Procurement must get a handle on data before doing ‘sexy analytics’

17 October 2018

Procurement functions need to get a handle on data management before they can take advantage of “sexy analytics”, according to an AstraZeneca procurement leader.

The pharmaceutical giant’s procurement process and technology leader Paul Armstrong told delegates at ProcureCon Europe that although there are many vendors selling spend analytics software, procurement departments are unable to feel the benefits.

“You can’t bump into a vendor without them talking about [analytics], but they really struggle to give examples of people who have actually implemented it,” Armstrong said. “There are lots of pilots but nobody has fully deployed it.

“Why is procurement struggling to take hold of this opportunity? Because there are problems to overcome before we get these analytics off the ground.” 

Armstrong shared how AstraZeneca had partnered with GEP in 2015, only to find procurement couldn’t find all the data needed to plug into the system. It took nearly 12 months to get the data out of the company’s various ERP systems. 

“We have started to get the value 2.5 years later,” he added. 

However, he said the problem still wasn’t completely solved. “You need really high quality structured data ­– and we haven’t got it. If your data is not top quality, it’s going to keep dragging you back. No one really likes to solve that problem, because data isn’t sexy.” 

He added that one of the problems was lots of people creating data, with no idea about what it is going to be used for.

Armstrong’s solution is data-driven procurement. He has appointed someone to own the master data for procurement. He added that he wished he had done this sooner.

“Give someone accountability for data,” he advised. “You need a standard central process. Try to standardise. You need to create ownership and governance flows.” 

He added that the power of using data comes from “connecting the dots”. 

“Your weakest link is data quality,” he said. “You need to create a process to clean it. Your data is only useful if it can tell you stories. 

“If you want to start your digital transformation, then first start to deal with your data.” 

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