Big Data in Procurement: Large amounts of data bring great potential for procurement & supply chain

After years of technological innovation and the massive IT investment in recent years, businesses are now sitting on a mountain of data. This unmanageable mass of unstructured data on production, marketing, sales, HR, finance and operations, as well as many other internal processes, is complemented by transaction data for suppliers, customers and partners. Leading companies are gaining tremendous value from this treasure by perverting hidden knowledge about customers, products and business activity.

Digitization is fundamental to the entire business world and the way we work - from operational processes to customer engagement. Employees demand flexibility, which can be increasingly achieved through the use of smartphones, tablets and co in the workplace.

The effect on procurement

Big Data is one of the most important topics when it comes to the future of procurement. This is evidenced by the current study by SAP Ariba and the University of Applied Sciences in Würzburg-Schweinfurt: 72% of respondents chose Big Data and Predictive Analytics as the top priority in procurement.

The data treasure, which is slumbering in the procurement department, is decisive for the success of the entire company. It contains information and data on long-term business relationships, contracts and other financial transactions. Through the use of technology to simplify traditionally complex processes, this treasure can be lifted and data-driven, well-founded decisions made.

Thanks to modern technology, advanced analysis is possible, which can act as a catalyst for decision-making, innovation and company growth can be advanced. Mobile access to Big Data from the Internet of Things and Industry enables decision-makers in procurement to gain insight into relevant information - anywhere, anytime. In addition, employees are empowered to better comply with internal policies and best practices, reduce costs, reduce costs, and increase the strategic value of each transaction.

Purchasing organizations have the task of enabling purchasing experiences and a supply chain that is fast, intuitive, sustainable and low-risk. But at the end of the day, everything is designed to make purchasing digital, efficient and, above all, smart. This is precisely the future of purchasing.

Drop old habits

In order to reap the benefits of digital transformation in procurement, classic approaches and processes need to be optimized and made more intuitive. It is important to break the "data silos" grown over years and decades, caused by different autonomous systems. Often, data is unstructured, on different servers, and in non-digital form. This important information can be found, for example, in scanned documents, e-mail boxes and spreadsheets. However, this information can only be analyzed completely digitized. Added to this is the training of employees, talent management and the creation of new job requirements. Purchasers must be sensitized to digitalization, modern technologies and processes. Only through a change in the culture and the attitude of the employees can modern disruptive technologies be used effectively. Big Data, Predictive Analytics, and Cognitive Computing require new skills and new ways of working, such as self-service analysis.

Heading for new shores

The challenge for procurement is to understand and use the data to make better and more informed decisions. This also frees the potential for changing the value-added and supply chains. Through the new fact-based action, decision-makers are able to develop the comprehensive benefits that go far beyond savings and efficiency gains.

Once the Big Data is digitized, it becomes time to make Smart Data. Intelligent, innovative technologies, some of them are already based on machine learning, enable the purchasing department to process information correctly and make informed and quick decisions. Thereby the company can secure decisive competitive advantages and place a new emphasis on procurement. By digitizing purchasing, innovations can be promoted throughout the organization, risks reduced and the supply chain sustained. Mobile access to Big Data from the Internet of Things and Industry 4.0 also enables decision-makers in purchasing to gain insight into relevant information - anywhere, anytime. Through the use of cloud-based applications in purchasing, there is a transparency over the entire purchasing cycle - all information from price estimation over the bid phase up to order allocation is available at any time and from anywhere. The result is an optimal digital strategy: customers can easily and intuitively go through the purchasing process. Orders can be placed on the basis of stored data from previous orders without re-entering the data, and suggestions for future purchases can be made - Predictive Analytics and Prescriptive Guidance make it possible.

Fujitsu: Purchasing becomes an experience

Value creation over the entire process - from procurement to invoicing: the Japanese technology group Fujitsu has also made its mark in the digital transformation of its business processes. As a result, the company would like to continue to innovate and offer its customers an optimal service. In order to be able to introduce efficient, standardized processes also in purchasing in Europe, the Middle East, India and Africa, Fujitsu has opted for the SAP Ariba cloud-based platform. The aim is to improve profitability, create a long-term, sustainable competitive advantage and accelerate the procurement process. With the implementation of SAP Ariba, Fujitsu will optimize and change its operational functions such as finance, procurement, order processing and supply chain management. The solution combines all systems, processes and trading partners with the business network of SAP Ariba and allows access from anywhere and at any time. By digitizing purchasing, the company can manage and intuitively manage its entire purchasing process, control spending, identify new sources of energy, and improve the supply chain.

The future of procurement starts now

Procurement has changed dramatically in recent years: its function is more strategic and its activities more valuable than ever. The automation of the operational tasks is in full progress and the value contribution of the Purchasing Department is increasing. New technologies, cross-process data, big data and the complete transparency of the supply chain can be used by purchasing in order to make the "shopping experience in the company" simpler and smarter. If this change succeeds successfully in Purchasing 4.0, that is to say the next generation procurement, this function will have a higher place in the company and will be a major innovation drive. SAP Ariba and IBM are working together on the future: By linking SAP Leonardo, IBM Watson and SAP Ariba, an even more intelligent source-to-pay / source-to-settle process is to be possible by comparing the findings from purchasing data with predictive information from unstructured data.