Rearden’s (Ketera) New E-Sourcing Tool — Simple, but not Simplistic (Part 2)

Click here for Part 1 of this post, authored by Thomas Kase. Today's post is a collaboration between Jason and Thomas.

One thing that stands out in using Rearden's new Ketera E-sourcing tool is the ability to hide or embrace (albeit in a relative manner) complexity in creating an RFP or tender structure. Consider that when scoring bids, it's easy to breeze over different section elements or profile criteria. Or you can enter (through an elegant interface that's super easy to use without training) an approach that creates flexibility around weighting different attribute elements in either a sum (total) manner based on the relative important of each question or on an equal-weight basis. Moreover, help-boxes and related information pop up to signal changes in your RFP structure to fully explain the results of a given click or action (e.g., explaining to the uninitiated what the "weighted average" option does). Yes, many other solutions have this capability already (we know of over a dozen). But Rearden's execution is one of the best to date for this type of feature; guiding inexperienced users through the process and masking all elements of complexity if required.

Creating questionnaires for suppliers as part of an RFP/RFX is a snap and users have the ability to easily create different answer types (e.g., multiple choice, free text, yes/no, etc.) Importing item elements into an event is equally as easy. Users have a choice of three ways to introduce items into the RFX equation – specifying any item by description (ad hoc), importing via an excel import template, or choosing from an existing library of items based on what you've sourced in the past. Attachment uploads follow a similar format and structure. Anyone who has used another e-sourcing tool in the past will have no problem designing an RFP within the Ketera Sourcing solution and those who are new to a sourcing toolkit should be able to work their way through the process of creating both basic and more advanced bidding packages without external assistance.

Sourcing Supplier Response Main Page: This is a screen shot of the main page that the supplier sees when responding to a reverse auction

Having used Ariba Discovery, we'd say that Rearden's sourcing tool is just as slick and easy to use, but combines more advanced elements in RFP creation, supplier response and negotiation more common to other e-sourcing tools. It's our view that a sweet spot client for Rearden would probably fall in the $100 million to $1 billion in revenue range, or would be a division or business unit of such size within a larger organization; a unit with little need for compartmentalization, approval steps and locked down features – whether proscribed or prescribed. By contrast, organizations characterized by process-driven bureaucracies with extensive signoff requirements, no digital signature acceptance, expectations around ERP integration points and locking down document and item libraries, etc., are probably not good Ketera Sourcing candidates.

In short, Rearden's solution is geared toward large-scale, low-touch deployments – with an emphasis on stripping out non-essential features to deliver maximum ease of use. Yet as Rearden's sourcing users get comfortable with the solution and broadly start to use it, how will the Ketera Sourcing solution scale to meet the challenges? The existing interface has scale limitations in many areas: templates, events, documents, etc. The good news is that it is probably easier to add a complexity wrapper around the existing platform to meet the needs of more sophisticated organizations than it is for providers of high-end solutions to simplify their platforms.

Sourcing Reverse Auction Supplier.png: this is a screen shot that depicts the buyer monitoring the bidding activity during a live event

One of the more valuable aspects of the Ketera sourcing solution is that the suppliers of all clients are introduced into the Rearden vendor network – further expanding their 1.2 million vendor large network. This shouldn't be of concern to prospective clients as the network doesn't identify which company any given vendor originally came from, nor with whom they do business. It will be interesting to see which of their solutions – the sourcing solution or the vendor network – is more important long-term to the Rearden business model.

Pricing

From a pricing standpoint, final pricing for Rearden's new Ketera Sourcing module is not yet available, but we believe it will be materially less than other solutions in the market. Expect the solution to be priced on a per-seat basis with the flexibility to also offer unrestricted enterprise pricing for clients with such requirements (figure one-third to one-fourth that of competitive solutions on an annual basis).

With Rearden's long-term goal at building a true networked business, it would make sense to keep price points as low as possible to encourage adoption, especially among middle market companies where such a solution is a material upgrade from the free versions of tools like Ariba Discovery and MFG.com, while combining both supplier search/network elements and solid base functionality.

Jason Busch and Thomas Kase

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