Sourcing Content

AI in Supplier Discovery: Tomorrow [PRO]

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In Spend Matters’ last PRO article for the AI in Supplier Discovery series, we overviewed some situations where you can find it today, or at least functionality that looked like it was enabled by artificial intelligence (even if it was not), and set ourselves up for a discussion of true AI that is going to creep into supplier discovery platforms tomorrow.

However, when we say true AI, we mean the definition of AI as “assisted intelligence,” because there is no true artificial intelligence out there and probably won't be for a very long time (with some futurists conjecturing it will be 2060 before machines are as smart as the dumbest of us). Note that we don't even mean “augmented intelligence,” as even though the platforms will augment your knowledge, it will still be up to you to make the right, intelligent, decisions tomorrow. (And maybe the day after that, but that is a subject for our next article.)

In our last article, we reviewed the capabilities of the leading discovery platforms today, which mainly revolved around:

  • Smart search
  • Community intelligence

...and the intersection of both.

We discussed how the improvements in computing power and web-usability made it possible for platforms to implement better and more powerful search algorithms that actually made searches useful across wide supplier directories and networks; how community intelligence allowed an organization to quickly narrow potential supplier pools down to reasonable sizes; and how the intersection allowed for the definition of "like" searches that could not be done before now.

But as of today, those "like" searches are still pretty high level. And they are best at finding suppliers that provide finished products and services that can be well-defined and compared to other suppliers that provide similar finished products and services. In fact, most systems with "like" searches are for the identification of suppliers for indirect. Not direct. (And not services either.)

But that is going to change tomorrow. Tomorrow, supplier discovery systems are going to support:

  • deep capability match that uses bill of materials, production requirements and other deep factors to support supplier search for direct suppliers
  • resource capability match that can identify needed skill sets, knowledge and related attributes for services suppliers

And we'll finally have smart supplier search for all. But how will it happen? And what will it look like? Let's explore.

Sourcing Optimization Should Be Accessible, Flexible: The Case for Rethinking a Misapplied Technology

Sourcing optimization can and should be applied more broadly to a variety of sourcing scenarios, bringing a simpler approach and guided exploration — designed with the everyday sourcing user in mind. With the value it can bring to categories and customers alike, why should sourcing optimization remain out of reach beyond the most complex logistics bids?

To understand how this situation arose, it helps to consider the rationale behind how first-generation sourcing optimization solutions were designed.

K2 Sourcing: Vendor Introduction, Analysis and SWOT [PRO]

The history of e-sourcing software stretches back to before the dot-com bubble burst, yet few of the original providers of RFX and auction management tools exist today as they did at their inception.

Some were bought and consolidated into the mega organizations we know today (e.g., SAP Ariba, which acquired FreeMarkets and Procuri), while others have slowly drifted into oblivion (RIP Emptoris). The result is that, with a few notable exceptions, procurement organizations today have few choices for standalone providers of e-sourcing tools.

One of those remaining options is K2 Sourcing, a provider of RFX and auction management software that has quietly served mid-market procurement organizations since 2003. Based in the Milwaukee area, K2 grew out of its founder’s frustrations as a procurement professional with the RFX and reverse auction platforms available then.

The young provider set out with one of the first cloud-based solutions in the space with a goal to “create the fastest, easiest and most transparent method for buyers to screen and select suppliers.” And while a lot has changed in the procurement and technology worlds in the past 16 years, K2 has managed, through a combined offering of subscription software and supporting sourcing services engagements, to build a stable and respectable client base, counting brands as varied as Verifone, Lozier Corp., Big Lots, Milwaukee Tool, Tempur Sealy, Kaiser Permanente and others.

This Spend Matters PRO Vendor Introduction offers a candid take on K2 Sourcing and its capabilities. The brief includes an overview of K2 Sourcing’s offering, a breakdown of what is comparatively good (and not so good) about the solution, a SWOT analysis and a selection requirements checklist for companies that might consider the provider.

WPS Management (Wescale): Vendor Snapshot (Part 3) — Summary and Competitive Analysis  [PRO]

Procurement organizations today don’t have to do a lot of legwork to build an initial shortlist for choosing an e-procurement or procure-to-pay solution. A Google search will return dozens of companies vying for your business, and the Spend Matters SolutionMaps for E-Procurement and Procure-to-Pay Suites make the process even simpler, rating top providers of these solutions against specific organizational requirements based on buyer demographics and psychographics.

Figuring out the differences between all of these choices, however, is easier said than done.

One of the key ways procurement organizations can do this is by understanding what type of market a vendor seeks to address. Although in concept the potential market a vendor is targeting could appear similar to how others position their solutions, the reality is that each provider is unique in terms of their best-fit customers, their capabilities and the technological foundations of their platform.

This is especially true of Wescale, which provides P2P functionality fit for a variety of businesses through an open business integration platform approach (PaaS, or platform as a service) not commonly seen from e-procurement or P2P providers in the North American market. For that matter, Berlin-based Wescale is not commonly seen outside of Europe — but to the detriment of potential U.S. and global customers that might overlook it due to its primary geographic focus.

This third and final installment of this Spend Matters Vendor Snapshot covering Wescale, the branded name for WPS Management, includes an objective SWOT analysis of the provider and offers a competitive segmentation analysis and comparison. It also has a recommended shortlist of candidates as substitute providers to Wescale as well as provider-selection guidance. Finally, it offers a summary analysis and recommendations for companies that can best take advantage of Wescale’s capabilities.

Part 1 of this series provided an in-depth look at Wescale as a company and its specific solutions, and Part 2 gave a detailed analysis of its solution strengths and weaknesses as well as a review of the user experience.

3 More Ways Procurement Can Transform with CRM

Spend Matters welcomes this guest post from Sean Harley, co-founder and CEO of LUPR.

In his recent Spend Matters post, Stan Garber described how sales organizations have leveraged customer relationship management (CRM) platforms from providers like Salesforce to achieve higher levels of success. We would like to suggest three more features of CRM that are transformative for supply management.

AI in Supplier Discovery: Today [PRO]

With this briefing on supplier discovery, we continue our series on AI in various source-to-pay technologies, which we started with AI in Procurement (Today Part 1 and Part 2, Tomorrow Part 1, Part 2 and Part 3, and The Day After Tomorrow) and continued with our recent series on AI in Sourcing (Today, Tomorrow Part 1 and Part 2, and The Day After Tomorrow) and AI in Sourcing Optimization (Today, Tomorrow and The Day After Tomorrow Part 1 and Part 2). The goal of this series is to define what is available with AI today, what will be possible tomorrow, and where the future may take us.

But first we must remind you of the status quo: Artificial intelligence does not yet exist, in the strictest definition of the term.

However, if you define AI as "assisted intelligence" (systems that can automate repetitive and standardized tasks performed by humans) or "augmented intelligence" (systems that can learn from humans and their data to provide insights that lead to, or recommend, better decisions), then there are technologies out there today that meet that need.

Today, the mainstream applications of AI in supplier discovery (which are, sadly, few and far between) generally fall into two categories, which themselves have limited functionality, but, there is still some functionality and it is a beginning.

Zycus: A Comparative Analysis of the S2P Suite (Source-to-Pay SolutionMap Analysis)

Zycus is part of an exclusive club.

It is one of the few source-to-pay suite vendors on the market that can offer at least adequate functional support across all six modular areas that Spend Matters tracks for S2P using only its internally developed capabilities. This stands in contrast to several of its biggest competitors, which have to varying degrees of success acquired and integrated best-in-class vendors or other suites to bolster their own capabilities.

And while Zycus cannot today claim its technology runs its suite of applications on a single data model, more than 95% of the solution is unified, and when compared against the market, it generally presents broad-based and out-of-the-box capability. Its solutions not only provide strong baseline (sometimes above-the-benchmark) functionality but they come from a single provider that is responsible for making it all work together.

This Spend Matters SolutionMap analysis examines Zycus’ solutions by modular and suite view to help interested parties understand the best components that make up the vendor’s end-to-end offering. It provides insight into which areas Zycus is strong in (and where it lags), how competitive individual modules are compared with best-in-class alternatives, and how combinations in the form of procure-to-pay (P2P), strategic procurement technology (SPT) and source-to-pay (S2P) suites stack up in comparison to Zycus’ broader peer group, including Coupa, Jaggaer, SAP Ariba, Ivalua and SynerTrade.

For this analysis, our report uses the aggregate results of nine SolutionMaps from Q4 2018 (the most recent in our quarterly update cycle), comparing a total of 58 solution providers across more than 600 granular functional benchmarks, which are aggregated into more manageable, tiered buckets for the purpose of this analysis. (Those procurement organizations leveraging SolutionMap for a software selection process gain insight into comparative performance at a significantly more granular level of detail that maps business requirements to functional performance.) The SolutionMap analyst ratings, also called the Solution scoring, used in this analysis are based on more than 3,000 hours of live product demonstrations and validated vendor RFI responses.

In subsequent briefs exploring SynerTrade and others, we will take a similar approach to analyzing source-to-pay providers, breaking down where end-to-end platforms excel (or fall below the functional benchmark) on module and suite bases. Previously, we covered the suite performances of Jaggaer, SAP Ariba, Ivalua and Coupa.

Sourcing and Engaging the Independent/Freelance Workforce — An Emerging Ecosystem? (Part 3) [PRO]

The overarching question motivating this five-part Spend Matters PRO series is one posed to practitioners: “As a services procurement manager, should I be paying more attention — maybe even taking action on — the independent contract workforce, or ICW, as a supply of skills/expertise?”

In Part 1 of this series, we examined if measures of size and growth of the ICW population provided a clear basis for answering this question and found that, at least in our opinion, it did not (see Part 1).

We also proposed that, in addition to monitoring demand within one’s organization (something not adequately done by most procurement organizations), the extent to which a new ICW ecosystem is emerging could also provide some basis for answering the question. We also proposed looking separately at the extent to which an ecosystem has been forming to:

  • Provide enterprises with the required capabilities to source, manage and maximize the value of this independent/freelance population (Parts 2 and 3 of this series)
  • Provide independent/freelance workers with the access to the opportunity pathways and the support/services they require to function as viable “operators.” (Part 4 of this series)
Starting in Part 2, we began looking at the formation of an ecosystem enabling organizations’ usage of (source, engage, manage and pay) independent/freelance workforce. In Part 2, we reviewed findings from a recent panel survey of CW/S solution provider executives which suggested that a new ICW ecosystem has been taking shape recently. When asked this: “Over the past three years, have you seen the emergence of new digitally-integratable, configurable ecosystem(s) of solution and service providers focused on enabling organizations and independent workforce on the demand and the supply sides?” over 80% of respondents answered “Yes, to some extent,” while none answered “No , I haven't seen that happening.”

In this third part of the series, we will continue this same assessment of an emerging ecosystem enabling organizations usage of ICWs , but dissecting it at the category and provider level.

In Part 4, we will provide a similar assessment, but from the standpoint of how ICWs are enabled/supported to function as viable operators. In Part 5, we will synthesize the findings and offer recommendations for services procurement practitioners and senior executives.

Comparing S2P Procurement Technology Suites on a Functional Basis: Coupa, Ivalua, Jaggaer and SAP Ariba

Now more than ever, better choices exist at the top end of the market for source-to-pay technology suites. When it comes to overall suite functional performance in the Q4 2018 SolutionMap, a handful of suite vendors tend to stand out from the overall pack, often for very different reasons. Four of the top performing S2P suite vendors in the Q4 SolutionMap functional benchmark are Coupa, Ivalua, Jaggaer and SAP Ariba. But how do they compare to the overall SolutionMap source-to-pay benchmark dataset? You can find out here in our coverage, which will include Determine, SynerTrade and Zycus.

Sponsored Article

Rethinking the RFP Process for Public Procurement Systems

When procuring an e-procurement system for public spend, one could argue that the complexities and differentiated requirements always call for a competitive RFP process. The problem is that some state and local governments are tight on resources or unclear on which requirements to include in the solicitation, so they outsource the market research and RFP development processes for e-procurement buys to consultants who, in turn, do one of two things. But both outcomes put agencies at an automatic disadvantage.

Fairmarkit: Vendor Introduction, Analysis and SWOT (Part 2) — Summary and Competitive Analysis [PRO]

The question of how to manage tail spend is as much a philosophical question as a technical one. There are issues around the thresholds that define tail spend, challenges around rogue spend that creates the long tail and the ultimate decision about who should be responsible for taming the tail.

But for most procurement organizations, the tail spend discussion is left unexplored.

Instead, the status quo way of managing tail spend often reigns. It’s rarely effective, so you’re left with the problems: wasted time by procurement and non-procurement staff, long lists of unknown or untrusted vendors, no clean data or visibility into savings left on the table.

Challenging this status quo is what Fairmarkit, a provider of tail spend management software out of Boston, seeks to do with its RFQ and analytics solutions. But where does Fairmarkit fit compared with other sourcing and tail spend management providers in the procurement technology market, and what are its relative strengths and weaknesses compared with direct and indirect competitors?

This Spend Matters PRO Vendor Introduction offers a candid take on Fairmarkit and its capabilities. Part 1 of this brief provided an overview of Fairmarkit’s offering and a detailed solution tour. Part 2 includes a breakdown of what is comparatively good (and not so good) about the solution, a SWOT analysis and a competitive breakdown of other providers that a procurement organization might consider while evaluating Fairmarkit.

Coupa, Services and Coupa Contingent Workforce: A Progress Report (Part 2) [PRO]

In this two-part PRO series, Spend Matters provides a review and analysis of Coupa’s recent evolution in addressing the category of services spend, including Coupa Contingent Workforce. In Part 1, we provided an overview of where Coupa is at with the integration and leveraging of DCR Workforce.

First, we revisited the Coupa “services procurement” background/context leading up to the DCR acquisition last year. We also recounted our September 2018 briefing, in which Coupa discussed the acquisition and what to expect as far as integration (or “unification”) of the acquisition over the coming months. Additionally, we discussed what we learned from our most recent January 2019 briefing by Coupa on the current state of the integration.

Based on this analysis, we concluded that, six months in after the acquisition, Coupa’s integration at the organizational and product levels appeared to be on course. The priorities seemed reasonable even given the unique dynamics of the VMS market — and the plan, based on Coupa’s history of stamping out post-merger integrations, seemed on track.

But beyond this, what has happened to the DCR product under the Coupa umbrella? And how is it fitting into the changing world of services procurement — and potentially even help to shape it? In Part 2 of this research series, we will provide our own observations on where Coupa seems to be going, in terms of the contingent workforce technology solution segment and its increasing overlap with other procurement technology solutions.