Businesses that are looking to create an efficient flow of goods and raw materials need to understand the ITIL procurement process. It is an essential part of just about every business you can imagine, including manufacturers and technology-based groups. There are many advantages to better understanding it and implementing it in your business.

In this article, we will discuss the nature of ITIL, the ITIL procurement process, and how you can make it work for your needs. You’ll also get some of the best tips for this process that we can find. As a result, you can create an ITIL procurement process that works for your business and its unique needs.

a diagram showing the main stages of a procurement process

What Is ITIL?

ITIL is the process of procuring items for a business and streamlining the process simply and effectively. It is one of the most important ways of managing a business because it provides them with a steady supply of items.

The ITIL procurement process is something that requires a simple approach, an understanding of your business needs, and a variety of other steps. You are trying to streamline everything to the point where you can easily handle an influx of goods without paying too much for delivery.

The Basics of the Process

When starting up the ITIL procurement process, you need to understand a few of the basics behind it. Below, you’ll find a useful list detailing some of its most essential items.

1: Identifying the Business Requirements

Understanding what your business requires from this process helps you get started on the right food. This knowledge includes the items you need, a strategy for your implementation, and a basic policy for your ITIL.

2: Selecting Suppliers

Once you have an idea of your needs, it is important to identify the vendors who best serve you. We’ll go into more depth on this later, but for now, just focus on finding five or so vendors who meet your needs.

3: Talking to Potential Suppliers

When you have a good list of providers, it is important to research them and then contact them to discuss their terms. By reaching out and coming to a basic understanding of their needs and telling them yours, you can improve the ITIL procurement process.

4: Discussing Delivery Methods

How are you going to get your supplies from your suppliers? This aspect needs to be addressed before you sign any contracts. They should have a variety of delivery methods and schedules that you can use.

5: Create an ITIL Procurement Process Framework

Once you have come to an understanding with your suppliers, designing a framework for your delivery needs is essential. This act requires discussing where they will deliver and understanding how this affects your business.

a more complex diagram showing the steps of procurement and sourcing processes

Important Terms to Understand

Here is a list of some of the most crucial ITIL procurement process terms that you need to know:

  • Sub-Processes – The basic steps that help implement the larger ITIL procurement process.
  • Objectives – The purpose behind your procurement process.
  • Evaluations – Discerns the quality of your procurement and finds solutions to problems.
  • Supplier – The company that provides you with your goods.
  • Contracts – People who receive goods from a supplier.
  • Standard Orders – A regularly occurring order that your supplier fulfills.
  • Special Orders – Those deliveries that are unusual or require speedy delivery.
  • Purchase Order – The written order for item delivery.
  • Purchase Request – A request to purchase an item. Differs from an order because it is non-binding until an order is made.
  • Supplier Service Level Report – Gauges how well your deliveries are being made.
  • Supplier Strategy – Defines the strategy the supplier follows to deliver your goods.
  • Underpinning Contract – The contract between an ITIL procurement process provider and you.

Tips for Improving Your ITIL Procurement Process

Those who are looking to perfect their ITIL procurement process need to consider the following tips. They are easy to understand and are easy to implement.

#1. Start with Your Budget

Avoid coming up with a procurement process without considering your budget. Try to avoid breaking the bank but make sure to budget a sufficient amount. We suggest about 10-15 percent of your total operating budget.

#2. Location Is Crucial

Delivery distance will profoundly impact procurement costs. Identify suppliers that are closer to you and work with them. It is also worth finding someone close because emergency deliveries will be easier.

#3. Minimize Delivery Necessity

While you will regularly receive goods from your supplier, you should try to minimize how often they deliver. Do this by ordering a sufficient level of supplies and concentrating multiple good types in one delivery.

#4. Perform Regular Evaluations

Some companies avoid regular ITIL procurement process evaluations because they don’t want to spend the money on them. That is a mistake because assessments can identify problems before they occur. Get one at least every six months.

#5. Research Your Suppliers

What are others saying about your suppliers? Do they appreciate their skills or are they poorly rated? Make sure to scrutinize them. Try the Better Business Bureau to get an idea of their service quality.

#6. Travel to Meet Your Suppliers

Before signing a contract, meet your vendors in person. Talk to them about their strategy, define contract terms, and learn more about their process. This way, you can get a better idea of what they have to offer you.

Putting It All Together

As you can see, the ITIL procurement process is one that you need to master. It provides you and your business with a multitude of benefits. It is essential to get started on this process as soon as possible to ensure you manage it correctly.

We hope this article about how to manage the entire ITIL procurement process will help you understand this concept better and apply it more effectively. Make sure to share this article with friends and business partners that you think could benefit from it.

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