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'''Spend management''' is meant to represent a holistic view of the activities involved in the "source-to-settle" process for enterprise spend on goods and services. This process includes spend analysis, sourcing, procurement, receiving, invoicing, payment, and settlement. Different practitioners and solution providers use different terminology to describe the management of this process - [[procurement]] and [[supply management]] are the other two most commonly used today.

Spend management is the way in which companies control and optimize the money they spend. It involves cutting operating and other costs associated with doing business. These costs typically show up as "operating costs" or SG&A (Selling, General and Administrative) costs, but can also be found in other areas and in other members of the supply chain.

Whether it is the money spent on goods or services for direct inputs (raw goods and materials used in the manufacture of products), indirect material (office supplies and other expenses that do not go into a finished product), or services (temporary and contract labor, print services, etc.), a companyn enterprise needs a mechanism by which they are not only able to save money butand/or control costs.

Spend Management is meant to represent a holistic view of the activities involved in the "source-to-settle" process. This process includes spend analysis, sourcing, procurement, receiving, payment settlement and management of accounts payable and general ledger accounts. but also identify the suppliers that offer the highest value. 

In an enterprise, spend management is managing how to spend money to best effect in order to build products and services. The term is intended to encompass such processes as outsourcing, procurement, e-procurement, and supply chain management. Since the "spend manager" could have a significant impact on a company's results, it has been advocated that this manager have a senior voice in running the company. The [[Chief Procurement Officer]] or Head of Procurement is the title assigned to the executive in charge of spend management within an enterprise.

== Cost reduction vs revenue generation ==

Companies divide money into two major buckets - revenue and cost. In hard economic times, when revenue is harder to come by, companies often turn to cost cutting initiatives. Cost cutting will increase net income. An increase in net income leads to a greater earnings per share and ultimately a higher market value (higher market capitalization).

Because cost cutting affects a company's bottom line directly, certain types of cost cutting can be the quickest way companies can increase their market value. The typical consensus is that the revenue to cost ratio is about 3 to 1; for instance, increasing revenue by $300 has about the same effect as cuttFor example, if you work for a company that has a 4% net profit margin, that company must generate $25 million in revenue to earn $1 million in profit. For this example company, saving $1 million dollars in enterprise spend assuming it all impacts the budget or bottom line has the same net impact of selling $25 million. The amount of revenue that equates to $1 million in savings depends on the company's profit margin. <ref>''[http://cporising  .costs by $100.m/wp-content/uploads/2010/06/ProfitMargins4.png Profit Margin Impact - Revenue Needed to Earn $1 Million]''</ref>

This is why, in hard times, companies typically turn to cost cutting measures such as layoffs and product quality reductions. However, most analysts agree that this short term tactic creates little long term value, nor any long term sustainable savings. This is why "Spend Management" has become a key long term strategy for companies seeking to maintain long term and sustainable value.



== Spend management systems ==

Most recently, companies have been utilizing new tools such as e-sourcing (for bidding and [[reverse auction]]), e-procurement (to control and monitor purchasing activities and contracts), and e-spend analyticsis (to gain insight into how much money is being spent on what types of services or products). Some tools are also addressing the entire spending chain, or [[purchase-to-pay]] cycle <ref>''[http://www.itjungle.com/fhs/fhs041310-story04.html P2P vendors in the US]''</ref>

(contracted; show full)

In the end, however, Spend Management is about creating long-term and sustainable savings. True Spend Management (and by extension Total Cost Management) is considered by many to be an ongoing cyclical processing

== 
See also ==
* [[reverse auction]]⏎
The main purpose of Spend Management is ⏎
⏎
	Aggregate information from disparate clinical, contracting, purchasing and account==

To efficiently and effectively manage the money an enterprise spends with suppliers. Cost savings pmayable systems. 
	Accelerate standardization efforts to identify savings opportunities. 
	Identify contract savings opportunitie be a major focus for certain types of goods and services (called categories of spend) but supply assurance, quality, innovation, and a host of other considerations cand maximize tier-level savings. • Prevent contact pricing errors due to expired or invalid contracts. 
	Access an on-line repository of digitized contract data, including pricing synchronization. be included in a category strategy. The organized management of enterprise spend by the procurement function has been shown to add significant value to business operations and the bottom-line {{Citation needed|date=August 2010}}.   

==Further reading== 
{{Citation
  | last1 = Pandit | first1 = Kirit
  | last2 = Marmanis   | first2 = H.
  | title = [[Spend Analysis: The Window into Strategic Sourcing]]
  | publisher = [[J. Ross Publishing]]
  | year = 2008
  | isbn = 1-932159-93-6 }}
1.	The individual reports for each company are downloaded as stated above and are clubbed into a single report. The clubbed report should include an additional column ID_COMPANY which refers to the company id.

==References==
<references />


[[Category:Management accounting]]

[[sk:Riadenie výdavkov]]