidation of marketing technologies under IT is not a one-time project. The database needs to be updated regularly with additions and removal of technologies, which means periodic analysis and assessment of the same. Also, even though IT procurement may understand the technicalities of the contractual terms and the working of digital technologies better than marketing procurement, marketing procurement teams have a better understanding of the business for charting out the scope of the procurement project. Thus, both teams must be well aligned and coordinated to be able to collaborate on an ongoing basis.

Marketing technologies may be completely brought under the IT procurement umbrella over time, even if it’s difficult to see that happening in the immediate future. However, going with the adage, “a stitch in time saves nine,” it’s recommended to begin the consolidation now.

 

 

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