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Years ago, I was working as a Procurement leader at a multinational conglomerate. In this role, I worked for a VP who was extremely focused on data. I recall my first meeting with him, where I had spent hours manipulating the data output from our ERP system so that it would be accurate for our review. I was scrambling to fill in data gaps manually because it was commonplace for me to update our reports in this manner - I was accustomed to NEVER trusting the system's direct output.
Walking into the room, I was proud of what I had prepared. However, the first question out from him was, “Is this the actual data that is in the ERP system?”
I proudly said, “No – I have cleansed it so that it is accurate and reflective of our true delivery performance.”
Needless to say, he was not happy. From that day forward, we used the data directly reported from the ERP – whether it was accurate or not. In his eyes, the importance was not on the accuracy in this case – it was fixing the root cause of the data inaccuracies so that the system is utilized as it should be. This was my first day of adequately managing our data strategy.
And this was one of the anecdotes I shared during my breakout session at the Procurement Leader’s Americas Congress 2020. Since that experience, I’ve been a data-driven leader who understands that better processes are the key to gaining better data. Technology alone can’t solve your Procurement data challenges – technology must mirror efficient processes, and efficient processes have good data in – and better data coming out.
Even now, as I help WNS Denali onboard new clients, the number one challenge I hear is, “Our data is a mess.” We can agree that data is complex, especially when you have different lines of business, currency, and technology platforms in place that tie together. The challenges with data are bountiful and improving procurement’s data strategy costs us time, money, and sanity.
There is ample research-based evidence to show that the amount of information in the world is growing each year exponentially.
Bad data costs U.S. business more than $3 trillion per year - HBR
According to IDC, 90 percent of worldwide data was created in the last two years and 80% of that is unstructured data
HFS reported that Procurement lags most business functions in advanced analytics
Unstructured data comes from multiple sources
Reactive purchasing processes and habits create a reliance on historical data
Unreliable data damages our credibility
The volume of data is too high to manage
There is a lack of forward-planning and strategy
Lack of expertise and intelligence to effectively sift the data and identify the right thread
Many of us have started to rebuild our Procurement function and business after accelerating economic changes and supply chain disruptions in 2020. Now the spotlight is on the accessibility to data so you can make forward-thinking business decisions. Let me bring some relevance from what I heard at the conference; the CPO of Starbucks shared a story about how her team was using data to determine the risk factors and timeline considerations for re-opening certain locations after the COVID-19 shutdown. Perhaps that can be considered a futuristic state for you.
To transform your Procurement data strategy, you should first ensure that you take an ecosystem approach. At WNS Denali, we think of Procurement as an ecosystem where everything is interconnected. One of the core pillars in your ecosystem is data and information, which can help you:
Determine your current maturity levels
Uncover any gaps
Focus on your strengths
Deploy new processes to feed better data into your platforms
In the session, Raj Nath, CPO of VICE Media, shared the VICE data transformation story. VICE was set-up as a decentralized procurement environment with a start-up mindset. They lacked process rigor, which created a disproportionate administrative burden on procurement. The volume of activity included:
23,000 unique vendors (and actively growing)
65,000 new vendor bills created annually
25,000+ annual AP inquiries
14,000+ active projects (6,000 billable vs. 8,000 internal)
The VICE team designed to focus on user experience as part of the data management transformation project. The procurement team developed a communication plan to engage the right people, including drivers, doers, advocates, and doubters. Then, they developed an AP Support Ticketing System to better manage the requests, opportunities, and data. As a result, the procurement team greatly improved the executive alignment with the CFO and COO and enhanced partnerships with the other lines of business. Raj offered this advice for anyone attempting to get their data under control, “Plan, communicate, execute, and adjust…then repeat!”
As Procurement practitioners, we have access to more data and information than nearly any other department. We see dollars in and dollars out. We have a holistic view of the business and supply chain pain points. The success of your short and long-term plans will depend on how well you can use data to drive informed business decisions and improve supplier innovation efforts. After all, data is the lifeblood of any business.
For more tips about improving your Procurement data strategy, listen to the full presentation here. If you need a roadmap or plan to get started, we recently published a Procurement leader’s actionable guidebook to accelerate your digital journey. Download your copy here.
Corporate Senior Vice President, Client Services
Julie Brignac is Senior Vice President and Head of Client Services at WNS Denali. She comes with 20+ years of multi-dimensional procurement experience gained through her varied roles including, CPO, Portfolio Executive, Management Consultant, and Entrepreneur. Prior to WNS Denali, Julie held management positions at Accenture, CHEP, Vantage Partners, Newell Brands and Honeywell. She holds an MBA degree from the University of Maryland.