In this first of many posts, we’ll highlight nearly 30 market sectors of procurement providers that we cover here at Spend Matters. This might seem like a lot, but keep in mind that some of these overlap with each other and are subsets/supersets of each other. For example, Source-to-Pay suites contain Procure-to-Pay (P2P) functionality (which scope-wise is associated with P2P suites) that itself covers “eProcurement” functionality for transactional procurement. Also, remember that we cover procurement solutions broadly to include procurement services of all forms, as we discussed here.
OK, enough of the preamble; let’s get down to it with market sector number 1, the Source-to-Pay suites….
Source-to-Pay solution suites and supporting services span sourcing and procurement processes, with some level of support for electronic invoicing and payments. Such suites automate and enable the following.
Sourcing & Supplier Management
- spend / supply analytics (spend analysis, supply base analysis, supply chain segmentation analysis, cost/price forecasting, supply market analysis, etc.)
- supplier discovery (e.g., looking up approved and/or preferred suppliers by category/commodity)
- supplier qualification / certification workflow and supplier setup (tied to AP)
- sourcing strategy (category/supplier strategy formulation, scenario planning, sourcing project definition/planning, etc.)
- sourcing execution. This includes RFx support for RFI/RFP/RFQ workflow, “Quick RFx” capabilities, competitive bidding, bid analysis (including ‘bid optimization’), and negotiations
- contract management (including authoring and use within downstream P2P and supplier management processes)
- supplier management, including supplier performance management, supplier quality/risk/compliance, supplier collaboration tracking, etc.
- Supply search and “guided buying”
- Catalog management
- purchase requisition management (planned Req/PO import, budget checking, approvals, processing, conversion to PO, etc.)
- PO management (rules management, approvals, processing, communication to suppliers, etc.)
- Invoicing (examples are PO flip, documents capture/conversion, pre-processing rule management, approvals, dispute management, supplier self-service, etc.)
- Payment processing
- Expense Management – including Travel and Expense report processing, and integration to P-card functionality
These systems may also offer:
- Services procurement functionality, including contingent labor and SOW (Statement of Work) based spending
- some level of Master Data Management (MDM) for supplier master data, catalogs, item masters, category/commodity taxonomy, contracts, etc.
- supplier risk management and broader supply risk management
- project and portfolio management, savings pipeline management, savings/value tracking, etc.
- category management (i.e., managing sourcing and supplier management at a broader level than just commodity-level sourcing projects)
- performance management (e.g., dashboards, target setting, performance tracking)
- advanced cost management (i.e., cost modeling, forecasting, and tracking beyond the bidding event)
- category/industry specific functionality, including supporting content and services (examples are spend category specific templates, external data/content integrations, etc.)
- supply chain specific functionality for commodity management, supply network visualization, supply chain collaboration (e.g., forecast/plan/order collaboration with suppliers), asset management, materials management, and advanced B2B integration.
- working capital optimization (dynamic discounts, supply chain finance functionality, etc.)
While some of the functionality of such suites is also resident to a lesser extent within ERP suites from ERP vendors, these suites are from best-of-breed providers who integrate their modules within the suites (although this is not so much the case with a few of the “rollup” providers in the market), similar to how ERP vendors integrate their major application modules.
In future posts, we will dive into some of our other market sectors.