Seeing all your spend data in one place can inspire a dramatic change in how you manage your business. It's even more useful if you also organize that data by supplier, categories, items buyer, then view it in real-time. You'll want to refer back to this information again and again! Yet, only a few organizations are able to get a detailed view of their spending. And this lack of spend visibility comes with a hefty price tag.
You know, when you're in a store, and you see something so awesome, it's like, your heart skips a beat?
You know that feeling of panic when you can't find something?
What is Spend Visibility The term "spend visibility" can be confusing, as it sounds like a synonym for "expense tracking." However, spend visibility goes beyond tracking spending. It, in fact, gives both a detailed and holistic picture of how money is moving throughout your company.
Why is Spend Visibility so Important Managing expenses and optimizing spend is a costly, labor-intensive, and inexpedient undertaking that, if done manually, requires diverting significant time and resources away from core business activities.
Having a single source of truth that gets updated automatically allows an organization's teams to communicate more effectively because they use a common system where everyone has access to the same information. This reduces errors that can lead to wasted money and increased costs. When you categorize that data by supplier and buyer and view it in real-time, you can quickly identify which suppliers are falling short on their commitments. You get the information about where your money is getting spent by department, category, supplier, item, codes, etc. This spins your head with possibilities as you can instantly see on which category you spent more than expected and which supplier can be bundled for the best deal. You uncover trends for controlled and uncontrolled spend, reduce maverick or rogue spending, and gain a clearer picture of what was happening across the organization by identifying areas of overspending and managing contracts more effectively. By now, you must be on board with the fact that every organization needs to have a clear picture of where exactly they are spending their money, i.e., to have clear spend visibility. But in reality, organizations seldom engage in spend analysis activities to get such distinct spend visibility.
What is a Good Visibility and How Spend Analysis Helps Achieve it The procurement environment is becoming more and more complex and competitive, and the need for accurate and reliable data is growing. But contrary to this demand, procurement data is getting messier, siloed, and fragmented.spend analysis lets a business visualize and understand its spending at a particular point in time. This is an all-encompassing, dynamic methodology to visualize, analyze, and understand the spend composition and trends, such as:
What are we purchasing? Who is purchasing? Who are we purchasing from? When and how often do we purchase? How much did we spend in total, and what prices did we pay? What quantities or volumes have we purchased? What is the spend development over time? In short, spend analysis, when done right, provides you with the transparency you need to make strategic decisions based on data rather than gut feelings.
Key Challenges in Achieving Spend Transparency and Visibility Most companies struggle with procurement visibility.
Spend visibility can be hard to follow for several reasons:
Complex IT infrastructure : Multiple enterprise resource planning (ERP) systems or versions or legacy systems with low connectivity result in low spend visibility and make it difficult to track and manage spend and costs. Companies with IT infrastructure that doesn't work together, can't connect well, or is outdated results in the lack of visibility and subsequent hindrance into meeting the company's goals.Data in multiple languages : It has long been a challenge to analyze spend data that's present in multiple languages to get the desired spend transparency. A solution like Ignite provides a centralized platform to access and analyze the spend data from multiple languages and translate it to English.Inconsistent metadata or low data integrity : Spend data is one of the most important yet difficult-to-access and analyze types of data in the world. The data is often inconsistent, with different metadata fields across sources, mismatched entries in the same fields, or inconsistent formats and entries. A cloud-based solution like Ignite Ignite helps solve this problem by using advanced proprietary algorithms to automatically cleanse, transform, and normalize your messy data.To learn more about how to overcome spend visibility complexities, check out our on-demand webinar: How to Achieve Spend Transparency in Complex Organizations .
How Cloud-Based Solutions Make Spend Visibility Easy When it comes to data, most companies have a lot of it. They have spend data for the whole company, departmental data, and even data on individual suppliers and contracts —all of which might be stored in spreadsheets or databases with no real structure or sense. This results in chaos and confusion.book your demo .
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