• Written by Sonali Subhadarsini, Product Manager

A category manager in an energy and utilities company often finds themselves waiting on a report to answer seemingly straightforward questions, such as which suppliers are providing the most critical components for their operations, or what the total spend is on a particular category of goods. These questions are not trivial, as they can have significant implications for the company's ability to maintain its assets and comply with regulatory requirements. The procurement team's ability to quickly and accurately answer these questions can be hindered by the complexity and volume of data involved, which can lead to delays and inefficiencies in the procurement process.

The procurement questions that currently wait on a report

The procurement team in an energy and utilities company typically has to deal with a wide range of questions on a daily basis, from queries about supplier performance to requests for information on spend analysis. Many of these questions currently require the team to wait on a report to be generated, which can take anywhere from a few hours to several days, depending on the complexity of the query and the availability of the data. This can be frustrating for the team, as they may need to make timely decisions about procurement strategies or respond to urgent requests from other departments. For instance, a shift supervisor may need to know the status of a critical spare part, and the procurement team may have to wait on a report to provide this information.

One of the main challenges faced by the procurement team is the lack of visibility into the company's procurement data, which can make it difficult to answer questions quickly and accurately. The team may have to rely on manual processes, such as searching through spreadsheets or contacting suppliers directly, to gather the necessary information. This can be time-consuming and prone to errors, which can further delay the procurement process.

The data behind them: purchase orders, supplier contracts and terms, invoice history, category structure

The data that underlies the procurement questions in an energy and utilities company is typically complex and multifaceted. The company's procurement system may generate a large volume of data, including purchase orders, supplier contracts and terms, invoice history, and category structure. This data can be difficult to navigate and analyze, particularly for those who are not familiar with the company's procurement processes. For example, a category manager may need to analyze the company's spend on a particular category of goods, which can involve reviewing thousands of invoices and purchase orders.

The company's category structure can also play a critical role in determining the types of questions that can be asked of the procurement data. The category structure can help to organize the data and provide a framework for analysis, but it can also create complexity and make it difficult to compare data across different categories. A well-designed category structure can help to facilitate the analysis of procurement data, but it requires careful planning and maintenance to ensure that it remains relevant and effective.

Sector constraints: outage planning and regulatory reporting burden

The energy and utilities sector is subject to a range of constraints that can impact the procurement process, including outage planning and regulatory reporting requirements. The company's ability to maintain its assets and comply with regulatory requirements can depend on its ability to quickly and accurately answer procurement questions. For instance, the company may need to plan for outages, which can require careful coordination with suppliers and other stakeholders. The procurement team may need to answer questions about the availability of critical spare parts or the status of maintenance contracts, which can be critical to ensuring the reliability of the company's operations.

The regulatory reporting burden can also create challenges for the procurement team, as they may need to provide detailed information about the company's procurement activities to regulatory bodies. This can involve generating reports and responding to queries, which can be time-consuming and require significant resources. The company's ability to comply with regulatory requirements can depend on its ability to quickly and accurately answer procurement questions, which can make it essential to have a robust and effective procurement system in place. For more information on how AsscherAi can support operations, please visit our operations page.

What improvement looks like: spend under management, price variance to contract, supplier concentration

Improving the procurement process in an energy and utilities company can involve a range of metrics, including spend under management, price variance to contract, and supplier concentration. The company's ability to manage its spend effectively can depend on its ability to quickly and accurately answer procurement questions, which can help to identify areas for cost savings and optimization. For example, the company may be able to reduce its spend on a particular category of goods by negotiating better prices with suppliers or identifying more cost-effective alternatives.

The price variance to contract can also be an important metric, as it can help to identify areas where the company is not getting the best value from its suppliers. The company may be able to reduce its costs by renegotiating contracts or identifying more competitive suppliers. Supplier concentration can also be a critical metric, as it can help to identify areas where the company is reliant on a single supplier or a small group of suppliers. This can create risks, particularly if the supplier experiences difficulties or is unable to meet the company's needs.

By improving the procurement process, the company can reduce its costs, improve its efficiency, and minimize its risks. This can involve implementing new systems and processes, such as AsscherAi, which can help to provide greater visibility into the company's procurement data and facilitate more effective decision-making. For more information on how AsscherAi can support your procurement needs, please visit our contact page.

What this does not do, or when it is the wrong choice

While AsscherAi can provide significant benefits for procurement teams in energy and utilities companies, it is not a solution that is suitable for every situation. The system is designed to provide answers to questions about the company's own data, and it is not intended to provide external data or insights. The company's procurement team may need to use other systems or tools to gather external data or to analyze market trends, for example.

One of the common mistakes that companies make when implementing AsscherAi is to assume that it will automatically provide all the answers they need. However, the system requires careful planning and configuration to ensure that it is providing the most relevant and accurate information. The company's procurement team may need to work closely with other departments, such as IT or finance, to ensure that the system is properly integrated and configured. By understanding the limitations and potential pitfalls of AsscherAi, companies can ensure that they are getting the most out of the system and achieving their procurement goals.