Welcome To
The Bottom Line

In less than a decade, the smartphone has become essential to our daily lives. Perhaps ironically, its primary function of allowing us to make a call at almost any time and anywhere has been superseded by a dizzying array of other activities it facilitates, including banking. The convenience and accessibility with the smartphone and subsequent digital devices, e.g., tablet, wearables, etc., has changed things radically for financial institutions (FIs). Today, consumers determine how, when and where they will access financial services. To say this change has complicated things for banks and credit unions is an understatement.

A study conducted by the International Association of Contract and Commercial Management (IACCM) found that poor vendor contract processes cost companies as much as nine percent of their total revenues. Although this was a cross-industry study, there is little reason to believe the financial services sector fares any better or that the picture has improved since 2015. With so much money being left on the table and the drumbeat for cost efficiencies sounding as loudly as ever, financial institutions are seeking new ways to make this area easier to manage more effectively.

Engaging with a sourcing partner can be an effective means to improve your institution’s bottom line and protect your operations from the distractions that can be created when management must handle such duties themselves. However, it is important to note that not all sourcing management firms are created equal. As with all partners you select, some of these firms will be a better fit with your culture and objectives than others. We suggest asking the following questions before selecting a strategic sourcing partner.