The Spend Analysis Category

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Procurement’s Spend Analytics Expertise is Untapped Strategic Lever for M&A success

Mergers and acquisitions provide a constant reminder of how business is always in flux and how executives need to meet the challenge of managing it. The first 100 days after a merger or acquisition often set the tone for the new entity and can influence long-term success. The environment is typically perfect for early procurement synergy capture, where when executed correctly, procurement optimization can improve EBITDA by an average of 10% to 30%, which is one reason why procurement is an untapped strategic lever for M&A. With effective spend analytics, organizations can better size up the savings based on the combined entities spend in key procurement categories and identify the commonality of suppliers across the merged entities and categories where spend is highly fragmented.

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Procurement Benchmarking in the Era of Big Data

Let’s be honest: most benchmark reports promise much but deliver little. They often start with good intentions but focus on high-level best practices or rely on survey questionnaires to gather their data. Benchmarks can take weeks or months to develop, and even then they are often discarded if they can’t give concrete action points to procurement. At the same time, we live in the era of big data. Perhaps you’ve heard that more data has been created in the last two years than all of the previous human history. As data becomes the oil of the fourth industrial revolution, why wouldn’t we put all this data into action?

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ROI, Today: Making the Near-Term Business Case for Spend Analytics

spend analytics

Most varieties of procurement software deliver some form of return on investment. Whether it’s an e-procurement system that consolidates process costs or a sourcing tool that optimizes supplier selection, successful vendors can always point to clear ways their solutions deliver value, both immediately and in the future. When it comes to spend analytics, however, demonstrating ROI has proven more elusive. This is because dedicated spend analysis tools are often viewed as enablers to saving money through other methods, rather than a benefit in their own right. Yet while it is true that spend analytics deliver value by illuminating new savings opportunities, these tools can also be used to obtain tangible wins in their own right.

These 3 Data Problems Could Be Draining Your Company’s Resources

Spend Matters welcomes this guest post from Brian Alster, global head of supply and compliance products at Dun & Bradstreet.

When you’re working on estimating the costs of your third-party relationships, the last thing you want to find are holes or inaccuracies in your data. It can leave you unable to make informed, data-driven decisions. This fear might explain why, according to Forrester research, almost a third of enterprise architects and chief data officers spend at least 40% of their time discerning the credibility of their data before using it to make critical decisions.

Simfoni: What Makes It Great (Spend Analytics SolutionMap Analysis)

Spend analytics tools that stagnate age quickly. But solution providers that listen to customers, practice agile software development and bring a deep knowledge of procurement can flank a large cross section of incumbents — quickly.

Simfoni, one of the top-ranked spend analytics software providers by both Analyst and Customer scoring in the Spend and Procurement Analytics SolutionMap, is a case in point. Founded in 2015, Simfoni delivers above-the-benchmark performance in numerous functional areas and is convincingly a Value Leader across all spend analytics buying personas. Join us in exploring what make Simfoni great, based on the latest functional and customer SolutionMap benchmarks from Q2 2018.

“What Makes It Great” is a recurring column that shares insights from each quarterly SolutionMap report for SolutionMap Insider Subscribers. Based on both our rigorous evaluation process and customer reference reviews, each brief explains how the provider excels and where it beats the SolutionMap benchmark, concluding with a checklist for ideal customer scenarios in which procurement, finance and supply chain organizations should consider the vendor.

Program Management: The Missing Link in Procurement Technology Modules and Suites (Part 5d — Analytics Components) [PRO]

data analytics

Analytics is an essential component of effective program management. All processes within procurement depend on analytics, and the more individual tasks become integral threads in a tapestry of activity, the greater the value that the analysis of data brings to an organization.

But obtaining such value requires a software platform that supports the program, which in turn requires certain functional components to be successful. In this installment of our ongoing series on program management, we define the analytics solution components needed to facilitate both initiative identification and initiative support.

Simfoni vs. SpendHQ: Spend Analysis Head-to-Head Technology Evaluation and Comparison

Simfoni and SpendHQ have both common and different DNA, particularly in how they originally built and delivered their spend analysis software.

Simfoni initially designed its spend analysis tool to enable the success of other consultancies delivering procurement and spend analytics. Similarly, SpendHQ was born out of Insight Sourcing Group, a consultancy itself.

Although in a matter of years Simfoni has evolved dramatically, it has remained true to its roots, delivering a spend analysis tool that serves both consultants working with end users and procurement organizations directly. And while ISG at first used SpendHQ as both an internal tool and as a leave-behind for procurement organizations, today SpendHQ operates as a standalone company, with a growth rate that is outpacing the market, making it one of the two largest — if not the largest — standalone spend analysis software providers.

Simfoni and SpendHQ have rarely encountered each other in the market to date, given Simfoni’s global focus and SpendHQ’s North America-centric orientation. Still, since both beat the average functional benchmark score in the Spend Matters Q2 2018 Spend and Procurement Analytics SolutionMap, we thought a comparison was in order. Because a collision course is inevitable at some point.

Join us in this unfiltered SolutionMap results analysis from our Q2 2018 dataset, along with the commentary of the Spend Matters analyst team. These Head-to-Head columns share the insights of each quarterly SolutionMap report for SolutionMap Insider Subscribers<, providing comparative cuts of SolutionMap benchmark data along with the trademark quips that Spend Matters was better known for in its early years. So buckle your seat belt, prepare for some real data and expect a few sparks to fly as we pit Simfoni and SpendHQ against each other in the spend analysis software evaluation ring.

Not yet an Insider member? Here’s a preview: In certain spend analysis categories — which include data layer, process support, technology, configurability and services — Simfoni convincingly comes out on top. But in others, it’s darn close, and in at least one area, SpendHQ delivers an unquestionably superior score.

Program Management: The Missing Link in Procurement Technology Modules and Suites (Part 5c — Analytics Examples) [PRO]

Analytics

Perhaps more so than any other category of procurement software, spend analysis tools, used either as a standalone product or as part of a broader procurement suite, succeed the most when they bring together visibility and insights in ways that helps users take action. That’s why we’re focusing on analytics as we continue our series on how procurement can support broader enterprise program management. In our last installment of this series, we dove into various spend and supply analytics that support key enterprise programs. Today’s installment explores six of those analytics areas and provides examples worthy of consideration.

Program Management: The Missing Link in Procurement Technology Modules and Suites (Part 5b — Example Analytics within Enterprise Programs) [PRO]

analytics

In the most recent installment of this series, we explored how program management is a foundational capability that supports business transformation through a closed loop performance management process. If you’re a procurement organization that is trying to drive change in increasingly diverse, complex and collaborative areas, you’ll need to:

  1. Coordinate that enterprise-driven change vis a vis program management
  2. Align with your stakeholders on where you’ll add value
  3. Plan for the change and what it mean to you, stakeholders, and suppliers
  4. Bring forth your digital enabled supply management capabilities
  5. Execute (and keep coordinating)
  6. Measure your progress and adjust
  7. Rinse and Repeat
And as you do all this, you’re going to need analytics to find opportunities, prioritize projects, launch projects/workflows, manage KPIs and set up processes that have embedded analytics that allow them to adjust to changing conditions and spot risks that threaten them. In this installment of our series on program management, we’ll:
  1. Detail the analytic categories and specific analytics based on the program management life cycle
  2. Map enterprise programs to supporting analytics
  3. Dive into some selected analytics use cases and required technology components
And of course this will all be with a supply-side focus.

Jaggaer Advantage vs. Ivalua: Spend Analysis Head-to-Head Technology Evaluation and Comparison

Jaggaer Advantage, formerly BravoSolution, has been known for many years for its spend analysis functional prowess. But Ivalua has been somewhat of a well-kept secret among spend analysis software vendors, since the provider has not often emphasized this module alone, on a product basis, distinct from its best-in-class source-to-pay suite. Both Jaggaer Advantage and Ivalua bring a unique set of capabilities to spend analysis and related procurement software areas. And both beat the average functional benchmark score in Spend Matters Q2 2018 Spend Analytics SolutionMap. But how do they stack up against each other in a head-to-head bout?

Join us in this unfiltered SolutionMap results analysis from our Q2 2018 dataset, along with the commentary of the Spend Matters analyst team. These Head-to-Head columns share the insights of each quarterly SolutionMap report for SolutionMap Insider Subscribers, providing unique comparative cuts of SolutionMap benchmark data along with the trademark quips that Spend Matters was better known for in its early years. So buckle your seat belt, prepare for some real data and expect a few sparks to fly as we pit Jaggaer Advantage and Ivalua against each other in the spend analysis evaluation ring.

Not yet an Insider member? Here’s a preview: In four out of seven spend analytics categories — which include data layer, process support, technology and services — Jaggaer Advantage comes out on top (sometimes convincingly so). But in three areas, Ivalua delivers superior performance. And as you peel the onion between the two on a subcategory basis, the use cases for when one is likely a better fit than the other becomes clearer.

Overall, the results suggest that the right solution will vary based on different organizational requirements. There’s no debate that spend analytics selection processes will reward procurement organizations that tailor provider selection to their specific needs.

Program Management: The Missing Link in Procurement Technology Modules and Suites (Part 5 — Analytics Strategy) [PRO]

Procurement doesn’t just drive value through “steady state” sourcing activities that pop up in the enterprise. It helps lead the transformation of the extended value chain and also supports and improves enterprise-level transformation activities. In both cases, such transformational activities will require strong supply analytics that procurement organizations are increasingly supporting through procurement centers of excellence where analytics and market intelligence (especially for sourcing processes) occupy the top functions within a procurement CoE (see more on the topic of procurement CoEs).

Any experienced procurement professional knows that business alignment is critical. This alignment process inevitably leads to a set of enterprise-led (or procurement-led) programs that in turn require a set of analytics capabilities to support. In this Spend Matters PRO analysis, we’ll share:

  • A DuPont-style enterprise value decomposition to nearly two dozen enterprise programs and support supply analytics areas
  • How to frame supply analytics within an overall close-loop performance improvement cycle — and examples within each step of the life cycle
  • A drill down into some of the top enterprise programs into the specific analytics required
  • A further drill down and set of examples in some of the most used analytics

Jaggaer Indirect vs. Sievo: Spend Analysis Head-to-Head Technology Evaluation and Comparison

The bar for spend analysis software has risen considerably in recent years. Thanks to higher expectations for overall function enablement, enhanced reporting, artificial intelligence-based classification capabilities, and even predictive and prescriptive capabilities, a spend analysis tool designed even a few years ago may not stand the test of time as well as it might have in the past.

This makes the comparison between Jaggaer Indirect and Sievo all the more interesting. The good news for procurement organizations considering both solutions is that they perform at or above the Q2 2018 Spend Analytics SolutionMap overall — and individually help set the benchmark standard for certain areas. But how do they stack up against each other in a head-to-head bout?

Join us in this unfiltered SolutionMap results analysis from our Q2 2018 dataset, along with the commentary of the Spend Matters analyst team. These “Head-to-Head” columns share the insights of each quarterly SolutionMap report for SolutionMap Insider Subscribers, providing unique comparative cuts of SolutionMap benchmark data along with the trademark quips that Spend Matters was better known for in its early years. So buckle your seat belt, prepare for some real data and expect a few sparks to fly as we pit Jaggaer Indirect against each other in the Spend analysis evaluation ring.

Not yet an Insider member? Here’s a preview: In most spend analytics categories — which include data layer, process support, technology and services — Sievo comes out on top (sometimes convincingly so). But in at least one area, Jaggaer delivers superior performance. And as you peel the onion between the two on a subcategory basis, the use cases for when one is likely a better fit than the other becomes clearer.