In March 2022, I met Stephany Lapierre, Founder & CEO of Tealbook, during the Americas Procurement Congress in Miami, Florida. Our coincidental meeting, in an elevator, was pivotal. As I sipped my morning cold brew, Stephany, fresh from her workout, was preparing to deliver a keynote on "Scaling Transformation on the Foundation of Trusted Data". This chance encounter and her subsequent talk profoundly resonated with my professional challenges, sparking a transformation in my approach to procurement.

As Chief Procurement Officer (CPO) at a large Japanese bank, I was tasked with developing and implementing a centralized, strategic procurement function. My mandate was clear: streamline procurement to enhance efficiency, drive sustainable savings, and deliver quality goods and services. However, I quickly encountered significant hurdles, chiefly among them, the challenge of managing and harnessing supplier data effectively.

Data Fragmentation Continues to Challenge Leaders

Our initial attempts to consolidate supplier data were complicated by the fragmented nature of our existing systems along with their associated management methods varying from completely in-house to being handled by external provider(s). Navigating through six different enterprise resource planning systems and ten general ledgers, each with inconsistent data structures and content, proved challenging. The simple task of generating a supplier spend report by line of business became an almost 3-month ordeal, plagued by data integrity issues associated with manual data manipulation and a lack of consistent data rules — a classic case of 'garbage in, garbage out'. This was further exacerbated by the lack of enterprise-wide data governance rules and guidelines.

Transform Data into Insight

Recognizing the need for a robust solution and in line with our strategic target operating model, we implemented Coupa, a leading SaaS platform for source-to-pay activities. However, Coupa alone was not sufficient for our immediate needs concerning historical supplier spend data. To address this, we partnered with Visionet Systems and embarked on creating a supplier spend analytics data lake. This ambitious project aimed to ingest five years of historical data from disparate systems, providing a unified, real-time view of supplier spend. The scope also included the weekly receipt of supplier spend updates from these systems to enable current-state reporting.

The implementation was daunting. Mapping and rationalizing data from multiple sources, that included corporate systems along with offline data feeds, into a coherent repository was a monumental task that stretched over a year, far beyond the three months we had optimistically estimated. The project required us to scale down from twenty-five targeted data attributes to ten, each tailored to our specific needs while ensuring consistency and quality across different systems.

Data Excellence in Procurement is Possible

The efforts paid off. With the new data lake operational, powered by sophisticated Power BI dashboards, we could analyze supplier spend with unprecedented speed and clarity. This capability transformed our procurement strategy. In the first year of using our new system, we realized savings significantly beyond the initial targets set by our regional COO — a testament to the power of accurate, accessible data.

Data Excellence in Procurement

My ongoing dialogue with Stephany Lapierre underscored a shared conviction: procurement inefficiencies are often symptomatic of underlying data issues. Over coffee in New York City in 2023, she reiterated a simple yet profound insight, "It's not a procurement problem, it's a data problem." This perspective serves as a guiding principle in effective procurement management.

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As the landscape evolves with advancements in technology and artificial intelligence, the imperative for robust data governance becomes even more critical. The procurement journey from data chaos to clarity provides a compelling case for the critical role of data in strategic decision-making.

Data Excellence in Procurement is Possible

• Determine essential reporting elements within supplier/third-party requirements.

• Identify and map all relevant data sources to reporting attributes.

• Define historical reporting requirements, considering look-back or rolling reporting cycles.

• Implement a consistent methodology for supplier/third-party rationalization to avoid duplicate reporting.

• Align data source structures with procurement taxonomy.

• Establish and standardize Extract, Transform, Load (ETL) processes.

• Identify requirements for data enrichment, such as ESG (Environmental, Social, and Governance) and DEI (Diversity, Equity and Inclusion).

Ready to Transform Your Procurement

Visit us at Hatfield Advisory to learn more about how we can help you transform your procurement challenges into opportunities or contact us directly via our contact page.