LIVE Dispatch: Forrester's Andy Bartels Takes the Stage

Last week at Ariba LIVE, Forrester's Andy Bartels led a break-out session, giving a good high-level overview of the Spend Management technology landscape. Interestingly enough, I counted less than half the number of attendees for his presentation than those who listened in on Vance Checkett's spiel which occurred right before (both were top notch in my book). The main gist of Andy's presentation was that E-Sourcing and E-Procurement are just the start of a "successful Spend Management Program". Andy believes that contract management, automated spend analysis, EIPP, services procurement, supplier connectivity and networks are all critical to enable the next level of performance and results.

Throughout his lecture, Andy shared some insightful facts and figures -- which included some insight into his practice as well. Clearly, Andy is an analyst who is in demand on the vendor selection advisory side of the world, and it would appear that he's influencing more deals than I thought. According to his numbers, Andy now gets 100 inquiries per quarter. But what's most interesting is that many of the conversations -- 75% in fact -- are now cross-functional, involving stakeholders outside of just procurement alone (or IT alone, as the case may be).

Regarding Spend Management technology adoption, Forrester is now tracking about 9000 e-procurement deployments worldwide and 3,700 e-sourcing implementations. This contrasts with the number of EIPP implementations, which stands at 2,400. After this, the number of contract management, services procurement, spend analysis and other Spend Management technology deployments drops off precipitously. BTW: I would assume that these numbers are on the divisional or "instance" level rather than company or enterprise level.

In his presentation, Andy compared the opportunity that companies are leaving on the table by not investing in these advanced areas to that of an oil well. To wit, in the oil exploration business, the returns a team achieves from a single site are commensurate with how far they typically drill past the top level. Comparing E-Sourcing and E-Procurement to top-level capture, Andy notes that other techniques, the metaphorical equivalent of "steam injection and cross drilling", are critical to get at the rest of the oil deposit (which includes such areas as services procurement, which in Andy's words, "is the big untapped frontier of Spend Management"). But I'd extend this metaphor a bit further by suggesting sometimes you need to drill in unorthodox places. Perhaps the Spend Management equivalent of drilling in the Alaskan wildlife preserve is going after marketing and legal spend ...

Jason Busch

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