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LEVELING THE PLAYING FIELD ON DATA-DRIVEN INTELLIGENCE: IMPROVED ACCESS AND SMARTER IMPLEMENTATION TO DRIVE GREATER VALUE FOR BUSINESSES

23/04/2019

John Callan, Senior Director at Coupa

 

Procurement is a vital component to any successful business, much like the deal closing sales teams working on the other side of the organisation. But in many cases, procurement teams suffer from inadequate intelligence compared to their counterparts.

 

Sales benefits from an abundance of internal and external resources, combining data and analysis to make intelligent informed actions. Market research, customer profiling and a data-driven approach has created a focused and efficient business practice, recognised as directly impacting the bottom line and embraced by the entire business.

 

Procurement is more than capable of delivering these same contributions to an organisation. But in many ways it has been neglected, through a lack of understanding and operating legacy systems based on outdated ideas, holding back its ability to contribute greater value.

 

Outdated solutions

Yesterday’s procurement intelligence solutions are no longer viable. They were developed for siloed organisations and lack the ability to work cohesively with modern business practice. They cannot deliver the insight for procurement to be valued within an organisation.

 

Patchworks of systems, products and processes have created inefficiencies in the exchange of information between buyer and a supplier. The cumbersome and slow nature of these systems lack the intelligence business decision makers need today.

 

Parts of these systems have advanced over time, especially in payments. But this has not been part of a strategic and unified approach and the lack of integration fosters an environment of inefficiency and missed opportunities to optimise.

 

Implementing the right platform

It’s time for procurement to realise the benefits it can – and should – be delivering to businesses. Powerful technology platforms are available to procurement teams that can enable them to provide impactful insights that are equally as strategic as those generated by their colleagues in sales.

 

Business functions including sourcing, approving and onboarding suppliers and purchasing goods, can work together holistically as part of a streamlined process. Implementing smart, integrated solutions that not only simplify core procurement functions but also deliver valuable intelligence and create incredible opportunities for business.

 

For instance, using new insights to: create the most effective category plans, fair market pricing evaluation to maximise savings and analysis of consumption patterns to reduce overall spend,  analysis of preferred supplier compliance, contract usage and buying channel distribution to address savings leakage.

 

These solutions can inform smarter business decisions and deliver applicable insight. Empowering procurement teams and business leaders to focus on the higher value functions of procurement such as negotiating contracts, monitoring supplier performance and strategic sourcing.

 

Data that drives decisions

Millions of data points are locked within the typical procurement process. But most of this data remains inaccessible and unused because procurement teams struggle to turn it into the actionable insights they need. That’s why it’s critical for companies to focus on increasing the maturity of their analytics and intelligence capabilities.

 

The best way in which to do this is by creating ‘open’ data systems that inform a business though a shared pool of information, unifying data resources to maximise the application of intelligence and impact to the business. Delving deeper into the data and creating actionable insights.

 

Data needs to be shared, analysed and available in real-time. It needs to be informed internally and externally, integrated through the business and taking advantage of third party and external sources of information. Through sharing information departments and businesses can see the benefits and drawbacks as they choose suppliers. Costs, delivery times, geography, availability and track/record.

 

Analytics, artificial intelligence, bots, community intelligence and other technologies can work together to improve procurement outcomes. For this to become a reality they need to share the right data and enough data to have an impact.

 

Delivering valuable insight

In today’s data-driven economy, procurement teams need to implement systems that leverage the abundance of data to deliver intelligence that can be turned into actions. This access needs to be at all levels of the business and gather all applicable data, in an open data system.

 

It’s of paramount importance for businesses to change their attitudes to procurement and work with platforms that can realise and deliver the value of data they require. Through a holistic view of procurement and open data systems in-line with sales, significant savings can be made,  inefficiencies removed and with each step in the journey, analytics and intelligence can become more valuable to the business.

 

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Finance Derivative is a global financial and business analysis magazine, published by FM.Publishing. It is a yearly print and online magazine providing broad coverage and analysis of the financial industry, international business and the global economy.