Procuri Empower: Dispatch Two

Welcome to the Spend Management Ecosystem

If you're looking for any further company-based scoop on these virtual pages -- or any others -- about the Ariba/Procuri deal, you probably won't find it. The first forty-five minutes of presentations at Empower -- which included keynotes from Mark Morel, Bob Calderoni, and Tim Minahan -- said virtually nothing of consequence regarding the deal or joint vision, other than what has already been disclosed. But it was easy to discern a couple of messages that Ariba and Procuri are jointly trying to push out to the Procuri user community. First, from a semantics perspective, Bob Calderoni did not use the "supply management" term once during his short presentation. Rather, he continued to describe the space as "Spend and Contract Management". Hmmm, as I've mentioned before, methinks Tim Minahan's blog, Supply Excellence, will soon become "Spend Excellence" or perhaps "Spend and Contract Excellence".

Second, as you might expect, both Ariba and Procuri are trying to placate customer fears about a combined entity. Tim Minahan paraded National City's Jean-Jacques Beaussart on stage to discuss how working with both Procuri and Ariba separately to date has been "one of my best professional experiences" to date. Beaussart did call out what he hopes the union will bring to customers and the overall marketplace which is namely the "movement to industry standards to manage suppliers, how to pay them, metrics to measure success, what is definition of savings, and how to measure success." Ariba-driven standards will, Beaussart argued, "help us to go back to management to build stronger business cases." I find this interesting. Perhaps Ariba should figure out a way to carve out Hackett from Answer Think next to help them realize this vision.

Always the sourcing professional, Beaussart also jokingly suggested that he expects prices for Ariba's/Procuri's solutions should go down as well due to synergies in customer services, development, etc. However, I'd suggest there's no need to hold Ariba's pricing feet to the fire. And that's because the Invisible Hand of market competition will continue to put price pressure on the more mature elements of the Spend Management market such as eSourcing, eProcurement and contract management. Thanks to aggressive moves by Emptoris and others designed to compete for existing Procuri customers, I have no doubt Beaussart and other procurement leaders will not have to worry about inflationary pricing on core Spend Management technology because of the deal. Rather, the acquisition -- and the competition's response -- might have the opposite effect.

Jason Busch

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