This document provides guidance on conducting purchasing spend analysis with a small budget using basic Microsoft Office functions and existing data from accounting or ERP systems. It recommends getting spend data from multiple years for suppliers, categories, business units, and payment schedules. This data can then be analyzed in a pivot table to identify top suppliers, spending trends, and opportunities. Creating a simple analytic dashboard allows relevant spend insights to be obtained without expensive specialized software. The process outlined helps understand needs before potentially investing in additional analytic tools later.

1. Big Data with a Small Budget
for
Purchasing Spend Analysis
You Do Not have to spend lots of money
on complex analytic tools to obtain the
most relevant spend analytic
information.
Bill Kohnen July 2014

2. Introduction
• Big Data and Analytic Solutions continue to be a
point of focus
• Even before “Big Data” Purchasing groups were
swimming in data and struggled to put it to
effective use
• The success of Strategic Sourcing methodology
had the effect of also identifying and standardizing
the types and format of information that can be
used to drive improvement
Bill Kohnen July 2014

3. Take Action
• Using Fairly basic Microsoft office functions you
can conduct valueable analysis of lots of data
• You can do this without expensive specialized
software that requires lots of training, support
and on going cost
• Using this basic process may ultimately make you
decide to pursue a specialized analytic tool set
but by then you will understand very well what
your needs and expectations are
Bill Kohnen July 2014

4. Get Basic Data From AP or ERP System
Have a Senior level person with broad knowledge review and add other data as
needed. A Senior person will save time as they will know the data and be able to
make educated guess’s about any gaps on their own
Sample End Format For Illustration
Supplier
2012
Spend
2013
Spend
2014 YTD
Grand
Total
Category Owner Business
Payment
Schedule
Demand
Acme Spend $ 3,500,000 $ 1,500,000 $ 5,000,000 Direct Alex Aerospace N30
MRP
Demand
Beta $ 5,000,000 $ 3,000,000 $ 300,000 $ 8,300,000 IT Ben Corporate N90 Capital Plan
Food
Services
$ 120,000 $ 120,000 $ 70,000 $ 310,000 HR Kate Corporate N30
Monthly
Recurring
Delta $ 300,000 $ 310,000 $ - $ 610,000 Facilities Kate Corporate N30
Annual
Recurring
X Tron $ 850,000 $ 1,850,000 $ 1,250,000 $ 3,950,000 Indirect Jane Medical As Needed
As Needed
Approval
Bill Kohnen July 2014

5. Create Pivot Table
Bill Kohnen July 2014

6. Chose What You Want To Review
Choose
Fields You
Want To
Review
Bill Kohnen July 2014

7. Example of Top Suppliers
Bill Kohnen July 2014

8. Build An Analytic Dashboard That Meets Your Needs
Bill Kohnen July 2014

9. Summary
• Take advantage of the tools you have and the
simple process described to generate value
from purchasing spend analysis
• There will be immediate payback
• You will better prepare yourself for
understanding what new tools might add
more value later
Bill Kohnen July 2014