Top 10 P2P platforms: Wax Digital | Digital supply chain

What is data analytics and why is it important for organizations to use it?

Data analysis is the process of collecting, cleaning, transforming, and analyzing an organization’s information to identify trends and extract meaningful information to solve problems.

The main benefit for procurement teams who embrace analytics is that they are equipped to make faster, more proactive, and more efficient decisions. Spend analysis and other advanced statistical analysis remove the guesswork and responsiveness common to spreadsheets and other manual approaches, and improve efficiency and value.

As procurement continues to play a central role in the success of the organization, adopting analytics is essential to improve operations, achieve and achieve key performance indicators, reduce staff burnout, acquire valuable market information and protect the bottom line.

How can organizations use procurement analytics to benefit their operations?

Teams can leverage data analytics to tangibly improve performance across all procurement activities – by identifying new savings opportunities, getting a consolidated view of spend, understanding the right time to spend. contract renegotiations and suppliers to use to prioritize and segment suppliers, assess and address supply chain risk and more.

Procurement can ultimately create a more comprehensive procurement process that invites more suppliers to the table and becomes even more specific about cost drivers and other criteria.

“The main benefit for procurement teams who embrace analytics is that they are equipped to make faster, more proactive and more efficient decisions.”

Purchasing analysis can provide essential information for expense management, category management, supplier contracts and negotiations, strategic sourcing, expense forecasting, and more. Unilever, for example, used actionable insights from spend analysis to optimize spend, procurement, and contract negotiations for a particularly unpredictable industry like transportation and logistics.

Whether a team needs to find ways to conserve cash, further diversify its supply base, or leverage sustainability, innovation, or diversity initiatives, analytics can help procurement meet the needs of the team. the organization.

How is data analytics used in supply chain and purchasing?

Data analysis encompasses descriptive, diagnostic, predictive and prescriptive data.

Description shows what happened in the past, while diagnostic Surface analyzes allow us to know “why” these previous events occurred.

This clear view of sourcing operations and trends lays the foundation predictive analytics, which predicts future events, and prescriptive analytics, which recommends the best actions for teams to take based on these predictions.

Teams can leverage all four types of analytics to gain visibility across the entire supply chain and identify opportunities for optimization and value creation.

Take the example of on-time delivery (OTD). Predictive analytics identifies the likelihood that an order will be delivered on time before it is even placed, based on previous events. Combined with recommendation engines that suggest actions for improvement, analytics allow teams to proactively mitigate the risk of late deliveries, for example by allocating an order to a second or third source of supply.

Advanced analytics is a focus of research and development for JAGGAER, and we expect the ability of procurement to leverage AI to become even stronger and more impactful.

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