What is a spend taxonomy?
Specific to procurement, and also known as a category tree, Susan Walsh describes a taxonomy in her book Between the Spreadsheets as “a list of categories and sub categories used to classify data into groups or ‘buckets’ of items or services, providing a unified view for the purpose of reporting and analytics.”
It will normally have between one to five levels (columns), and the level of detail will depend on the organisations preference. It is not a GL(general ledger) code and should look very different to this, which only has one level.
Why should I choose a customised spend taxonomy?
✔ Classify your spend data with a taxonomy that includes all the categories you need (and none of the categories you don’t need).
✔ Classify your spend data in a language and terminology that’s relevant to your business.
✔ Report on exactly what you spend and with whom.
✔ Get chart and analytics-friendly categorisation.
Stop fumbling around in the dark. Invest in a customised taxonomy for precise, actionable and business-relevant information to power your decisions.
Taxonomy Customisation
What if you could classify your spend data using your own business language? All those thingymabobs and thingymajigs would finally be correctly classified in a way that’s impossible with an-off-the- shelf taxonomy?
That’s where we come in. Unlike many other suppliers, we classify our spend data manually. This means we can build your taxonomy as we classify your spend data. That means you get a full and thorough taxonomy with only relevant classifications specific to your business and your data. No stone, hammer or screw is left unturned or unaccounted for!
What will it look like?
You might already have built your own taxonomy that’s working well for you. We offer a taxonomy review service that acts as a ‘belt and braces’ to confirm that everything’s covered. You’d be surprised at what we find. In one instance, water was missing from the taxonomy, and on another project, there were two very similar items that we flagged, and they were merged together.
What will your customised taxonomy look like?
Your new taxonomy’s structure and detail will depend on your objectives and the quality of your data. If you have a lot of detail in the invoice/PO description and want to report and analyse this, you’ll need a detailed taxonomy. In contrast, if you have a lot of detail but only need top-level categorisation, you should use a simpler taxonomy.
An adaptable approach to custom taxonomies
There’s no one-size-fits-all approach when it comes to building custom taxonomies. So if you lack detailed descriptions, or don’t have any descriptions at all, it’s not a problem. We can classify your data with whatever you have, giving you the visibility you need.
Detailed Taxonomy
Simple Taxonomy
Ready to request your customised taxonomy?
All we need from you is your existing data in an Excel/CSV format. It really is that easy.
Get in touch to get started.
Read Susan's book Between The Spreadsheets
Between the Spreadsheets: Classifying and Fixing Dirty Data
covers everything from data classification, normalisation, and taxonomy design, Between the Spreadsheets shows how the COAT framework helps organisations create consistent, trustworthy data.
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