Spend analysis technology or spend analysis software is a business software developed to automate the entire spend analysis process. It increases efficiency and accuracy while aggregating, cleansing, classifying and analyzing enterprise-wide purchasing data. Spend analysis technologies also help in reducing procurement costs and monitoring supplier compliance.
Spend analysis operates under a fundamental principle: a business should know how effectively it's using its money.
Business software created to automate the complete expenditure analysis process is known as spend analysis technology or spend analysis software.
Data collation and analysis are the two stages of spending analysis. Spend analysis software requires access to a robust database of the business’ historical spending to be effective. This can operate in two ways:
Some spend analysis software integrates reliable third-party databases with the fundamental spend data from the business. These databases include the company's partner data that enables further in-depth examination.
Because internal data has such a wide range of analytical possibilities, it is often more helpful for spend analysis technology. The best part is that the software organizes this information into categories applicable to the company. Spend analysis technology gives the company several levers it can use to magnify or study the data.
Spend visibility, optimizing operations, managing risks, and ad hoc spending are a few of the benefits realized from implementing spend analysis technology.