How can organisations reduce maverick spend without slowing purchasing?

Organisations reduce maverick spend without slowing purchasing by making the compliant route the fastest one: pre-approved catalogues, contracts that budget holders can actually find, and approval thresholds that match risk. Control comes from design rather than restriction. Done well, cost optimisation procurement activity improves speed and compliance together.

The aim is to remove the reasons people buy off-contract, not to police them. The sections below cover what drives maverick spend, how to streamline approvals, which tools help, how to change budget holder behaviour and how to measure progress.

What causes maverick spend in the first place?

Maverick spend is caused mainly by friction and lack of awareness: budget holders cannot find the right contract, the approved route is too slow, or the contracted supplier does not meet their needs. Most off-contract buying is a rational response to a poorly designed process, not deliberate rule-breaking.

In practice, the same handful of causes appear again and again:

• Poor visibility of contracts. Budget holders do not know an agreement exists, or cannot easily see what it covers and how to use it.
• Slow or unclear approval routes. If raising a compliant requisition takes days, a corporate card or direct invoice starts to look attractive.
• Gaps in the contracted offer. Preferred suppliers may not stock what teams need, or may have weak service levels, so people look elsewhere.
• Urgent or low-value purchases. Small, time-pressured buys are the most likely to bypass the process.
• Weak ownership. Where nobody is accountable for category compliance, leakage goes unchallenged.

Diagnosing which of these applies in your organisation should come before any control is introduced. A spend analysis by category and department usually reveals that leakage is concentrated in a few areas rather than spread evenly.

How can approvals be tightened without adding delays?

Approvals can be tightened without delay by tiering them according to value and risk, automating routine decisions and reserving human review for genuine exceptions. Low-value, on-contract purchases should flow through almost instantly, while higher-risk or off-contract requests receive proportionate scrutiny.

A practical approach has four parts:

1. Set tiered thresholds. Agree spend bands with finance so that routine, catalogue-based purchases need only line manager approval, while larger or non-standard requests escalate.
2. Automate the straightforward cases. Where a requisition matches an approved supplier, price and budget code, it should be approved automatically or with a single click.
3. Set service levels for approvers. Agree response times and delegate authority to deputies so absence does not stall purchasing.
4. Make exceptions easy to request. A short, quick route for justified off-contract purchases is better than a rigid block that people work around.

The common mistake is adding approval layers across the board in response to leakage. This slows compliant purchasing and pushes more activity outside the system. Control should be risk-based, concentrating effort where the financial or commercial exposure is highest.

Which tools make compliant purchasing the easy option?

The most effective tools are e-procurement or purchase-to-pay platforms with punch-out or hosted catalogues, a searchable contract register and clear purchasing guides. They work because they put approved suppliers, agreed prices and routing in one place, so buying on-contract takes less effort than buying elsewhere.

Useful capabilities include:

• Catalogue purchasing with pre-negotiated prices, so budget holders select items rather than source them.
• A contract repository that shows scope, pricing, contacts and renewal dates in plain terms.
• Automated workflow and budget checks that route requests correctly and flag overspend before commitment.
• Controlled purchasing cards for genuine low-value needs, with category and merchant restrictions.

Technology alone does not solve the problem. A platform that is hard to navigate or populated with the wrong suppliers will be bypassed just as readily as a paper process. Tools should be configured around how people actually buy, and the contracted offer must be competitive enough to deserve the traffic. Reviewing and renegotiating weak agreements, as part of a wider cost optimisation programme, often does more for compliance than any system change.

How do you get budget holders to buy on-contract?

Budget holders buy on-contract when it is quicker, clearer and better for them than the alternative, and when they understand why it matters. Behaviour changes through involvement, simple communication and visible accountability, not through instruction alone.

Several actions consistently help:

• Involve users in supplier selection. Teams who shape specifications and evaluation criteria are far more likely to use the resulting contract.
• Communicate in practical terms. A one-page guide showing what is covered, how to order and who to call is more effective than a policy document.
• Manage supplier performance actively. If service from a contracted supplier is poor, users will leave. Strong supplier relationship management keeps the contracted route worth using.
• Share data with budget holders. Showing departments their own compliance levels and the savings at stake builds ownership.
• Provide a named procurement contact for each category who can resolve problems quickly.

Where capacity is limited, organisations sometimes bring in interim procurement resources to embed these routines, then hand over to the internal team once the working practices are established.

How should maverick spend be measured and tracked?

Maverick spend should be measured as the proportion of addressable spend placed outside approved contracts or processes, tracked by category, supplier and department over time. Consistent definitions matter more than precision, because the trend shows whether interventions are working.

A workable measurement framework includes:

• Spend under management: the share of total addressable spend covered by contracts or approved processes.
• Contract compliance rate: spend with contracted suppliers as a share of spend in categories where a contract exists.
• Purchase order compliance: the share of invoices matched to an order raised before the commitment, which highlights retrospective buying.
• Tail spend analysis: the number of low-value suppliers and transactions, where leakage often concentrates.

Start by cleansing and categorising spend data, as inconsistent supplier records and coding can hide the true picture. Report monthly or quarterly to budget holders and finance, and focus on the categories with the largest value at stake. Benchmarking your results against comparable organisations through procurement benchmarking can also help set realistic targets rather than aiming for an arbitrary compliance figure.

If you want to understand where maverick spend is arising in your organisation and design controls that do not slow your teams down, speak to eXceeding. Our independent consultants can analyse your spend, identify the root causes of off-contract buying and help you put practical, proportionate controls in place.

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