California State University has created a program on Spend Analytics and implemented it, presenting a clear sight to campuses and Chancellor’s Office to bring more savings.
The California State University (CSU) previously identified billions of spend in 2011 yet was unable to analyze the reasons behind it.
Back in history:
CSU used guesswork to analyze the data and that too with very little reliable information.
Why is Spend Analytics important?
It is a critical choice for identification of great savings and budgeting, planning strategies and sourcing can be developed from it. The purchasing compliance is driven by the negotiated contracts and makes sure to notice the opportunities that slip. Communication is held in the form of data and is delivered the same to the stakeholders, team members, and suppliers. Existing sourcing value is extended and the pressure is forwarded to the ERP technology investments.
Spikes Cavell, a useful tool though!
This online tool was first used by the CSU to track the record, manage and measure the campus. The strategic purchasing was done in the spend efforts with the help of this tool. The targets were set and opportunities pop up for the sustainable options of purchasing.
How does Spend Analytics Solution work?
Classification is done that is the key to the successful program.
- Extraction: guidance on the definition of spend and associated attributes is provided. It is determined what data elements should be added to bring a solution. Only those areas are taken which require immediate attention. The originating sources for the spend data are looked for and identified.
- Validation or Cleansing: End-user testing and defect resolution strategy is recommended at this step. Script templates and testing guide are provided.
- Classification: Sourcing of groups is recommended. Categorization of the spend happens.
- Enhancing: Data enhancement and enrichment opportunities are generated.
- Analyzing/Report making: Procurement activities of solutions are presented once the standard report type is selected.
Read More:- Guide to Tail Spend
Management of the Maverick spend:
Maverick spending is the expenditure that results from the purchases that break the rules as established by the corporate procedures.
And the quantification brings wondrous results!
- Compliance with contracted vendors.
- Invoice consolidation efforts.
- Change in spend across time.
- Clear visibility of spend by category and department.
- Spend Analysis:- Snapshot of the total spend.
- A new method of implementation as a result of the analysis of data.
And finally, the benefits!
Significant savings can be seen. Those savings which take time will be easily made. Team efficiency is increased and staff works in coordination with the suppliers. The purchasers and the customers can be seen in a more satisfying position. The contracts improve and more opportunities for the betterment of the firm become transparent.
Read More:- What is Procurement and How To Optimize Processes, Performance, and Technology?
What do we learn from it?
First of all, the data entered plays the most important role. And the tools used in the process, are crucial too. The bond between the staff and the customers needs to be strengthened and without the coordination, no firm can make progress. The implementation methods can be changed with the changing time and requirements. Trends should also be considered.
Contact us today to know more about how Simfoni’s technology and Spend Analytics Solutions and how it can help your organization achieve world-class Spend Management
