The lack of transactional data especially in indirect categories is a common issue in many companies. ProcureNode is a system with incredibly easy access to making digital transactions for your b2b purchases.
ProcureNode is a SaaS-based multi-channel procurement software for making business transactions digitally in cloud-based software.
For buyers, ProcureNode acts as a purchase-to-pay (P2P) system with an easy and user-friendly interface. It provides statistics and detailed information on procurement spend.
For sales, ProcureNode provides an opportunity to grow the number of orders received digitally. It’s a platform for connecting businesses digitally. If you already have an eCommerce solution, ProcureNode works as an extension. It takes your products and services directly into the reach of your current and potential customers.
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How can you manage your indirect spend if you have no sufficient data on it?
Spend analytics and spend management calls for data, which is usually driven out from ERP systems. If your master data is well managed, such data can be used for supplier performance measurement, item price development, purchase pattern analysis, and much more. With the data, you can optimize and control your material flow as well as manage supplier quality.
However, this is very rarely the case with indirect spend. Orders are often placed without using ERP or any other procurement system by either email or phone. The only source for data is the suppliers’ information system. While they can be well developed, they’re company-specific. Harmonizing these reports from multiple suppliers may well be a mission impossible.
Digitalization and lean six sigma
Procurement digitalization begins from a transactional level. The baseline must be set up first. The digitalization process goes from baseline towards the top starting from the transactional level, moving up towards spend and items management to the “big picture”.
Transactional data is also essential for reaching out to the lean six sigma method. The method is aiming to reduce and minimize all non-value adding activities in a process flow. These activities include transportation, stock, motion, waiting, processing, overproduction, and defects.
The success rate of going towards procurement digitalization and applying lean depends on data availability. The more detailed, systematic, and accurate data you have, the better you will do.
How well is your indirect supply base performing and have you set KPIs to measure it?
While it may not make sense to compare the delivery performance of your service providers to your MRO (maintenance and repair operations) suppliers, it still may be interesting to know consolidated performance levels within all MRO category suppliers together and pick best performing stars from those lacking behind.
Once you know your best-performing suppliers, you can focus on where improvement is most required.