Meet the Power Duo: The Proactive Procurement and Data Science Affair

How mature is your procurement function? This is measured by the 'degree of your proactive stance' and reflected by showcasing procurement's VALUE and IMPACT across the entire business. This article posits that the extent of your proactivity is mirrored in your data science capabilities, unveiling the correlation between data science and your proactive capacity to create value.

If you are in rush just scroll down; the whole article is summarised in the next picture

Proactive Procurement: Is it just another BUZZword?

The vast majority of procurement decisionmakers will tell you that proactive procurement is strategic, emphasising innovation and value creation. At the same time, you've never met 2 people that define strategy, innovation and value creation the same way.

So yes, just like any definition lacking specific quantitative thresholds, proactive procurement is heavily utilised as a buzzword but this does not exclude the term from carrying semantic significance.

Procurement Maturity hence Proactive Procurement is a spectrum. The more accurately you can foresee and shape future outcomes, while reaping business benefits, the more proactive you are.

Simply put, you can set the level of proactivity to span 'from 0 to 100': from entirely tactical, where professionals reactively respond to emerging needs, to fully automated processes. No organisation is even close to achieving the fully intelligently automated stage and even if humans were to be indeed fully substituted, there would always be room for more proactivity.

Evaluating Proactivity: The Novel Intelligence Procurement Maturity Model

Proactive Procurement implies automating mundane work, diminishing human error, positively impacting multiple stakeholders and evermore releasing time for more strategy and innovation. But how do you measure the above and how do you get there? I can readily provide hundreds of detailed financial performance, risk and operational efficiency metrics....But any definition that takes writing a book to explain loses meaning.

At Novel Intelligence? Ltd we see Procurement Maturity as a direct reflection of the type of strategic information needs you can satisfy, while delivering objective business outcomes. This is directly related to the type of questions you can both answer and readily monetise (WHAT, WHY, HOW MUCH, HOW LIKELY, HOW SIMILAR), which are in turn reflected by your data-science maturity. Gentle reminder:

DataScience = Algorithms+Software Development+Business Understanding

The above image is straightforward to interpret and captures both your current proactivity levels as well as the procurement maturity journey from being fully reactive to becoming more and more proactive.

Boosting Procurement Proactivity/Maturity: Where to Begin?

Identifying the low-hanging fruit is essential, and businesses should focus on procurement analytics projects that provide a direct connection to value, impact multiple areas of the business, and make it easy to envision the potential of data-science.

Such swift, high-ROI, holistic procurement analytics projects are feasible when expertise in data science, exclusive research, and forensic accounting are combined.

The Novel Intelligence framework combines all the above and will help you boost working capital, optimise operational efficiencies and minimise risk. Having done R&D proactively, we deliver value every 2 weeks.

And in case you can't live without 'corporatish': "Our framework serves an integrated procurement strategy that bridges the gap between top-bottom and bottom-top approaches". And that's the memo...

Any objections or questions? Follow the link: Dr. Kyriakos Christodoulides

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