Procurement Analytics at a glance:
Modern procurement teams are faced with managing fast-evolving demand-supply situations, disruptive trends and a multitude of vendors, however diverse information sources often result in conflicting indicators.
Restructure the supplier base to achieve the right balance of quality, price and supply assurance, and improve partner collaboration.
Consolidate spend to capture maximum value from aggregated volumes and supplier contracts.
Manage price escalations with higher visibility into commodity price volatility and product/service costs.
Reduce transaction costs to deliver additional savings to the organisation.
Proactively mitigate risks with a real-time view of supplier, market and commodity dynamics.
Effectively manage processes including RFx, supplier performance and compliance tracking.
Procurement can leverage analytics to address these priorities, drive positive change across the function, and craft proactive strategies based on what’s likely to happen in the future, rather than past trends. Our specialist teams consolidate, integrate and analyse data sets, provide clear recommendations and next steps to help you turn insights into actions quickly, and make intelligence available to the wider business for effective decision-making. Procurement Analytics from The Smart Cube comprises multiple modules which address specific priorities:
Review historical and future spend profiles, and identify opportunities for supplier consolidation and tail spend optimisation.
Develop scenario-based and predictive cost models and price forecasts to drive informed decisions.
Monitor contract spend and compliance, optimise payment terms, and understand purchase price variance.
Create scenario models for tenders and bids, track supplier performance against SLAs, and develop supplier sustainability scorecards.
Listen for supplier-related risk signals, and monitor early warnings for category risks.
Take data-driven decisions and drive more value at a category level, recognising the unique metrics, data sources and optimisation levers for each category.
With Procurement Analytics from The Smart Cube, you can:
We always start with prioritising business questions and not data problems. Based on your needs and analytics maturity, we’ll work with you and your team to identify and prioritise use cases where analytics can deliver the most value. For each use case, we deploy a robust and agile methodology:
We understand your business objectives and define solution success criteria through diagnostic and discovery workshops.
We identify the relevant datasets from internal systems (e.g. ERP and SRM) and external sources.
We align with you on proof of concept scope.
We implement statistical modelling (e.g. regression, clustering, segmentation) and advanced data science techniques (e.g. machine learning, text analytics) to generate insights and deliver rapid value from the projects.
We augment the solution with other internal or external data (e.g. commodity price forecasts, supplier financials) based on learnings from proof of concept and perceived business benefits.
We scale-up and deploy the solution in other business units or categories, and provide ongoing actionable insights.
When you choose Procurement Analytics from The Smart Cube, you always get:
A solution tailored to your maturity and goals: We can build a pilot around a use case if you’re starting out with procurement analytics; our specialists can augment and extend an existing analytics team; or we can deploy a full-scale analytics solution.
Flexibility and customisation: We adapt to your tech stack, procurement systems, data sets and sources, creating a bespoke solution which delivers outputs tailored to your needs, ensuring high adoption across your function and business stakeholders.
Established procurement and data science expertise: Unlike many software vendors, pure-play analytics firms and consultancies, we have a 17-year track record of delivering valuable tailored intelligence to procurement teams at many of the world’s largest companies.
Skills and data across the analytics value chain: Our capabilities span data consolidation/integration, reporting, visualisation, predictive and prescriptive modelling, and deep learning – leveraging multiple alternative datasets to enhance our insights.
A suite of purpose-built assets: Our proven assets enable faster delivery and better outcomes for a wide range of procurement activities – from data collation and extraction, to regression analysis and risk tracking and monitoring.
Relevant advice and recommendations: You don’t just get dashboards. Our Artificial Intelligence + Human Intelligence (AI+HI) model means you get actionable insights and recommendations, contextualised to your business, driving analytics adoption.
This furniture giant had no central overview of its 40,000 indirect suppliers (with a yearly spend of €4.8 billion) and wanted to improve governance and evaluate cost savings opportunities.
The Smart Cube created an automated spend cleansing tool, comprising automated VBA for regular spend reporting, and a dynamic and department-wise customised Qlikview spend cube dashboard for reporting and conducting Pareto analysis. We suggested to reduce the number of suppliers by 4% (1,816) and dependence on manual intervention by 50%, and suggested ways to achieve cost savings.
The client consolidated spend by reducing tail spend to realise a savings of €41.2 million by following our recommendations.
In order to improve operational efficiency, the client wanted to assess the possibility of releasing cash by evaluating supplier payment terms.
The Smart Cube evaluated the payment terms across categories and developed a simulation tool that displayed the cash released by each business unit. We apprised the client that it was paying its suppliers 8 days earlier than the negotiated terms, resulting in significant cash releasing opportunities.
The client visualised cash release opportunities worth approximately $300 million across the organisation.
The client was wary of high costs across indirect categories and wanted to identify cost savings opportunities to increase its bottom line.
Our specialists conducted industry benchmarking and Pareto analysis to identify quick wins through supplier base rationalisation for the identified top spend categories. Invoice processing, purchase price variance, contract consolidation and parent–child mapping were also conducted to realise spend consolidation opportunities.
The spend consolidation opportunities helped the client visualise cost savings of $350 million across 3 categories.