Efficient Plant May 2019 - 26

enterprise software tips

Purchasing
Analytics
Monitors
KPIs

Darren McGregor, Illumiti

The SAP S/4HANA purchasing
analytics dashboard provides
immediate access to critical
operating factors.

PURCHASING ANALYTICS IS one
of the most powerful tools the SAP
S/4HANA enterprise-resource-management (ERP) system puts at your disposal.
SAP makes it easy to activate this
essential resource, which provides
instant access to critical purchasingrelated data, keeps you up to speed with
industry best practices, and can save
your operation time and money.
In the S/4HANA environment, as part
of the procurement overview, SAP offers
a purchasing analytics dashboard. This
component consists of a series of tiles
that show the status of key performance
indicators (KPIs), from purchasing
spend to upcoming contract expirations,
to supplier evaluation, in real time. In
other words, anytime you look at one of
these tiles, you're seeing live data. You

The purchasing analytics dashboard provides a quick overview of your operation.
The Overdue Purchase Order Items tile
will flash red when a specified number
of overdue items is reached. Other tiles
in the dashboard can perform the same
function for their respective areas.

26

| EFFICIENTPLANTMAG.COM

can refresh the information whenever
you wish and view it for a specified
length of time.
Because procurement changes so
quickly, S/4HANA helps your organization stay on top of KPIs by letting you set
a visual-alert threshold that flags outliers.
Let's say that the business can handle 50
purchase orders with ease, but things get
more difficult at 75, and become a problem after that. You can set the number in
the Overdue Purchase Order Items tile to
stay green until 50, turn yellow between
51 and 75, and flash red starting at 76.
Some manufacturing companies have
no visibility into procurement KPIs
because they don't track them. Instead,
they operate reactively by waiting
for someone to notice that too many
purchase orders are overdue or purchasing spend has reached capacity. Other
organizations manage procurement data
manually, compiling it into spreadsheets
at month-end, but it can take days to
get that information to the supervisors
who need it. In some cases, the process
is especially time-consuming because it
involves assembling data from different
systems.
With S/4HANA purchasing analytics,
there is no waiting for someone to send
you a report. As a manager, when you
look at your dashboard one morning,
you might see five red tiles-a sign that
it's time for a deeper dive into each of
those areas. If the Overdue Purchase
Order Items tile is red, that could mean
you're unable to provide raw materials to
your line.
The purchasing analytics dashboard
also alerts you to off-contract expenditures. If someone in the company buys
a widget off-contract, and you already
have a deal with that vendor, your staff

MAY 2019


http://www.EFFICIENTPLANTMAG.COM

Efficient Plant May 2019

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