BMS 202 – BUSINESS STATISTICS

TUTORIAL 04: Data Collection, Analysis, and Presentation

1 Overview
Data collection, analysis, and presentation are vital components of the procurement process.
By effectively collecting, analyzing, and presenting data, procurement professionals can make
informed decisions, identify trends, and optimize procurement strategies. Here is an overview
of data collection, analysis, and presentation in the context of procurement, along with
examples:
1.1 Data Collection
Procurement professionals collect data from various sources to inform their decision-making
processes. Data can be collected from internal systems, such as enterprise resource planning
(ERP) systems, supplier databases, and procurement software, as well as external sources like
market research reports and industry publications.
Examples of data collected in procurement include historical sales data, supplier performance
metrics, pricing information, market trends, customer feedback, and demand forecasts.
For example, a procurement team may collect data on past supplier performance, including
delivery times, quality ratings, and customer complaints, to evaluate and select suppliers for
future procurement activities.
1.2 Data Analysis
Data analysis involves using statistical methods, algorithms, and visualization techniques to
extract insights and identify patterns from the collected data.
Statistical analysis techniques such as regression analysis, time series analysis, and correlation
analysis can be applied to uncover relationships between different variables, such as supplier
performance and pricing.
Advanced analytics techniques like machine learning and predictive modeling can be used to
make data-driven predictions, such as demand forecasting or supplier risk assessment.
For example, data analysis can be used to identify cost-saving opportunities by analyzing
pricing data, historical spend patterns, and supplier negotiations.
1.3 Data Presentation
Data presentation involves effectively communicating the analyzed data to stakeholders
through visualizations, reports, and dashboards. This helps stakeholders understand the insights
derived from the data analysis and make informed decisions.
Visualizations such as charts, graphs, and dashboards provide a concise and intuitive way to
present complex data and trends. They can be used to showcase supplier performance metrics,
cost savings achieved, or market trends.
Reports and presentations can be created to summarize the findings from the data analysis,
highlight key insights, and make recommendations for procurement strategies or supplier
selection.
For example, a procurement team may create a dashboard that visualizes supplier performance
metrics, such as on-time delivery rates, quality scores, and pricing trends, to provide a
comprehensive view of supplier performance to stakeholders.
1.4 Data Integrity and Quality
Ensuring data integrity and quality is essential for reliable analysis and decision making.
Procurement professionals need to validate and clean the collected data to remove errors,
inconsistencies, and duplicates.
Data validation techniques, such as data profiling and data cleansing, can be used to ensure
data accuracy and completeness.
Data quality metrics, such as data completeness, consistency, and timeliness, should be
monitored and maintained to ensure reliable analysis.
For example, a procurement team may validate and clean supplier data to ensure accurate
analysis of supplier performance metrics, pricing information, and contract terms.
1.5 Continuous Improvement
Data collection, analysis, and presentation are iterative processes that require continuous
improvement. Procurement professionals should regularly review and refine their data
collection methods, analysis techniques, and presentation formats to enhance the effectiveness
of their decision-making processes.
Feedback from stakeholders, performance evaluations, and industry best practices can be used
to identify areas for improvement and implement changes.
For example, feedback from users of procurement dashboards and reports can be collected to
make improvements in terms of usability, data visualization, and the relevance of the presented
information.

Data collection, analysis, and presentation are essential components of procurement. By

collecting relevant data, analyzing it using statistical techniques, and presenting the insights
effectively, procurement professionals can make informed decisions, optimize procurement
strategies, and drive continuous improvement in the procurement process.

2 Methods of data collection

Data collection is a crucial step in the procurement process as it provides the foundation for
informed decision-making. Effective data collection methods allow procurement professionals
to gather relevant information about suppliers, market trends, and internal processes. Here are
detailed notes on the methods of data collection with a focus on procurement, along with
examples:
2.1 Internal Data Collection
Internal data collection involves gathering data from internal systems and processes within the
organization. This data provides insights into past procurement activities and helps in
evaluating supplier performance, identifying cost-saving opportunities, and improving internal
processes.
Examples of internal data sources in procurement include:
• Enterprise Resource Planning (ERP) systems: ERP systems store data related to
purchase orders, invoices, contract terms, and supplier information. Procurement
professionals can extract data from these systems to analyze spending patterns, track
supplier performance, and monitor contract compliance.
• Procurement Software: Procurement software platforms offer functionalities for
managing supplier relationships, sourcing, and contract management. Data can be
collected from these systems to track supplier performance metrics, monitor
procurement cycle times, and capture supplier feedback.
• Internal Surveys and Feedback: Procurement professionals can collect data through
surveys and feedback mechanisms within the organization. These methods can provide
insights into internal stakeholders' satisfaction with procurement processes, identify
areas for improvement, and gather feedback on supplier performance.
2.2 External Data Collection
External data collection involves gathering data from external sources outside the organization.
This data provides information about market trends, supplier capabilities, industry benchmarks,
and economic factors that impact procurement decisions.
Examples of external data sources in procurement include:
• Market Research Reports: Market research reports provide valuable insights into
industry trends, forecasts, and supplier landscapes. Procurement professionals can
collect data from these reports to understand market dynamics, identify potential
suppliers, and assess the competitiveness of pricing.
• Supplier Databases: Supplier databases, such as industry directories and online
marketplaces, provide information about a wide range of suppliers. Procurement
professionals can collect data from these sources to evaluate supplier capabilities,
compare pricing, and identify potential suppliers for specific procurement needs.
• Industry Associations and Trade Publications: Industry associations and trade
publications often publish data and reports related to specific sectors. Procurement
professionals can gather data from these sources to understand industry benchmarks,
best practices, and emerging trends.
• External Surveys and Research Studies: Surveys conducted by external organizations
or research studies can provide valuable data on supplier performance, market
conditions, and industry-specific challenges. Procurement professionals can collect
data from these sources to gain insights into supplier capabilities, pricing trends, and
risk factors.
2.3 Supplier Performance Data Collection
Supplier performance data collection focuses on gathering data specifically related to supplier
performance metrics. This data helps in evaluating supplier capabilities, identifying areas for
improvement, and making informed decisions about supplier selection and contract renewals.
Examples of data collection methods for supplier performance include:
• Key Performance Indicators (KPIs): Procurement professionals can define and collect
data on specific KPIs that measure supplier performance. These KPIs may include on-
 time delivery rates, quality ratings, customer satisfaction scores, and pricing
competitiveness.
• Supplier Scorecards: Scorecards provide a structured framework for evaluating and
collecting data on supplier performance. Procurement professionals can use scorecards
to collect data on various performance dimensions, rate suppliers, and track
improvements over time.
• Supplier Audits and Site Visits: In some cases, procurement professionals may conduct
audits or site visits to assess supplier performance firsthand. These visits allow them to
collect data on factors such as production capacity, quality control measures, and
adherence to sustainability standards.
2.4 Market Intelligence Data Collection
Market intelligence data collection focuses on gathering information about market trends,
competitor activities, and pricing dynamics. This data helps in understanding market
conditions, negotiating with suppliers, and making strategic procurement decisions.
Examples of data collection methods for market intelligence include:
• Industry Reports and News: Procurement professionals can collect data from industry
reports, news articles, and press releases to stay updated on market trends, new product
launches, and changes in regulations that may impact procurement decisions.
• Pricing Surveys and Benchmarks: Procurement professionals can conduct or participate
in pricing surveys and benchmarks to collect data on pricing trends, negotiate better
deals, and assess the competitiveness of supplier pricing.
• Supplier Interviews and Discussions: Direct interaction with suppliers through
interviews or discussions can provide valuable market intelligence. Procurement
professionals can collect data on factors such as supplier capabilities, market trends,
and upcoming product innovations.
Data collection in procurement involves gathering information from internal and external
sources, supplier performance metrics, and market intelligence. Internal data sources include
ERP systems, procurement software, and internal surveys. External data sources include market
research reports, supplier databases, and industry associations. Supplier performance data
collection focuses on gathering data related to supplier performance metrics, while market
intelligence data collection involves gathering information on market trends and competitor
activities. By employing these data collection methods, procurement professionals can make
informed decisions, optimize supplier relationships and drive continuous improvement in the
procurement process.

3 Techniques for Data Analysis and Presentation

Data analysis and presentation play a crucial role in leveraging the collected data to derive
insights and make informed decisions in the procurement process. Effective analysis
techniques help in identifying trends, patterns, and correlations, while presentation techniques
ensure that these insights are effectively communicated to stakeholders. Here are detailed notes
on techniques for data analysis and presentation with a focus on procurement, along with
examples:
3.1 Statistical Analysis Techniques
Statistical analysis techniques involve applying statistical methods to the collected data to
uncover relationships, trends, and patterns. These techniques help in understanding the impact
of various factors on procurement outcomes and enable evidence-based decision-making.
Examples of statistical analysis techniques in procurement include:
• Regression Analysis: Regression analysis helps in understanding the relationship
between a dependent variable (e.g., procurement cost) and one or more independent
variables (e.g., supplier performance metrics, market conditions). It can be used to
identify factors that significantly impact procurement outcomes.
• Time Series Analysis: Time series analysis is used to analyze data collected at regular
intervals over time. It helps in understanding trends, seasonality, and forecasting future
values. In procurement, time series analysis can be applied to analyze historical spend
patterns, supplier performance, or market demand.
• Correlation Analysis: Correlation analysis is used to determine the strength and
direction of the relationship between two variables. For example, it can be used to
assess the correlation between supplier performance metrics (e.g., on-time delivery)
and customer satisfaction scores.
3.2 Advanced Analytics Techniques
Advanced analytics techniques, such as machine learning and predictive modeling, go beyond
traditional statistical analysis to make data-driven predictions and optimize procurement
strategies.
Examples of advanced analytics techniques in procurement include:
• Machine Learning: Machine learning algorithms can be trained on historical
procurement data to identify patterns, predict outcomes, and automate decision-making
processes. For example, machine learning models can be used to predict supplier
performance, forecast demand, or identify potential risks in the supply chain.
• Predictive Modeling: Predictive modeling involves building mathematical models
based on historical data to make predictions about future outcomes. In procurement,
predictive modeling can be used to forecast future spend, identify cost-saving
opportunities, or estimate the likelihood of supplier non-compliance.
3.3 Data Visualization Techniques
Data visualization techniques help in presenting complex data in a visual format that is easy to
understand and interpret. Visualizations enable stakeholders to quickly grasp the key insights
from the data analysis and support data-driven decision-making.
Examples of data visualization techniques in procurement include:
• Charts and Graphs: Bar charts, line charts, scatter plots, and pie charts are commonly
used to represent data visually. These visualizations can be used to showcase
procurement metrics, such as spend by category, supplier performance scores, or
savings achieved through negotiation.
• Dashboards: Dashboards provide a consolidated view of key procurement metrics and
performance indicators. They can include interactive charts, tables, and performance
 scorecards. Dashboards enable stakeholders to monitor procurement performance in
real-time and identify areas for improvement.
• Geographic Mapping: Geographic mapping techniques can be used to visualize supplier
locations, distribution networks, or risk factors across different regions. This helps in
understanding geographical dependencies, identifying potential sourcing opportunities,
or assessing supply chain vulnerabilities.
3.4 Reports and Presentations
Reports and presentations are essential for effectively communicating the analyzed data and
insights to stakeholders. They provide a structured format to summarize key findings, present
recommendations, and facilitate discussions.
Examples of techniques for effective reporting and presentation in procurement include:
• Executive Summaries: Executive summaries provide a concise overview of the
analysis, highlighting the key insights and recommendations. They are particularly
useful for senior management who may require a high-level understanding of the
procurement analysis.
• Data-driven Visual Presentations: Presentations that incorporate data visualizations,
such as charts, graphs, and tables, help in conveying complex information in a clear and
engaging manner. Visual presentations can be used to showcase procurement strategies,
supplier performance trends, or cost-saving initiatives.
• Interactive Dashboards: Interactive dashboards allow stakeholders to explore the data
and drill-down into specific metrics or dimensions. They encourage stakeholders to
engage with the data, ask questions, and gain a deeper understanding of the insights.
In conclusion, data analysis and presentation techniques in procurement involve applying
statistical analysis methods, advanced analytics techniques, and data visualization approaches.
Statistical analysis techniques such as regression, time series analysis, and correlation analysis
help in understanding relationships and patterns. Advanced analytics techniques like machine
learning and predictive modeling enable data-driven predictions. Data visualization techniques,
including charts, graphs, and dashboards, provide an intuitive way to present complex data.
Effective reports, executive summaries, and visual presentations ensure that the insights
derived from data analysis are effectively communicated to stakeholders in the procurement
process.