Market Intelligence is crucial for any strategic sourcing initiative, but that intelligence is only as good as its underlying data. By extension, and as Source One has spoken on before, that underlying data is only as good as it is malleable and usable.

Formats Matter

Malleable here does not mean that the data should be manipulated or fundamentally changed to mean something different. This isn't license to cook your books. Malleable should be interpreted as flexible and movable -- you should be able to manipulate your data's presentation and format to suit a specific need. This can't be done with hard copies of data -- the pink sheet of an invoice or hard copy of an order form might be proof of purchase and give accounting something to process, but in terms of calculating savings opportunities and tracking spending, it's just above having nothing at all in terms of preferred format. 

Having data provided in a digital format is a good first step, but there's more to the puzzle. If a specialized inventory system is in place, it's imperative that this system be optimized and used -- meaning, if it accepts a certain type of information automatically, and suppliers can provide information in that format, those suppliers should be feeding information into that system via that specialized format. If a more homespun system is in place, and tracking spend is done through a series of spreadsheets, the delivered file type becomes important. Absent specialized software that must be fine-tuned, scanned invoices and Adobe PDFs are difficult to harvest data from, whereas spreadsheets and text files are the easiest to pull from. An emailed invoice from a supplier will more often than not be a preferable solution to an attached PDF of the scanned physical invoice. 

Control The Controls

In terms of working with the data, it's important to get the input of every knowledgeable party, but doing so without a proper organizational structure can lead to disarray, mistakes, and wasted time. Establishing a network of shared files, locally hosted or via a cloud service, allows for collaboration and can deter the sort of disorganization that can arise from multiple versions of a file being emailed or otherwise distributed back and forth between a group. Additionally, a set of permission levels can ensure that only those who need to edit a document can, while those who simply need to review the information can access it without fear of accidentally altering it. Additionally, there are provisions in place to allow for increased collaboration, where multiple parties can manipulate the data in real time, together, saving time and wasted man-hours as one party waits for another's changes. 

It should be noted that both permission controls and collaboration tools can be found for free, as permission controls are often embedded in an operating system (Windows and OSX have had them by default for a decade or more) and collaboration tools can be found in Google's gratis productivity apps.

Have It All

While an organization might be tempted to eliminate the data from completed projects to free up storage and reduce the need for IT upgrades, by recording this data  in perpetuity in an accessible form, these archives become a knowledge base. The larger a knowledge base is, the better an organization can determine past pricing, supply trends, and a number of other performance metrics that can influence future spend decisions.

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Nicholas Hamner

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