Author Archives: Jason Busch

About Jason Busch

Jason Busch is the founder and Managing Director of Azul Partners (a media, publishing and advisory firm with ownership and management interest in a range of ventures). He started Azul Partners in 2004 after leaving FreeMarkets. The firm now controls the largest and most influential set of B2B, procurement and supply chain media and research resources online, reaching millions of readers and members each year through diverse properties including: Spend Matters, Spend Matters Plus/PRO, Spend Matters UK/Europe, Spend Matters Netherlands, MetalMiner, Public Spend Forum, Trade Financing Matters and Healthcare Matters. He is also active as a partner in Spend Matters Group, an advisory firm, which works with companies and private funds on transactional advisory and due diligence in the procurement, finance and supply chain areas. Jason is known for his role in shaping (and shaking up) the analyst, media and technology industries. He spends most of his time working on new ventures, helping put together strategic investments and buyouts for companies & private funds, and of course, continuing to research, write about and lecture on procurement, finance and supple chain topics that capture his interest. Prior to Azul Partners and FreeMarkets, Jason worked in consulting and merchant banking. He holds undergraduate and graduate degrees from the University of Pennsylvania.

Looking at Supply Chain Risk Like an Insurance Provider: Do Business Here, Not There

It would be great to have a supply chain risk silver bullet that highlighted specific suppliers that present riskier prospects. That would be financial risk variables, broader supply chain exposure, political risk (of site/factory/host countries), and more. Short of this risk management panacea or expensive one-off analysis, the 2014 FM Global Resilience Index is a fascinating starting point, at least as it pertains to both country specific risk and the overall factors that contribute to supply chain risk.

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Looking at Supply Chain Risk Like an Insurance Provider: Evaluating Risk Elements

- July 17, 2014 9:39 AM | Categories: Supply Chain Management, Supply Risk

FM Global recently released their Global Resilience Index of countries covering supply chain risk elements associated with geographies. As they call it, the index is “an equally-weighted composite of nine core variables that affect business resilience to supply chain disruption.” In other words, the study is not just about supply chain risk itself, but the ability of countries (and organizations) to withstand the shock of supply chain risk.

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What Makes Public Sector Spend Analysis Different: Lessons From Spikes Cavell in the US and UK (Part 1)

- July 16, 2014 7:02 PM | Categories: Analytics, Public Sector, Solution Providers, Spend Analysis

Spikes Cavell, a spend visibility provider perhaps best known in the UK for serving public sector clients with a broad-based spend classification and analytics offering, has spent significant time and effort expanding on a growing beachhead in US public sector procurement at the state and local level. This research brief begins to explore the basics behind Spikes Cavell’s approach to public sector spend analysis and what makes serving this challenging sector of the market different. In this first of a two-part Spend Matters PRO series, Jason Busch, founder and managing director of Spend Matters, also examines what unique spend visibility approaches and attributes are useful and/or required depending on specific public sector dynamics, based on lessons from Spikes Cavell and other experts in public sector procurement – as well as private sector takeaways and lessons from these situational requirements.

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Physical and Financial Supply Chain Convergence: It’s Real But Harder Than It Looks

- July 16, 2014 10:32 AM | Categories: Innovation, Supply Chain Management, Trade Financing

My Trade Financing Matters colleague David Gustin has been talking quite a bit about the convergence of financial and physical supply chains. But there’s both hype and reality, as he points out in a post titled "The Hype of Physical and Financial Supply Chain Convergence." Still, the value of business networks that operate between companies in such scenarios is indisputable. And they’re becoming even more so as supply chains operate in a globalized context.

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Supply Chain Risk From an Insurance Provider’s Perspective: “The Shot Heard Round the World”

- July 15, 2014 10:26 AM | Categories: Commentary, Supply Chain Management, Supply Risk Management

I was recently at an analyst event for a software company and sat across the table at a breakfast with a technology researcher who covered the market for insurance companies. I asked the analyst, who had spent over 20 years in the industry, what it was like to look at solutions from an outsider’s perspective and what trends she sees as shaping the market. Almost on cue, the topic of discussion shifted from underwriting and claims management to that new topic of general procurement and finance interest: supply chain risk management. Given her generalist insurance background, I had no idea what to expect when I queried her on the subject, but what I heard back was as expert – or more – than anything I’ve heard from a non-insurance perspective.

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Contract Management and Manufacturing: On Industrial-Specific Use Cases for CLM

- July 14, 2014 10:30 AM | Categories: Contract Management, Supplier Management

Many questions we get regarding contract management suggests that most practitioners and consultants think of contract lifecycle management software as a somewhat generic set of capabilities that work across industries without significant tailoring, customization, or configuration. But in fact there are a number of specific use cases for manufacturing environments. And there are also more advanced use cases in manufacturing.

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Purchases: Of Urban Pride and Prejudice

- July 11, 2014 2:26 AM | Categories: Commentary

pizza on pavement For many years, the Gay Pride Parade in the heat of the summer marked the culmination of this openness. People of various backgrounds and orientations could be seen cheering on the parade as it worked its way down the local street. Everyone was respectful (granted, there are some outfits – or lack thereof in certain spots – that I’d rather my children not see). But the respect extended to being respectful of the neighborhood, including cleaning up one’s beer cans and vodka bottles after the party. In recent years, however, the Pride parade has marked an opportunity for every manner of troublemaker to trash Lakeview, leaving garbage and pavement pizza (no, not the literal kind) for all to see and be nauseated by for days after the event.

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GTCR & Opus Global Buy Hiperos: Consolidation Begins in Supplier Management Solution Market (Part 1)

- July 10, 2014 3:23 PM | Categories: M&A, Solution Providers, Supplier Management

Marketing can have a funny influence on things. Hiperos labels what it enables as “third party management” rather than “supplier management” or “supplier lifecycle management.” But make no mistake. This is a play with words by a clever marketing department and doesn’t mean a different core value proposition. (We think this comes from a sales focus on finance rather than procurement; to the CFO it’s all a bunch of third parties and compliance, and finance just can’t be bothered with terms like suppliers.) When GTCR and Opus Global acquired Hiperos earlier this week and not only kept the current management (one of whom is a major investor) actively engaged in the business but also put them on the broader holding company’s board, they were making a bet on the need to better manage traditional indirect suppliers, staffing companies, consultants, BPOs, and others who serve customers in a contracted way – in their case, typically large financial services clients. In many cases, Hiperos led with a “meet the [fill in the blank] regulatory requirement” value proposition – a message that works, especially for a finance audience.

But what Hiperos and its competitors (Aravo, HICX, IBM/Emptoris, Lavante, Oracle, SAP, and many others) are capable of accomplishing in the sector far transcends simply meeting check-the-box regulations. Done right, the better engagement of suppliers across a lifecycle is a massive undertaking, as it starts with a tailored onboarding process (don’t count on your P2P or e-invoicing provider to touch more than a few bases in this area) and carries through to supplier engagement, performance management, development, risk management and eventually off-boarding (by PO, assignment or overall) at both the SKU and overall vendor level. And it’s an undertaking that can transform procurement and finance outcomes spanning all non-employee resources and T&E-related spending (which represents a massive portion of the business). For this and related reasons, we believe that in 2015 (and perhaps sooner) we will see more consolidation in this market. In this three-part Spend Matters Plus research series, VP of Research Thomas Kase and Managing Director Jason Busch consider the backdrop and rationale behind the expected consolidation and offer predictions for what moves to watch. Our analysis today begins with why this market is becoming more strategic to customers.

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The Role of Rhetoric in Supplier Negotiation: A Rebuttal

- July 10, 2014 6:32 AM | Categories: Commentary

I usually don’t find myself so vehemently disagreeing with an essay than I did with an article published in Inside Supply Management from spring, titled “Creating Negotiating Excellence.” The author, a procurement practitioner at a financial services firm, makes the case for creating negotiating centers of excellence (not a bad idea on face value, mind you). But the argument she makes in favor of it speaks to a view of supply chain that I think misses the point in terms of what can make good negotiations truly great.

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Purchase Price Variance (PPV) in Procurement and Savings Strategy: Limitations and One Potential Use

There are many reasons why purchase price variance (PPV) is not the best metric to track procurement performance. In last week’s Spend Matters PRO research brief, Why Purchase Price Variance (PPV) Should Be Banished From Procurement Measurements and KPIs, Jason Busch (Managing Director) and Pierre Mitchell (Chief Research Officer) gave 10 reasons why PPV can be misleading and how smart procurement organizations in the market have long since moved past it. These reasons include the fact that declining and rising cost variables outside of a buyer’s control can have a significant effect on individual part costs not reflected in the actual performance of a procurement manager and the fact that PPV fails to measure true lifecycle costs. In today’s Spend Matters PRO research brief, Jason and Pierre start by providing a summary of the first analysis and then explore a scenario where PPV may actually be a useful means of measurement, courtesy of Tungsten’s new network analytics capability.

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Using Contract Management to Build Third-Party Visibility and Manage Supply Risk

- July 9, 2014 10:29 AM | Categories: Contract Management, Supply Risk Management

Many organizations implement contract management solutions to create efficiencies in the contract authoring and implementation process while also reducing risk. Others use contract management as a means to drive compliance and notify stakeholders of opportunities to take action (rebates, timing of sourcing events, etc.). But going beyond these areas, contract management technology can also play a key role in tracking suppliers and other third parties, as well as help manage supply risk.

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Hiperos Acquired by GTCR and Opus Global Holdings: Analysis and Implications

- July 8, 2014 12:30 PM | Categories: Breaking News, M&A, Supplier Management, Technology

Earlier today, GTCR and Opus Global Holdings collectively announced they had acquired Hiperos, the supplier (and other third-party) management vendor. Hiperos is originally a supplier performance management (SPM) focused provider from Southborough, Mass. It has since expanded to deliver a broad range of third-party data collection and supplier lifecycle management solutions – and will now operate as a business unit under Opus Global. Opus Global in turn is a JV between GTCR (a private equity firm from Chicago) and Doug Bergeron. Bergeron was until 2013 the CEO of VeriFone and is now the CEO of Opus Global. GTCR and Bergeron go back to VeriFone – which Bergeron (together with another investor) had bought from HP for pennies on the dollar ($50 million for an asset which HP has paid $1.3 billion). When Bergeron resigned after 12 years as CEO, the company had a market valuation of $3.5 billion. (We thought Bergeron’s long-term ownership and patient growth focus background is important to note.) Note also that Bergeron’s background is from the financial services industry – where Hiperos has a strong presence. In this Spend Matters PRO analysis, VP of Research Thomas Kase and Managing Director Jason Busch take a closer look at Hiperos (including a detailed SWOT analysis), private equity/buyout implications, the prospects for the supplier and third-party management market, and what the acquisition means for customers, prospects, and competitors.

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