Benefitfocus is a SaaS benefits administration platform that helps companies, municipalities, and governments to provide benefits to their employees and members. The platform helps employees get the benefits that they need, whether financial, healthcare-related, or voluntary benefits. The company, founded in 2000, has over 1,000 employees. Voya Financial acquired Benefitfocus in 2022.
SaaS procurement and management is a hands-on job. As the tech stack grows, IT leaders often find themselves devoting more time to keeping the contracts going, with less time remaining to tackle the high-level challenges they were hired to solve. This was the case for Benefitfocus. With over 150 vendors under management throughout the IT function, CIO Sean Wechter was becoming mired in a daily routine of sales team communications, renewals, and negotiations.
The volume of renewals frequently caught the team off-guard, resulting in “scramble mode” when a contract deadline would sneak up. A reactive procurement approach often results in challenges like inadequate legal review and less negotiating power for new contracts. As a leader in the financial and healthcare space, Benefitfocus must maintain a high standard for contract compliance and data security.
The company needed a better way to manage the purchasing process. They researched options and found Vendr through recommendations from others in their network. “I looked at their logo slide to find other CIOs I knew,” said Sean.
“The recommendations were overwhelmingly positive, so we decided to give Vendr a try.”
Benefitfocus onboarded with Vendr in 2021. The team began utilizing Vendr’s expert buying services to take over the negotiations for renewals and net new purchases. The shift to outside procurement allowed the team to take advantage of hundreds of data points from Vendr deals conducted on behalf of clients. This level of visibility wouldn’t have been possible, even with an in-house procurement team. As Sean explains,In the many categories we procure software in, they've closed 70 deals in a year. We may have completed one deal. The deal context is fantastic.“
The team saw immediate improvements in its ability to manage relationships with IT vendors, confident that software purchasing and negotiations were well in hand thanks to their vendor CSM and buying team. Sean credits the Vendr platform with simplifying the supplier management process.
“Vendr has helped us shift from defense to offense on renewals. Before, we were very reactive. Renewals would sneak up on us.”
Sean explains “Now, with the portal and our customer success manager, we meet 30 minutes every week and we're on top of it.”
Vendr was quickly able to deliver savings for Benefitfocus. Within the first nine months of implementation, the company saw considerable savings for its software purchases. “In less than a year, we’re knocking on the door of a million in savings,” explains Sean.
Vendr’s easy pricing structure makes it easy for the team to calculate the return on investment. “I've worked with other procurement firms on a contingency basis. With Vendr’s flat fee, you can plan it in. You understand what you're paying,” says Sean. “Partnering with Vendr was the right decision for our team, without a doubt.”
Working with Vendr has added value in other business categories, as well. “Our savings with Benefitfocus has been both financial and procedural,” says Sean. With Vendr acting as an extension of procurement, Sean share that the team can now “focus on running the business, building products, and serving our customers versus arm wrestling with suppliers on the best deal and best terms.”
The relationship with Vendr has also improved the contract process for new and existing suppliers. Because of its work in the healthcare space, contracts often include certifications and addenda to meet compliance requirements. Vendr has been able to integrate these into its buying process to better align with Benefitfocus’ needs. “Partnering with Vendr means that we were able to package up all those requirements,” says Sean. “They get out to the supplier quickly so we're not blocked on any of the procedural compliance pieces in the procurement process.”
With a streamlined process and a solid procurement partner in place, Sean and the team can now administer SaaS purchases in hours rather than days. The time they save helps them drive impact initiatives and add value to the organization.
Vendr helped healthcare leader Benefitfocus save nearly $1M in under one year while improving its procurement process and contract compliance metrics.
- Streamlined administration for over 150 IT suppliers under management
- Realized exponential savings within the first year of implementation
- Improved its procurement process through a pricing and negotiation partnership
- Increased adherence to regulatory requirements in its supplier contracts
- Created more time for IT to address other high-level initiatives