What is Spend Analytics? Explore From Benefits to Best Software

Managing company expenses is far from easy. 

Between negotiating prices with suppliers, making sure you are following compliance rules, and figuring out where your budget is leaking, it can feel like you are stuck in a maze.

Many businesses are in the same boat - struggling to keep track of every dollar spent. And spreadsheets are no longer helping.

Spend analytics take the weight off your shoulders by presenting a clear view of where your money is going, bundled into categories.
‍
If you are convinced that spend analytics can be a possible solution to manage company expenses, continue reading to implement it for your business.
‍

What is Spend Analytics?

Spend analytics is a data-driven approach to managing and optimizing your company's expenses. It is a valuable software that aggregates, categorizes, and analyzes all your financial data. From invoices and purchase orders to payment records, this spend analytics consolidates information from various sources into one centralized system.

Now, let’s take a closer look at how analytics software works. It involves five steps - Data collection, Data aggregation, Data analysis, Visualization, and Reporting.

• Data collection: The first step in any spend analytics process is gathering the necessary data. This includes but is not limited to - invoices, purchase orders, payment records, and expense reports.

• Data aggregation: Once the data is collected, it's then aggregated into a centralized system. This is essential because the data comes from different sources, often in disparate formats.
  All your invoices, which might be in your email, a physical file, or an ERP system, are pulled into a single digital dashboard.

• Data analysis: Using various analytical methods, the software goes through the aggregated data to prepare it for interpretation. 

• Visualization: Post-analysis, spend analytics software typically offers data visualization features, converting complex data sets into charts, graphs, or other visual formats. This makes the data easier to understand, facilitating better decision-making.
  ‍
  You might see a bar graph comparing this year's Q2 electricity costs to last year’s, making it immediately obvious how much more you're spending. Learn more on Embedded Data Visualization

• Reporting: The final stage involves the creation of detailed reports based on the analyzed and visualized data. Decision-makers use these reports to understand spending patterns. 

Spend analytics creates an entire ecosystem to bring financial transparency to your organization. Keep reading to learn how it can make a real difference in your business.

Related Read

• Transportation Analytics: What it is & Why it's Important
• Logistics Analytics: Benefits, Types Examples & Use Cases
• Procurement Analytics: What it is, Benefits, Tools & Use Cases
• What is Self-Service Reporting? Benefits, Tools & How it Works

Benefits of Procurement Spend Analytics

While many people see spend analytics as a way to cut costs, it's more than that. It serves multiple functions that can streamline operations, improve supplier relationships, and drive revenue. Now, let's explore how spend analytics can benefit your business.

• Greater Financial Visibility: Spend analytics gives you a clear view of where your money is going. Knowing your expenditure patterns allows for better resource allocation and helps you stay on budget.

• Improved Cost Savings: The software helps pinpoint areas of overspending. Once you know where the leaks are, you can take immediate action, whether negotiating better terms with suppliers or eliminating unnecessary costs altogether.

• Better Compliance: Spend analytics assists in this by tracking your expenses against company policies and industry standards. This reduces the likelihood of financial penalties and helps maintain your company's reputation.

• Supplier Management: Having insights into your spending also gives you a better handle on your supplier relationships. You can assess supplier performance, monitor deliverables, and project future interactions, allowing for better negotiation tactics and more effective collaboration.

• Strategic Decision-Making: It helps you identify trends in spending, which can be invaluable when planning for the future, especially if you're considering scaling your operations or entering new markets.

• Streamlined Procurement Process: Knowing what you're spending where makes it easier to prioritize purchases and even standardize certain types of procurement, thereby saving both time and effort.

• Real-Time Monitoring: Spend analytics software usually offers real-time monitoring, which allows you to react to unexpected changes in expenditure swiftly, helping to avert financial mishaps.

• Improved Cash Flow: By knowing your spending habits, you can optimize your cash flow. By identifying slow-paying clients or finding a pattern in your operational costs, you gain control that can positively affect your cash reserves.

• Data-Backed Negotiations: When negotiating contracts with suppliers or stakeholders, data is your best friend. Spend analytics provides this data, strengthening your negotiation position and helping you secure more favorable terms.

• Increased Accountability: The transparency provided by spend analytics promotes accountability within your team. When employees know that expenditures are being closely monitored, it encourages responsible spending and can even inspire new cost-saving initiatives from within the ranks.

Related Read: What is Procurement Dashboard? KPIs, Templates & Examples

Challenges Associated with Spend Analytics

While spend analytics offers many benefits that can revamp how you manage expenses, it's not a magic wand. Like any tool, it comes with its own set of challenges that need to be addressed for successful implementation and operation.

• Data Quality and Consistency: Inaccurate or inconsistent data can lead to misleading analyses and, ultimately, poor business decisions. This can be a major roadblock, especially when the data comes from various sources and in disparate formats.

• Implementation Complexity: Another challenge lies in the implementation phase. Setting up the software can be a complex process that requires expertise. If not handled correctly, this can result in data mismatches, functional gaps, or even system failures, costing your company time and money.

• Change Management: People are naturally resistant to change. Getting your team to adapt to a new system can be challenging. This often involves retraining staff and potentially facing pushback from those set in their ways.

• Costs and ROI Concerns: The initial cost of the software, ongoing maintenance, and potential costs for training staff. As a result, businesses are often concerned about the return on investment and whether the benefits outweigh the costs.

• Vendor Lock-in: Some spend analytics solutions may not be interoperable with other systems your business uses. This can result in a 'vendor lock-in' situation, making it difficult to switch providers or integrate other solutions in the future.

• Limited In-house Expertise: Lastly, your team needs a specific skill set to interpret the data effectively. Without in-house expertise in data analytics, you may not get the most out of your spend analytics tool, even if the software itself is top-notch.

10 Best Spend Analytics Software 

In this section, let’s look at the 10 best spend analytics software that maximize the benefits and have limited challenges.

1. Databrain

DataBrain is designed to embed enterprise-grade Business Intelligence (BI) directly into your desired applications. The software development kit (SDK) helps you build a custom spend analytics application in a few minutes. It helps procurement professionals turn data into actionable insights, drawing the road for more informed and strategic decision-making.

Key Features of DataBrain:

• White-Labeled Customization: When adding a new tool, the last thing you want is that it doesn't fit with the look and feel of your existing systems. DataBrain allows for white labeling so that you can add your branding and interface. It creates a unified user experience that can handle all your procurement data without confusion.

• Drag & Drop Insights: In the procurement world, time is money. The drag-and-drop feature in DataBrain enables you to create complex KPIs in a jiffy. You can identify overspending areas or supplier inconsistencies at a glance, enabling you to take quick corrective actions.

• Scalable Architecture: DataBrain's architecture is built to scale. It can manage billions of rows of data without breaking a sweat. This ensures that even as your procurement operations grow, you won't hit a bottleneck regarding spend analytics.

• Broad Connectivity: Procurement involves dealing with many databases and data warehouses. DataBrain's ability to integrate with almost any relational database means you don't have to go through the hassle of data migration or consolidation. This is invaluable when you're tracking spending across various platforms and vendors.

• Security Protocols: Security is non-negotiable, especially when dealing with sensitive financial data. DataBrain has end-to-end encryption and complies with industry standards like SOC 2 and ISO 27001. So, not only can you make sound spend-related decisions, but you can do so with the assurance that your data is locked up tight.

• No-Code Tools: With DataBrain's no-code capabilities, team members with minimal technical skills can set up and manage spend analytics dashboards. This democratizes data access and allows quicker, more inclusive decision-making in procurement.

• Advanced Visualization: DataBrain's advanced visualization tools offer interactive dashboards and custom reports, making it easier to spot trends, outliers, or other relevant procurement insights.

By enabling you to customize, scale, and secure your spend analytics, DataBrain fits the bill for any procurement team serious about maximizing efficiency and security.

See it in action
Interactive Dashboards

‍

2. Happay

Happay is an expense and spend management platform designed to make life easier for employees, managers, and finance teams. The platform offers a range of features aimed at streamlining various business processes.

Key features of Happay:

• Self Booking Tool (SBT): This allows you to book flights, hotels, and cabs independently, giving the company better control over expenses.

• EPIC Credit Cards: These cards have zero collateral and facilitate seamless payments from SaaS subscriptions to utility bills.

• Prepaid Cards: An alternative to traditional corporate cards, they offer instant funding and help control and track expenses.

• Integration Capabilities: Happay can integrate with various other software like ERPs and HRMS, adding another layer of convenience to your business operations.

Happay is not flexible enough to add your own analytics features.

3. Sievo

Sievo is not just another analytics tool; it's a powerhouse for transforming your procurement process. With promises of up to 11% savings on your annual spending, it makes every dollar count. Here's why you might want to keep an eye on this tool.

Key features of Sievo:

• Crystal Clear Visibility: Sievo provides a lucid view of your spending patterns. 
• Automate the Manual: Source-to-Screen process automates manual data management tasks, saving you both time and resources. 
• Actionable Insights: Sievo gives you the information to make timely decisions, accelerating your organization's growth. 
• Beyond Savings: Sievo enables a more sustainable, diverse, and resilient supply chain, making sure your procurement has a long-lasting positive effect.

4. GEP

GEP helps in managing your enterprise-wide spending data. This powerful spend analytics tool arms you with actionable insights, making procurement strategy a walk in the park.

Key features of GEP:

• AI-powered algorithms for precise spend classification.
• Comprehensive dashboards for full stakeholder coverage.
• Eliminates payment duplication and highlights service-level variance.
• Intuitive supplier management for optimal relationship building.

5. Jaggaer

JAGGAER Spend Analytics provides actionable insights across all spending, offering a comprehensive platform to understand and manage your expenditure.

Key features of Jaggaer:

• Pre-Configured Dashboards: They have built-in headline views and filter capabilities, tracking multiple dimensions like early payment and contract compliance.
• Quick Value Identification: The platform pinpoints areas for spend optimization, such as reducing unit prices and consolidating suppliers.
• Data Security: JAGGAER's robust user and role-based access ensures data safety.
• Fast Value and Scalability: Begin with essential data and follow an implementation timeline for incremental data loading or system expansion.

7. Zycus

Zycus Spend Analysis is a tool designed for procurement professionals to optimize their spending. It offers various features that enhance procurement performance, generate actionable saving opportunities, and increase compliance.

Key features of Zycus: 

• Automated Spend Visibility: Zycus utilizes patented AI-powered technology for spend data classification and identification.‍
• Robust Reporting: This tool is equipped for big data, making it easier to find savings opportunities.‍
• Better Sourcing Decisions: Advanced analytics are available for commodity tracking and cost modeling.

7. Coupa

If you're responsible for procurement or financial oversight, data is your go-to resource for informed decision-making. Coupa comes equipped with AI-generated insights and community-driven data that help you optimize your business spend. 

Key features of Coupa:

• AI-Driven Analysis: The tool uses advanced machine learning to offer actionable insights tailored to your business needs.

• Benchmarking: Assess how your organization stacks up against industry metrics, enabling you to pinpoint areas for improvement.

• User-Friendly Interface: Coupa Spend Analysis is designed for ease of use, allowing you to make sense of complex data sets quickly.

9. SAP Ariba

SAP Ariba offers automated processes and a comprehensive view across various spending categories. It integrates seamlessly with back-end systems to improve visibility, control, and savings.

Key features of SAP Ariba:

• Unified Spend Management: Manage direct and indirect spending, external workforce, and travel expenses all in one platform.

• In-depth Spend Insights: Gain a comprehensive view of your company’s spending habits to reduce costs and mitigate risks.

• End-to-End Integration: Seamlessly connect with your back-end systems and payment processes for optimal control and savings.

• Scalable Solutions: As your business grows, SAP Ariba grows with you, offering market-leading solutions designed for scale.

9. SpendHQ

SpendHQ seamlessly integrates spend intelligence with performance metrics, aligning with your financial and strategic goals.‍

Key features of SpendHQ:

• Integrated Spend Intelligence: SpendHQ offers actionable insights by centralizing all spend data. 
• Performance Management: Aligned with both financial and non-financial goals, SpendHQ's performance management feature ensures that your projects deliver tangible business impact.

10. Simfoni

Simfoni has set itself apart in a crowded field by prioritizing customization and actionable insights. Businesses can adjust the platform to their unique needs—regardless of size, expertise, or location.

‍Key features of Simfoni:

• Spend Analytics: It provides real-time visibility into your spending. It transforms raw data into actionable insights, helping you identify opportunities and savings.

• eSourcing: Its advanced automation features help you make quicker and smarter sourcing decisions.

• Spend Automation: Take control of unmanaged spending. It automates processes to improve compliance and reduce risks.

How to Choose the Best Spend Analytics Software?

Picking the right spend analytics software can be straightforward if you know what to look for. Here are a few key points to keep in mind.

• Define Your Needs: Know what you want the software to do, real-time tracking or long-term analysis.
• Ease of Deployment & Use: Opt for software that is easy to implement with your existing process. And an intuitive interface never hurts.
• Scalability: Make sure the software can grow with your business.
• Security: Check that it meets industry security standards to keep your data safe.
• Integration: See if it can easily sync with your existing systems.
• Cost: Consider the full costs, including setup and ongoing fees.
• Reputation: Research the company's credibility and customer reviews.
• Customer Support: Ensure good support options are available for troubleshooting.

Conclusion

If you've been following along, you know that choosing the right spend analytics software is crucial for your business. We've looked at the benefits and challenges of spend analytics. We also explored the 10 best spend analytics software and compared options.

And, Databrain can be your best choice. With its intuitive interface, real-time analytics, and top-notch customer service, it sets the standard in the industry. To make impactful decisions for your company's financial health, Databrain is your go-to partner.

Sign up for Databrain

‍