Through spend analysis, firms can gain greater visibility and valuable information on the amount of money spent. Additionally, the data obtained from spend analysis can help an organization make informed decisions about how their current processes can be improved. Moreover, since cost effectiveness is one of the major goals for any company, implementing a spend analysis solution will offer insights to organizations about their expenditures and procurement activities. This, in turn, results in a lower total cost to procure goods and services. As a result of such advantages, many organizations have started opting for spend analysis studies to improve their process efficiency and cut down on overall costs.
The Procurement Pain Point and Insights Offered
A global automotive manufacturing company wanted to reduce procurement lead time and material spends with the help of a spend analysis study. The automotive manufacturing company’s processes, data or systems related to customers, partners, products, vendors, and employees were not standardized. As a result, the client wanted to gain insights on achieving a single platform to integrate all of their purchasing activities. Additionally, they also wanted to streamline their procurement performance by cutting down their inventory costs, material spends and wastages in inventory stock.
The spend analysis professionals at SpendEdge carried out a comprehensive research methodology. This in-depth research included primary and secondary research to cater to the specific category requirements of the client. During the course this spend analysis study, the client was provided with a better visibility into the procurement data, enabling them to capture the spend against products, services, commodities, and suppliers. Such an insight helped the company reduce costs and strategically improve supplier relationships. Additionally, SpendEdge introduced the concept of self-service for the client, which streamlined and automated workflows – enabling employees to manage online shopping carts easily.
Key questions answered in this spend analysis study include
The engagement helped the client improve procurement efficiency and reduce procurement lead-time with the automation of different procurement activities. Additionally, the client was able to increase the visibility of in-transit inventory and improve supplier delivery performance and material planning.