Better Decision Making: the advent of the analytics-driven procurement team ….
Advanced analytics is increasingly playing a vital role in contemporary procurement and supply management. Here, Optimum’s Gerard Chick highlights his ‘Magnificent Seven’ – seven key tips to take into account when implementing procurement analytics for your organisation.
Identify Alternatives – Often times; this is as simple as structuring out the problem. Data driven solutions are not always appropriate or needed. Inherently, this requires a strong understanding of your business and the problem you are trying to solve.
Manage Quality – Humans and data will never be perfect. When possible, automate data collection, cleansing, and measurements to help isolate errors and develop a trusted version of truth.
Plant seeds – This is particularly important for new analytics teams. Constantly seek out new opportunities, prioritise projects with the highest potential value, and begin collecting data. Data collection must be ‘intuitive’ for employees.
Assess the value you are adding – There is a real and immediate need for people with the ability to handle and analyse data. Future goals for procurement and their use of analytics should include better internal integration of systems, predictive analytics, and stronger ties between internal data and intelligence from external markets.
Right people, right place right time – Having the right people focused on the right set of problems is one of the most important components of an effective analytical capability.
Team approach – Although some may think they are capable of managing the entire process from data collection, warehousing, processing, analysis, and implementation, delegating and focused expertise can accelerate (and often reduce long-term costs)ROI.
New skill sets – Of great importance here is that CPOs can’t afford to limit their thinking about the huge skills issue here. Perhaps the chief concern of business and procurement leaders today relates to the scarcity of talented procurement people.