THE BUSINESS REVIEW FOR PROCUREMENT LEADERS
By Malcolm Wheatley
Despite spend analysis being pivotal to effective procurement, all too often in practice it is "plagued with functional silos, ad-hoc management, weak technology support and poor source data quality", according to analysts AMR Research. More than a third of companies have no visibility into over half of their spend, it reckons.
Spend analysis projects have been under way for more than 20 years, yet it is only relatively recently that technology has begun to convert a time-consuming, manual and static process into a more real-time and useful one. Nevertheless, the challenges of gathering data in the first place, "cleaning" it, reconciling different product codes and handling feeds from multiple ERP systems remain.
Three technology solutions have emerged in the market: first, those of data
analysis specialists, such as SAS, Zycus and Kalido, which have moved into
the procurement space; second, "master data management" of the
sort advocated by SAP, which seeks to build quality data into the fabric of
the enterprise system; and third, solutions offered by procurement vendors
such as Ariba and Emptoris, which have been acquiring niche spend analysis
firms in the past couple of years.
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