I’ve had a confluence of inquiries and conversations in recent weeks with folks on all sides of the spend analytics (and broader procurement analytics) markets, including at the ISM and Spend Matters Global Procurement Tech Summit. It feels from these talks that the market is abuzz with energy. But it’s a new excitement, not just simply investment in traditional cleansing, classification and visualization approaches. From these discussions, I’ve spotted five trends that I see coming together in curious new ways (and no, they’re not mutually exclusive — there’s overlap between them).
- First generation solutions are getting replaced in increasing number. With apologies to my colleague Pierre Mitchell, the “spent analytics” baby is getting through out with the visibility bathwater. More and more companies are replacing first-generation solutions (even in cases where had they tapped the latest capabilities from their current vendors, they might have achieved superior results) with those that are either more cost-effective, category-specific, incorporate “big data” models or otherwise stand apart from legacy approaches. Increasingly, “predictive” solution approaches, which embed analytics through guidance and recommendations, are starting to poke their heads up over the spend horizon — which is a key to the long-term proliferation of machine learning models.
- A new generation of solutions is quietly (without much of a marketing push) gaining significant traction. Some of these are “British Imports” including Spend360 and AnyData Solutions — both of which are winning more than their fair share of deals at the moment. Some of these solutions are differentiated based on their overall analytics platform stack (i.e., they’re more than “just a tool”). Others are starting to push next-generation AI approaches – among these, IBM, Spend360 and TAMR are up to some very cool developments, which we’ll profile in more detail later.
- Audit/recovery (at the invoice line-level), supplier management and spend analytics are in the early stages of converging. I’m in the midst of writing a Spend Matters PRO research brief on this topic and I can’t do it justice in a few lines. But as solution and technology vendors in this market (e.g., Lavante, PRGX and Apex Analytix) expand their capabilities, look for them to help drive convergence of different solution areas in one — albeit in different ways between them!
- Non-traditional (large provider) sources of analytics are increasingly being seen as an option by organizations. This includes, of course, SAP (with Ariba) but also Oracle as well. And curiously, it also includes consultancies (and hybrid services, managed services and SaaS providers like GEP), some of which have developed their own analytics competence with homegrown solutions in recent quarters — and others that still use third-party solutions on a managed services basis. Even supplier network providers, e-invoicing and trade financing providers (e.g. Tungsten, Basware, Taulia, C2FO, etc.) are increasingly blurring the analytics line with various data-centric capabilities (including benchmarks in certain cases).
- Spend analytics is morphing in new directions and is now labeled incorrectly in many cases (i.e., too narrowly). What do I mean by this? Contract analytics, payment analytics, etc. are increasingly being delivered alongside traditional spend analysis solutions by the same providers. It’s just a question of expanding (and incorporating) the datasets under consideration. I recently saw Sievo’s capabilities in the contract compliance area (which is encroaching on some aspects of contract management technology) and believe it’s a sign of things to come more broadly as integrated spend analysis, savings/pipeline management and contract compliance solutions come together. And, of course, payment analytics — which some vendors are starting to experiment with — is a Trojan horse for much more (e.g., building the business case and managing/implementing working capital management and trade financing programs).
Where do you see spend analysis headed? Drop a line or post a comment.