We now return you to our regularly scheduled programming….
Two of my favorite things: (1) waking up in Italy and (2) talking about spend analysis.
Despite my 90-year old Nonna’s wishes, I tend to do much more of number (2) than number (1). But I’m excited because today I get to do both.
The location for (1) is Stresa, Italy on Lake Maggiore and the occasion for (2) is the 20th Meeting of the Board of Directors of Italy’s Procurement Executive Circle. Organized and hosted by i-Faber, the “Circle” was designed “to be an environment where procurement leaders from the main companies operating in Italy can meet and exchange thoughts and ideas on business dynamics, best practices and management models in the purchasing and supply areas. The initiative promotes the development and dissemination of a managerial excellence and is constantly updated for its multi-industry and multi-sector business community.” Among the 120 or so expected to be in attendance are the CPO/head of procurement-types from Italian companies like Parmalat, Autogrill, and Ducati as well as the top in-country leaders for large multinationals like Abbott, Bayer, and Heinz. This is a perfect example of CPOs who are thinking globally and networking locally and they are doing it in style, Italian style.
My keynote presentation is on Spend Analysis and finding value in the data. Spend Analysis is the foundational element to operational excellence within procurement. Those that do no level of spend analysis, either automated or manual, (about 25% of all enterprises) are guilty of procurement malpractice. I’ll be covering a lot of ground in the 90 minute presentation and I will absolutely be spending time discussing Spend Analysis on the pages of CPO Rising. But today, I’ll just mention a few of the primary issues that enterprises have with the underlying data.
Not all spend data is good data or usable data. For example, I spoke to a CPO on Tuesday who has a new spend analysis service provider that has been working for several months and is still unable to differentiate supplier data from customer data. This is not a reflection on the service provider’s capabilities, per se, as much as it highlights the basic reality that the raw spend data is a primary challenge for a majority of enterprises. There can be issues with the quality of the raw data (ERPs do some things well, capturing procurement information is not one of them). There can be issues with how the data is stored – call it the data structure. And, there can be issues with where it is stored – too many, disparate source systems being a major example of this problem.
I hope to report back on the state of Spend Analysis in Italy but since my presentation will be the only one in English, I’m not sure what I’ll be able to find directly. I will try to recruit friends like Luca Guzzaboca from Banca MPS (and co-founder of Acquisiti & Sostenibilitia who I’m told may have a conflict), Daniele Calciolari of GSK, or my hosts including Claudia Contarini from i-Faber to help me out.
Ciao!
Well said Andrew, the thing about spend analysis, while it has caught the attention of procurement leaders and providers alike, this space is still crowded with multiple views and each argument seem to be logical. but there are some fundamental issues which need to be addressed when one is building this capability. We are conducting a best practice webinar with one of the old time expert in this space and hope to bring more clarity to this space. best of luck
Very interesting blog on spend analysis. I agree with what you say when you say not all spend analysis data is useful/good data.