Plus or PRO Content

What To Expect from Best-in-Class Sourcing Optimization Technology and User Design (Part 2) [PRO]

Sourcing optimization has played a somewhat curious side role in the history of e-sourcing technologies. Approximately half a dozen procurement vendors have offered varying degrees of capability over the years, but customer adoption, especially in the user base of vendors offering other sourcing and procurement technology suite capabilities, has remained variable, as have the capabilities of the underlying optimization solutions themselves.

As we noted in the first installment in this series, sourcing optimization is “heady, complex and requires significant mathematical, technical and domain expertise to use” — at least in the past. It’s not a common skill combination. Developing and supporting such capability has also required skilled R&D (academic), product development and product management resources, so assuming you could find the right people, adding sourcing optimization to existing sourcing products required significant investments.

This Spend Matters PRO series provides a “how-to-guide” to selecting and developing best-in-class sourcing optimization technology, inclusive of a user design and interface that can maximize adoption. We suspect it will be useful for procurement organizations, consultants, business process outsourcing (BPO) firms and third-party logistics (3PL) providers evaluating or cobbling together solutions to use internally or own behalf of customers.

But this brief should also be equally valuable for technology vendors that are looking to build capability in the area, or improve upon existing sourcing solutions. In Part 1 of this series, we explored how powerful constraint support, solid mathematical foundations and advanced cost modeling capability must come together in a solution that dovetails best-in-class functional capability with optimal user design. In this second installment, we turn our attention to e-sourcing and reverse auction integration approaches, guided sourcing “what-if” support and automatic missing/outlier data identification.

Extending Procurement Information Architecture to Provider Ecosystems (Part 2) [Plus+]

Let’s recap where we ended up with conclusion of the first installment in this series. A range of application vendors are trying to build out native platforms or sit on top of others flexibly. For example, Coupa hedges its bets by building on top of AWS, but also partnering with IBM (on SmartCloud) and showing up on SuiteApp.com. Providers are also trying to develop healthy B2B ecosystems that are creating B2B activity and, as a result, “liquidity.” There’s no way to better monetize that liquidity than from B2B e-commerce networks for source-to-pay (S2P) on the buy side and both attract-to-order and order-to-cash on the sell side. All this talk of liquidity reminds us of a different time and place in the procurement and supply chain world: the “marketplace era” from the late 1990s and early 2000s. This time, however, there are many technology differences that will make the vision of liquidity a reality faster than many will imagine. But not without a key application rub that should be top of mind for all procurement and IT organizations.

Extending Procurement Information Architecture to Provider Ecosystems (Part 1) [Plus+]

In our previous series on procurement services provision and information architectures (here, here, here, here, here, here and here) we discussed the importance of thoughtfully designing various architecture elements such as MDM, analytics, workflow, portal infrastructure, etc. to re-frame overall information capabilities beyond the traditional provider-led “module-menu” approach. Simply put, the idea is to loosely couple these capabilities so that they can be iteratively improved (and switched out as needed) while they squeeze more value out of the fragmented information topologies that litter the enterprise landscape. The coupling of these capabilities can – and should – create situations where the sum of a set of assets greatly exceeds their individual contribution elements.

What To Expect from Best-in-Class Sourcing Optimization Technology and User Design (Part 1) [PRO]

There’s a reason Coupa spent a healthy chunk of its IPO proceeds to purchase Trade Extensions: sourcing optimization technology is heady, complex and requires significant mathematical, technical and domain expertise to build. But more important than the barriers to entry in bringing it to market, the value sourcing optimization can bring to customers is materially greater than what standard e-sourcing and reverse auction technology can deliver. So if you’re pitching “savings” or “value” as a service for procurement, you’d be hard pressed to prioritize any other area over strategic sourcing optimization and related supply network design capabilities — even if it’s still somewhat a novelty in terms of adoption outside of logistics and transportation spend.

While we have explored and defined sourcing optimization technology in the past (including specifically what makes Trade Extensions great and why Coupa bought it from a customer perspective), we have not yet defined what the optimal (no pun intended) components and user design elements of a sourcing optimization solution look like more generically. This Spend Matters PRO series aims to do just this, breaking new ground in spelling out for procurement and supply chain professionals, consultants and technologists what they should look for (or strive to build) when considering sourcing optimization capability. It is meant as a companion to the other PRO articles in this series thus far covering what best-in-class technology and user design look like for e-sourcing (see: here and here) and reverse auction (see: here and here) technologies .

So what does best-in-class sourcing optimization look like and how does form follow function from a design perspective in supporting it? In this first installment in our series, we cover the concepts of powerful constraint support (and what’s required to support it), solid mathematical foundations and advanced cost modeling.

Strategic Technology Planning: A New Imperative for Contingent Workforce and Services Procurement (Part 2) [PRO]

In Part 1 of this series, we provided a context and rationale for the adoption of strategic technology planning for contingent workforce and services (CW/S) procurement. We also began the discussion of what strategic technology planning explicitly means for an organization and how it can be enacted. Part 2 of this series continues that discussion.

By way of summary, we defined “strategic technology planning” as a specific type of strategic planning that lets an organization (i.e., CW/S procurement) know where it is now, where it wants or needs to be some time in the future, how technology can be leveraged as an enabler and what changes in resource allocation and investment must occur or what constraints will condition progress. We should emphasize that strategic technology planning is not the same as a tactical plan or roadmap, though ideally it would lead to these.

Strategic planning is more about high-level understanding (insight and foresight) than it is about immediate, direct action. We believe it must become a critical component to any CW/S procurement function and program that wants to avoid being caught flat-footed and aims to deliver a new (and necessary) level of business value over a reasonable planning horizon (e.g., three to five years). This type of planning effort may represent a shift of gears for many procurement practitioners. For this and other reasons, we suggest and outline a process in this Spend Matters PRO research brief that is intended to help practitioners get started and pointed in the right direction.

What To Expect from Best-in-Class Reverse Auction Technology and User Design (Part 2) [PRO]

auction

Spend Matters tracks more than 50 technology providers that claim to have some type of auction or reverse auction capability in place to support strategic sourcing efforts of procurement organizations. But only a select few vendors go the extra mile to support what we consider the core capabilities that just about any procurement organization can take advantage of to drive incremental savings and results.

As we conclude our look at what procurement organizations should expect from the intersection of best-in-class reverse auction capabilities with a streamlined user design/experience, we define and explore the following areas: asynchronous real-time interactive graphical views (of events), real-time substitution request capabilities, real-time connectivity monitoring, constraint support and optimization-backed capability. Missed Part 1? Read it here.

What To Expect from Best-in-Class Reverse Auction Technology and User Design (Part 1) [PRO]

Thus far in this Spend Matters PRO research series, we have explored how optimal user experience (UX) and advanced feature/function support have become inseparable when it comes to delivering best-of-breed e-sourcing capabilities (see What You Should Expect from Best-in-Class E-Sourcing User Experience and Functionality: Part 1 and Part 2). We pointed out, for example, that numerous specific elements must come together to drive strategic sourcing and RFX success for anything but the most basic strategic sourcing scenarios.

These capabilities that we covered include guided event creation, simplified template creation, clutter free role-based views, easy bulk file upload (and association), easy starting bid population, simplified bid validation and verification, and nuanced delegation approaches (for buyers and suppliers). When it comes to reverse auction capability and technology, however, this is just a necessary list of basic functionality for foundational support. It’s far from complete, as reverse auctions are really their own “sub-module” in their own right.

As our series continues, we explore how additional UX and technology/feature requirements come together to create best-in-class reverse auction technology. But let us first start this series with a warning: Few technology providers come close to touching all these core capabilities today. In this first installment, we define and explain the concepts of — and capability needed to support — powerful lot configuration (with formula-based pricing), extensive (reverse auction) format selection, deep parameterization capability and smart “multirepresentative” supplier views.

Online Work Platforms and Enterprises: Survival of the Fittest or the Fastest? [PRO]

cheeta

In this PRO research brief, we provide an analysis of the complex dynamics that characterize the online work platform technology market, in particular with respect to large enterprise adoption (or, to date, the lack thereof). We also examine some promising platform strategies/approaches that may promote platform business viability and, over time, more success in achieving large scale enterprise penetration. Finally, we discuss the implications of our analysis for both platform providers and enterprise buyers.

(Note: To avoid possible perception that we are making endorsements or recommendations in this brief, we forego references to specific platforms (platform providers are evaluated separately, in our Vendor Snapshot and SolutionMap series, with these strategies and approaches in mind.)

What You Should Expect from Best-in-Class E-Sourcing User Experience and Functionality (Part 2) [PRO]

E-sourcing technology is becoming increasingly defined by the user experience as much as the underlying functional and technical capability. But in the future — and we see this trend starting already with best-in-class capabilities — the combination of the user experience (i.e., design) and underlying technology solution components and feature/function capabilities will become increasingly intertwined and inseparable. This Spend Matters PRO series examines the intersection of what a best-in-class user experience and functionality capability means for e-sourcing solutions today and tomorrow.

In Part 1 of this series, we explored what capabilities and experience procurement organizations should expect from best-in-class guided event creation, clutter-free views and simplified template creation and management within e-sourcing solutions. In this installment, we turn our attention to how the world of best-in-class user experiences and underlying functional capability are coming together to support bulk upload/attachment association, starting bid population, bid validation and verification and procurement/supplier delegation for strategic sourcing, category management and auction/negotiation enablement. These are capabilities that buyers of these solutions should evaluate vendors on based on demonstrated capabilities, approach and planned releases, and they are capabilities that technology providers should continually strive to enhance.

What You Should Expect from Best-in-Class E-Sourcing User Experience and Functionality [PRO]

E-sourcing technologies have been around for two decades now. The authors have played various roles over the years in helping architect them, design them, configure them, select them and use them. Yet while today e-sourcing should be a mature and functionally rich technology out of the box, the reality is that there are still a number of offerings that don't have some of the most basic features you would have expected some years ago.

In contrast, other offerings continue to push the envelope in various areas of what the product can offer. In this two-part Spend Matters PRO brief, we outline what specific elements you should expect from best-in-class e-sourcing user experience and functional components. In the first installment, we cover how best-in-class solution designs feature guided event creation, clutter-free views and simplified template creation and management. As will soon become clear, it is impossible to separate a best-in-class user experience from underlying functional capability in many areas of strategic sourcing technology — the two are becoming increasingly yoked. Form following function. Or function following form. You decide!

The Future of the Procurement Technology User Experience (Part 2): Advanced Mobile and ‘Mission Control’ Dashboards [PRO]

ux

Does anyone remember how bad early procurement technology interfaces were? While there are some folks we can blame directly — for example, whoever designed SAP SRM’s original interfaces in earlier releases should be doomed to spend his retirement managing the search, requisition and approval process for the coffins of all of the licenses that were never used — the limitations of early UIs were mostly due to where technology was at the time. We are not just talking about the latest in “Amazon-esque shopping” or “type ahead” search capability, or minimizing the number of clicks required to perform a task, clever menu nesting, tab structures, integrated activities within “suites” that transcend being within a specific module and the better use of icons and colors. That’s so 2015. Rather, nearly all elements of the modern 2017 technology stack are starting to come together in a manner that is driving the start of a radical shift in creating more usable procurement technology overall. This is big. It’s much bigger than Coupa rising to fame (initially) by creating a UI that was vastly superior to Ariba at the time (not SAP Ariba today, mind you).

As we noted in an earlier installment of this series exploring “smart systems” and messaging, chat and collaboration (MCC), “Smart systems drive integrated guidance leveraging new "AI" techniques ... They do this by mixing semantic technology, sentiment analysis, key-phrase driven expert systems and other machine learning techniques with history to determine what the user is doing and what the user wants to do … [and] new approaches to MCC represent a new ‘layer’ of the user experience. Just as third-party analytics dashboards have become a standard ‘front end’ in many procurement suites for drilling into spend, supplier or modular based data, so too are these components becoming a standard addition to procurement technology applications. As with front-end analytics, they can either be developed internally (by a procurement software vendor) or they can be OEM’ed/licensed by a provider — as is often the case with analytics — and incorporated as a component of the product.”

Today, we turn our attention to advanced mobile enablement and “mission control” dashboards — two other components driving the next-generation procurement user experience in technology. In this research brief, we define these areas and their components, and provide practical use cases of how they are leveraged within technology.

Designing a Spend Category Taxonomy Properly is Harder Than You Think (Part 2: Go Deep) [Plus+]

category management

We recently had a client ask us if we could offer specific guidelines or methodologies for creating a spend category taxonomy within the automotive and industrial markets. The question resulted in a discussion among a number of us with industry experience. And since we didn’t have any research already published on the topic, we thought we’d invest the time to document our findings. In this second installment of a two-part Spend Matters Plus research series, Chief Research Officer Pierre Mitchell explores how granular procurement should go in creating a spend taxonomy and concludes with practical tips for implementing a program.