Tag: Spend analytics

marketing analytics

Spend analytics solutions helped a manufacturing company to identify spend patterns and increase profitability by 12%

The client is a leading manufacturer and distributor of high-quality construction equipment based out of Germany. The company is well-known for delivering high-quality construction equipment and services in more than 14 countries.

In today’s complex business scenario, gaining a 360-degree view of the spend may seem like an uphill task, even for well-established companies. The client, a multinational conglomerate in the industrial and manufacturing sector, was no exception. With business units spread across Europe, the client faced several spend management issues that left a measurable impact on their business operations.

Quantzig’s spend analysis solutions can be custom configured to your organization’s existing processes and spend management system’s subtleties to help you deliver sustainable results. Request a FREE proposal to gain in-depth insights into our portfolio of spend analytics solutions.

Business Challenge

Global manufacturing companies face a wide range of challenges including the need to adhere to local regulations related to labeling requirements and safety standards. Such factors are pressurizing manufacturing companies to adhere to the regulatory requirements without compromising on their operational efficiency. Spend data, data systems, and domain knowledge are often siloed within specific groups of teams in manufacturing companies. Therefore, leveraging spend analytics solutions has become important for companies to address such challenges.

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The client, a German manufacturing company, was struggling to gain a consistent and unified view of spend throughout different functional groups within their organization. With minimal access to vendor information and a mere 6% of the organization’s spend data categorized, the client was experiencing a steady decline in their negotiation power. By leveraging spend analytics solutions, the manufacturing company was looking to overcome such challenges caused by data silos and operational complexities. As a result, they approached Quantzig to gain greater visibility into their spend patterns and improve profitability.

Our spend analytics experts can help you achieve notable improvements in supplier performance, and efficiency. Get in touch with them right away!

Solution Offered and Value Delivered

The spend analytics experts at Quantzig adopted a comprehensive approach to understand the core business challenges faced by the client. The initial phase of the engagement revolved around analyzing the client’s existing spend data and patterns. By gaining valuable insights from such analysis, the experts then unlocked the potential value in the growing spend data of the client which further helped them to identify roadblocks to spend management. Also, the solution offered by Quantzig enabled the manufacturing company to integrate spend and supplier data and eliminate bottlenecks by leveraging real-time spend insights.  As a result, the client realized an increase of 12% in their profitability and identified several saving opportunities which were previously unknown to them.

Quantzig’s spend analysis solutions encompass the entire value chain, with each offering uniquely configured to meet distinct client requirements. Request a FREE demo below to know more.

Spend analytics solutions also helped the client to:

  • Proactively address compliance related issues
  • Achieve notable improvements in supplier performance
  • Streamline their procure-to-pay operations

Why choose Quantzig as your next analytics partner?

Quantzig’s spend analytics solutions provide companies with opportunities for procurement that help them to achieve wider business objectives. An in-depth spend-analysis solution by Quantzig helps leading organizations to rationalize their supply base, deliver unit cost savings from unmanaged spend, reduce maverick spend, and harmonize pricing across buying centers. At Quantzig, we bring together scalable advanced technology and analytics experts to deliver accurate results that give sourcing and category teams confidence in the spend data, so they can focus on delivering value.

To learn more about how our spend analytics solutions can help you tackle supply chain risks and drive continuous innovation and improvement, request for more information now.

To know more about spend analytics, take a look at our holistic guide to spend analytics here:

A Definitive Guide to Spend Analytics

marketing analytics

A Definitive Guide to Spend Analytics

What is spend analytics?

Spend analytics is the process of identifying, collecting, categorizing and analyzing the spend data of an organization. The goal of spend analytics is to decrease procurement costs and improve efficiencies. Spend analytics help businesses to gain clear visibility and dive deeper into spend data to understand the spending patterns and the supply base, to track the matrices of procurement performance, and to gain actionable insights for spend consolidation to reduce the procurement cost. Also, spend analytics solutions can aid businesses in identifying cost arbitrages, benchmarking internal performances and improving delivery performance.

Identifying opportunities for consolidation of spend and reduce procurement costs is a daunting task for businesses. But we are here to help. Get in touch with our experts now!

Why is spend analytics important?

In today’s complex business environment where leading players are leaving no stone unturned in the quest for cost reduction, spend analytics is considered to be the best way to optimize spend.

Following are the reasons why spend analytics is important for businesses today:

  • Spend analytics can be helpful for gaining visibility on spend data and suppliers
  • Spend analytics has the ability to streamline procurement processes
  • Spend analytics can help in better risk and spend management
  • Spend analytics can help significantly in category level analysis.
  • Spend analytics can be helpful in building an effective relationship with suppliers
  • It can help manage the tail spend in a much better way

How can you control your spend with spend analytics?

Costs are skyrocketing in many industries but that does not imply that companies should raise rates to keep up with current levels of profit. The consistent growth of any business is, of course, important but there is more that can be done on the operational side to keep your profits increasing despite growing industry costs. The formula to succeed here is optimizing the process to contain costs throughout the supply chain. Also, companies can leverage spend analytics to gain spend data visibility across the departments and various business locations. This visibility can help businesses make significant improvements to the bottom line without putting more efforts into customer acquisition. Furthermore, spend analytics helps companies to gain visibility into how their spending impacts business operations.

Here is a list of various ways in which spend analytics solutions can help in controlling costs:

Find potential savings

Spend analytics helps in identifying the specific areas of spend in business and segment the procurement spend data to decrease costs and boost efficiency. This can further help in analyzing the sources that provide the best savings opportunities. Also, such data can be used to negotiate cost savings with suppliers.

Quantzig’s spend management solutions can help businesses in streamlining their procure-to-pay operations. Want to know how? Request a FREE proposal now.

Understand aggregate spend

With the help of spend analytics solutions, companies can gain an understanding of how their spend affects the overall performance of the business. Furthermore, this data can assist in strategic planning and can increase visibility into supply chain operations. The increased visibility allows businesses to gain useful insights into their current procurement processes and then streamline their operations.

Evaluate supplier performance

By leveraging spend analytics solutions, businesses can evaluate their supply chain and can identify dependencies, risks and quality issues in the overall supply chain network. Also, through spend analysis services businesses can identify and rank key performance indicators (KPIs) that are most important to their organizations, and then use this as measurement against their supply chain to determine the performance of the suppliers. Consequently, this can lead to better supplier performance management.

Request a FREE demo below to know how our customized spend analytics dashboards can help you reduce maverick expenditures and capitalize on new opportunities.

Challenges businesses face while implementing spend analytics

Lack of understanding

Spend data is usually incomplete, not updated, or isn’t accurate to make strategic decisions based on it. Companies need to understand that they need to collect accurate data for better decision making. Also, they need to classify and segregate the spend data through automated programs to avoid manual errors.

Lack of resources

Traditional spend analysis systems were developed to provide local opportunities and simple strategic programs. Such systems were not able to deal with complex data sources. So, companies need to leverage spend analytics solutions today to understand and analyze complex data sets and institute intelligent spend management strategies to reduce maverick spend.

Lack of capabilities

Companies tend to miss opportunities for savings due to the lack of capabilities to gain 360-degree visibility into their supply chain networks. But by leveraging spend analytics solutions, companies can have better data visualization and can implement the best practices to streamline sourcing and procurement processes.

Manual classification of data

Companies across industries face challenges in data classification. Datasets for each and every company is stored and structured differently. Manually classifying data can be subjective as well as inconsistent. Also, manual data classification is a complex and expensive task for businesses. Businesses following the manual process of data classification tend to miss essential information stored in unstructured data sets. As a result, businesses can leave their most critical assets vulnerable based on incorrect information. 

Want to know more about challenges in spend analytics implementation? Request for more information below.

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Three Reasons Why Spend Analytics is Important from a Business Perspective

There is a wide variety of procurement technology available today that helps businesses to manage different aspects of procurement processes including strategic sourcing and purchase-to-pay processes. Such technologies help in improving vendor management and contract management. Despite the availability of such solutions, many organizations struggle in managing their spend data and find it difficult to transform them into actionable insights.

Are you finding it difficult to identify opportunities for consolidation of spend and to reduce procurement costs? Get in touch with our experts now!

Why is Spend Analytics Important?

Reason #1: To overcome the challenge of data management

Spend data comes from multiple sources which include accounts payable systems, payment consolidators, and vendor data management systems. Therefore, it is crucial for businesses to identify sources of spend data resides is not a one-time process but an ongoing exercise. Also, enterprises are in constant flux due to mergers and divestitures. This makes it impossible for them to have all the data in one place. For proper spend data management, companies must leverage spend analytics solutions to understand and segregate the spend data into procurement-centric spend categories.

Our spend analytics solutions help companies to gain visibility, track procurement performance metrics and supply base. Request a FREE proposal now to gain more insights.

Reason #2: To deal with data visualization challenges

Spend analytics helps organizations in interpreting data and transforming it into useful information. Also, spend analytics solutions help in making spend data more productive both for sourcing and procurement professionals. Traditionally, enterprises use MS Excel to analyze data but relying on spreadsheets alone for spend analysis is a time-consuming process and requires a lot of resources in the long run. With customized spend analytics dashboards, businesses can visualize spend data and gain in-depth insights into factors affecting spend.

Request a FREE demo below to find out how our customized spend analytics dashboards can help you reduce maverick expenditure and capitalize on new opportunities.  

Reason #3:  For better spend data analysis

Availability of multiple procurement technology under one roof makes it difficult for enterprises to analyze spend data. Also, this limits their ability to leverage analytics outside the technology suite. But spend analytics solutions can help in spend data management while improving the workflow between sourcing and procurement process. Customized spend analytics dashboards aid in spend mapping by focusing on integrating modules and offering better data visualization capabilities. Therefore, spend analytics solutions offer purpose-driven experiences to companies across various business operations.

Want to know more about how customized analytics solutions can help you redesign your sourcing strategies and improve procurement efficiency? Request for more information below.

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spend analytics

A Beginner’s Guide to Spend Analytics

What is Spend Analytics?

Minimizing cost is the major cause of concern for many companies and this is the reason they spend more time in the process of spend management. Spend analytics can make this easier by optimizing the supply-side performance and consolidating the data from the supply chain. Spend analytics help companies to make data-driven decisions and identify better opportunities for savings by analyzing their spending patterns. Also, spend analytics can assist in examining the expenditure of an organization and offers significant visibility into the procurement spending of an organization. This can further help the organization to improve the supply chain operations and result in better returns.

Our spend analytics solution can help you in minimizing supply chain disruptions. Request a FREE proposal to learn more about our portfolio of services.

Benefits of Spend Analytics Solutions

spend analytics

Better visibility on suppliers and spending

By leveraging spend analytics solutions, any organization can yield valuable insights into its expenditure in real-time. This detailed information can be handy in improving the overall procurement process. Consequently,  organizations can adopt better practices for procurement that will be more helpful and efficient in managing the relationship with suppliers, improving supplier base and category management.

Spend analytics is the key to manage the tail spend of any organization. Request a FREE demo below to find out how it can help you unlock cost-saving opportunities.

Helps in the category level analysis

Spend analytics solution can help companies to analyze spend at the individual category level. This can assist in gaining visibility into the overall spending of the organization to control the cost-effectiveness. According to recent research results, organizations that leverage spend analytics develop a better relationship with preferred suppliers. Furthermore, spend analytics can help organizations to achieve bigger business objectives by making sourcing efficient and optimizing the supply base.

Assists in managing the risks

Working with the same suppliers for years can incur potential risks for organizations. A robust spend analytics solution can help organizations to innovate their supply chain and deliver new products and services to the customers. Also, by gaining actionable insights from analytics dashboards, companies can make capital improvements and deal with unforeseen challenges such as supply chain disruptions, cash-flow issues, and labour shortages. Spend analytics also provides an opportunity for procurement teams to contribute to wider business objectives and deliver unit cost savings and reduced maverick spend across buying centres.

Are you finding it difficult to improve your bottom-line due to inefficient spend management? Get in touch with our experts right away!

Quantzig’s Advantage

The fragmented, inaccurate, and unstructured data can lead to undesired outcomes for businesses and can charge heavily on their pockets. Quantzig’s spend analytics solution offers comprehensive category wise spend analysis based on commodities, suppliers, supplier locations, buying locations, business units, and cost centres. This helps businesses to enhance visibility into spending patterns for all indirect spend categories across an organization’s supply base. Our customized analytics dashboards deliver accurate results that instil confidence in sourcing and category teams regarding the spend data that can help them deliver value.

Warranty claims management saves US$ 25 million for electrical equipment manufacturer

Business Challenge: Improving warranty management process. A leading electrical equipment manufacturer wanted to improve the warranty management process and reduce costs.

Situation: High warranty claims cost and cumbersome warranty processing process

The electrical equipment manufacturer had a diversified portfolio of electrical, power, automation and control equipment, with a large number of repairers. The error rate in the invoices sent for warranty claims processing was very high, resulting in delayed validation, payments and high costs, while providing little clarity on the process followed by various product groups. The client wanted to improve the warranty claims management and accuracy in the transactions with its many repairers for diverse products, to reduce warranty costs.

Solution/Approach: Single warranty management platform for clear visibility and management

We integrated all the claims and warranty data on a single platform, to provide clear visibility and streamline warranty management. We used statistical modeling, warranty transaction processing to reduce errors, and estimate the time and effort spent in warranty management. We further used predictive analytics to identify and eliminate fraudulent warranty claims.

Impact: Reduced annual warranty costs by US$ 25 million

The electrical equipment manufacturer streamlined the warranty management process, which reduced total annual warranty costs by US$ 25 million and reduced the total cost of ownership for warranty applications. The client also had greater visibility into the causes of failure and which helped them in improving product quality.

100% budget accuracy realized by industrial tools manufacturer through budget planning analytics

Business Challenge: Accurate budget planning for global manufacturing operations

A global industrial tools manufacturer wanted to improve the accuracy in planning for its business budget specific to manufacturing operations across various locations.

Situation: Inefficient and error prone budgeting process

The client’s manufacturing budget forecasting models were non-centralized and based on an individual location’s production requirements, leading to inaccurate overall budget predictions and wafer-thin margins. The client was looking for customized budgeting and forecasting solution for real-time budget planning process.

Solution/Approach: Provided a dashboard solution based on financial and budget analytics

We created a dashboard based solution to act as budget planner for the organization. This included integration of all organization data to eliminate multiple data entries, multi-dimensional real-time financial analysis, affordability analysis and cost-benefit analysis, to provide accurate budget forecasting.

Impact: 100% accuracy in budget forecasting and improved margins

The client improved its budget forecasting accuracy by 100%, and was able to create long-term perspectives on budget allocation for various manufacturing locations, and improved its profit margin.

HR analytics solutions

Spend analytics delivers US$ 12 million procurement savings for vaccine manufacturer

Business Challenge: Improving cost savings in indirect spend category. A US based vaccine production company wanted comprehensive global spend assessment of their indirect procurement spend.

Situation: Expensive centralized global procurement structure

The client’s existing centralized indirect procurement structure was proving to be expensive. The client was under pressure to gain immediate savings while realigning the supply chain organization structure for indirect categories. For this it needed to develop a comprehensive spend assessment of its indirect procurement spend.

Solution/Approach: Category specific spend analysis of all indirect procurement expense

We integrated spend data from across the enterprise value chain, including accounts payable systems, card transaction systems, purchase orders and e-procurement systems. We then conducted comprehensive category wise spend analysis by commodities, suppliers, supplier locations, buying locations, business units and cost centers, in order to create visibility into spending patterns for all indirect spend.

Impact: Reduced overall procurement spend and improved cost savings

The vaccine production company received detailed sourcing strategies, which it incorporated into its global procurement structure and supply chain initiatives. Based on insights on category based cost saving opportunities, the client was able to realize US$ 12 million in annual cost savings for indirect spend.

Spend analytics and price performance assessment reduces used cars purchase and maintenance costs for fleet operator

Business Challenge: Developing low cost fleet strategies

A leading fleet operator in the UK wanted to understand the price performance of used cars in the UK for development of fleet purchase and existing fleet maintenance strategies.

Situation: Spend analysis on used cars for next purchase cycle

The client was in the strategy development process for future fleet purchases as well as maintenance of existing fleet. For this the client wanted in-depth insights on the price performance of used vehicles, and recommendations to enable maximized returns and reduce life cycle costs.

Solution/Approach: Spend analytics based on demand forecast with test model schema development

We analyzed the market information on used cars through demand forecast and sales planning. We developed a test model schema to determine the factors with high correlation with prices of used vehicles and relative weight of factors and utilized spend analytics, for determining optimal price suggestions.

Impact: Reduced operation costs and better inventory planning

The detailed assessment of used vehicle life cycle costs helped the client in minimizing the direct and indirect costs associated with the used vehicles. The client was also able to better plan for managing its inventory acquisitions and future fleet purchases.

Transport and distribution management and spend analytics delivers USD 10 million in savings for online retailer

Business Challenge: Improving distribution strategy by analysis of distribution spend

An European online retailer wanted to improve its product distribution by analysis of the spend on in-house versus 3rd party logistics provider, and determine the best distribution options.

Situation: Determining between in-house and 3PL distribution

The client used 3rd party logistics (3PL) provider for transportation of its products from production plants to non-local warehouses, while it leased fleet and managed in-house transportation for local warehouses. Client wanted to evaluate the cost of self-managed transport service versus using 3PL in non-local transport, and recommendations on the best possible options.

Solution/Approach: Spend analytics to determine the expense and cost benefits of each option

We mined all of the client’s historical and real time transportation data for all deliveries, used spend analytics to monitor the transport and logistics costs, predict the potential cost outlays and savings from change in transportation method, and identify the most efficient methodologies.

Impact: USD 10 million savings in a year

Based on our insights, the client switched to self-managed transportation, using leased fleet across a few closer outbound destinations while retaining 3PL service for distant locations. The client realized USD 10 million in annual savings with the improved distribution management.

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