Posted by  Paul Cook  Published on  16 Sep 2014
  • Category Management
  • Procurement Strategy
  • Spend Analytics

To start on a journey, you need a destination. Let's start with this - what would it look like if procurement became a hub of information for the organization? What data might we share and with whom?

As 360⁰ Supplier View’s Declan Kearney has stated in his writing, supplier management is probably one of the most misrepresented, under-resourced, yet critical areas of business. Yet if you put a blank piece of paper in front of any executive and asked them to describe what they’d want from their suppliers and they’d fill it with demands.

From a category-specific standpoint, managing spend doesn’t just mean supplier rationalisation and controlling maverick spend, it can also be a question of enabling stakeholders and empowering their decision-making.

Meanwhile, there’s strategic value to having access to supplier management information: market trends, risk, understanding global capability, viability of projects - if the business can find out what it needs in the supply base, that can be hugely valuable.

So there’s a will, but is there a way? Thinking about supplier interface as the domain of procurement or supply chain can be a rather limiting idea - many, even most, parts of the business have some involvement with suppliers. But for many organizations, because of the maturity of the function, procurement’s role is one of cajoling stakeholders into channels of process and value delivery.

The dashboard concept changes that…

If, as a procurement chief, you’re making your decisions based on the metrics you need, identifying areas that need addressing and aligning performance with organizational goals, you’re in a position to get the attention of the business. Which is useful, really, because if you have all that data organised in such a way that you can read it, you’re in a position to offer counterparts something that they desperately need.

In the UK, the National Health Service is a good example of a body that needs to make savings, but, it has claimed, has previously been prevented from doing so by a lack of effective data.

According to an article in UK newspaper The Guardian, these organizations are now finding results from developing a dashboard to remedy that: “And how do trusts align themselves with the forthcoming procurement strategy? Well, the East of England NHS Collaborative Procurement Hub is working with a number of stakeholders […] to capture a range of benchmarking metrics which will allow each trust to compare, monitor, and improve their contract compliance, catalogue utilization, product classifications, and spend profile.”

What are we looking for, then, in a dashboard?

  • Cross-functional translatability - Procurement data is useful only in so far that it can drive purchasing activity, which means user adoption has to be simple and result in meaningful outcomes.
  • Integration - Realistically, the data in any organization may come from any array of sources and any team might inherit any number of systems churning out different metrics. Any dashboard would need to be able to collect and interpret that and then make it accessible as part of a portfolio of readings.
  • Aligned - Having reliable, easily accessible data is vital to creating trust among stakeholders, but that doesn’t go far enough. From the outset, an aligned effort can involve bringing in a selection of internal partners and ensuring that the outcome has built-in ROI and adoption.

For some, it’s possible to start small with this type of supplier management and build outwards from a process or a category. For others, it’s a question of taking what’s available and siphoning it into something meaningful. For most there’s a long road ahead, but the possibility of putting information in front of the people that need it is an increasingly central concern for teams.