Aravo's $50K Supply Risk QuickStart (Part 2)

In the first post on Aravo's recently introduced $50K Supply Risk QuickStart program, I provided some details on what the package includes and how Aravo integrates different data sources to present views into different supply risk elements. In this post, I'll provide additional details on how Aravo plans to go to market with this and related tools. Supply Risk is one of a number of QuickStart programs that Aravo plans to take to market in the coming quarters as a way to get customers to use its solutions more quickly. It hopes to demonstrate the benefits that targeted supplier information-management tools and packaged services can bring (and upsell to a more comprehensive SIM program and solution once it's able to prove the value in a targeted area). Aravo told me to look for a total of four QuickStart software and solution bundles in "short order" that will bundle products, services, information, and training.

Once up and running, Aravo's Supply Risk Quickstart can help provide companies with a means of monitoring specific supplier risk types by delivering, in Aravo's words, "[a] centralized supplier management system that serves as a single source of truth for supplier information, and autocollects risk information directly from internal sources (IT systems and business stakeholders)." Unlike Aravo Risk, Aravo's more expensive supply risk solution, Quickstart isn't designed to deliver a means of monitoring all potential supply risk types, or to bring in external data sources. Rather, it's meant as a targeted way to gather information consistently, enabling predictive risk indicators that provide an early-warning mechanism as well as a way to mitigate risk through corrective-action planning done as automatically as possible.

Aravo certainly claims to do a lot for a $50K price tag: monitoring various risk elements for an organization's most critical 1000 suppliers. It contains the cost and scope of deployments by limiting the solution to a single environment, and relying on as much "standard attribute and survey content as possible." It also guides users down specific best-practice paths regarding what specific fields to collect and monitor. Once in place, the system is not static, however, and enables the "on-going configuration access to email templates, drop down lists, user and project team administration and risk calculations." To minimize cost and complexity, the supplier-side interface of Supply Risk QuickStart is available only in English.

So what's Spend Matters' verdict on what customers get for their $50K/ 1-year (or $85K/ 2-year agreement)? Quite a bit in fact, especially for what the program is designed to do: provide a jump-start to supply risk monitoring and management initiatives. Still, I would caution that Aravo QuickStart for risk, while a good way to get started, is only a partial solution. Companies that are serious about risk should think far beyond monitoring their top 1,000 suppliers; ultimately, they should think about how to deploy programs that encompass their entire supply base, rather than select subsets. After all, a critical small supplier that finds itself in dire financial or operational straits can be equally as disruptive to a buying organization as a larger one. Moreover, companies should look for supply risk solutions that bring multiple types of content and third-party information to bear (rather than just relying on content they've already licensed, or their own systems and qualitative inputs).

Still, I've got to hand it to Aravo for putting together a solid, affordably priced, bundled risk management solution to get companies started. For half the cost (or less) of bringing on a new, fully loaded FTE with the right skill set to manage supply risk, companies can put in place Aravo's basic system to get started. Even if the package is incomplete, Aravo QuickStart provides a solid start to helping companies gain a more complete picture into multiple types of supply risk within their supply base (both initially and over time). Perhaps more important, Aravo QuickStart provides an expandable framework and architecture to roll out a more comprehensive supply risk solution after an organization proves the value of early risk detection and intervention. For this, I'm more than happy to overlook its shortcomings, as I'm sure will its customers.

Jason Busch

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