Spend Analysis

Year in spend 2020: procurement benchmarks since the COVID-19 pandemic

HetaPirttijärvi_100.jpgBy Heta Pirttijärvi, Business Development Manager, Sievo

In this article, we will look at some of the effects that COVID-19 has had on business spend based on anonymised enterprise data.

2020. We all know that it was an eventful year, disrupting many things as we know it. There have been enough Internet posts about how 2020 disrupted digitisation, how working from home affected individuals and how procurement needed to adapt. But how is 2020 presented in companies' spend? Have companies spent more on consulting projects for help through the crisis? How much has travelling spend actually decreased by? How about fruit around the office? Have companies had the money to do market research? Let us find out...

Top five spend analytics measures for procurement managers

ErinMcFarlane_100.jpgBy Erin McFarlane, Vice President: Services, Fairmarkit

If you have recently joined an organisation or moved into a new role that is directly related to procurement, it can be challenging to know where to start. Even if you have been in the role for a while, the whirlwind of daily activity can distract you from having a strong holistic view of your organisation's relationship with its supply base.

There are hundreds of valuable metrics to help you better understand your company's supply chain. But like any professional, you have limited time and reporting requests can distract your team from critical activities. If you are in procurement and trying to better understand the commodity or category that you have been assigned, understanding the numbers is especially important to getting off to a great start.

Here are the top five spend analytics measures, along with how to define them, where to find them and what influence they have on your company:

3 reasons why focussing on spend analytics matters

KirkPoucher_100.pngAll sorts of spend analytics technology is available - but how do you best translate this data into constructive action? Procurious spoke to Kirk Poucher, Managing Director of SpendHQ.

5 tips to help prevent and control maverick spend

Georg_Roesch.jpgA little innovation never hurt anyone. But whilst Maverick Spend may cause us to re-evaluate our processes, it can wreak havoc and cause long-lasting damage. Georg Roesch, Senior Manager at JAGGAER, outlines five ways you can prevent it from happening and keep it under control.

Global GDP: How large is public procurement?

BosioDjankov.pngBy Erica Bosio (Program Manager of the Growth Analytics, Development Economics Vice Presidency at the World Bank) and Simeon Djankov (Director, World Development Report 2019)

Public procurement -- the process by which governments purchase goods, services and works from the private sector -- amounted to $11 trillion out of global GDP of nearly $90 trillion in 2018. In other words, 12 percent of global GDP is spent following procurement regulation.

How procurement spend analysis can cut costs

Spend_Analysis_150.pngWhile it is true that you often have to spend money to make money, optimising every cent by tapping into the power of spend analysis creates significant savings opportunities compared with flying blind and having no visibility on your spend.

To get an optimal return on your investment, it pays to understand and implement effective procurement spend analysis as part of your overall business process management.

How can maverick spend hurt your company?

MaverickSpend_150.jpgRogue purchasing can cost you plenty. PurchaseControl unpacks the implications of maverick spend and how you can tackle it.

Making headway in tail-spend management

TailSpend_200.jpgSupply management organisations have tended to ignore tail spend, considering it non-strategic. But as they realise the cost savings that can be derived, organisations are becoming more aware of their tail-spend management problems and are looking into solutions.

The traditional mindset of cost savings is dead

Hemant_Porwal_100.jpgBy Hemant Porwal, Executive Vice President: Supply Chain and Operations, WESCO Distribution

Over time, the concept of measuring savings has evolved to creating a baseline by comparing items under the form, fit and function framework.

Top-quartile procurement teams have taken this further by adopting total cost of ownership (TCO) into their request for proposal (RFP) models, instead of pure price comparisons. A key point is that these TCO criteria measure costs can be principally influenced by procurement teams.

However, this is not enough. We need a more holistic metric which measures cost from the first mile to the last mile and, ultimately, within reach of customers in the last three feet. The metric to use is total cost to serve (TCS).

12 benefits of advanced spend analysis

LariNumminen.jpegBy Lari Numminen, Chief Marketing Officer, Sievo

Having a robust spend analysis solution in place has become a prerequisite for running a professional sourcing organisation. But do you get all the possible benefits from your current spend cube?

At Sievo, we have worked with hundreds of clients across most industries. Here are 12 of the most important benefits that sourcing organisations can get from advanced spend analysis. The question is: are you already leveraging all of these?

4 reasons why value is the new procurement normal

HelenMackenzie_100.jpgBy Helen Mackenzie
An experienced former CPO currently working with Procurious to help connect the procurement community across the world.

We're all talking about delivering value these days in procurement, aren't we? But with so many definitions around, how do we maximise its impact?

6 most painful mistakes in spend analysis

SammeliSammalkorpi.jpegWhile procurement leaders increasingly turn spend data into a competitive advantage, laggards continue to repeat painful mistakes.

You may have noticed that spend analytics is a hot topic right now. According to Deloitte's Global Chief Procurement Officer Survey 2018, the majority of CPOs across the world expect analytics to have the greatest bearing on procurement over the next two years. As a provider of spend analytics software, Sievo has been busy and has seen more interest than ever from both private and public organisations to get their spend data into shape.

As leading procurement organisations find new opportunities to turn spend data into value, others repeat the same painful mistakes. Sammeli Sammalkorpi, VP: Customers and Co-founder of procurement analytics solutions provider Sievo, highlights the top six mistakes that you should avoid making in your spend analysis projects.

How can data improve supplier decisions?

BenGoldwasser_100.jpgThe transportation and logistics industry has mountains of data available, and experts encourage carriers and their customers to embrace data-backed business decisions. Ben Goldwasser, a business development professional at Spendrix specialising in risk analysis, business administration and technology issues affecting the transportation and logistics industry, takes a brief look at using data to improve supplier decisions.

Where the world of procurement is heading

SammeliSammalkorpi.jpegHaving more data generated in the last two years than in the history of mankind is an opportunity to recognise how analytics is a source of competitive advantage. Sammeli Sammalkorpi, Co-founder of procurement analytics solutions provider Sievo, shares some key points from a lecture presented at the London Business School.

Using big-data analytics to drive forward business value in procurement - Part 1

WalterCharles_.jpgA conversation with Walter Charles, Chief Procurement Officer, Biogen.

Walter Charles' global procurement teams support billions of dollars in annual purchases. Having spent decades at Kraft Foods, Kellogg's, Johnson & Johnson, and now Biogen, Charles provides keen insight into the state of procurement today as well as how big data analytics is disrupting the landscape to provide CPOs with meaningful answers to more strategic procurement execution.

6 things to consider before you purchase any procurement technology

DanQuinn.jpgThinking of investing in some of the latest procurement technology? If you have not consulted market trends, got a third opinion and done all of your research, you might want to pull on the reins, advises Dan Quinn, Senior Vice President of cloud-based spend management provider Jaggaer (Middle East and North America).

Introducing the Lavergne Procurement Matrix

Remy_de_Lavergne.jpgAre you a procurement value creator, or a cost-reducer? Perhaps you're neither of these - or both? Procurious member Remy de Lavergne, a transport and indirect purchasing manager, has created a new matrix that shows, among other things, just how far the profession has come.

What is procurement's future in the 4th Industrial Revolution?

 

Mluleki Ntlemeza.jpgThe fourth Industrial Revolution, characterised by a fusion of technologies that is blurring the Iines between the physical, digital and biological spheres, builds on the digital revolution (known as the Third Industrial Revolution) that has been occurring since the 1950’s, said the World Economic Forum.

'4IR' has seen the emergence of technologies in procurement, which are set to disrupt established methods. Examples are cognitive procurement and Blockchain.

Mluleki Ntlemeza (MCIPS), e-Procurement specialist at PetroSA, unpacks the impact of the fourth Industrial Revolution on the future of procurement in this month’s SmartProcurement.


 

 

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