This post is part of our 2016 Year-End Procurement Tech Review, in which we offer procurement practitioners a bird’s-eye view of some key vendors and their solutions in select categories. This week, we’re highlighting companies in the sourcing (including e-sourcing) and supplier management spaces.
Sourcing optimization solutions today have supported some of the largest and most complex sourcing events ever conducted. Yet overall, adoption has lagged the market for general-purpose e-sourcing tools and suites. Keelvar, a four-year-old firm that started as a spinout from a research lab at a university, is hoping to change this. Its primary differentiation is that, unlike the majority of sourcing optimization software providers, it realized from day one that the solution was not a better optimization module but rather a better sourcing platform where ease of use was the most important driver of adoption.
- Founded: 2012
- Headquartered in Cork, Ireland, with offices in Germany (Berlin), the U.S. (Austin, Pittsburgh) and Brazil (Rio de Janeiro)
- Number of employees (range): 11–25
- Total annual revenue (range): $2 million–$10 million
- Percentage of revenue from procurement/supply: 100%
- Serves customers in Africa, North America, South America and Western Europe
- Number of customers (range): 11–25
- Industries responsible for the majority of their business: manufacturing, food and beverage, retail, energy, transportation
- Customers include: Associated British Foods, Marks & Spencer, Siemens
- Available modules: Keelvar Sourcing Optimizer
- Other app integration: Tableau
Background & Overview
Emerging from the 4C research laboratory in the Department of Computer Science at the University College of Cork with €750,000 in seed funding in 2012, Keelvar released its initial software-as-a-service (SaaS) product to help buyers establish a balanced and cost-effective sourcing outcome between large and small suppliers in negotiations. Initially, its differentiation relied in part on a price-gathering mechanism that supported communication of creative ways in which waste can be removed from the sourcing process and actual bid awards, helping its early government and private sector clients reduce costs beyond traditional e-sourcing approaches.
Keelvar has made large strides since, transforming itself from a small, new entrant solving primarily small-scale optimization problems for small and mid-size organizations to an established vendor solving large-scale optimization problems for mid-size and large companies and procurement organizations outside of just the Irish and U.K. markets.
Earlier generation strategic sourcing optimization solutions required a level of analytical knowledge that few resources inside typical procurement organizations had. This limited the application and reach of sourcing optimization to only a few high-dollar categories inside Global 2000 organizations. Keelvar, however, is bringing sourcing optimization to a much larger cross section of procurement practitioners, enabling even public sector bodies and organizations with no advanced sourcing training to use this new sourcing approach.
Commentary & Summary
Keelvar’s greatest asset is its ability to guide a typical procurement user to take full advantage of the capabilities of sourcing optimization to prove transformative to procurement efforts — and change the basis of negotiation, price discovery and supplier engagement while improving both internal stakeholder and supplier relationships.
Spend Matters encourages all procurement organizations to learn about the potential of sourcing optimization approaches to improve supplier negotiations, stakeholder engagement, supplier relationships and event award decisions. Keelvar is an ideal vendor to “teach” the basics to procurement teams interested in learning about the concept, process and approach to sourcing optimization. Its ease of use, rapid deployment time and low cost make it the e-sourcing solution provider with the greatest chance of making sourcing optimization less of a novelty and more of a common toolset in private and public sector procurement organizations of all sizes.
For a more comprehensive analysis and guide for procurement organizations looking to understand whether they should consider adding the provider to their shortlists for consideration, please head over to Spend Matters Plus.