Grant Millard, head of technology at Vendigital explains.

Whilst larger businesses may have a clear IT roadmap and investment to implement a common system across their organisation, the ability to easily visualise and analyse business information remains a challenge.

For smaller organisations, systems reviews are a frustrating and anxious time. Most believe they are being hampered by their existing systems but a complete overhaul is out of the question because it would be too costly, too disruptive, or both. Instead of doing something, they end up doing nothing which could undermine business performance.

The solution in either case need not be expensive. Business information (BI) technologies are now available which allow you to simply extract baseline data feeds from legacy ERP/MRP systems. Once aggregated, this data will provide the business intelligence needed to inform decision-making across the organisation.

The type of business intelligence gained from such BI systems is only constrained by the information captured within local systems. A common example of where leading businesses are making a step change in affecting their bottom line is ‘spend analytics’. By capturing goods receipts and accounts payable information, businesses are able to leverage their supply chain spend across common suppliers or markets; rationalise their supply base and drive operational efficiencies.

For example, simple data mining could reveal that the business is spending a significant sum on logistics; using multiple suppliers across a number of locations. Based on this knowledge, it may be possible to negotiate a contract with a single, global supplier leading to improved pricing, supplier rationalisation and reduced administrative costs. Independent research suggests that a good spend analytics platform can save a business between 9 to18 per cent based on its supply chain spend, just by giving procurement functions the information needed to take action.

But why stop there? Organisations further along the maturity curve are now looking for a single source of truth for all their KPI needs including vendor performance, risk, demand planning and much more. Good BI systems can also incorporate external data feeds such as commodity, financial or geopolitical indices, which can enrich source data and provide business leaders with valuable insights, all within a single environment. The inherent beauty of data warehouse or BI systems is that their functionality can be layered in at a pace that works for the organisation, unlike ERP/MRP system migrations, which tend to be a wholesale change that can prove highly disruptive.

Whilst all this sounds good in principle, it is reliant on the integrity of your source data. If looking to deploy a BI system as a cost-effective way of delivering business intelligence quickly, it is necessary to partner with someone who understands your business and the market you operate in and who can help to cleanse and categorise your data in a way that will drive value. Data security naturally remains a key concern as well. Understanding where your data is stored and the controls in place to safeguard it are important considerations.

Grant Millard is head of technology at Vendigital, a firm of procurement and supply chain specialists.