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Great Procurementbrings Powerful Insights and Analytics

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Great Procurementbrings Powerful Insights and Analytics THE SIX DISTINCTIONS Great procurement brings 5 powerful insights and analytics that inform decisions Analytics play an increasingly influential role in most business decisions. For procurement, the field of data analytics is rapidly advancing, and offers numerous applications to drive additional, tangible value. Understand the Analytics Predictive Analytics Forecast & predict – building on a foundation of Landscape past activities, ‘predictive analytics’ can be used Take time to understand how analytics can to find trends and patterns to help forecast the drive value. Then, establish which combination probability of a situation occurring again in the of analysis can be applied to provide the future. Combine data with a wider understanding maximum benefit. of the business and predictive analytics generate insights that help shape more effective responses Descriptive Analytics to the most challenging scenarios. Establish your baseline – start by compiling all the data you can gather. What data do you Prescriptive Analytics have? What do you know – and where are the Recommend and prescribe – in today’s gaps? Defining a baseline can deliver fresh landscape, this capability stands at the leading insights into consumption and spending edge of analytics. ‘Prescriptive analytics’ harness patterns, value opportunities and determine learnings from multiple sources – both internal levels of compliance and efficiency. At a and external, be this big data from the emerging minimum, sanitizing spend data can reveal Internet of Things (IOT) to pattern-recognition what the business spends and where, and can and cognitive technologies. In this way CPOs can help to identify the largest areas of opportunity. help progress critical business functions from This can be referred to as ‘descriptive analytics’. reactive to proactive/predictive, and develop specific action plans, based on more detailed Diagnostic Analytics and more intuitive predictive models. Find the facts – determine what is currently happening in procurement, and the wider Benefits for Procurement: Everyone has data— organization, based on factual data. Using but your team has mastered its data and cracked accurate metrics helps you swiftly identify the code, understanding what questions to essential, and often unseen, problems, ask, and what data to analyze, to become an understand WHY these problems are important advisor to the business. occurring, and pinpoint genuine wins. Diagnostic analytics explain or identify Business Benefits: Procurement helps the what happened. business identify and uncover unexpected opportunities to drive additional value from investment. Use Analytics to Turn Insights Payments Analytics Ensure payment accuracy, detect duplicate into Action or erroneous payments and optimize working With an understanding of the types of analytics, capital based on payment terms and policy turn your attention to how to apply analytics in a analysis and best practices. procurement context to capitalize on your data, inform decisions and take action. This thinking Supplier Risk & Performance Analytics can take many forms, for example: Monitor supplier performance with regards to the contract and SLAs and identify risks. Spend Visibility Analyze spend data to develop insight about Benefits for Procurement: Procurement spend and consumption, identify value plays an important role in using data and opportunities, and assess compliance. analytics to ensure that expected results are achieved, and policy and compliance are Category Analytics maintained, while constantly mining data for Drive maximum savings for the business new insights and opportunities to present by developing market and supplier analyses, to business stakeholders. should-cost models, price benchmarks, aggregate supply market intelligence and tools Business Benefits: The business harnesses and templates to identify opportunities, support its data for real-time decision-making based bids and negotiations, and drive efficiency. on data and insight, making smarter decision’s, faster, and driving better results. Compliance Analytics Analyze compliance with preferred suppliers and buying policies, invoice accuracy and contract compliance. .
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