We’re in the midst of a big data revolution. Around the world, 2.5 quintillion bytes of data are produced daily, and approximately 90 percent of the world’s data were generated in just the past two years.
When the phrase “big data” was added to the Oxford English Dictionary in 2013, the industry had only seen the tip of the iceberg. For years, companies have been collecting and analyzing massive amounts of information.
This proliferation of data has led many organizations into a period of innovation with far-reaching implications. The imperative to transform this data into useful, actionable insights has never been greater, and no industry or line of business is immune from the big data revolution underway. It comes as no surprise that procurement professionals are turning to big data to drive digital change. They are increasingly realizing that the future belongs to those enterprises that can successfully harness its value for competitive advantage.
To understand the priorities and challenges that global companies face on their digital journey, the University of Applied Science Würzburg/Schweinfurt, in cooperation with SAP Ariba, conducted a survey of more than 650 leaders in procurement, finance and supply chain functions from organizations across North America and Europe. When asked to rank the top five priorities for their organizations, 72 percent of respondents cited big data and predictive analytics as their chief concerns.
That figure reflects a paradox that procurement professionals understand all too well. While their organizations enjoy greater access to data about their suppliers, customers and prospects, the enormity of it can make meaning hard to come by. Out of this abundance of data, how can procurement professionals draw meaningful insights, integrate predictive analytics into their day-to-day responsibilities, and provide prescriptive guidance to buyers?
The challenge for procurement professionals is to sift through all the data and distill it in a way that makes informed decision-making possible. Big data, predictive analytics and prescriptive guidance can further scale with cognitive computing power to enhance situational awareness and speed of decision-making. The resulting business value promises to improve the way procurement professionals carry out their crucial roles.
Today, most procurement organizations face three key challenges when working with big data:
Advances in technology and new concepts like intelligent computing provide opportunities to predict and respond effectively to customer and market demands. The insights they yield can guide buyers to create requests for information or contract templates based on unlimited amounts of information analyzed across multiple databases. Connecting people and information guided by intelligent procurement systems will fundamentally change how companies buy and sell.
