SAP Ariba Live: The challenges and potential in data

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Every day 2.5 quintillion bytes of data are created across the globe, according to IBM. That data comes from everything from pictures uploaded to social media, to information collected by internet-connected manufacturing devices. The rate at which this data is created continues to increase, with IBM also recording that 90% of the data that exists in the world today was created in the last two years alone.


Procurement is part of that data creation. It has purchase information, it has weather reports, it has manufacturing and delivery data, and it has lists and lists of suppliers. That information has valuable intelligence within it but the challenge for procurement, and the matter at the heart of discussions at SAP Ariba Live in Prague, is how the function can understand and use that data to turn it to make better-informed decisions.


A lot of the data procurement has access to at the moment is unstructured in that it resides in email inboxes or on Excel spreadsheets. One of the keys to unlocking its potential is to ensure the data is saved in a format in which that information can be analysed.


The second challenge is ensuring teams possess the capabilities to analyse and utilise data. That does not necessarily mean functions need to hire data scientists, but they do need to develop the skills within the team to be able to use the systems that can create the analysis and spot the trends.


The technology exists to help capture and structure that data but, again, it comes with the challenge of implementation. For that, you have to build buy-in across the organisation, as well as within the function.


Get those parts right, though, and the function will open up new avenues of potential value, far beyond simple cost savings. Speakers at SAP Ariba Live said the function would garner more information about the full extent of the supply chain, when demand and costs peak, the points between which goods travel to, and where the constituent components of those products come from.


The importance of data management will become an ever-more important part of procurement’s role, especially as it pivots away from savings and towards adding value in other areas. Those first-mover CPOs are the ones who will see the greatest benefits to their functions and, ultimately, businesses.


Alex Atzberger, president of SAP Ariba, summed it up when he told me that if a function doesn’t have “great data, it won’t be able to make procurement awesome”.


This article is a piece of independent writing by a member of Procurement Leaders’ content team.

Tim Burt
Posted by Tim Burt

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