Insight Into Services SpendingInsight Into Services Spending

Services procurement at Motorola Inc. makes up as much as half of the wireless and communications equipment provider's expenses. To get a better view of its consulting and software services spending, Motorola is using a new version of Elance Inc.'s services-procurement-management software.

Elance SPM 4, which will be generally available this week, is being used in Motorola's U.S. operations, with plans to roll it out worldwide next year. "We didn't have the visibility and control to ensure that we were spending money in the best way, that we were getting the most for our dollar," says Dennis Neumann, Motorola's director of indirect E-procurement solutions and operations.

The software has been integrated with Motorola's product-procurement system, Ariba Buyer, so that the company can impose consistency from procurement to purchase order. "In procurement, there may be specific skills or products that a supplier brings, and we've got to have the flexibility to understand our existing supplier base," Neumann says.

Motorola may also use the system to help it track spending in development, outsourcing, marketing, and other functions. New features in version 4 may help. The software lets companies manage more-complex contracts in services such as software-license management, IT consulting, and business-process outsourcing via a bill-of-services function that lets businesses structure contracts so they include contingent staffing, milestones, and other options. Companies can mix and match the service types in a single order, such as an IT consulting contract that has different deliverables, several service-level agreements, and different rates, says Diana Jovin, VP of marketing and business development.

Also new is a supplier self-service-maintenance and change-order-management tool so suppliers can submit information for master contracts, too. The software is available as a hosted service or can be licensed. Pricing depends on the amount of spending a company manages; a three-year contract ranges between $3 million and $5 million.