Accounting for Geographic and Cultural P2P Adoption Differences (Part 2)

We'd like to welcome back b-pack's Julien Nadaud to Spend Matters. We recently interviewed Julien on his view of how European countries and companies have adopted eProcurement, invoicing and related P2P capabilities in different ways based on regional, business and cultural differences. This is part two of a two-part interview series (Click here to read Part One).

Spend Matters: What are the main differences you've observed driving adoption in the US market?

Julien: I found two main differences:

One is about the company governance. European organizations are centralized with top-down decision processes. This is emphasized in France, where the President and CEO having quite a lot of power within a company. It makes things much easier when someone has to make the decision to implement new software that will change the way all people in a company are working. These executives can decide to fully automate all processes related to 100% of the spending for the entire company, even on a pilot / shotgun rollout strategy. That makes company reorganization and transformation happen much faster, once the decision has been made.

The other difference is about requirements and P2P vendors. For software providers, requirements make their lives quite challenging, because expectations are usually much larger than their product specifications. They are very detailed and include all kinds of ideas coming from many managers who unfortunately expend energy thinking about how to address complex problems before solving the simple ones. The good thing is that it makes products evolve quickly, with a lot of features coming from the field. The US focuses more on the simplicity and the usability of the product. I think that the company that can provide solutions that address both of these points will have a real advantage in the global market.

Spend Matters: Why do you think the US lags behind Europe from an automation perspective (but potentially ahead in other areas such as strategic sourcing, supplier performance management, etc.)?

Julien: The US and Europe are going about the same kind of business (building and selling products) -- but just the opposite ways. Europeans are first focused on how to build products while the US first examines how to sell them. This is the same for procurement -- the US focuses first on the supplier relationship while European companies focus on internal processes. The two approaches are going to merge when market reaches its maturity.

Spend Matters: What has been your early experience in the US market so far? Are the same messages from Europe working in the US for P2P and related areas?

Julien: In fact, except for some minor differences, we're seeing similar trends develop where US companies start having the same problem as European companies -- less people, more regulation and increasing competition from emerging countries. The way companies operate are actually very similar, and the same product can fit very well in both the US and Europe, especially if the product has been designed to handle international business in large corporations. However, messages and marketing have to be completely redesigned to reflect fundamental cultural differences between the two continents.

Spend Matters: What European country is the US most similar to from an adoption and usage perspective?

Julien: The UK seems to have a similar configuration to that of the US. They are more advanced on supplier relationship management but do not go as deep into procurement automation as France, for example. Germany is an industrial country and has some similarities when it comes to mid-size businesses having vertical software that focus on production and not on human process efficiency.

Spend Matters: When it comes to workflow configuration and management, is there a trend around the degree of customization / configuration required by country? Which countries tend to configure / customize their automation and controls processes around procurement the most?

Julien: Countries with big companies, complex rules, regulations and years of maturity in implementing ERP systems are good candidates for advanced and customized software implementation. This is why not all countries are at the same level. In addition, customization is needed when a company wants to address 100% of their needs, as 20% of specific business processes requires approximately 80% of the software customization. Through experience, I can say that automating 100% of the spending chain brings a huge value in terms of process management, financial accuracy and overall efficiency, but this cannot be done without customization.

Spend Matters would like to thank b-pack's Julien Nadaud for sharing his thoughts.

Jason Busch

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