For years, Coupa has explored the concepts of incorporating leveraged contracts into its arsenal (leveraged contracts provide pre-negotiated pricing and specified terms with select suppliers). Coupa’s own GPO program, positioned under the Coupa Advantage label, is finally real and has a number of active users and members. Earlier this week, Coupa’s GM Ashish Deshpande, who has spearheaded the effort from day 1, led a discussion with a number of Coupa customers who are already using leveraged contracts. This Spend Matters PRO analysis explores Coupa’s new leveraged contract program (including available contracts, suppliers, typical savings, business model and related topics) and strategy and explores what types of organizations should think about signing up for Coupa Advantage.
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In our previous Spend Matters main site coverage of Amazon Business and Part 1 of our Spend Matters PRO analysis, we dove into some of the details of Amazon’s re-vamped foray into B2B e-commerce, particularly regarding the user experience and Amazon’s selection and pricing features. In this next edition, we’ll dive into some of the marketplace solution functionality and some opportunities to close the key gaps. In the next installment, we’ll also analyze some of key opportunities we see for Amazon to improve its B2B solution for larger firms – and even form smaller ones, too! Many associate the term “solution” only with software applications, and while Amazon Business is initially basically a re-skinned version of Amazon.com, we expect to see more e-procurement-like functionality embedded in it to serve the needs of smaller firms where a large percentage of their spending could come from a provider like Amazon. For larger firms, the story is, of course, different as we’ll explain...
In our previous post on Amazon Business (an expansion of Amazon Supply), we discussed the basics of the new release and model in its current form. But, there’s much more to this story for procurement professionals – good and bad. After spending time with members of the Amazon team, and “reading through the tea leaves” from both these conversations and other sources, there are some critical factors to consider for buyers, sellers and technology partners when they “dance with the [Seattle] bear.” Some of these are specifically commercial, and others are more strategic (IP protection, for instance). We’ll also highlight some no-brainer short-term opportunities and some more strategic opportunities and issues. For example, Amazon Business is currently an e-marketplace and not an e-commerce platform that facilitates non-intermediated commerce. Yet that doesn’t mean Amazon couldn’t become a true “platform” intermediary leveraging the technical components of the IaaS and PaaS side of the company house. Such a scenario could be closer than many might think (e.g., consider Mechanical Turk in relation to emerging contingent work platforms or think about Amazon Home Services/TaskRabbit applied to fixed-fee B2B services). Anyway, I’m foreshadowing too much. Let’s get started and dive in. In the first part of this PRO research series, we’ll focus on selection, pricing and user experience as well as highlight 10 shortfalls (or “opportunities,” if you will) in the solution stack that warrant serious consideration.
Becoming a Smarter Services Customer – The Evolution of the Operations, Procurement and Sourcing Consulting Market (Part 3) [PRO]
In Part 3 of our series examining the evolution of operations, procurement and sourcing consulting, we turn our attention to maximizing value and becoming a smarter services customer. This topic is especially critical when practice utilization (percentage of hours billed as a percent of total available hours of employee bench capacity) is near all-time highs given the current market conditions where purse strings have been slightly loosened to execute the backlog of post-recession activities (e.g., ERP upgrade projects, procurement training, "souring wave n+1" activity, etc.). Previously in this series, Chief Research Officer Pierre Mitchell and Founder and Managing Director Jason Busch explored growth rates within firms, the battle for consulting talent, the rise of new practice areas as well as threats and opportunities for the sector.
The Evolution of the Operations, Procurement and Sourcing Consulting Market (Part 2 – Threats and Opportunities) [PRO]
The management consulting market for procurement, sourcing and related services has grown dramatically in the past 5 years (in the first installment in this series, we share our market growth analysis, along with key trends in 2014). But unlike the numbers, the news (beneath the surface) is not entirely positive. Granted, while from a practice revenue and growth perspective, it is difficult to argue with anything but the notion that we are living in the “best of times,” if you're an insider in the operations, procurement and sourcing consulting market, the actual 2015 reality brings with a number of threats as well. In this multi-part Spend Matters PRO series, Jason Busch and Pierre Mitchell consider the evolution of the operations and procurement consulting market and how clients can focus on getting the maximum value from their services partners. Today, they focus on threats and opportunities in the procurement consulting market for 2015 and beyond.
The Evolution of the Operations, Procurement and Sourcing Consulting Market (Part 1 – A High CAGR Is Potentially Misleading) [PRO]
If looked at from a superficial perspective, the procurement and sourcing consulting landscape looks similar to how it did 5 years ago. The firms that dominate the sector are largely the same. Boutiques also remain in the mix, but beneath the surface, there are highly significant changes that have been causing a material shift in the market. Large incumbents are acquiring niche provider and are now looking to build a broader spectrum of technology, managed services, integrated market intelligence, advanced analytics and defensible vertical capabilities to go on the offense. In this multi-part Spend Matters PRO series, Jason Busch and Pierre Mitchell consider the evolution of the operations and procurement consulting market and how clients can focus on gaining the maximum value from their services partners.
Part 1 of this analysis looked at the business need for the market-informed sourcing (MIS) approach and how it can take us past where regular sourcing suites break down. Part 2 of this PRO research brief by Vice President of Research Thomas Kase focuses on Trade Extensions and its offering in greater detail.
There’s a new strategic sourcing philosophy and capability on the market: market-informed sourcing. In this 2-part Spend Matters PRO research brief, Thomas Kase, vice president of research, explores the concept of market-informed sourcing and where it can take us – past where regular sourcing suites break down (even some of those with sourcing optimization). He also provides an in-depth look at one of the providers making market-informed sourcing a reality: Trade Extensions.
Earlier this month, Spend Matters published a story highlighting Auto News’ coverage of supply chain and procurement localization at Magna International. On the surface, supply chain localization seems simple – work with local suppliers in the areas where you do business globally. Supply chain localization is far from easy – in fact, its requirements and practices are often incongruous with some procurement and supply chain trends leading to greater centralization of efforts and management.
Moreover, without the right structure and design – not to mention technology – the supplier localization efforts can overwhelm individuals (e.g., category managers) tasked with global oversight of specific sourcing and related supplier management efforts.
So what enablers can procurement and supply chain organizations turn to as they move toward localization given this context? There's a bunch. Read the full post to find out what they are.
Sourcing in Latin America (with Mexico Focus): A Primer for U.S. and Canada Procurement Organizations [PRO]
Earlier today, Jason Busch, Spend Matters’ founder and managing director, and Xavier Olivera, director of Spend Matters Mexico and Latin America, conducted an “Ask the Expert” webinar titled Spend Matters en Español: The State of Procurement in Mexico and Latin America. Given the interest among both practitioners and providers in the U.S. in understanding priorities and how to do business in Mexico and neighboring countries most effectively, we decided to write a quick primer to showcase those items that companies should be considering as they develop their efforts in the region. For U.S. and Canadian organizations, the total cost equation is increasingly adding up for Mexico sourcing – and the ease of doing business is rising as well (aside from new regulations and compliance requirements for e-invoicing, which we will be exploring in more detail in a separate analysis).
Considering rising U.S. interest in nearshore sourcing, the timing could not be more perfect to launch a new site focusing on Latin America procurement and supply chain (Spend Matters will be launching this site in conjunction with Xavier in Sept/Oct 2014). Awareness and interest is at an all-time high among Latin American companies. Mexican organizations, in particular, are prioritizing efforts to get smart on tech solutions including analytics, P2P, and sourcing. This Spend Matters PRO research brief begins to explore top procurement priorities in the region and the state of solution adoption – as well as how to do business effectively with local suppliers and procurement organizations.
Many people refer to ERP systems (notably master data stored in them) as the “system of record," which is interesting terminology. Think about supplier master data entered in the buyer’s ERP system that immediately can become “stale” the moment it’s entered. Let’s even take a better example of the penultimate document of record between the trading parties: the contract. A buying organization can use a contract lifecycle management solution that is fully integrated with an e-sourcing solution and even Microsoft Word documents that can be used as the user interface of sorts in contract authoring. Data is tracked at a detailed data element level and built up from low-level clause libraries. Yet when it comes time to seal the deal, the buyer and supplier print the contract and then start scurrying around for the final signatures, usually hand-written and faxed, only to then be stored and scanned so that the document image can be attached back to the CLM/ERP system. In today's Spend Matters PRO research brief, Pierre Mitchell makes an argument for the need of systems to accommodate the data types and user types across the source-to-pay continuum.
Earlier this spring, Coupa provided a briefing and demonstrated a version of its latest inventory module to Spend Matters. Coupa sells its inventory module as an add-on to core procurement but separately from accounts payable, contracts management, and other suite components. But the question remains: in its initial release, does it provide enough value to justify the added cost and modular expansion for companies using other Coupa suite components?
After seeing it, Chief Research Officer Pierre Mitchell and Managing Director Jason Busch argue in this Spend Matters PRO research brief that Coupa’s new inventory management capabilities are likely to bring the company closer to marginalizing the expansion of an ERP value proposition in middle market deployments (but not necessarily a fit with larger customers who are likely to have more sophisticated processes than the tool can handle – let alone inventory management systems already in place).