Spend analysis the window into strategic sourcing pdf file

The first step in strategic sourcing, proceedings 90th annual international supply chain conference, may 2005 best practicies in spending analysis cure for. Haralambos marmanis isbn 9781932159936 retail price. Leveraging our decades of experience, diverse spend category expertise, strategic sourcing best practices, and procurement tools and resources we collaborate with clients to deliver value. The spend analysis function is designed as an integral part of the larger, unified gep smart eprocurement software system with the capability to transform the strategic sourcing and. Spend analysis is a superior book on the subject of strategic sourcing. Strategic sourcing spend analysis spend consultant support. Latest procurement and supply chain news, opinion, analysis, practical advice and tips from supply management, the official publication of the chartered institute of. Abstract this paper introduces spend analysis, spend management and supplier management field. It categorizes items based on annual spend, vendors, use, strategic. It can also be leveraged in other areas of business such as inventory management, contract management, complex sourcing.

It provides an executive overview and technical details for. This spend analysis book is currently the only reference that provides indepth guidance on the spend analysis process, what it involves specifically. Spend analysis ebook by kirit pandit 9781604277029 rakuten. Spend analysis software spend visibility smart by gep. A careful spend analysis that ties technology and consulting expertise can help convert senseless raw data into strategic sourcing opportunities to achieve savings. How to improve the effectiveness of your spend data and spend analytics. All too often organizations do not incorporate nonrecurring spend into a sourcing pipeline, and end up in a reactive mode of procurement. It is currently the only reference that provides indepth guidance on what spend analysis really is, what it involves specifically and how to use it in your journey to worldclass performance. To learn more about how making sense of data with spend analysis tools can help you gain greater visibility into your procurement efforts, check out jaggaers new whitepaper, using spend analysis to build your sourcing.

This document details a 4phase framework to strategic sourcing, outlining time frames, activities, and outputs. The window into strategic sourcing is the ultimate handbook on spend analysis for firms who are looking at spend analysis software solutions to better understand their. The strategic sourcing methodology provides the state with a process to reduce spend on key categories, reduce. And strategic sourcing advanced spend analysis is critical to understanding the current spend in indirect and direct categories. In other words, spend analysis became a must have for any sensible strategic sourcing. Spend analysis is the most critical component, and the starting point, of strategic supply management and is essential to achieving worldclass performance. At each step in the process, our sourcing specialists proactively share their strategic sourcing knowhow and categoryspecific best practices to our clients. In other words, spend analysis became a must have for any sensible strategic sourcing program. Stay in touch and up to date through member only events and branch meetings. Act of organizations comparing key metrics of operations to others in the industry is called benchmarking.

One of the foundation blocks for transforming an organizations practices to world class supply management is the business process called strategic sourcing. Using the spend analysis tool, enporion developed a customized market basket report. Spend analysis, the window into strategic sourcing. Understand where spend analytics fits in the overall evolution of an organizations procurement transformation journey pwc describe what spend analytics enables in terms of strategic sourcing and category management name some of the top spend analysis software players in the north american marketplace 5.

The lower cost among organizations using spend analysis could be related to leaner procurement functions resulting from spend analysis program s. Measuring strategic sourcing and procurement maturity. A growing number of senior executives are coming to. The approach adopted includes the following phases. The following sourcing efforts are the key to developing opportunities into cost savings and process efficiencies. Growing numbers of senior executives are coming to realize that strategic supply management can be a driver of improved corporate performance and better risk management. Cips has formulated positions on strategic sourcing as this is a key activity for purchasing. Spend analysis the window into strategic sourcing by kirit pandit and dr.

Spend analysis process prep for strategic sourcing. Cleanse your data, understand your purchase history, aggregate suppliers, classify spend, and create a strategic sourcing roadmap for greater savings and easiertomanage spend categories with source ones spend analysis service our spend analysis. How incorporating six sigma into strategic sourcing helps. Pdf managing procurement spend using advanced compliance. Read spend analysis the window into strategic sourcing by kirit pandit available from rakuten kobo. Procurement still has not been elevated to an equal on the senior. Strategic sourcing methodology pdf semantic scholar. Spend analysis is the most critical component, and the starting point, of strategic supply.

Spend analysis thus became the window into strategic sourcing it was the front end that helped identify opportunities and also a back end that helped monitoring and tracking of these savings. Spend analysis is the name of the process used to a collect the spend data from the different enterprise source systems, validate it, and then place it in a standardized and usable format b organize the information into. Strategic sourcing also known as sourcing strategy or procurement strategy allows an organization to realize significant savings by evaluating its procurement costs across a number of spend categories. Spend analysis identifies targets of opportunities and current risks in the acquisition of. Opportunities identified in gep smarts spend analysis function can be transformed into strategic savings projects in gep smarts savings function. It is currently the only reference that provides indepth. We also have many ebooks and user guide is also related with spend analysis the window into. Joe payne, director of strategic sourcing, source one management services, is an experienced consultant who has helped many companies reduce costs and manage change. A rapid turnaround llengthy software implementations cost money in more ways than one. Failures and missed opportunities were common, as tweaks to manufacturing and supply lines were frequently based on gut feelings.

By connecting the sourcing events to the savings projects, gep smart allows you to identify where the savings will come from and track them through contract negotiation and ultimately to purchase. Strategic sourcing spend analysis total cost of ownership the total cost of ownership calculation is an advanced cost structure analysis where, in addition to product cost elements, other cost elements, such as acquisition transportation, warehouse, financing cost and lifecycle usage period, maintenance, repair, are taken into. Spend analysis and benchmarking, strategic sourcing spendedge. Whether purchasing goods or services, a few items or a few thousand items, procureports eauction tool can generate signi. By tailoring the solution for the customer and your unique requirements, an organization will be able to truly gain visibility into the data they need to develop a strategic, forwardthinking sourcing. Some costeffective alternatives available for spend analysis and strategic sourcing. Within the strategic sourcing process, spend analysis is one of the most critical process steps providing clear visibility into your organizations overall spend. Interviews from 12 cases are then used to identify best practices and cost drivers in sourcing kbs. The window into strategic sourcing is the definitive text on this important subject, written by leaders in the field.

By tailoring the solution for the customer and your unique requirements, an organization will be able to truly gain visibility into the data they need to develop a strategic, forwardthinking sourcing plan. The information is not only useful for sourcing professionals but. Few companies have employed standard procedures or systems to control spending from sourcing through purchasing compliance and quality assurance according to aberdeen group, the category spend management report series 2004. Some costeffective alternatives available for spend analysis and strategic sourcing include. Get spend analysis the window into strategic sourcing pdf file for free from our online library pdf file. The window into strategic sourcing is the definitive text on strategic sourcing, written by leaders in the field. The window into strategic sourcing and algorithms of the intelligent web.

We provide analyses, information, spend analysis software and overall guidance to improve efficiency and strengthen cash flows across your entire organizational supply chain. Spend analysis is the process of analyzing historical sp end by collecting, categorizing. Nov 06, 2017 spend analysis is the name of the process used to a collect the spend data from the different enterprise source systems, validate it, and then place it in a standardized and usable format b organize the information into a standard classification structure and cleanse the information by eliminating any mistakes, discrepancies, andor flaws. A spend analysis of one agencys spend is used to identify the types of kbs procured. Spend analysis or spend analytics is the process of collecting, cleansing, classifying and analyzing expenditure data with the purpose of decreasing procurement costs, improving efficiency, and monitoring controls and compliance. Making informed decisions during the strategic sourcing process is critical to ensure that your organizations procurement processes dependent on the spend. Online auctions are an integral part of the strategic sourcing process. He leads a team of project managers and analysts, developing insights into the challenges organizations face when undertaking initiatives to reduce costs in the area of indirect spend. Enhance your network and get connected to a global community of 120,000 in 150 countries. It can be as granular as a spend analyst desires e. Spend analysis focuses on increasing the visibility of management on their items. Link spend analysis efforts to your sourcing processes. Spend analysis the window into strategic sourcing 1st. Spend analysis is a tool that provides knowledge about who are the buyers, who are the suppliers, how much is being spent for what goods and services, and where are the opportunities to leverage buying power.

The first step in strategic sourcing details the baseline process that an organization should follow to establish a functional strategic sourcing program grounded on. The nz transport procurement manual broadly implies that a procurement strategy. It describes the need for a spend analysis system, its benefits and savings which such system can help to achieve. A strategic spend analysis solution will allow your organization to identify what data is important to collect, and will then enable actionable business decisions based on that data, including a forwardthinking sourcing roadmap. Find opportunities for strategic sourcing by gathering procurement requirements and supplier. A procurementfocused taxonomy weve devised a method for categorizing spend into buckets that actually make sense to a category manager or strategic sourcing analyst a. Both practitioners and academicians will find the topics interesting and educational. Strategic sourcing is organized since some type of methodology or process is needed. Chapter 3 how to do a successful spend analysis implementationchapter 4 opportunity identificationchapter 5 anatomy of spend transactionschapter 6 spend analysis. Procurement strategic sourcing professionals are generally responsible for conducting spend analysis in the organization. The strategic sourcing process cycle is a five step process of spend analysis, supplier performance management, supplier identification, sourcing and contract management.

Private sector companies are using spend analysis as a foundation for employing a strategic approach to procurement. Understand where spend analytics fits in the overall evolution of an organizations procurement transformation journey pwc describe what spend analytics enables in terms of strategic sourcing and category management name some of the top spend analysis. If you cant analyze your spend a growing number of senior executives are coming to realize that strategic supply management can be a significant driver of improved corporate performance. The authors detail every aspect of spend analysis in an intelligent and myriad display of awareness on the subject. Spend analysis should include the identification, automated collection, cleansing, grouping, categorization, and analysis of all spend data for the goods and services purchased for the organization. This spend analysis book is currently the only reference that provides indepth guidance on the spend analysis. If your interest is to find massive cost savings for your business then this book is for you.

This is the first reference to provide indepth guidance on spend analysis. Jul 24, 2008 access all areas of the cips knowledge online library including tools and templates and supply management stories. Steps in building an advanced supply management organization. Purpose the purpose of this document is to provide a workable procedure for the strategic sourcing methodology of procuring goods and services for th e state of louisiana. Spend analysis the complete guide to savings opportunities. Recognizing the potential in government purchasing, gao examined if.

Every organization has different data and business needs, so we believe a spend analysis solution should take that into consideration. Spend analysis as a service from source ones category. Private sector companies are using spend analysis as a foundation for employing a strategic. Pdf spend analysis the window into strategic sourcing download full ebook.

This market basket report allowed the client to quickly generate itemized spend and usage detail for each spend category and it significantly shortened strategic sourcing cycles. A procurementfocused taxonomy weve devised a method for categorizing spend into buckets that actually make sense to a category manager or strategic sourcing analyst. How incorporating six sigma into strategic sourcing helps strengthen the supply chain in the early days of manufacturing, managers often relied on guesswork when adjusting their processes. In most cases there are substantial opportunities hidden in the spend data generated by typical enterprise systems. If not, they can consume money and deliver no returns due to lack of adoption. A growing number of senior executives are coming to realize that strategic supply management can be a significant driver of improved corporate performance. Spend analysis the window into strategic sourcing 1st edition. Dec 12, 2014 every organization has different data and business needs, so we believe a spend analysis solution should take that into consideration. We present flowchart of spend analysis process in form of a dataflow diagram. The authors have positioned spend analysis within the overall context of a supply management program, and made a compelling case for why it is important to implement a robust spend analysis program as a strong foundation for strategic sourcing.

Making informed decisions during the strategic sourcing process is critical to ensure that your organizations procurement processes dependent on the spend data execute successfully. The window into strategic sourcing is the definitive text on this. It is currently the only reference that provides indepth guidance on what spend analysis. Strategic sourcing contract management supply chain product development finance cost accounting corporate buyers suppliers. If you cant analyze your spend a growing number of senior executives are coming to realize that strategic.