Plus or PRO Content

Ivalua: Vendor Snapshot (Part 3) — Downstream Solution Overview [PRO]

supplier network

Ivalua has been growing steadily since Spend Matters’ comprehensive update in 2016, with the suite provider adding clients, offices, employees and capability around the globe. After we provided an updated background in Part 1, we delved into Ivalua’s primary upstream solution components around spend analysis, strategic sourcing, direct sourcing and contract management in Part 2.

Today, this seven-part Spend Matters PRO series will continue our solution overview with a look at the downstream components — namely catalog management, e-procurement and order management, e-invoicing, expense management, payment management and IVA for guided buying. After we review these downstream components, we’ll finish up our solution review with a couple of the cross-platform capabilities around risk and performance management, supplier information management and master data management (MDM). After we finish with our solution overview, in Parts 4 and 5, we will dive into Ivalua's particular strengths and weaknesses from a solution perspective.

Ivalua: Vendor Snapshot (Part 2) — Upstream Solution Overview [PRO]

gig economy

In Part 1 of Spend Matters' seven-part PRO series, we provided an updated background on Ivalua, which has been growing steadily since our last Vendor Snapshot in 2016, adding clients, offices, employees, customers and capability around the globe. No longer the Rodney Dangerfield of procurement, Ivalua is finally getting some real respect, having just reached unicorn valuation status in its last funding round.

There are a number of reasons for this, some of which revolve around services and global support capability, and others that revolve around its extensive solution platform. The latter is the subject of our articles today and tomorrow, where we will overview all of the major components, starting with the upstream ones today. Then, after we review the downstream components in Part 3, we will dive into Ivalua's particular strengths and weaknesses from a solution perspective in Parts 4 and 5.

10 Reasons for Procurement to Work With Payments (Part 3) [Plus+]

early pay

Closing the payment gap – not just the invoicing gap – remains a Holy Grail for procurement organizations looking for greater oversight and control in transactional purchasing and even supplier relationship management. It’s also a means to bring finance and procurement organizations closer together – and to prove that finance is really procurement’s ally in the struggle to wrestle the maximum amount of utility out of P2P programs together, rather than separately. As my colleague Pierre Mitchell has noted, “any land grab is usually about job security built upon the pillar of bureaucracy.” In other words, finance and procurement must really be in the payables thing together.

The 10 reasons for procurement to work with finance departments are:

1. The value of control and oversight of the end-to-end transaction with suppliers
2. Building greater invoice/transaction insight that can bridge the visibility gap in getting line-level detail to supplier invoices without having to request information from suppliers
3. Being able to quantify efficiency driven metrics through a Trojan Horse adoption approach to e-invoicing
4. Reducing supplier risk
5. Capturing savings/leakage through closing the transaction, invoice and payment loop
6. Not getting taken advantage of by vendors that hide the total cost of P2P implementations by masking the amount suppliers are charged
7. Flexibility on supplier engagement/fee assumption in the case of supplier network models
8. New securitization/capitalization opportunities (e.g., securitizing the discount of forward payables through converting the discount classification to revenue)
9. Effectively addressing payables also forces addressing the “payment clock” question as early as possible to capitalize on opportunities.
10. Create powerful “information exhaust” around the optimal means of engaging with suppliers on a total cost basis – beyond just reducing risk. This not only includes capturing additional discount opportunities through payment integration, but also understanding how and when suppliers (and different groups of suppliers) are taking advantage of different payables opportunities.

The Contingent Workforce and Services (CW/S) Insider’s Hot List: August 2019 [Plus+]

Welcome to the August 2019 edition of Spend Matters Insider’s Hot List, a monthly look at the contingent workforce and services (CW/S) space that’s available to our PLUS and PRO subscribers. This edition looks at the new Beeline-Avature partnership; another look at the size and scope of the gig economy; developments in freelancer banks with news from Shine and Revolut; and more ...

Coupa’s 3 Special Forces Teams (Part 3: Value Engineering + Customer Success) [PRO]

In the final installment in our series covering Coupa’s 3 Special Forces teams (see Part 1: Corporate Development and Part 2: Alliances + Business Development), we cheat a bit from a series title perspective. And that’s because Coupa’s final special forces team essentially represent two functions in one (although they are in fact different groups): value engineering (sometimes called “value optimization”) and customer success.

Our analysis today begins by defining what value engineering and customer success functions do (and not do) for enterprise software/Saas/cloud companies. Then we provide the details behind Coupa’s programs. And finally we explore how Coupa leverages these two areas in ways that disproportionately benefit its broader operations in business spend management (BSM).

Jason Busch serves as Managing Director of Spend Matters Nexus, a membership, research and advisory organization serving technology acquirers (private equity, corporate development, etc.) and CEOs. The views expressed in this research brief are his and do not necessarily reflect that of the Spend Matters analyst team. But he would like to thank his colleague Pierre Mitchell for his review and input on this piece, given his deep experience in this area. Research note: This brief is based on extensive primary research. Beyond already available public information, no data or insights were provided by Coupa. However, a fact-check was provided to Coupa for informational purposes to ensure accuracy.

Digital Business Strategy: The CPO’s Outside-In Agenda (Part 3) [PRO]

In the first two installments of this Spend Matters PRO series (see Part 1A, Part 1B), we noted that a number of pressing issues are shaping procurement from the outside in, yet chief procurement officers (CPOs) are still primarily concerned with issues set by an inside-out agenda — that is, cost-cutting and supply assurance targets mandated by upper management. Our PESTLE analysis of factors shaping the modern CPO agenda identified broad trends like economic instability, globalization, changing digital business strategies and the need to address corporate social responsibility (CSR) as areas that procurement organizations need to consider if they want to truly tap and manage the opportunities (and risks) offered by external supply markets, starting with sustainability and CSR in Part 2A and Part 2B.

Today we move on to the second item topping the CPO’s outside-in agenda: digital transformation.

Digital transformation is increasingly creeping into a CPO's crosshairs because digitization is becoming a daily part of our personal and professional lives. Not only is software becoming critical for everyone in the organization to do their jobs, but the internet is becoming critical to sales and marketing to advertise and sell the product as well as to R&D to do research and engineering to control just-in-time manufacturing. Meanwhile, from a corporate strategy perspective, companies are aggressively looking at their digital business strategies — and consulting firms like Accenture, Deloitte, McKinsey and others are busy capitalizing on this. Distribution companies do not want to get “Amazoned.” (For example, Accenture is looking to next generation digital technologies to achieve it’s ZBx nirvana — and achieve sustainable zero-based spend in a zero-based supply chain.) Logistics firms do not want to get “Ubered.” Contract manufacturers want to become innovation incubators. And pretty much every finished goods manufacturer wants to embed telemetry to collect data and use it to improve customer satisfaction, increase top-line growth and pass the data back to the supply chain to improve operational efficiency.

Digitization is the new buzzword and just about every publication out there is talking about it, running articles on how to do it, and publishing “deep” exposes on the benefits of digitization. Best practice guides, case studies, futurist projections, and other in-depth studies are a daily occurence. Not all are equal, not all are relevant to your organization, and not all are even accurate. But that’s beside the point. Digitization is here, and its influence is only going to grow. So rather than sit back like a luddite and bemoan the coming wave of pink slips due to automation, CPOs need to rally their organizations around digital to help them see the benefits new technologies can bring (as tactical process cost reductions can always be invested in strategic value generation efforts if they use these same technologies to make the case, a case that does not necessitate a reduction in workforce, just a shift from the tactical to the strategic).

Ivalua: Vendor Snapshot (Part 1) — Background [PRO]

FM Global Resilience Index

A lot has changed since Spend Matters’ last full snapshot on Ivalua in December 2016, when we said (with apologies to the late comic) that Ivalua was the Rodney Dangerfield of procurement suites in terms of not getting any respect. At the time, we clearly noted that “if we add up the differentiated combination of its architecture/platform, industry enablement, functional/modular capability (across the source-to-pay continuum), analytics and ‘overlay’ process support capabilities, the sum of the Ivalua package stands out from all others in a true ‘deadpan’ way — albeit with no laughing involved. In short: Ivalua deserves much more respect than it gets from a market that is typically less familiar with it compared to larger peers.”

Since then, Ivalua has raised two massive rounds of capital, the first in April 2017 when it raised $70 million from private equity firm KKR (to build a war chest to accelerate R&D, expand its global footprint, triple down on marketing and make strategic acquisitions), and the second funding round just a couple of months ago when it raised another $60 million and achieved “unicorn” status. Now it's the envy of its peers, and we know for a fact that the other big players — Coupa, Jaggaer, Oracle, GEP and SAP Ariba — have taken notice.

But before we put the cart before the horse (or, in this case, the analyst’s conclusions before the background and solution overview), we're going to back up and start at the beginning now that you have an idea of what's to come.

Ivalua is one of the few source-to-pay (S2P) providers that has built its end-to-end solution on a single technology stack from the ground up, and one of the fewer still that doesn't try to grow through an acquire-and-integrate approach (like SAP Ariba, Jaggaer and even Coupa), or replatforming (like Determine or Oracle), but rather, develops its own native stack (as has GEP, Zycus, and mostly Coupa). Furthermore, it's also one of the few that has enough depth and breadth across each core area to enable it to serve as a single technology S2P suite for the procurement organization. That should not be a surprise given that the firm has been building this platform in-house on a single stack for the past 19 years while working with a global customer base.

This is important because there comes a point when the overall procurement organization performance beyond sourcing-identified savings and P2P-catalog compliance relies on a single extensible platform approach that goes beyond just functional enablement within procurement. Plus, if you want real automation/RPA, guided procurement and real AI someday — you’ll really want a single-workflow-driven platform that works on a single data store, because no advanced technology works without a sufficient amount of good, clean, harmonized data.

This revised, seven-part Spend Matters PRO snapshot provides facts and expert analysis to help procurement organizations make informed decisions based on Ivalua's source-to-pay capability, its suitability for specific industry segments, its global service and support footprint, and how each of these stacks up to its competition. (Hint: Ivalua is second in four out of five Source-to-Pay and Strategic Procurement Technology SolutionMap rankings, and second in two out of five P2P maps — namely the Nimble and Configurator personas — in terms of analyst score in the 2019 Q2 SolutionMap release.)

Part 1 of our updated vendor snapshot provides a company background and a summary recommended fit suggestion for when organizations might want to consider Ivalua in the procurement technology arena. Parts 2 and 3 provide a detailed solution overview. Part 4 will dive into the strengths, and Part 5 looks into the weaknesses across the product line. Part 6 will provide commentary and a SWOT analysis, and Part 7 will provide a comparative market overview and final summary analysis.

6 Factors that Impact the Cost, Hassle and Heartache of E-Procurement and P2P Deployments [Plus+]

p2p deployment

In this research brief, we explore the specific elements that impact the costs and hassles of P2P implementations and ways of controlling them — or at least managing expectations upfront. What’s perhaps most valuable in our findings is that these six elements don’t just show up during the course of a given implementation — they’re often visible upfront if you know where to look. And they can even prove to be leading indicators of trouble to come before you sign a contract with a vendor. In short, if you know what potential roadblocks to look for upfront, you can minimize or avoid unnecessary costs and hassle down the e-procurement road. Here’s how.

Guided Buying 4.0 — A Framework to Consider (Part 1: Guided Buying in E-Procurement) [PRO]

Many people know the term “Industry 4.0,” which describes the latest industrial revolution that combines big data, cloud computing, the internet of things (IoT), hyper connectivity, human-machine interfaces, robotics and embedded analytics that feature artificial intelligence (AI)/machine learning. It’s revolutionizing manufacturing and supply chains, but what about the most basic processes that deal with B2B buying?

That brings us to the concept of "guided buying." It’s not new, but in the last five years of my experience as an analyst of P2P solutions, I have realized that it is a term used without much precision. I can compare it to terms like “platform,” "best practices," “world class” and others that have been overused so widely that they’ve lost the force of their meaning. Terminology should be defined with a specific scope, intent and substance for it to really be useful. So, I’ve been recently collaborating with my colleagues to provide more specific insights on this concept, and we’ve decided to develop a maturity framework to help do this.

The act of guiding is a deliberate and proactive process that helps the person being guided achieve their objective and reach their destination. This is a concept that we have applied to the purchasing function for several years. In fact, almost 15 years ago, the first analyst who wrote about this concept of "guided buying" was my friend, mentor and Spend Matters colleague, Pierre Mitchell. Here is some of what he wrote back then.

“Think about an end user who, rather than going to a clumsy Intranet site to find a few local e-catalogs and supplier ‘punchout’ sites, gets instead a corporate Google-like interface and types in whatever they’re looking for. Then, the user gets automatically guided to preferred supply sources/channels (e.g., an e-procurement catalog, a supplier website, an internal inventory location or a requisition that’s electronically escalated to the proper commodity manager) based on commodity taxonomies, supply strategies/policies, preferred supplier listings, commodity manager skills, local inventories, specialized knowledge rules and supplier website content (or that of specialized content providers). In other words, users are guided to preferred supply sources before a maverick spend ever occurs.”

Today, what's interesting is that we already have the IT tools and solutions that we did not have 15 years ago. Today, companies can apply the concept of "guided" in all areas of the organization, including in contracting and sourcing. However, the focus for this part of this series is in the transactional purchasing area within procure-to-pay.

Let’s take a look at this problem, our framework, and some strategies and solutions.

SAP Intelligent Spend Group analysis: 10 observations of the new Ariba-Fieldglass-Concur business unit [PRO]

Last week, SAP released its financial results for the second quarter 2019. In the announcement, presentation and earnings call, SAP broke out revenue for its new Intelligent Spend Group (in previous quarters, it broke out revenue for the similar “Business Network” segment). This business unit consists of SAP Ariba, SAP Fieldglass and SAP Concur. According to SAP, quarterly performance for the group represented approximately $880 million (USD) in revenue based on actual reporting in euros of €786 million. At constant currency levels, revenue was up 17% year-over-year, or 22% factoring in currency changes.

This Spend Matters PRO brief begins by highlighting some of the additional detail provided on the earnings call and then provides 10 observations on the current state of the business unit based on customer, channel and other checks conducted by the Spend Matters analyst team. Spend Matters PRO subscribers also have access to previous coverage of SAP Intelligent Spend Group. Recent briefs include:

* SAP Intelligent Spend Group is future for Ariba, Fieldglass, Concur (Part 1): Customer Analysis, Solution Integration, Roadmap [PRO]
* SAP Intelligent Spend Group is future for Ariba, Fieldglass, Concur (Part 2): Hard Questions on Integration [PRO]
* SAP Intelligent Spend Group is future for Ariba, Fieldglass, Concur (Part 3): How can the SAP spend platform ‘Run Simple’? [PRO]
* With Barry Padgett leaving SAP, what’s next for new Intelligent Spend Group? [PRO]

The Artful Design of Procurement (Part 2) [PRO]

Spend Matters 50/50 2016

As noted in our last post, as I was writing up some notes from the Ivalua NOW 2019 conference, which it gave the theme “The Art of Procurement,” and which probably seemed more artistic when it was held at Le Carrousel Du Louvre, and not the Renaissance Chicago (but you’ll have to ask my colleagues Michael Lamoureux and Peter Smith, who attended the Paris event and posted their notes here, there and everywhere). But at the end of the day, since the better theme is not so much just about art (even though there is a definite craft/“art” to doing procurement transformation — and using digital as part of that transformation), but about the proper design of procurement and the procurement process, I decided to pen these pieces.

In Part 1 of this provocative PRO analysis, after setting the stage, I tried to really define what art vs. design was in a procurement context. Today, I’m going to try and build on that to describe:

* Design-centered procurement and platform design rather than just product design
* Platform enablement of the “participative art” of procurement
* A counter-intuitive palette: low code software platforms
* The procurement practitioner as artist

And I hope to inspire you to be a better artist, who paints a more impressive picture in your daily professional life.

The Artful Design of Procurement (Part 1) [PRO]

In a previous post, I was writing up some notes from the Ivalua NOW 2019 conference, which it themed “The Art of Procurement.” That theme is fun, and although it tempts me to bring in Zen analogies in archery, martial arts or even motorcycle maintenance, I think the better theme is not so much just about art (even though there is a definite craft/“art” to doing procurement transformation — and using digital as part of that transformation), but also about design.

In this multi-part Spend Matters PRO series, I’ll cover the following topics:

* Art vs. design within a procurement context
* Design-centered procurement and platform design rather than just product design
* Platform enablement of the “participative art” of procurement
* A counter-intuitive palette: low code software platforms
* The procurement practitioner as artist

I won’t be laying out a paint-by-numbers prescription for procurement excellence, but art does hold some lessons: not so much as art as expressing an aesthetic, but more as a practice and expression of mastery.

Some have applied Sun Tzu’s “Art of War” to business, and of course to trading partner negotiations, but Picasso is perhaps a better example. He was hugely prolific and cut his teeth mastering all the traditional artforms before creating his unique cubist style. Procurement practitioners similarly must have a baseline mastery of basic commercial knowledge (legal, finance, negotiations, etc.), change management, etc., but also be adept at picking up new techniques and tools and applying them to the task at hand. For example, many progressive procurement practitioners haven’t just learned Lean/6Sigma, but also Design Thinking and Agile software development principles that can be applied to collaboration beyond just software development — including procurement.