Business Intelligence Procurement - a Vital Cog for a Future-proof Business

Digital disruption, data explosion and burgeoning globalization have reshaped business intelligence procurement and aspirations of multinational organizations. Organizations often jump into a deal in unaware geographies with third parties, business partners and counterparts without required knowledge of track records, backgrounds and business practices. There may be anti-money laundering concerns, liabilities pertaining to unfulfilled contracts, and costs in recovery of unpaid amounts.

Amidst these daunting challenges, there are a few uphill tasks, including enhancing the customer experience, bolstering productivity and remaining competitive. This is where business intelligence (BI) procurement comes in. BI tools can leverage users to access various types of data and they can gain insights into how business is performing. Stakeholders may have a few questions lurking in their minds:

Why have the sales dipped? What does the customer trend allude to? With historical and current insights, BI can help answer these questions. Of late, procurement of business intelligence services has surged by leaps and bounds to (but not limited to) boosting RoI, monitoring business operations, and assessing customer behavior.

Driving Spend Analytics and Cost Reduction

As stakeholders gear up for predictive decision-making and breakthrough customer insights, cost-reduction, productivity and efficiency have become pivotal to navigate a future of transformation. Organizations are unraveling human-machine capability with investments in advanced analytics, automation, natural language processing and machine learning. Business intelligence procurement becomes invaluable to making data-driven decisions in real time, creating more digital experiences and hyper-personalized customer interactions. Amidst these trends, cutting costs through automation and digital disruptions can be a game-changer.

Modern companies are striving to cash in on BI tools to help optimize procurement processes, addressing cost avoidance and cost savings. For instance, BI services can serve as a precursor for cost modeling, spend analytics, price benchmarking and payment analytics.

To shed some light on spend analytics, it collates data and uses analytical techniques to underpin decision-making and gain actionable insights to boost S2P operations. Procurement analytics can help answer simple yet crucial questions:

• Is the enterprise getting what is required?
• What is the enterprise buying?
• What strategies can help minimize cost?

The innate ability of spend analytics to track vendor-related KPIs, forecast market and price changes, predict demand and boost contract management will encourage organizations to inject funds into business intelligence procurement services. To put things in perspective, machine learning can help assess current and historical data, helping the enterprise get more reliable and accurate forecasts.

Price forecasting has emerged as a promising portfolio to create budgets and bolster procurement strategy. While BI software can have a cost of USD 3,000 (an annual minimum average), a free version is also available. BI suppliers tend to use subscription hosting plans (cloud) and perpetual licensing price structures. ?

The use of algorithms that can predict data behavior will help companies stay cut above the rest. With BI solutions extracting and ingesting raw data, enterprises can become more responsive and agile to stakeholders and customers.

Strategic Sourcing and Supplier Activities Become a Value Generator

Innovators are counting on business intelligence strategic sourcing to convert raw data into usable and applicable facts and summarize the data into real-time, meaningful and fact-based information. An estimate found that India’s software business is surging by 60% annually. Predominantly, a Software Sector Analysis Report spoke highly of Indian developers, claiming that the country's software market is five-fold more affordable than, for instance, in North America. For instance, software development companies may charge between USD 25 and USD 50 per hour (in India), whereas U.S. firms may charge between USD 30 to USD 70 per hour.

In essence, companies use BI-powered data to analyze strategic suppliers and make informed decisions and strategies. For instance, in June 2023, Microsoft collaborated with Moody’s Corporation to provide improved risk, data, analytics, research and risk solutions spurred by Generative AI.

A survey by the IBM Institute for Business Value asserted that advanced analytics, automation and AI can bolster performance. The survey, however, revealed that merely 33% (of 500) P2P managers surveyed reported that they are implementing these state-of-the-art technologies. The survey also found that organizations that optimized an accounts payable platform showcased 33% fewer duplicate or erroneous payments.

Roadmap: How Can Companies be Data Driven with BI Analytics?

Data-powered companies are undergirding business intelligence procurement solutions to go beyond dollars and assess factors that are not revealed on the P/L sheet—cost reduction and cost avoidance. Implementation or procurement of BI tools can streamline and automate processes and enhance customer experience.

As data storage becomes cheaper and procurement organizations ramp up investments in AI and analytics, business intelligence can be instrumental to KPIs created for industry pain points.

For a quick rundown, get a free PDF brochure of the BI Procurement Intelligence Report and win today’s race while running tomorrow’s with Pipeline-Procurement Intelligence.