Author Archives: Pierre Mitchell



About Pierre Mitchell

Pierre leads Spend Matters procurement research activities and has broader solution development responsibilities for intellectual property creation and firm strategy as Managing Director of Azul Partners. This includes spearheading efforts to build new types of interactive and social communities of interest within the procurement profession including overseeing the evolution of spendmattersnet.com, Spend Matters PRO, MetalMiner, and other digital assets within Azul Partner’s umbrella. Pierre has 25 years of procurement and supply chain industry and consulting experience, and is a recognized procurement expert specializing in supply processes, practices, metrics, and enabling tools and services. He is a regular contributor to business publications, a frequent presenter at industry events around the world, and counts himself fortunate to have served and interacted with so many CPOs and future CPOs. Prior to his positions in research and advisory, he led numerous operations and systems transformations at Fortune 500 organizations. Industry positions include manufacturing project manager at The Timberland Company, materials manager at Krupp Companies and engineer at EG&G Torque Systems. He holds an engineering degree from Southern Methodist University and an MBA from the University of Chicago. In the early 2000's, Pierre was the first supply chain practitioner to become a procurement "industry analyst" as the VP of supply management research at AMR Research (now part of the Gartner Group) where he provided trusted counsel to procurement executives, business leadership, IT, and the solution providers who serve them. Most recently, he was the head of procurement research and adjunct business advisor at The Hackett Group, where he helped expand Hackett's procurement benchmarks and research studies while growing the Procurement Executive Advisory Program into a gold standard membership-based procurement advisory service in the market today.


E-Procurement 2018 Trends and Forecast (Part 2: Provider Analysis)

The pace of change in the e-procurement market is moving faster than a speeding cXML document flying across the internet. Software vendors are innovating more quickly than ever before; solutions are no longer are just “software” but come preloaded with a dizzying array of additional items that are difficult to compare on an apples-to-apples basis; and customers are coming in smarter both in “new” and “replacement” deals, with greater expectations from provider solutions than ever before, especially the rate at which they’ll begin to realize benefits.

Today we publish the second installment of our 2108 procurement technology trend and forecast series, focusing on solution provider trends and priorities within e-procurement market. Part 2 of this series provides an analysis and exploration of two provider trend areas: continued M&A consolidation expectations in the e-procurement market (fasten your seat belt on this one) and rising procure-to-pay (P2P) and business-to-business (B2B) intersections, including a quantitative look at the rise, definition and size of B2B e-commerce today. Following today’s analysis, the final installment in this series will feature three additional trends and conclude with our 2018 e-procurement market forecast.

So without further adieu, let’s introduce some controversy, data, practitioner recommendations and (hopefully) insight on the first and arguably the most important near-term provider trends Spend Matters is already seeing evidence of early in 2018.

Sourcing Head-to-Head Technology Evaluation and Comparison: Coupa and Jaggaer (BravoSolution)

When it comes to functional capability, BravoSolution (now Jaggaer) and Coupa are the two providers to beat.

Jaggaer’s sourcing strengths should come as no surprise to those familiar with its history. Coupa’s rapid e-sourcing ascent, however, will surprise many. It went from laggard to leader in the sourcing technology sector when the ink dried on its agreement to acquire Trade Extensions. Regardless, both providers excel on a functional basis and lead in many of the buying personas for our Q4 2017 SolutionMap.

But are they the right fit for your organization?

Join us as we put on the gloves and pit Coupa and Jaggaer “head-to-head” in the Spend Matters evaluation ring. We’ll start by providing a technology summary comparative rating of each provider and then explore business requirements and scenarios, calling out the winner in each match up. If you’re considering either vendor or other sourcing competitors, look no further for an evaluation and comparison you can’t get anywhere else. This is the first in a series of “head-to-head” evaluations based on our SolutionMap data, and more matchups will follow as additional providers step into the ring and seats to these SolutionMap subscriber-specific events become available (in addition to our usual vendor deep dives on Spend Matters PRO, of course). Stay tuned!

E-Procurement 2018 Trends and Forecast (Part 1: Customers Adoption and Priorities)

e-procurement market outlook

You know what they say about predictions? They’re about as common as opinions: everyone has one. This Spend Matters PRO series walks through the trends we are seeing unfold in the market today based on our technology analysis and practitioner research and engagement. So let’s not predict; let’s share and analyze.

Today, we start our 2018 procurement technology trend and forecast series, beginning with customer adoption trends and priorities within the e-procurement market. We’ll explore what customers are valuing most from a selection and deployment perspective in 2018, as well as early trends that are sprouting.

In the second installment of this series, we’ll offer insight into e-procurement technology provider trends and strategies of note, and ask whether these are a good thing for customers (and if not, our recommendations for customers to mitigate risks). We’ll also share our comparative market growth (and sizing) estimates for 2018 compared with last year.

Program Management: The Missing Link in Procurement Technology Modules and Suites (Part 2 — Functional Building Blocks)

Program management is an integral component of source-to-pay (S2P) activities that is no longer optional for high-performing procurement organizations. In short, program management is a set of processes that manage specific projects and broader project portfolios that focus on higher-level processes and composite processes that cross the traditional linear flow of sourcing, contracting, purchasing and payments. These programs can be ancillary to core processes (e.g., M&A-related activities or globalization efforts) or transformational in nature to implement enterprise-level programs (e.g., working capital programs, risk programs, sustainability programs, digital programs, ERP upgrade programs, Lean/Six Sigma programs).

The problem is that, generally, program management is poorly automated and stovepiped within functions or subfunctions. Within procurement, there may be savings tracking for strategic sourcing processes displayed in a "CPO dashboard” but not much visibility and collaboration beyond that. This is a problem because as procurement is collaborating with stakeholders on ever broader processes and reaching deeper into stakeholder processes, supplier processes and external customer processes, there needs to be a cross-functional management capability. The emergence of collaboration tools like Slack and others have shown the enterprise desire to manage fast-paced mobile communication on the ground that is tied back to strategic objectives.

This Spend Matters PRO series defines what effective program management capabilities are from a design, platform and functional perspective that puts the user first. We explore both what represents best-in-class program management components today, what users should expect tomorrow and what we hope technology providers have on their roadmaps to build. We also explore some solution building blocks for effective program management, including best-of-breed project management, goal management, program auditing/audit trails and prepackaged initiative enablement. (Don’t forget to read Part 1 of this series to first understand the design principles on which effective program management technology is based.)

Unlocking Deeper Value in the Procurement and Finance Relationship (Part 1)

finance

Much has been written about the need for procurement and finance organizations to better align with each other, in particular how the two functions can best integrate purchasing and payables into an end-to-end purchase-to-pay (P2P) process. The opportunity for aligning these two functions, however, is much greater than simply improving transaction efficiency. Unfortunately, the various sources of misalignment that plague procurement and finance prevent many businesses from identifying these opportunities in the first place.

The sad part of this story is that the two functions share many common traits. Both seek to:

  • Elevate their value propositions as enabling business partners by providing compelling service offerings — and overcome their perception as bureaucratic corporate overlords
  • Maximize enterprise value and profitable growth through disciplined spend management
  • Spend not just less but better in terms of process efficiency and process effectiveness
  • Use new techniques and technologies to help the business make better decisions that support the above goals
Additionally, these functions should in theory strive to serve each other as internal customers while also enabling the other to deliver higher value to their own internal (and external) customers. Unfortunately, theory has rarely translated into reality, and the result is that each function is leaving money (and risk) on the table.

Procurement can certainly help finance get more value from its suppliers, but it can also help finance improve service delivery in areas such as FP&A, treasury, tax, financial accounting, risk and compliance, commodity management and even accounts payable.

On the flipside, finance can help procurement in multiple ways, namely to help procurement on value-adding activities — including helping finance. This is a classic “help me, help you” moment. If procurement can help finance help procurement (and help finance help itself), then procurement’s value potential can be truly unlocked.

Program Management: The Missing Link in Procurement Technology Modules and Suites (Part 1 — Design Building Blocks)

ux

This Spend Matters PRO series provides insight into what constitutes effective program management capabilities from design, platform and functional perspectives. We explore both what represents best-in-class program management components today and what users should expect tomorrow, including what we hope technology providers have on their roadmaps to build.

Part 1 of this series provides insight into the platform-level building blocks of effective program management capability, exploring user design as a central consideration of an effective system. User experience is critical to the acceptance and adoption of any source-to-pay (S2P) module and suite. Why? Without adoption and acceptance, there are no benefits, and the promised ROI will never materialize if the solution is not adopted by those that need to use it for the platform to work.

But maximizing user adoption is easier said than done. Users want a good experience when interacting with procurement technology. They expect not only the intuitiveness and ease of use of modern web-based platforms that they use to research products and buy in their everyday lives but also an ease of use that actually makes their job easier and more efficient. This is not what one typically achieved from an S2P platform designed in the ERP era, where green-screen workflows were often adapted as is to the GUI interface that came native with the advent of the world wide web.

This is one reason effective program management was rarely adopted, even when featured, in earlier-generation procurement technology solutions. And it’s why we’re going to tackle this subject first as our series begins.

20 Questions to Ask Stakeholders Before Implementing Your New Procurement System

Implementing new procurement technology is like implementing anything. There is a ton of change management involved, and if you don't get stakeholder input upfront, you are asking for trouble. This is especially true with modern procurement systems that can enable new practices on process redesigns that may be disruptive to the status quo. So, you need to get input from a myriad of stakeholders:

  • C-level versus lowest-level end users
  • Procurement users versus internal stakeholders and supplier stakeholders
  • Functional partners such as IT and finance who are “special” stakeholders because they are both spend owners and have a key role in the overall implementation
  • Visionary stakeholders looking to drive change versus stakeholders just wanting to keep their jobs and keeping efforts to a minimum
But what questions should you ask your stakeholders? Fear not. We have written a list of 20 key questions for you to consider.

You may be in procurement. Or you may be in IT. Or you can be a technology provider or consultant. Regardless, these 20 questions will help you tease out key requirements, intelligence and downstream barriers that you want to identify as early as possible. Just as spend influence is best done as early as possible, spend management transformation is also best informed as early as possible.

No More Ariba Network Prisoners: 75,000 Suppliers (and Counting) are Transacting for Free

Procurement transformation is usually about incrementalism. For a function that’s fairly conservative — and stands to lose more by making individual mistakes than it stands to gain from individual successes — this is a reasonable approach. But sometimes step changes happen fast. And sometimes, it happens with suppliers to procurement organizations, too. The rapid rise of Amazon Business has been one of these changes, whether that’s perceived as good or bad. But for SAP Ariba customers, another one on the same order of magnitude in the past 12 months has been the adoption of suppliers transacting with free accounts.

Unpacking the Digital Transformation Buzz in Procurement: A Framework to Consider

I had a large energy firm ask me about my thoughts recently on “digital transformation” and “digital business strategies,” given that senior management was looking to keep up with the Joneses and get a digital strategy in place. I jokingly mentioned that they probably had multiple management consulting firms trawling through their hallways looking to sell a digital strategy and transformation project. They laughed and said the consultants were indeed already clamoring to do this work.

Don’t get me wrong: having a c-level initiative du jour can be a powerful force to use for “organizational judo” within procurement. It’s the proverbial burning platform (or at least smoking platform) that can be used to light a fire and drive some change. The “digital” phenomenon is replete with buzzword phrases right now, and that’s a shame, because the impact of new digital technologies — and the new processes, strategies and operating models that they enable — can have a profound effect on procurement and the stakeholders it serves.

So before you go hiring that big consulting firm, you may want to read this “dummy’s guide” to procurement digital transformation. I’ll introduce a graphical framework and then unpack the drivers to explain how procurement can use these issues to make all of this digital stuff real. There are a few dozen specific trends and associated capabilities in play, and although not all of them will be in force for you, it’s worthwhile to work through and see which ones are most relevant and hold the most opportunity.

10 Questions Jaggaer’s Acquisition of BravoSolution Should Raise for Customers and the Market (Part 2)

Jaggaer’s acquisition of BravoSolution raises a number of questions for customers and partners regarding the broader strategy that Jaggaer and its owner, Accel-KKR, appear to be following in the market. In the second installment of this research brief, we pose five more questions customers, prospects and partners should consider as they explore the combination and what it means for them. (See questions one through five here.) These questions center on Jaggaer’s solution gaps that will remain following the acquisition of BravoSolution, whether the verticalization of procurement technology solutions matters, what it will take to enable a “super suite,” specific procure-to-pay (P2P) considerations and whether the transaction might trigger other acquisitions in the sector.

10 Questions Jaggaer’s Acquisition of BravoSolution Should Raise for Customers and the Market (Part 1)

This Spend Matters PRO Research Note asks 10 questions that Jaggaer and BravoSolution customers and partners should consider asking as informed “consumers” of this combination. These questions cover both the recently announced acquisition of BravoSolution by Jaggaer and general considerations based on Jaggaer and Accel-KKR’s business strategy as we see it. Part 1 of this research brief covers questions one through five, while Part 2 covers questions six through 10:

  1. What is a roll-up, what benefits does it bring and why is Jaggaer following this strategy?
  2. What did Jaggaer see in BravoSolution? And why does this matter for BravoSolution customers?
  3. Will the strategy that Jaggaer and Accel-KKR appear to be pursuing end up being a net positive for customers?
  4. How did BravoSolution operate before (e.g., regional managers and “postponement” of solution delivery approaches at the local level) and how might this acquisition change its previous approach?
  5. Is there advantage in size alone?
  6. What gaps will remain in Jaggaer’s portfolio following the closure of the transaction?
  7. Will verticalization (industry-based approaches) to procurement technology end up being more about marketing or more about product?
  8. What is a “super suite” as claimed in the announcement of the combination?
  9. What might happen to Jaggaer and BravoSolution’s individual procure-to-pay solutions as a result of the combination?
  10. Will this transaction trigger other acquisitions in the sector? And what does this mean for customers of other solutions?

A Different Sort of Influence: 16 Areas Where Supplier Management Can Help Engage Your Stakeholders Strategically (Part 1)

Supplier management is too often an afterthought in the eyes of procurement and its stakeholders. Yes, it's important to collect supplier qualification information through the sourcing and onboarding process, and then also monitor the suppliers against their contracts to get what you paid for and to reduce supply risk. But shouldn’t there be more to supplier management?

Progressive organizations are beginning to use supplier management (and third-party management more broadly) as a better overall governance structure for how to best externalize the enterprise. This is especially true as supply markets get digitized (and disrupted) and supplier innovation can be brought to bear beyond cost/spend savings.

“Innovation management” is indeed one of the areas where a supplier management approach can help procurement influence stakeholders, but there are 15 other ways, as well. Having a broader palette of value creation (for which we’ll discuss six major value streams) will not only help improve spend influence but also improve the quality of influence to help elevate procurement’s value proposition.