From a customer engagement perspective, Spend Matters believes that two companies could not be more different than SciQuest and AECsoft. AECsoft was known for a very long list of customers, many of which had a small relationship with the vendor (e.g., buying just diversity data or software). In contrast, SciQuest maintains one of the most rigorous customer evaluation processes in the procurement market (more on this in a future post), creating a formal grading structure based in large part on the value that customers are getting from working with SciQuest solutions and aiming to build multi-year relationships that start at six-figures and move up from there.
I was curious to learn how SciQuest planned to begin to layer this model on top of the AECsoft relationships it gained from its acquisition, including those customers without a formalized contracting arrangement and multi-year agreements with AECsoft. SciQuest's Gamble Heffernan told Spend Matters that SciQuest is working to "protect AECsoft customers" by "going back and putting certain agreements into a more formalized structure/scope of work going forward". Editors note: I had to smile at this statement. SciQuest is also rolling AECsoft's pricing -- which Spend Matters knows was often the very lowest in the market, but without a formal structure/price sheet to guide the commercial organization -- into a formal price-list.
Gamble noted that AECsoft's price sheet "was fluid" and SciQuest is working to "standardize pricing today" which will also help the vendor better engage and structure the types of closer working relationships that it is used to. Spend Matters believes this may involve a material price increase for AECsoft users when it comes to renewal time -- as well as for new contracts going forward -- to bring the solutions up to a market-rate for pricing.
On a different subject, I was curious to ask Gamble about how SciQuest was doing in maintaining its key technical staff outside of Tom and Lilly (the co-founders and dynamic duo that ran the company). In this regard, she noted that "pretty much to a person the developers are all still in the organization." However, she also suggested that in the past, many of the developers were also their own project managers, which SciQuest is working to change to a more traditional model.
Spend Matters is aware of one departure that has happened, but I am not surprised given a number of extenuating factors (stay tuned on this note, which I might add is quite positive), and I also do not believe this one move represents a pattern within AECsoft's technical or product staff.
- Jason Busch