{{Unreferenced, date=June 2019, bot=noref (GreenC bot) An Integrated Service Provider (ISP) is a for-hire firm that performs a variety of

logistics Logistics is generally the detailed organization and implementation of a complex operation. In a general business sense, logistics manages the flow of goods between the point of origin and the point of consumption to meet the requirements of ...

service activities such as warehousing, transportation, and other functional activities that constitute a total service package. In addition, other categories of spend may fall under the ISP's scope such as maintenance, repair, and operations (MRO) services. Firms that provide such services typically have a good understanding of their customers needs and are responsible for executing services in accordance with

contract A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tran ...

documents. Normally the scope of work (SOW) and the ISP contract are finalized only after an extensive

due diligence Due diligence is the investigation or exercise of care that a reasonable business or person is normally expected to take before entering into an agreement or contract with another party or an act with a certain standard of care. It can be a l ...

period.

As a service

The ISP provider may be contracted to perform a function or consolidate any number of activities required to support the customer's needs. In any case, normally the primary goal of the ISP is to achieve an overall cost savings for the customer. ISP providers normally work closely with the customer's management team within a facility to provide

strategic sourcing Strategic sourcing is the process of developing channels of supply at the lowest total cost, not just the lowest purchase price. It expands upon traditional organisational purchasing activities to embrace all activities within the procurement cycle, ...

to cut costs. In addition, the ISP and the customer normally will use key performance indicators that provide constant

feedback Feedback occurs when outputs of a system are routed back as inputs as part of a chain of cause-and-effect that forms a circuit or loop. The system can then be said to ''feed back'' into itself. The notion of cause-and-effect has to be handled ...

on the performance of the ISP program. ISP firms can manage single or multiple categories of spend, such as facility management services, as part of a total integrated scope of work. Management of an ISP contract is typically a joint effort with both sides designating an ISP Manager. These managers will normally have quarterly review meetings to review performance and feedback with the customer's facility management team. Managers will also develop and review strategies related to

spend management Spend analysis or spend analytics is the process of collecting, cleansing, classifying and analyzing expenditure data with the purpose of decreasing procurement costs, improving efficiency, and monitoring controls and compliance. It can also be lev ...

. ISP firms may be required to hold certain permits or licenses in order to perform services. To obtain information on state requirements, a firm may check with the Contractor's License Reference website as well as the National Contractor's website.

ISP provider example

An organization would start an ISP program in order to achieve a specific cost savings for its manufacturing facility. An ISP provider is selected at the owner's facility to conduct due diligence and analyze prior year spend data. After a thorough analysis by both parties, a contract is developed to meet mutually agreed objectives. Typically a go-live date is set to begin services. At this point the ISP provider has made all the appropriate preparations to provide agreed services. Logistics