Business Intelligence Now in Purchasing Software

Few departments are as hard pressed for new tools as Purchasing, where rapid increases in materials costs, greater deviations in lead times and supplier base growth and instability require ever increasing buyer dexterity. Recently, several BI applications have been introduced that appear to be addressing Purchasing's growing requirements.

Informatica's PowerAnalyzer analyzes purchasing data in near real time. It aggregates worldwide purchases to ensure that buyers are taking advantage of negotiated deals. The tool automatically alerts buyers when they exceed spending thresholds that entitle the company to discounts. For large multinationals, this fail-safe mechanism represents millions in potential savings.

The consumer package giant P&G is using CombineNet, an electronic expressive bidding tool that relies on combinatorial science and gives suppliers the power to change economic order quantities, product bundling, delivery routes and timing or other variables to optimize efficiency.

While both PowerAnalyzer and CombineNet can be considered 'spot solutions', limited in scope and targeting a specific problem, SAS has recently introduced SAS 9, a BI heavy weight using data integrated from every corner of the enterprise. SAS 9 aims to provide decision support capabilities to multiple functional areas within the organization, including purchasing. Their stated benefit is that they provide "a single, verifiable version of the truth" so that all functional decisions are based on compatible and consistent data.

Even more interesting from the manufacturing point of view may be the recent entry of ERP providers into the BI fray. Relevant Business Systems, best known as an ERP provider to the Aerospace and Defense industries, recently introduced the Business Wizard with Predictive Analytics, a BI tool that incorporates a user defined, interactive ERP-informed dashboard that enables buyers to evaluate vendors on multiple criteria based on "anticipated performance" on a given PO at the time of purchase. The most interesting aspect of the BW is that it provides a 'spot solution' (and this is reflected in its cost), while its decision support is based on integrated data and processes informed by the existing technology structure of the manufacturing organization.