How to Conduct Data Preparation Spend Analysis? 8 Step framework
Data Preparation
Spend Analysis
Data preparation spend analysis, involves extracting, transforming, organizing, verifying, essential data required to build procurement spend analytics reporting. A solid foundation is critical to the success of creating a data-driven spend analysis culture.
Accurate data preparation for procurement analysis requires a logical approach. A simple 8 step framework, allows for logical data capture, data cleanse, data preparation with Spend Analysis.
The data preparation steps required to complete a spend analysis are shown below:
Data Preparation Steps
Step Define Scope & Objectives
Step Identify the data requirement
Step Agree on the resource schedule
Step Data Extract template
Step Data Extraction method - SQL, Excel, CSV
Step Data Transfer process - firewall, tunnel, SharePoint
Step Data Governance - Data quality
Step Data Audit & Validation
Evidence, suggests, that using the data preparation steps, yields downstream benefits in data quality, procurement insights, and optimized cost management.
An investment of time, that delivers richer cost optimization, improved category management, and more accurate decision support.
To achieve this bespoke Spend Analytics Software is used.
Data Preparation Spend Analysis - Video YouTube
Best Practice Data Preparation Spend Analysis
Best practice procurement spends analysis, involves a standard template or data schema, normally in excel. This reduces the time required to prepare raw data significantly.
The Data person(s) is normally the go to people in the organization, who know the "data" and this is the "Trusted" Source.
Spend analysis extracts are taken from ERP - P2P systems.
Importance of Data Preparation spend analysis
For many organizations, the importance of data planning provides a unified approach to successful data spend analysis. Good data preparation is a fundamental prerequisite to delivering a spend analysis solution and delivering the following benefits:
Data Preparation Benefits for Spend analysis
Security
Cost
Accuracy
Speed
Volume
Variety
These steps, make it easier for your procurement staff to find and understand the information that they need to do their job. Easily validated spend analysis and a trusted data analytics source.
Provides the structure for easily sharing information with others, including Executives, Management and suppliers Allow the information to be stored for future reference, easy retrieval, and knowledge sharing.
Data Preparation Foundation
If spend analysis and analytics is a house, then data preparation is the below-ground foundation and is the cornerstone for creating insightful, data-driven cost optimization.
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