The relatively short formal history of spend analysis begins with folks like yours truly (in a former life) needing to find a way to justify one’s existence either in a procurement organization or as a sourcing consultant. In other words, spend analysis was simply quite focused on helping analysts, category managers, consultants and others tasked with identifying and implementing savings opportunities, as opposed to consolidating non-cleansed, AP-data dumps into a big-dollar spreadsheet or Access.
Ten years ago, this was the state of the spend analysis market. A lot has happened since that time, including vast improvements in data classification, enrichment, visualization and analytics – not to mention the incorporation of new invoice-centric data-sets and line-level visibility as the norm. Yet, the next frontier for spend analysis takes it beyond being a tool for sourcing wonks to save money.
This new world places spend analysis in an entirely new context– namely, as a tool to bridge the analytics gap between supply chain operations and the business. In a new case study profiling how procurement and manufacturing/supply chain groups have gotten on the same page through spend analysis at FMC Technologies, Thomas Kase explores this new future for an application set that has already proven its critical value within procurement.
We invite all Spend Matters readers to download the following brief from our free research library: Where Spend Analysis Meets the Supply Chain: Putting Big Data in a Procurement Context. In this paper, you can learn how FMC treats total cost as just a single element across a total of four business drivers and metrics (safety, quality, delivery and price) that it analyzes in its spend analysis deployment.