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2 August 2012 | Kamalpreet Badasha
CPOs need to invest in IT systems that give them greater detail about their procurement spend, according to consultancy Efficio.
According to a white paper Are you leaving money on the table? Why granular is good said ‘granular data’, which provides different levels of detail, was the key to successful sourcing.
It also recommended using a reporting structure that allows categories to be compared using multiple factors. This compares with relying on a report produced from an ERP system to collect information from across the organisation, or using stakeholder requirements that may not be commercially beneficial.
The quality of information collected for sourcing should use a structured data request that provides different levels of detail, which would allow quick analysis of information. Procurement professionals also need to ask suppliers to provide the adequate level of information and not assume it will be available from internal company sources.
“There is typically insufficient attention paid to setting up a reporting structure with suppliers to collect the required level of granular data following sourcing and supplier selection,” said Christo Zeller, principal at Efficio.
The paper advocated buyers be trained using specialised courses, as these would provide them with the knowledge to deal with large amounts of data quickly and effectively. And the optimum timeframe for capturing information is four to eight weeks.