4 essential tools for better procurement decisions

Making the best procurement decisions can be difficult. You need to evaluate budgeted spending, actual spending, projected spending and coverage across the organization to make the best choices. It’s also risky. An estimated 40 to 60 percent of manufacturing costs are related to raw material costs, so procuring resources at the wrong price significantly impacts profits.

Today, manufacturers face more challenges securing commodities than ever before. Increased pricing complexity and volatility impacting both direct and indirect exposure drive risk and uncertainty. Shifting markets – including increased global demand, acquisitions, and expanding networks of global suppliers – drive more FX exposure, complicated hedging strategies, and more stringent regulatory and risk policies. Constantly shifting political climates, trade wars, and political uncertainty complicate things further.

Manufacturers must find a more efficient and effective way to manage their portfolios, reduce market risk and increase margins.

The answer lies in automatically aggregating all available historical and real-time data – budgets, volume forecasts, physical coverage by cost component, derivative trades, forward prices, FX rates, cost models, market data, market news, sentiment data, and more – and using modern technology to turn that data into actionable intelligence. With the power of cloud, mobile, and advanced analytics (AI, machine learning etc.), procurement professionals can gain a real-time, accurate picture of coverage and price risk and make better procurement choices.

• Why is automatically aggregating data essential to good decision making?
  • Manually aggregating and analyzing data just takes too long. If you have siloed systems that don’t connect, you are forced to manually export and combine data – usually using spreadsheets. This process is both time consuming and can result in copy/paste errors. If you make decisions based on inaccurate data – or market prices that are no longer accurate – those decisions are not going to be optimal.
• Why do you need mobile?
  • The power of mobile is the power of real-time alerts and real-time insight. With Eka’s Procurement app, you can program alerts when component prices and availability may be impacted. You know the moment a problem occurs, and in that moment, in the palm of your hand, you can run market simulations to analyze the resulting impact on coverage. You can use the app to immediately share that insight with your team and evaluate what actions can help you solve the problem.
• Why do you need advanced analytics?
  • There is simply too much data – unstructured and structured, historical and real-time – to analyze with spreadsheets and outdated analytical tools. The data is moving too fast and old tools cannot keep up, and the longer you take to analyze the data, the less useful it is, because markets are still moving while you are analyzing.
• Why is cloud essential?
  • The only way to analyze data in real-time is to have that data located in a secure location that can be accessed anytime, anywhere. Cloud hosting has redundancy that ensures systems are never taken offline. If cloud servers are offline in Houston because of a hurricane, the system switches to alternate servers in New York, Arizona, Europe or Asia. You can use the software when you need it, always.

Download the Procurement app brochure to learn more. 

A Fortune 1000 food manufacturing company implemented Eka’s Procurement app to analyze and manage procurement while providing real-time scenario and intelligence capabilities to optimize decision making. With the Procurement app, the company has greater control over procurement of commodities, energy and packaging. The predictive, user-controlled advanced analytics and decision support tools improve management of risks and exposures.

Eka’s solution integrates with existing ERP systems to avoid duplication of entries and reflects the true bottom line impact due to movements and processing activities. The solution turns extremely large data-sets into real-time, meaningful and actionable decision-making insights.

With Eka’s Procurement app, you can track, monitor, analyze and manage enterprise-wide budgeted, actual and projected spends. You can simulate projected spend, perform detailed spend attribution analysis and view coverage and price risk. If coverage breaches your user-defined thresholds, you receive alerts immediately, enabling you to perform market simulations to evaluate the resulting impact on coverage.