Procurement has a lot of data, but it isn’t always high quality or logically structured. We spend considerable time trying to make sense of it all and are hesitant to share it with others because we don’t think it will meet their expectations.
But things are changing.
In a recent AOP Live session with Flavio Monteleone, an Expert Partner in Procurement at Bain & Company, and Heta Ruikka, Vice President of Product Management at Sievo, the audience asked multiple questions about how and when procurement should share data with the rest of the organization and with suppliers.
Flavio pointed out, “Procurement is becoming much more eager to share the insights they have for multiple reasons – internally and externally. Now, suppliers are coming back, asking for a price increase, so procurement wants to understand the reason. Prices have gone up – steel prices, ocean freight – procurement always challenges suppliers and is trying to do so in a very fact-based manner.
On the flip side, internally, they want to show what opportunities exist to reduce cost and to ensure resiliency in the supply chain. Procurement is trying to offer more to the business – to share the data and opportunities associated with the procurement function.”
Objective driven though it is, procurement still has to have the confidence to share their data. Getting past that concern is often rewarded with improved internal relationships, as Heta explained.
“What we’ve seen at Sievo is that when companies share their data – not only internally within procurement but with the business – they very quickly see the value. They suddenly have quite a few new friends internally. It usually happens quite naturally when procurement takes that step, but the mindset change is ongoing, and we’re hoping to push for that.”
Other key points procurement should keep in mind when increasing access to data include:
- Making sure discussions are fact based keeps everyone focused on outcomes
- Only sharing the data that needs to be shared, at least with suppliers
- The whole corporate culture has to align around supporting the sharing of data
Data can be “cruel” in Heta’s words, but it is also fair. “It gives everybody a fair chance to voice their argument based on a shared foundation.”
If procurement can increase transparency and level the playing field for ideas at the same time, we can absolutely make strategic gains – for ourselves and for the organization as a whole.
To watch the full AOP Live session, “How to utilize a data-driven mindset to supercharge your procurement organization,” click here.