Most spend analysis 'comes to naught'

24 November 2008
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24 November 2008

More than half of buyers fail to link the data they get from spend analysis with their strategic sourcing projects.

A survey of 280 global firms by the Aberdeen Group found 52 per cent made no connection between using their information on spend and categories to improve procurement.

"The ability to identify, prioritise and execute strategic sourcing is built upon the foundation of spend visibility, so the efforts to organise and analyse spend will be for naught if no action is taken on it," the report said.

It added those firms who do make a link increase savings by 67 per cent, get 25 per cent more spend under control and improve compliance to contracts by 11 per cent more than those that do not.

The study also revealed that more than a quarter of firms, 26 per cent, do not even have a project to examine their spend. Aberdeen also warned that just collecting and extracting spend data does not automatically create useful intelligence, with 55 per cent of firms citing poor quality information as their biggest problem.

SMnov2008

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