What Will the Spend Management Future Hold?

When I caught up in an on-the-record conversation with Tim Minahan a couple of weeks back, I was as anxious to get him talking about his view on where the overall Spend Management sector was going as much as digging into Ariba's product release (after all, during a briefing, there's only so much you can learn until you actually demo the solutions for yourself in a non Webex environment). Tim, ever the marketing guru, has views which are obviously informed by his current post and vision for Ariba, but he's still one of the top thinkers in the space. So as I share some of his thoughts -- and comment on them -- suspend your marketing disbelief for a minute and think about what he has to say.

Perhaps one of Tim's central views on procurement can best be described as "back to the future-esque" in tone. And this is his "inter-enterprise" view of the operating system of the future which will exist between companies, forming a commerce network -- combining connectivity and enablement -- as well as processes to help companies facilitate the exchange of information, content and goods and services. To Tim, the future of Spend Management is this type of networked nirvana which relies on decentralized nodes as well as a centralized operating system -- my words, not his -- to make it a reality. Might Tim be hinting at the future of the Ariba Supplier Network with this vision? Perhaps.

But if this world will ever see the light of day, the great thing about it will be that software becomes merely one tiny component of the value it provides. Rather, by putting content -- and community -- at the center of a system that will depend as much on its decentralized members exchanging and sharing information and content as much as a core infrastructure to manage, route, distribute and optimize it, this networked Spend Management world will provide true visibility that extends outside of one's one systems and data. Imagine, as an example, being about to look to the community to understand supply market capacity not to mention regional or supplier quality and performance trending for suppliers and geographies you might not have worked with in the past. This type of visibility might help a more informed sourcing decision and also might lead to a specific order size or specific release dates based on the comfort level of a new, global supplier being able to meet a company's own expectations based on what others in the network have realized in the past.

Tim's view of the future takes into account that not all processes, applications and content will be centralized by a single provider/operator of the network or hub itself. Rather, he believes that it will be essential to open up this networked Spend Management concept to other providers, exposing "non-Ariba" platforms, services and content through it. In my view, enabling third parties to share and sell their IP will be essential. But I'm guessing that much of this will come from participants sharing information in a structured but decentralized manner rather than seeing a new type of centralized content authority (e.g., a 21st century D&B) own and sell proprietary data. Who knows. I could be way off. But Tim's ideas -- even if they are coming from a self-serving perspective -- have certainly gotten me scratching my head. And they should get you thinking as well.

- Jason Busch

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