Today’s globally competitive market, highly demanding customers and the dynamic economic scenario have driven organizations to move ahead and leverage analytics by placing it at the heart of the organization in order to grow and yield positive results.
Analytics. It is a term that talks to procurement professionals in different ways. While some consider it as a must-have tool for making procurement future ready, others are still contemplating as to how will it help sourcing?
In today’s day and age companies require effective insights from their data to not only improve their performance but also expand their business horizons. Procurement as a sector is extremely rich with data and organizations are now beginning to leverage the same in order to impact the business in ways it could not before. “Procurement Professionals” or “Procurement Pundits”, as I like to call them, are now using analytics to gather insights on creating an effective category plan, evaluating price to maximise savings, analysing preferred supplier compliance, contract usage and much more.
By applying analytics to the millions of data points, these leaders are equipped to make vastly better business decisions through intelligent augmentation and do so more quickly through intelligent automation. In turn, they’re increasing cost savings, decreasing operating costs, and reducing risk—something all companies are keen to do.
Thus, there is no shying away from the fact that the future winners will be those business organizations who sustain themselves from the gravitational pull of the past on the fuel of analytics. They are now moving beyond the traditional weigh given to cost reduction and instead, focussing on expanding and deepening the scope of procurement analytics.
However, the big question is if Analytics Really Leads to Better Procurement Performance? Let us try finding that out:
Data analytics allows visibility to several factors that would usually be hard for humans to figure out on their own. As customers are becoming more and more demanding, data helps track products through the supply chain. Moreover, predictive data supports procurement professionals in finding ideal suppliers and adhering to a specific code of ethics throughout the supply chain.
Analytics help in identifying business risk faced by the suppliers comprising pricing, compliance, geographical and many others. It acts as a shield by managing risk and ensuring that supply risk can be laced into the sourcing equation to ensure business continuity.
Analytics in procurement allows innovation and helps in providing new solutions or help and support R&D with sources for new products or services to advance offerings.
In order to have the ability to recognize patterns from complex data sets, advanced analytics techniques allows procurement professionals or analysts to study the data in depth with ease, regulate the important drivers of price and consolidate the data based on the same. This results in not only maximising savings but also reveals noteworthy differences in vendor performance.
Powered by analytics, procurement holds the ability to stem insights from different sources of information and discover intelligence for competitive advantage. This paves the way for procurement professionals to cultivate an even profound understanding using cognitive technologies that will help them further transform the procurement landscape as they engage across their supply base and with business partners to unlock value from all types of data that have been hidden in the past.
For all of the reasons stated, analytics have never been more accessible. Thus, it is imperative to understand that analytics is a game –changer in the field of procurement. It does not only showcase the real worth of huge amounts of unstructured and structured data to move a step ahead of others but also adds to the enterprise-wide performance. It enables informed decision-making with the help of machine learning, artificial intelligence, and block chain. Thus, big data and analytics hold the ability to automate and accelerate businesses with the promise of transformative changes in procurement.