Traditionally, much of higher ed procurement has been reactive. Individual departments source what they need (when they need it), often without considering volume discounts, existing contracts, or compliance requirements. This fragmented approach leads to inefficiencies and overspending.
Strategic procurement, on the other hand, enables institutions to look at the big picture, consolidating spend, optimizing contracts, and building partnerships that deliver value beyond price.
So, what does it take to embrace strategic procurement to maximize cost savings? Let’s go step-by-step.
Before you can implement a strategic procurement model, you need to understand where you are right now. Start by assessing the maturity of your procurement. Key questions to ask include:
This assessment will help identify inefficiencies and opportunities to streamline operations.
Creating a strategic procurement solution requires clearly defining your goals. What specifically are you trying to achieve?
For most institutions, the goals are a mix of:
You will need to take an in-depth look at spend across departments. Identifying high-spend categories to start can help you maximize your savings.
With goals in mind, you can also establish KPIs that reflect the outcomes you want. For example:
One of the biggest challenges in higher education procurement is decentralization. When departments operate independently, it often results in duplicated purchases, inconsistent pricing, and reduced negotiating power.
Centralizing procurement doesn’t mean stripping departments of autonomy. It means creating standardized processes and guidelines to help everyone buy smarter.
Key strategies include:
This helps you get better control over spend and identify opportunities for savings. For example, an eProcurement platform with punchouts to approved supplier catalogs, along with P-cards, can bring more spend under contract and achieve renegotiated savings.
Strategic procurement relies on accurate, accessible data. Spend analytics can uncover patterns, highlight inefficiencies, and reveal opportunities for saving, including:
With the right data and tools, you can better forecast demand, reduce redundant purchases, and negotiate stronger supplier agreements. Consider scheduling regular spend reviews with key departments and using data insights to support strategic procurement solutions.
The best suppliers should not be seen as just vendors. Strategic procurement treats them as partners, building strong relationships and finding areas of mutual benefit. Improving supplier relationship management (SRM) can provide significant benefits and uncover additional ways to save.
Stronger relationships build the foundation for:
If you’re not investing in SRM, you’re likely falling behind your colleagues. Gartner data shows that in the past two years, supplier collaboration has become a priority for 88% of procurement leaders.
One of the most effective procurement solutions available to higher education institutions is the use of cooperative contracts. These pre-negotiated, ready-to-use contracts save time, ensure compliance, and leverage the collective buying power of multiple institutions.
Rather than each college or university conducting its own solicitation, cooperative contracts allow institutions to access competitively solicited agreements that meet procurement standards. This eliminates duplication of effort and typically results in better pricing and terms than a single institution could secure on its own.
Cooperative contracts often result in savings of 10% to 15% or more.
Strategic procurement is an ongoing process. You should build mechanisms to monitor performance, review the data, and refine your strategy as needs evolve. Creating a set of key performance indicators (KPIs) and comparing them to your baseline and long-term goals can help you identify shortfalls and celebrate successes with your procurement solutions.
Many colleges and universities view procurement as transactional. While that’s true, procurement leaders today are moving well beyond sourcing and purchasing to create long-term value to lower costs and align with institutional priorities.
The right procurement solutions can enable academic institutions to take an ever greater role in mission success.
E&I Cooperative Services is the only member-owned non-profit sourcing cooperative focused exclusively on education. Explore our competitively solicited cooperative contracts and strategic procurement solutions to help your institution save time, reduce costs, and stay compliant.
