Procurement teams are relying on their electronic procurement systems for more than just purchasing, but are finding that these systems often lack the built-in analytics tools needed to measure their effectiveness, Forrester Consulting says in a new study.
The study found that 82% of procurement teams rely on procurement software to save their company money; 76% said they use it to find the best suppliers; and 74% to identify purchasing processes that drive up efficiency. Forrester based the study on a July 2017 survey of 150 procurement and supplier sourcing professionals across various industries across North America and Western Europe. The study was commissioned by BravoSolution, a provider of procurement software.
Following are the percentages of respondents citing the top three most essential features of procurement analytics tools:
- An online dashboard that displays the capabilities and delivery performance of multiple suppliers—58%;
- Sourcing analytics data that shows how well each supplier performs as a source of products—55%;
- Analytics data that show how well a procurement organization is managing spending—55%;
The report notes the following percentages of respondents as citing their biggest challenges in demonstrating the value of their procurement operations:
- An inability to collect performance data—34%;
- A lack of defined performance metrics—30%;
- A lack of useful procurement data—28%.
“Procurement professionals realize that helping their businesses win in an increasingly competitive landscape means more than simple cost savings,” Forrester says in the study. “At a time when firms depend more and more on outside partners and suppliers, procurement professionals are pushing for a broader vision of their role with an increasing emphasis on the value delivered to their business.”
“Many firms are looking for more sophisticated analytics tools,” Forrester adds, “to help them gain these insights.” That will not only help procurement pros do a better job of buying what their companies need, but also produce the data to prove how they helped to cut spending while improving operations, Forrester says.
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