Process mining: Where is procurement losing money?

4 min read

Numerous handovers take place between ordering and payment in procurement. Process mining can use event data to show where approvals are delayed or invoices are processed again. Whether this leads to savings depends on data quality and the measures taken afterwards. For an initial run, SMEs need a clearly defined process and a measurable question.

The traces left by the procurement process

What is process mining? Process mining analyses event data from IT systems to examine recorded process flows. An event might be the creation of a purchase order or the approval of an invoice. A case identifier groups events together. Timestamps make it possible to examine the intervals between recorded steps.

A case study by the IEEE Task Force on Process Mining shows why the choice of case identifier matters: several invoices can be associated with one purchase order. An analysis by purchase order line item therefore answers different questions from a view of individual invoices.

For procurement, a narrowly defined question is a useful starting point: How much time passes between invoice receipt and approval? Or how often is an invoice checked again before payment? Such patterns highlight areas for investigation. On their own, they do not establish that a financial loss or error has occurred.

From waiting time to financial impact

A long wait for approval can bring the deadline for an early payment discount closer. Whether a discount was actually lost can only be determined by checking the payment terms, invoice amount and payment date. A repeated check may also point to a cumbersome process or be justified by the circumstances.

The relevant business team should therefore first examine the cases that stand out: Which steps are mandatory? Were there queries about quantity or price? Is an intermediate step missing from the records? Only then can the team decide whether a cover arrangement, better data maintenance or a change to the approval procedure would be appropriate.

To measure success, the team defines a metric and a comparison period before making a change, such as the time from invoice receipt to approval. The controlling team can then check whether the metric has changed and which financial effects can be reliably attributed using the available data.

Preparing the first run

A pilot starts with a defined process, such as invoice verification for a selected organisational unit. Procurement and IT work together to establish which systems contain the required events and how purchase orders, invoices and payments are linked. Sampling individual cases helps identify missing or incorrectly assigned events.

The team then compares the recorded flows with the applicable rules and discusses deviations with the process owners. For confirmed opportunities, the team defines a measure, the person responsible and a deadline. The length of the pilot depends on factors including data access, the quality of the links and the scope of the process examined.

When selecting software, the required data sources, data preparation capabilities and total costs, including implementation and operation, all matter. Vendors should use a specific data example to show how their solution links purchase orders and invoices and how results can be traced. Questions about access rights, data processing and operational support also need to be addressed.

Reviewing employee data and co-determination

Event logs can allow conclusions to be drawn about employees, for example through user identifiers or timestamps combined with other information. Whether data is personal data must be assessed for the dataset in question. Simply omitting names is not necessarily sufficient.

For personal data, the General Data Protection Regulation requires, among other things, a specified purpose, a legal basis and data minimisation. Companies should therefore consult their data protection officer early on to determine which fields are needed, who will have access and how long the data will be stored.

If there is a works council, its co-determination rights must also be assessed. § 87 paragraph 1 number 6 of the German Works Constitution Act concerns the introduction and use of technical equipment for monitoring employees’ behaviour or performance. Whether and how it applies to a specific project depends on its design.

Frequently asked questions

Image source: AI-generated (November 2026)

Translated from the German original using artificial intelligence. The German version is authoritative.