Planning. Design. Change by Donna Jean Carney
By Donna Jean Carney
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Extra info for Planning. Design. Change
Measurements are actual numerical quantities that are associated with one or more contexts. So, for instance, in the world of spend analysis, at a high level, you might want to see your spend in United States dollars (USD) aggregated by supplier, commodity, cost center, division, geography, and time. ” The word “dimension” is actually very fitting because it lets you envision a spend hypercube whose intersection points correspond to a spend measure. Thus, the total spend (also called the “top of the cube” spend) could be, say, $4 billion.
The authors have heard about a few success stories, but many more failed implementations, when customers have tried to use existing data warehouses for spend analysis. ” The data are not cleansed or enriched in any way, resulting in inaccurate spend classification and reports that lack credibility. Scope creep causes report and data requirements to increase, resulting in performance issues (reports take a long time to run), which in turn causes low adoption. Knowledge assimilation is not designed into the system.
Each month you can track how much maverick spend is being driven through preferred suppliers, price, volume, and budget variances and calculate where you are relative to the final savings target. If preferred vendor spend is not increasing, it might mean a faulty order process, wherein the buyers are not being steered to using preferred vendors. If the price discounts are not being captured, this means contract compliance is not being monitored. Monitoring and measuring your progress will allow you to take corrective actions early in the process to plug the spend leakages.