Supply Chain and Performance Measurement using Microsoft Excel

Supply Chain / Procurement / Purchasing Professionals – What’s up for New Year? 

As globalization accelerated in such a pace which opened vast possibilities, opportunities and challenges for procurement teams across the globe. The growths of support services are considered as key points of differentiators in the market place which forced the Procurement team to increase its competitiveness.

It is key at this stage that organization identifies and assesses their current procurement strategies and need to validate its effectiveness considering the expected future developments available in the pipeline.

So what should be the priorities for procurement departments in the New Year? I have mentioned few of them below:

• Accessibility to data and information,
• Transparency in process and compliance,
• Involvement in decision making,
• Greater efficiency in procurement and demand planning,
• Flexibility in order management,
• Empowerment as a core function

What else….?

Supply Chain and Spend Analysis

Hello There,

This time, I thought I should give bit of my thought about how we can use excel in spend analysis.

It might have already discussed in business meetings that sourcing Strategy, Category expertise, negotiation methodology, managing supplier relation and procurement execution are all critical components of a highly effective Supply Chain Management initiative and the beginning of these all process starts with spend analysis, so it is the prime tool.

Spend Analysis should be a hot subject of discussion in any Supply Chain Organization because of the importance it has in a decision making process. Take an example of the hospitality industry; spend analysis plays a prominent role in the procurement function because of the ability a spend analysis report has in helping to understand and to clearly establish expenditure patterns throughout the organization which will eventually enable the Supply Chain practitioners to accurately identify how much ($) is being spent, on what (Goods and Services), with whom (Suppliers), by whom (Business Unit) and how (Method of purchase) on a daily basis.

Also analyzing spends supports the day to day food and beverage costing, or for a monthly menu engineering and event costing, just few of the benefits…

Defining and understanding scope of spend analysis is really become a mighty task these days because of non- availability of cleansed, standardized data.

Besides the above mentioned issue related to quality data there are few more show stoppers the analysts are identified and they are:

1.    Lack of expertise and ability among existing staff to access, organize and analyze spend data for sustainable use.

2.    Lack of consistent approach and source to get the real time spend information from a procurement system.

3.    Failure of Top Management in linking the information and insight gained from spend analysis with the strategy and objectives of their organization

Faced with above said facts, the learning from industries around the globe concludes that, the most successful spend data analysis can be done in a more effective way considering the following: