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October 2011 | Adam Leach
Procurement needs good data in a consistent
format to maximise the benefits of spend management, according to the latest CPOAgenda webinar.
Speaking on the topic of Spend Management: How to do it and how to
optimise it, Rob Hindman, senior manager BPO procurement, Capgemini Procurement Services said the effectiveness of
spend optimisation depends on the quality and format of data. “If you don’t
know where you’re buying or what you’re buying then you’re not going to be able
to get much out of spend optimisation,” he said.
He told listeners he commonly worked with
clients that had multiple data collection techniques and this fractured
approach caused problems in the process. Duplicated data can also cause
significant issues. Referring to a past client, Hindman said: “They must have
had IBM listed 11 times under different names.”
Chris Campbell, commodity sourcing manager at
HSBC, agreed data
quality across the organisation and the supply chain is key. “Unless the data
can be collected effectively then it’s not going to work”. In order to improve
collection, he recommended sending out an example of the data required, so
suppliers and stakeholders can see what format to provide it in.
Martin Street, head of UK procurement at
HSBC, who manages an annual procurement budget of more than $2 billion (£1.2
billion), believed spend analytics to be the “cornerstone” of strategic spend
“Without spend analysis it is difficult to
ensure suppliers are providing at the correct prices.” He added having quality
spend data is a valuable tool for meeting negotiating departmental budgets: “It
allows us to have those meaningful discussions with senior budget holders.”
Chris Ayscough, purchasing director at
aviation technology firm SITA, agreed that the technology opens up new opportunities, but
that it is people that are key in making the most of it. “Ultimately it’s about
how people pick up the baton and drive success, spend analytics is just an
enabler,” he said.
* To listen to a replay of the webinar, please click here to register.