Five tips: How procurement can use big data effectively

Whether you are presenting to the board, carrying out spend analysis or looking at supplier performance, with more and more purchasing data available how you present it can be critical to your outcome.

Here are five top tips to improve how you use data.

1. Source. Most organisations have spend data to analyse. Think about other sources of data – 80 per cent of stored data is estimated to be unstructured. Text analytics can give insight into supplier information on social media. Visualising social media data related to a supplier can give timely insights. Note that different parts of the world favour different social media sites, so make sure the countries where your suppliers operate are covered. The timeliness of your source is also an important consideration. Real time data will allow you to monitor strategy implementations and allow the tweaking of plans to increase success. For example, monitoring maverick spend on a new contract can be quickly identified and reduced.

2. Focus. Don’t try and cover too much information in one presentation. Be concise and only include relevant information. That way your message will be clearer and it will be more likely that your audience will remember it.

3. Story telling. People love and remember stories so include one around your data to make it captivating. You can use a narrative based around time or geography. Add human interest as this engages your audience emotionally. For example, if you are presenting data on the success of a supplier relationship management programme, you can narrate you presentation around how the programme has developed over time and include anecdotes from individual stakeholders that highlight an aspect of the programme.

4. Visualisation. People are programmed to understand patterns so graphs are more instantly understandable than numbers. Use appropriate colours. You want colour to emphasise your message not detract from it. My key bugbear is pie charts. While they look pretty, people find it hard to compare area. Length is easy to compare so in general bar charts are more useful than pie charts for comparisons.

5. Analysis. Use trend analysis to show patterns and to predict or forecast the future. Use this to form conclusions that will inform decision making in your organisation.

So get out there and produce beautiful information from all that big data.

(Source: http://www.supplymanagement.com/blog/2014/10/five-tips-how-procurement-can-use-big-data-effectively#sthash.t9IsTmhp.dpuf)