Along with my colleague Brian Sommer, I'm giving a chat later today at the Best Practices Exchange in downtown Chicago (actually, it's taking place at US Cellular Field, home of the recent World Champion White Sox). I am trying out some new material which I'm hoping does a better job than I -- along with all of my analyst and consultant colleagues -- have done in the past at simplify the Spend Management technology landscape. In the discussion, I'll share a simple segmentation that essentially creates only four "buckets" of technology enablement within Spend Management. These are: Sourcing and Decision Support, Procure-to-Pay, Visibility and Contract Management, and Risk and Performance Management.
The first two categories are probably less controversial than the final ones, but in five years time, I believe that you won't be able to separate out spend visibility from contract management (or at least the compliance side of CM). And along the same lines, I believe that risk and performance management will also go hand-in-hand (and will be elevated by leading procurement and operations organizations in technology investment priority).
I'll share more findings that I detail in the deck next week, but one that jumps out as I look at and prepare my material is that virtually no providers have solutions which cover the entire landscape -- at least with any depth. As an example, Ariba, which probably one of the widest and deepest footprint of all of the providers, is lacking supply risk management technology (and has limited offerings in the supply performance and quality areas). In addition, I was struck by the very incomplete the offerings of ERP providers, despite significant progress (for example, SAP has come a long way from an operational procurement prospective in its forthcoming my SAP SRM 6.0 release, but there are still major holes in its spend visibility and analytics capabilities, not to mention risk management and other areas).
So if you take away anything from this new analysis, remember this: the Spend Management technology market is far from won. In fact, no vendors have complete coverage, and there are still huge advantages that the best of breed providers have, whether its enabling stand alone capability that drives competitive advantage or enhancing back-end ERP or operational procurement to improve real-world results.