Despite having access to more information and analytics than ever before, poor data quality is crippling procurement performance, according to the inaugural Procurement Data Governance Survey from procurement solutions firm BravoSolution and North Carolina State University’s Supply Chain Resource Cooperative (SCRC).
“The report highlights the importance of data quality and governance mechanisms that organizations can put in place to achieve value,” said Robert Handfield, executive director of SCRC at North Carolina State University, in a news release. “The results of the First Annual Procurement Data Governance Survey emphasize that for organizations seeking to harness the power of analytics, investment in data governance is a foundational requirement for procurement.”
BravoSolution and SCRC surveyed 70 procurement leaders and found that for almost two-thirds of organizations, bad data quality is the primary cause for less than optimum procurement decisions. The research also showed that although poor data is a significant industry issue, only 20 percent of organizations are currently implementing an improvement program. This revelation closely follows findings from Deloitte’s 2017 CPO Survey, which found quality of data to be the biggest barrier to effective application of digital technology for 49 percent of CPOs surveyed.
“Procurement is no exception to the big data movement. Advanced analytics is the key to unlocking procurement performance. They provide the only way to gain true strategic insights that create the business case for action and leads to supply initiatives that capture opportunities for reduced cost and increased value,” said Andrea Brody, chief marketing officer at BravoSolution. “Data should drive, not inhibit, confident decision-making. If procurement teams can’t rely on what the numbers show, it makes digital strategy and transformation virtually impossible.”
When asked to rank data quality priorities, 58 percent of respondents said accuracy was the biggest concern, followed by valid data (18 percent), complete data (11 percent), unique data (11 percent) and timely data (11 percent). “The industry can’t afford to ignore data governance. The insight offered by clean, quality data directly correlates to more business opportunities. Organizations that fail to prioritize data governance and digitization on the procurement agenda will continue to leave value on the table,” added Brody.
This study is first in a series of research projects designed to uncover the current and future state of data governance within the procurement function and the role good governance plays in advanced analytics.