Outlook for analytics
The digitisation of public procurement is well underway in Finland, and more procurement-related data is being generated than can be used. Hansel aims to be a trailblazer in data analytics in public procurement. In the past few years, developments in this area have been dizzying.
In terms of analytics, the top themes in 2023 were the need to invest in data infrastructure, the use of chatbots based on large language models as sparring partners in coding, initiatives by Hansel’s customers to open up purchase invoice data, and the need to strongly invest in Business Intelligence (BI) analytics, both internally and externally.
An appropriate data foundation is a requirement for the use of more advanced analytics such as modelling, forecasting and machine learning models, meaning that the data must be up to date, reliable and faultless, and that it must be automatically collected from the source systems. An often stated rule of thumb is that 80% of an analyst’s working time is spent cleaning and parsing data, leaving 20% for the analysis itself. This is very much in line with reality – at least sometimes. Hansel launched a major data analytics infrastructure reform project in 2023. Similar projects currently seem to be underway in many organisations. A new job title, data engineer, has appeared in job advertisements, and data engineers are currently worth more than gold to many companies.
Processing of procurement data is evolving
Chatbots based on large language models (LLMs), most famously OpenAI’s ChatGPT, garnered widespread hype in 2023 and were also present in the daily life of Hansel’s analytics team. LLMs are not independent analysts yet, but solving various technical and mathematical data modelling and coding issues with the aid of LLMs is going well. Of course, this requires expertise on the part of the user, as LLMs may come up with answers that sound correct but are still wrong, and care must be taken not to enter any confidential information in (open) LLMs. When used correctly, LLMs have the potential to significantly increase a data analyst’s efficiency.
In 2023, two completely new organisations were added to the Tutkihankintoja.fi (Explore Public Spending) portal maintained by Hansel: Tampere University and the City of Järvenpää. Making purchase invoice data open is also one of the objectives of the new Government Programme, which means that we should see more of such developments in the near future. The relationship between Tutkihankintoja.fi and the centralised, national procurement data resource mentioned in the Government Programme will certainly also be examined in the coming years. As a longer-term vision, Finland should definitely have an open procurement portal similar to USAspending.gov. Hansel is in favour of increasing the transparency and traceability of public procurement.
Amidst all the AI hype, it should be kept in mind that the most added value to Hansel’s business and our customers comes from traditional descriptive analytics. This means that BI analytics is and will remain the bread and butter of Hansel’s analytics services. Forecasts and modelling will be used when there are tangible uses for them, but well-executed graphs and tables on procurement data best meet the analytics needs in many cases.
Read next: Hansel offered support for the launch of the wellbeing services county’s procurement processes
You may also be interested in
AI to improve the customer experience and improve internal efficiency
In the world of technology, 2023 will probably be remembered as the year when a breakthrough of generative AI solutions based on large language models took place.
Emissions from joint procurement calculated
In 2023, around EUR 1.6 billion worth of goods and services were procured through Hansel’s joint procurement.