Friday Rant: With Technology Choice Comes Responsibility That Many Aren't Ready For

When I first got started in the Spend Management world back when buyers were just buyers and Ariba, i2 and Commerce One were more happy to trade barbs with each other than actually deliver solutions that did what they promised, the fundamental defining element of the time was that procurement and supply chain organizations lacked a full range of technology options available to them. There were high-end solutions that quite often were anything but -- that is, except in price -- and one ubiquitous low-end solution suitable for just about any job -- Microsoft Office. That was it. But it's exceptional how much things have changed in just over a decade.

Today, we have options galore. We even have free options available (e.g., Rosslyn Analytics just launched a free version of its spend analysis software -- stay tuned for an analysis of the product in the coming weeks). But as we all know, even free comes with a price (e.g., sharing confidential data under potentially less secure arrangements than during a paid contractual agreement) and perhaps more important, an opportunity cost. After all, when we're talking ROIs for paid solutions that often deliver 5x, 7x or even 10x their investment, the true cost of free becomes even more apparent if the give-away products don't deliver the same capabilities as the paid ones (not withstanding security, confidentiality and other potential concerns).

As historical standards go, we're living in an era of Spend Management technology excess, a digital cornucopia of options in nearly every functional area. And the transformation -- in relative terms -- happened almost over night. Which is scary and eye opening at the same time. It's the technology equivalent of a former citizen of the Soviet Union who was previously forced to make do with a Trabant -- if he was so lucky -- crossing the border into the West and having the ability to pick and choose from dozens of automotive brands and hundreds of models that can actually exceed 45 MPH and not break down, to boot. Granted, our metaphorical Russky can't drive with a bottle of vodka wedged in between his legs in the West and hope to avoid a speeding ticket by sharing some with the police, because after all, freedom does come with at least some responsibilities, I suppose. Which brings me to my next point.

How can we make sense of all of this choice? If we consider just one area in the Spend Management technology world, spend visibility / analytics, we have dozens of different providers today, many of which aren't even direct competitors yet still are lumped together by many as the same class of product (e.g., Ariba, Emptoris, BravoSolution, Zycus, Oracle, SAP and others take an entirely different approach than BIQ which takes an entirely different approach than Endeca which also happens to take a different approach than Spend Radar). In fact, it's plausible that an organization might opt to maintain two, three or possibly all four types of solutions in-house depending on their specific needs. But how best can an organization decide what it needs given the plethora of options and differentiated approaches out there?

The answer I think is relatively simple: getting smart yourself and deciding what priorities and capabilities should matter most to your organization by investing the time and effort -- first convincing your superiors that it's worth the time to fully do your upfront homework -- to understand what's available and appropriate. No longer is it possible to delegate even in part a decision to an industry analyst firm or research firm (or an independent expert, for that matter). Sure, third-parties can be useful as one source of input. But chances are that even they won't be up on the latest capabilities from every provider -- I can tell you I'm not, and I think I know as much about this market as anyone -- let alone the new options entering the market everyday.

Moreover, unlike the past, you really can get fired for hiring IBM/Accenture -- or SAP or Oracle, for that matter -- if a project crashes and burns. And this goes for consulting engagements too, such as hiring a firm to pursue category sourcing and supply chain strategies that they really have no expertise in which far too often leads to un-implementable or suboptimal results while also damaging existing supplier relationships. After all, as an example, I've heard of numerous occasions where tossing more Accenture bodies into category sourcing the mix led to nothing more than a body count -- not more savings for the client.

This puts the onus on you to get things right by fully understanding the universe of options. With Democracy, comes the responsibility to get smart on your options. This is essential because given that we're no longer living under the equivalent of Spend Management technology communism -- an apt metaphor in more ways than one -- we've basically been given the most dangerous thing available to us: choice. Before, we used to call Gartner to get the rubberstamp on buying a certain technology package (the equivalent of turning to Granma International, the Cuban national newspaper, to seek advice on whom we should vote for in the next election). Now, well, you get the picture. I sincerely hope that when it comes to Spend Management technology choice, that we can all prove Winston Churchill's famous quip wrong that "the best argument against democracy is a five minute conversation with the average voter". After all, no one wants to go back to the days of few Spend Management technology options. Or do we?

Jason Busch

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