At the start of the series the Prisoner, starring Patrick McGoohan, we hear a dialogue
What do you want? says Patrick
The reply comes ‘Information’
Whose side are you on? Retorts Patrick
That would be telling. We want information… information… information.
According to Wikipedia, Information is that which informs, which reduces uncertainty. It is closely related to communication, education, knowledge, meaning and understanding to name but a few.
There is data all around us, collected in millions of transaction lines across multiple databases, all waiting to be analysed. Yet it is more than information that is required.
Directors, Managers, and employees alike must take decisions. What is the best course of action, the most efficient and effective use of resources, which direction to travel in, where to focus effort next? To do this requires specific, relevant, and appropriate information.
Consider three examples that a robust analysis of spend data can help improve your organisations decision making, so producing meaningful results.
- Goods Receipt Note (GRN) analysis: This analysis can show you where you have over-delivery, under-delivery or replacement delivery by supplier, by product. Multiple instances of this take time and by implication money to deal with, plus they will be irritants to those entering in the Goods receipt notes. By performing this analysis, you can focus on specific suppliers to improve their deliveries to your organisation.
- Expense analysis: An analysis say of hotel expenses across the year could indicate that better hotel rates might be possible through approach one of the hotel chains, such as Premier Inn or Travelodge. This saving of accommodation costs give a direct return on the profitability of your organisation.
- Invoice matching by supplier. Invoices received from suppliers are entered against the purchase order, or as a direct invoice entry. By being able to report on error rates on invoices by supplier will show the time, and productivity lost, within accounts payable. Providing this information back to the relevant supplier or suppliers would improve efficiency and effectiveness, as well as reduce some of the frustrations felt by the accounts payable team in dealing with suppliers.
Consider then the spend management decisions you need to take. How can you be more effective? What analysis areas to focus on first? Where is there a current lack of information?
The requirement is for decision making to move from anecdotal, subjective assessment, to one based on scenario analysis, evaluation, modelling and structured review. Touchstone’s Spend Management reporting solutions can give you this information.
The knowledge you gain from this insight guides effective decision making, which lead to appropriate actions delivering meaningful results.
John Chapman, Programme Director