I recently had the chance to sit down with Amalto Technologies, a Paris-based supplier enablement start-up which is just beginning to aggressively ramp up its North American operations. My various conversations with them have been educational and refreshing. And that's because when it comes to supplier enablement, the vast majority of the market is focused on initial supplier on-ramping and catalog management. These are two every important areas, no doubt, but the significant amount of time each of them takes often limits the number of suppliers that companies focus on in their eProcurement implementations to less than a hundred (often times significantly less). Amalto, in contrast, is focused on a very different aspect of supplier enablement -- document and transaction automation (conceptually, think faster and cheaper EDI for the masses).
Amalto's real differentiator, however, is on what segments of the market that the firm focuses. In their own presentation, they suggest that we can lump a company's suppliers into four tiers. Tier 1 suppliers are very large suppliers exchanging thousands of documents per year and are already XML enabled or have the means to "XMLise" their documents. Tier 2 and 3 suppliers are those suppliers that exchange at least 500 and 100 documents per year, respectively. And tier 4 suppliers are smaller suppliers with whom a company only exchanges a few documents per year. Amalto is focused entirely on the middle of this group: tier 2 and 3 suppliers. These suppliers are often overlooked in eProcurement and EIPP implementations because they have represented in the past anything but the proverbial low hanging transactional fruit. In fact, they're quite the opposite -- a troubling set of suppliers who most likely comprise a minority of a company's spend going by an 80/20 rule but perhaps a significant -- maybe even a majority -- of a company's offline transactions and document exchanges.
Amalto goes after these two groups with two separate solutions (each of which combine hardware and software). Their humorously titled b2box is a hardware and software solution the size of a small or medium-sized router that companies -- either procurement organizations or larger suppliers -- can host on-site to facilitate the electronic exchange of quotes, orders, invoices and related types of documents with numerous trading partners. The box -- it literally is a box -- is flexible, though highly configurable (companies customize each one initially and then update it as new suppliers/buyers come online, new document types are required or systems are modified). For those organizations who want to minimize IT's involvement in this type of hardware support, Amalto can remotely monitor the box for companies. Amalto's second supplier enablement solution is focused on enabling tier three suppliers. This solution, also with a catchy name, b2een, delivers a similar type of integration support for smaller suppliers as the b2box, albeit in a remote fashion (i.e., it is a web-service -- there is no hardware to install).
Amalto has already started to work with Ariba to help push their solutions into their user base. While I am not sure the extent of the partnership, I suspect it will be the first of many for Amalto. SAP and Oracle -- not to mention Ketera, SciQuest and other procure-to-pay providers -- users will clearly want to get their hands on a similar type of capability as they get past their initial wave of supplier enablement focused on larger suppliers. After all, supplier enablement is not just about the catalog (or focusing on the biggest of the big, as the case so often is).
- Jason Busch