Heads up to the sourcing tool providers out there. In case you missed it, Pittsburgh-based sourcing and optimization company CombineNet was recently awarded the following US patents:
- 8,165,921: Dynamic exchange method and apparatus
- 8,190,489: Bid modification based on logical connections between trigger groups in a combinatorial exchange
- 8,190,490: Overconstraint detection, rule relaxation and demand reduction in a combinatorial exchange
- 8,195,524: Items ratio-based price/discount adjustment in a combinatorial auction
I looked at the patents and it seems that all of them refer to various ways of applying an iterative bid gathering process where suppliers work through a solution to modify their bids until slack/dummy variables are eliminated, i.e. an optimal solution is found.
When asked, CombineNet was somewhat coy about the specifics around how they will put these patents to use, and preferred to point to future product offerings. They did, however, validate that the new patents all relate to various ways of enhancing an iterative bid gathering process and added, "these enhancements will define the state of the art of expressive competition, encouraging suppliers to participate on their own best terms while still supporting optimization in near real-time," so it will be interesting to see how this takes practical shape.
CombineNet will leverage the new patents to collect and analyze data in both e-Auctions and eRFx sourcing events (which further supports CombineNet's recent move to embed Reverse Auctions into their ASAP (Advanced Sourcing Application Platform) tool) as well as expand optimization capabilities and support complex spend areas.
Obviously, as with all patents, one practical implication is to fence in technology. In this case, a portion of auction functionality -- so we will perhaps have to wait and see who gets in trouble first for trying to jump that fence.
Congratulations to CombineNet for their hard work in getting these patents: now go show us some groundbreaking features! After all, even combinatorial patent trolling is not something we'll get excited over. But breakthrough capabilities and customer outcomes are.