In the age of data, it comes as a surprise that 65 percent of global information technology (IT) and business decision makers have reservations or an active mistrust in their data and analytics (KPMG’s Guardians of Trust report). At the first Procurement igNite for 2018, a quick poll during the event revealed that only one participant’s organization had data strategy as a corporate focus, and most did not have a comprehensive enterprise-wide data strategy.

Organizations therefore often find themselves lacking when it comes to understanding how data and analytics can support the decision making process. And without knowing how data aligns to business outcomes and business imperatives, the full value of their data assets cannot be leveraged. This lack of strategy may also translate into poor trust in the outputs from data and analytics.

A data strategy provides an organization with a common understanding of data as an asset. It drives a data driven culture and helps to change mindsets and practices. Roles and responsibilities are clearly defined, while the required skill sets and capabilities in order to execute the strategy effectively are also clearly outlined. Such a strategy provides a roadmap of the incremental steps the organization needs to take in order to become a fully digital, analytically-driven enterprise.

In the absence of a corporate-wide data strategy, the procurement team can look at championing it by developing one for their function before implementing data and analytics programs. Suggested a member of the igNite audience: “Procurement leaders should take ownership of data. They can play a pivotal role in linking data and information in a unified way for entities within the organization.”

By having a robust view of data gathered from multiple information systems, the procurement function can capitalize and use advanced analytics to help the business make better decisions and deliver value. This serves to position procurement as a business generation function, and not just a cost-saving one. Ultimately, it can move procurement towards having a strategic position in the organization.

Another participant made an astute observation: that large investments in data and analytics are often born out of client-facing functions such as marketing, as well as data-custodians such as finance and procurement functions. He further noted that it is in the latter where some of the greatest opportunities for data and analytics are, where programs can make a difference and deliver positive business outcomes.

Indeed, procurement teams do not always come to mind immediately in data and analytics discussions. Often overlooked, procurement teams are sources of rich data. For example, procurement professionals have data on how much their organization is spending on goods and services. They collect data that helps them to monitor and manage supplier/vendor relationships, and to mitigate risk of supplier/vendor performance. Thus, when procurement data is combined with data sources such as operations, finance and even human resources, new insights into cost control, cash flows and even fraudulent transactions can be generated.

In today's world, procurement leaders need to know how to articulate the value of and the return on investment on data and analytics initiatives. CPOs should know how to make use of superior data management and analytics to unlock insights. These essential capabilities support managerial decision making and ultimately enhance financial performance for their organizations.

We would like to thank the following external speakers who contributed to Rethink Procurement: Championing Data Strategy, 1 February 2018 - Laurent Clemot from Flexera, Arindam Sengupta from Shell Eastern, Mano Manikkam from Visa, Keith Carter from National University of Singapore School of Computing, and Qasim Hussain from Kellogg.