Supply Excellence — Spend Analysis: Building the Business Case

Spend Analysis: Building the Business Case

September 7th, 2007 · by Tim Minahan · No Comments · best practices, spend analysis

In its latest benchmark, Aberdeen Group tackles the age-old conundrum of how to justify an investment in spend analysis automation. Sure, the benchmark, which surveyed over 700 enterprises, also offers additional evidence of the benefits of automating spend data cleansing, classification, and analysis. But, to my knowledge, it stands as one of the first analyst reports that presents a clear business case for investment in spend analysis software.

Specifically, the Aberdeen benchmark found that spend analysis software delivers the following benefits:

34% increase in total spend under management
75% increase in savings from sourcing efforts based on spend analysis
33% improvement in compliance with negotiated agreements
22% reduction in sourcing cycles, enabling companies to increase the volume of spend that is strategically sourced.

Using these findings, Aberdeen estimates that a $1 billion company can generate incremental savings benefit of $19 million through the use of automated spend data cleansing, classification, and analysis solutions.

Download a complimentary copy of Aberdeen’s Spend Analysis Benchmark for more details on how to build your own business case for spend analysis automation.

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