We’re not a huge campus. We have 7,000 students. And we want the departments to be able to spend their budgets as wisely as possible. If we can send them through negotiated contracts, it allows them to stretch those scarce budget dollars even farther.Steve Lunden
Gonzaga sees big savings with eProcurement
ESM Purchase plus p-cards helps university spend better
Gonzaga University made a major shift in its purchasing a few years ago when it began the transition from purchase orders to purchase cards.
But Steve Lunden, purchasing director, also knew he’d need to put some safeguards in place to ensure those P-cards are used properly.
After talking with colleagues at other higher education institutions, including Portland State University, Gonzaga selected ESM Purchase, a cloud-based eProcurement solution that provides control and visibility into an organization’s spend.
“It’s all about control… But we don’t call it control. We steer customers and help them make the right choices when they make a purchase. As long as they are going through the ESM shopping portal, we know they are getting the right contract.”
It took less than two months to deploy the solution. Immediately, the benefits started rolling in. “The very first transaction starts a snowball of savings for my department, the school and the user,” Lunden said.
Here are five ways ESM makes purchasing better at Gonzaga University:
‘Right catalogs, right discounts’
With ESM Purchase, Lunden can guide P-card users directly to Gonzaga’s approved vendors and contracts through an online marketplace. Each time a P-card is used in the marketplace, Lunden knows buyers are getting the best prices and, long term, helping to generate rebates and other savings.
“The thing that really appeals to me is that we get people directly to our negotiated contracts,” he said. “They are going to the right catalogs and they are getting the right discounts.”
‘Clearly defined’ orders
ESM Purchase also gives Lunden and his staff a clearer picture of just how university departments are spending their dollars and allows them to quickly address any issue that comes up.
“When stuff comes in from ESM, it’s clearly defined,” he said. “Since I get a copy of every ESM order, I know that if there is a question, I can find out really quickly who ordered that item and I can redirect them to the correct vendors.”
‘Simple,’ ‘intuitive’ for users
The e-commerce shopping solution is easy to learn - no different than shopping and buying on consumer sites. They can simply search and click their way to the items they need. Then, if required, ship their online order to a supervisor for the appropriate approvals.
“We promised an eCommerce experience and that’s really what it’s like,” Lunden said. “It’s really pretty simple and they know how to do it. They can order items without much interaction. It’s really intuitive.”
In fact, Lunden said he didn’t have to schedule dozens of training sessions so users could become familiar with the system.
“It’s just a matter of people knowing it’s there and then making sure the right catalogs are available to them,” he said.
On contract for significant savings
With ESM, Lunden has a complete view into how the P-cards are being used. Every transaction is tracked through the system, allowing Gonzaga to analyze spend and identify new opportunities to drive savings and negotiate better contracts.
He’s also developed a system to track Gonzaga spend and compare the contract price with what buyers would pay if they went straight to a merchant’s website.
“Roughly, we are running about a 14 percent savings. That’s significant,” Lunden said.
For users, the eye openers come when Lunden shows them exactly how much they saved using approved contracts - 75 percent on a clock, 50 percent on AA batteries, 30 percent on vinyl gloves.
“If you can get a 75 percent savings, wouldn’t you jump on that?” he said.
‘Circumventing PO costs’
Despite the success, not everybody goes straight to the marketplace, Lunden said. Some on campus still attempt to order items through the old purchase order process, even when Gonzaga’s approved vendors offer the same things. Often, buyers simply get the price for a camera, for instance, or other item, from a local shop.
“When they send a requisition over here, instead of turning it into a purchase order, we run it through ESM with the buyer’s P-card,” Lunden said. “We circumvent the cost of the PO and get the low prices that we’ve negotiated. They are always surprised when they see the savings.”
The future for Gonzaga = more catalogs, more spend with ESM
Going forward, Lunden is continuing to expand the number of departments with access to the marketplace and adding new catalogs. He’s recently added Fisher Scientific, and has others on his short list. He’s also working on more ways to educate users about the benefits of shopping there.
“Directing how those P-cards are used was our main motivator when we chose ESM Purchase,” Lunden said. “But, those cost savings? Those are pretty nice.”
“We promised an eCommerce experience and that’s really what it’s like. It’s really pretty simple and they know how to do it. They can order items without much interaction. It’s really intuitive.”Steve Lunden
ESM is a leading provider of cloud-based spend management and eProcurement solutions, giving customers complete control of their spend through a comprehensive suite of integrated, yet modular solutions. The company’s flexible sourcing, purchasing, invoicing and contract management applications help organizations save time and money. As a SaaS-based solution, ESM makes financial system integration, data visibility and streamlining of the entire procure-to-pay process fast and easy. On the web: esmsolutions.com.