Here’s How To Add Value To Your Procurement Process By Making Procurement More Data-Driven
In recent years, data-driven procurement became a hot topic. As more and more business processes go digital, the importance of leveraging data in business processing becomes increasingly evident. Finance executives know that digitizing procurement and leveraging data more effectively is a good idea. However, few devote the resources and tools necessary to make procurement more data-driven.
A LevaData study from two years ago found that 97% of the senior executives surveyed believe that data-driven procurement is “vital to achieving long-term value, cost reductions, and efficiency gains,” However, this survey also found that 82% of senior executives are not prepared for data-driven procurement.
No worries, though. With the right tools, you can digitize your procurement system and make procurement more data-driven fairly easily. Here’s how.
Where To Get Your Data
An organization with data-driven procurement puts data at the center of its operations. This enables the organization to use insights from data to drive its strategies and decision making.
The procurement process can supply data related to spending patterns, purchase history, and the steps you take to review and approve purchase requisitions. Procurement data also includes information about compliance and performance, such as how much time it takes to generate purchase orders and comparisons of planned and actual spend. There’s also a wealth of information you can collect from and about your suppliers.
In order to make procurement more data-driven, you need a way to collect all the data that’s available through the procurement process. This is where automation comes in.
The Link Between Automation And Data
Procurement automation makes data collection much easier than trying to do the work manually. An automated system like NextProcess’ Purchase Order Module tracks all the information you put into it, placing huge amounts of processing data at your disposal. You can also customize these automation systems to fit your company’s individual needs.
Want to monitor vendor performance more closely? You can easily pull-up information about promised versus actual delivery date, ordered price compared to invoiced price, and the number of returns for each vendor.
Concerned that your planned and actual spend aren’t lining up? An automated system logs all the information related to purchasing in an electronic database. This gives you easy-access access all the data you need to analyze your spend patterns.
Putting Data To Good Use
Once you have the data, it’s time to analyze it. To start, you’ll need to focus on what you’re trying to achieve so you know what data to use. Then you’ll be able to leverage that data using analytics to connect patterns, anticipate changes, and plan for the future. If you want to learn more, check out our article “Understanding The Essential Role Data and Analytics Play In Procurement.”
Software automation from NextProcess turns data collection that would take a human team weeks or months into a quick, efficient process. Making your procurement more data-driven can add enormous value to your procurement process. Contact us today to learn how NextProcess can help.