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Use of Big Data Analytics To Establish A Dynamic Fair Market Rate

IP.com Disclosure Number: IPCOM000245676D
Publication Date: 2016-Mar-29
Document File: 2 page(s) / 194K

Publishing Venue

The IP.com Prior Art Database

Abstract

Disclosed is a method to use big data data analytics to establish a competitive target market rate within a contractor sourcing application using real time market, industry, and skill details.

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Use of Big Data Analytics To Establish A Dynamic Fair Market Rate

Applications are available to assist organizations with finding subcontracted project

resources. The traditional approach is to send project requests to suppliers, receive responses, and then select a contractor from the responses. If a response is above an established target rate, then it requires additional approval by the buyer to establish that the price is fair value to the requestor. Establishing the target market rate used to perform this comparison, loading the initial target market rate, and maintaining the target rate during market changes is a manual and complex process involving many steps and procedures. Because of the manual complexity and limitations of the current process, it is usually undertaken once a year. In addition, the rate established cannot take into account multiple facets of required skills beyond a primary skill set and level of expertise. This can result in initial established targets becoming obsolete and not reflective of current fair value of the unique skill. As a result, more requests over time need approval and review by a procurement buyer. These approvals then introduce delays into the process of finding and engaging a subcontractor. Rate trends up or down cannot be taken into account until the next annual cycle of the rate establishment process, resulting in missed savings opportunities.

A method or system is needed to:


• Enable organizations to establish and maintain a real time market rate for thousands of job role skill sets in the services market across multiple suppliers that reflect the most current price points.


• Ensure those rates stay competitive for the duration of the contract in highly dynamic markets or skills


• Reduce the number of requests requiring manual review/approval due to being above the established target rate

The novel contribution is a method for obtaining the market rate from data provided...