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Using Sabermetrics to Track Procurement’s Relationship ROI

By April 18, 2023April 28th, 2023No Comments

Data and analytics play an important (and growing) role in procurement’s ability to drive profitability, create value, and manage risk. And yet, most organizations may be missing out on one key way to leverage analytics.

Sabermetrics is the use of in-game data and analytics to improve player and team performance in baseball… also known as Moneyball based on the book by Michael Lewis. 

I recently spoke with Brian Peters, Senior Director of Global Procurement Services & Delivery at Gilead Sciences, about how he is using his own form of sabermetrics to prove one specific theory: that better upstream connections between procurement and the business lead to quantifiably increased downstream impact. 

Brian has asked his team to capture some specific data points when sourcing requests first reach procurement. They plan to use that data to prove – once and for all – that getting procurement involved sooner leads to benefits such as:

  • Higher savings
  • Improved business outcomes
  • Increased stakeholder satisfaction
  • Shorter cycle times
  • Improved supplier experience

Time will tell, but in my opinion data will ultimately shape how procurement sees itself as a profession and how the company sees them in return. 

Procurement spends a lot of time with procurement… talking about procurement. And while some of that time is well-intentioned and even well spent, it can also create an echo chamber that new ideas are unable to penetrate.

Brian advocates for getting “out of the bubble” to share ideas and increase contact with the business. They want to hear procurement ideas and engage in the procurement process – but procurement may have to take the first step to make that happen – and the perfect time for that may be right now.

Many procurement teams have proven their weight in gold over the last few years, and that hard work can be converted into an audience with the C-suite. Adopting a “challenger persona” as Brian puts it, where procurement approaches leadership with disruptive ideas AND RESPECT to serve as an engine of value creation.

Every team is made up of different styles, different personalities, and different backgrounds. For leaders trying to provide motivation, the best advice may be to start small.

This is where the sabermetrics approach can be incredibly powerful. Form a thesis, gather data, and then see if the thesis holds. Adjust if it does not. Test again and repeat as needed. Once the data indicates that procurement is taking the steps required to drive desired business outcomes, their ability to do so at scale will be vastly improved.

To hear my full conversation with Brian Peters, check out Capturing the ROI of Upstream Relationships on the Art of Procurement pod.

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