The Merger – Tension and Technology Insight In Our Short Story

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We have produced several research papers during the course of the past few months, and we think some you may have missed our work owing to the holiday season. If that is the case, we thought we would do a reminder as we move into the autumn “new term” as it were.

We published “The Merger” as a single short story, based on a several articles we first published on this website. It tells the story of two CPOs and what happens when their firms decide to merge. It was written by Peter Smith of Spend Matters and Steve Cobley of Ivalua, a leading eProcurement software firm.

As well as the incredible tension around whose job might go post-merger (and perhaps just a hint of another sort of tension, our readers thought), when we put it together as a paper we did include some more serious thoughts on how technology can help or hinder in such situations. The story contrasts the situation of a CPO with technology that supports what she is doing in the organisation, with one whose systems do not really add much value to his team’s efforts.

This is a brief extract from the paper on those lines, and you can download the whole thing here, free on registration. We look at the issue of best-of-breed procurement technology versus integrated platforms, an ongoing debate and with some important dimensions for senior procurement professionals to understand.

 

Technology Options – Best-of-Breed or Integrated Platform?

In terms of the end-to-end requirement for "source-to-pay" technology, there is a range of approaches. The concept of a single integrated platform is fairly straightforward. One alternative, "best of breed" means acquiring solutions from different providers who claim strength in different elements of the overall capability. So that might mean one supplier for spend analytics, another for sourcing, a third for catalogues and ordering, and perhaps another for eInvoicing.

However, in our experience, few users who might claim to have "best of breed" have approached it in a structured logical fashion. More often, a range of solutions have been acquired over the years, some perhaps being implemented as part of ERP projects, others being utilised in just one part of the wider organisation, perhaps arising from past acquisitions. It is rarely the result of a genuine analysis of which provider is really the “best” in each sub-sector of the market, and it is even less usual to find that the integration issues have been fully considered and thought through.

So here are three questions for any organisation to ask about the "best of breed" approach:

  • Will we really have best of breed or simply a random collection of systems?
  • Will we be able to integrate the systems in order to get the information and intelligence we need?
  • What are the costs of running multiple systems and platforms?

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