In the past few weeks, I've had a couple of conversations with various folks from Ketera, including Bill Phelps and Jon Lew. Bill heads up Ketera's professional services, support, and data center functions and Jon has responsibility for key large accounts within the consulting organization. I wanted to talk to Bill and Jon to get their on-the-ground perspective about supplier enablement and eProcurement, given Ketera's years of experience in implementing and enabling their own solutions. Incidentally, for those that do not know Ketera, the vendor is one of the few in the market with near end-to-end Spend Management capabilities, ranging from upfront spend analysis through to eProcurement and contract management.
Throughout our conversation, Bill's and Jon's perspectives echoed what I've been hearing in the market of late -- namely, that the majority of a typical company's suppliers are not yet ready to transact online. In one study Ketera did for a client to understand eProcurement supplier readiness, they found that less that 20% of their client's current suppliers were capable of conducting anything except email, phone, or fax transactions. Clearly, electronically enabling anything close to a majority of suppliers in a case like this would require significantly more than a simple on-boarding process.
When it comes to supplier enablement, Bill and Jon pointed out two major challenges they constantly see in making eProcurement implementations work. First, they observed that simply making a supplier's catalog data available is not a trivial task. Given the findings of the survey they pointed out, making catalog data available can often prove more challenging than any buying organization would consider initially (especially for anything more than a company's largest indirect and MRO suppliers). For overseas suppliers, this can be even more of a hurdle, but Bill and Jon did point out that "foreign suppliers tend to be more sophisticated when they are part of a US-based organization."
The second major issue they brought up is the challenge of getting suppliers to transact once catalog and content data is already available and the eProcurement application is up and running. Obviously, for a Staples-like supplier, this question is irrelevant, but for the majority of small and medium-sized businesses, getting suppliers to use a system is often the largest hurdle to eProcurement success. To help overcome these challenges, Ketera often gets actively involved in the supplier-side of each customer implementation. They will do everything from designing and implementing the catalog content management process -- which includes submission, checks, content augmentation, approval, and final posting -- to supplier catalog hosting (where Ketera actually hosts the catalog as a punch-out site for a customer). In addition, Ketera provides classification, attribution, and translation services to help standardize and roll-out supplier information as part of catalog-based systems.
When it comes to eProcurement and supplier enablement, Ketera's most significant claim to fame is their On Demand approach to both buyer- and supplier-side roll-outs and on-boarding. And by tying its overall model to a subscription that encourages rapid adoption and quick wins, Ketera offers a user-friendly approach to selling and proving the value of eProcurement, something clearly lacking in the ERP world today. But perhaps most important, I was impressed that the Ketera team clearly understands all of the nuances of the supplier-side of eProcurement -- which is often the biggest stumbling block to achieving returns in the first place, and something that an SAP or Oracle rep will be loathe to tell you when they're pushing their SRM capabilities.