Spend Analytics for Procurement Improvements
Spend Analytics is the discipline of collecting, processing and analysing procurement data. Spend analysis uncovers and unveils the buying patterns of business through an in-depth review of procurement data. And generally,organisations use spend analytics technology to manage their suppliers to track procurement performance and decrease cost.
Spend Analysis Process
The process of spend analysis involves pulling together purchase history data to answer and assess the who, what, when, where, why, and how of an organisation’s expenditure.
Why Perform Spend Analysis?
Spend Analytics is a technology that brings together purchase-related data and turns it into immediate, budget-saving opportunities.
As we know, Spend Analysis is the best way to get great visibility in the procurement spending of an organisation – which can help them to consolidate the suppliers and expenditures of an organisation. Performing Spend Analysis will help you better visibility on suppliers and spending, in improving processes,in managing the risks, in category level analysis, in managing effective supplier relationships and in tail spend management.
How does Spend Analytics Support Procurement?
Spend Analytics answers the core questions to improve the financial efficiency of a company. Like,
- How much money does the company spend?
- Which supplier provides which goods or services?
- Is the organisation getting what it expects for the purchase or contract?
Spend Analytics Technology integrates the information from sourcing data,cleans it for accuracy, and categorises it to item level. It helps the senior executives and procurement professionals make actionable decisions for their organisation, identifying future savings opportunities and increasing Procure-to-Pay efficiency.
When done manually or without dated tools, the data analytics & preparation process can take months, limiting the frequency of use. With AI-driven SaaS solutions, the process can take weeks or even days to achieve more accurate richer results. As companies make the switch, Spend Analytics moves away from a once-a-year; to a quarterly or monthly review. As procurement analysts,business leaders and management apply the actionable insights, which can become a simple tool to understand the past and help predict future spending and savings.