New Research Study — Spend Visibility: Beyond The Basics

After a few quarters of research examining the spend visibility and analytics landscape, I sat down to put pen to paper to examine both the history, evolution and future of the sector. The result is the latest Spend Matters Compass research paper, Beyond the Basics: Using Spend Visibility to Drive More Than Category Sourcing Strategies and Spend Reporting. This most recent brief is part of Spend Matters Compass Series II, Spend Visibility and Beyond -- Analytics Broader Role in Procurement and Supply Chain, a broader body of research designed to bring procurement and supply chain organizations up to speed on the types of analytics and procurement investments they should be making as well as what technology providers to consider based on their business priorities. This paper begins by offering a foundation that describes the core elements of spend analysis and then it looks forward, examining new and emerging approaches to getting more from procurement, operations, financial and supplier data sets and sources.

One of the surprises in this research is that pragmatic spend analysis innovation is coming from multiple sources, from small start-ups driving true innovation around the types of datasets to work with (e.g, BIQ) to the biggest software companies that are just starting to change the data acquisition and management paradigm (e.g., Oracle). It's also coming from suite vendors (e.g., Ariba, Emptoris), who are getting better and better at turning analytical and contracting tools into compliance platforms rather than simply functional tools to define, implement and measure strategy and performance. Even new start-ups (e.g., Spend Radar) are getting in on the act with new data acquisition, classification and presentation twists, as are broader content management and relational navigation (e.g., Endeca) providers. And of course the old stalwarts of the sector (e.g., Zycus) have new tricks up their sleeves as well.

Four of the areas of emerging innovation we examine and profile in the paper include: spend data mashups, spend analysis and sourcing linkage, spend analysis and contract / compliance linkage and supplier hubs / supplier data integration. Of these four areas, the two which excite me the most based on their potential to transform spend analysis are the concept of mashups and supplier hubs/supplier data integration. The former transforms the concept of spend analysis into a broader spend/supplier/operations/procurement analytics platform and framework. It allows organizations to consider many new types of datasets and their interrelationships to help drive new levels of savings, compliance and risk reduction.

Supplier hubs or supplier data integration capabilities, based on the concept of customer data integration (CDI) and enterprise master patient index (EMPI) in other enterprise technology areas, will eventually change the paradigm of spend analysis data integration and presentation. With these new approaches, companies will be able to move away from batch approaches to accessing and combining data to a model of real-time, query-driven integration that gathers, cleanses and presents systems data from aggregate sources at any point in time based on the actual query itself. These approaches will also serve to create a new type of virtual vendor master that not only pulls information, but can also push data and populate back-end systems with accurate, updated information in a dynamic environment. Such a system will also flag changes in real-time that will alert business users to key indicators in any type of underlying dataset (or a combination of factors within the underlying data sets). In a sense, the supplier hub concept has the potential to combine spend analysis with supplier information management in a truly dynamic environment, where the information presented is only as old the last time the "return" or track-pad button was clicked.

Curious to learn more about what you're missing out on in spend analysis today? Download Beyond the Basics: Using Spend Visibility to Drive More Than Category Sourcing Strategies and Spend Reporting for free right now.

Jason Busch

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