Revolutionizing tail spend management
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In today’s business landscape, effective digital procurement strategies are vital for organizations to optimize spend, enhance operational efficiency and address risk while maintaining an ideal user experience. One area of significant potential that is often overlooked is tail spend management.
Tail spend refers to the volume of unmanaged, lower-value, everyday purchases that account for most of an organization’s transactions and a significant portion of overall spend. Individual tail spend transactions may be smaller in value, but the cumulative impact can be substantial. Historically, a lack of dedicated tools and/or a concentrated focus of investments on strategic spend categories have deterred procurement teams from developing effective solutions to manage the tail. However, recent advancements have opened the door to new possibilities for procurement organizations looking to uncover missed opportunities, including cost savings, increased business insights and process optimization strategies. Recognizing this missed potential, an increasing number of industry leaders and experts are advocating for specialized technologies designed to solve tail spend once and for all.
Simfoni is a next-generation digital solutions provider for procurement intelligence and a trailblazer in tail spend management. Last month, Simfoni announced an investment led by Kearney, the industry-leading global management consulting firm, in a move that is expected to correct previous misconceptions surrounding tail spend management.
Enabling procurement transformation with effective tail spend management
In a groundbreaking move that is set to rock the procurement landscape, Kearney recently formalized a partnership with Simfoni to accelerate the accessibility and effectiveness of its tail spend management program. This move is part of Kearney’s broader strategy to invest in proven technology solutions that help clients to navigate complex business challenges and achieve digital procurement transformation and sustainable growth. Kearney identified tail spend as a major pain point for clients with traditional BPO, shared services, and payment solutions failing to address root cause and support end-user needs. Experts anticipate the combination of Kearney’s rich heritage in procurement with Simfoni’s digital tail spend solution will cement Simfoni, which, according to Gartner, is an already-established leader in this maturing space, as the market leader in tail spend.
(Simfoni announced sample vendor for tail spend management in 2023 Gartner Hype Cycle for Procurement and Sourcing Solutions.)
“Partnering with Kearney is an exciting opportunity for us to expand our reach and ensure we can offer our spend management capabilities in the most complex and largest of enterprise situations,” said Chirag Shah, CEO of Simfoni. “By combining our technology and tail spend expertise with Kearney’s distinctive, agile approach to strategic consulting, operations, sustainability, and governance, we can broaden the scope of our delivery of a comprehensive procurement solution that drives truly impactful outcomes for our clients.”
The investment is underpinned by Kearney’s vision of a modern spend management architecture that incorporates specialist solution providers such as Simfoni to reshape the way organizations view and manage tail spend.
Simfoni’s composable spend management platform provides powerful analytics, e-sourcing, and optimization, with spend automation workflows to help clients identify, manage and optimize strategic and tactical procurement processes. Simfoni’s unique pay-as-you-save pricing model removes barriers to adoption, making its state-of-the-art digital solution accessible to organizations of any size. Kearney’s deep expertise in sourcing, governance and change management means clients will benefit from an end-to-end solution to streamline processes, lower costs and improve overall compliance and user experience in the traditionally hard-to-manage area of tail spend.
Procurement transformation for the digital era
Kearney has a long history of driving savings and operational efficiency for its clients. With Simfoni’s tail spend management solution, organizations will now have access to the technology and expertise to make meaningful strides toward eliminating maverick spend, consolidating suppliers and negotiating more favorable terms. By automating repetitive processes and leveraging artificial intelligence, Simfoni streamlines procurement operations and frees up valuable time and resources so procurement teams can focus on more strategic decision making. The result is increased productivity and tangible business outcomes that highlight procurement’s strategic value to the business.
Simfoni’s spend management platform brings immediate value for customers by combining a superior user experience with powerful AI-enabled spend analytics, sourcing, optimization, spend automation, vendor management and payment consolidation to help clients identify savings and optimize complex procurement processes. The combined capabilities of Kearney and Simfoni create the most advanced tail spend management solution on the market, including:
- Technology that offers a human-centric user experience for frontline managers through executives and works with existing technology, avoiding disparate systems and eliminating the need for offline workarounds.
- A pay-as-you-save model with fees hard wired to usage and savings.
- Payment consolidation and vendor management, reducing the burden on procurement and accounts payable teams to manage the high volume of tail vendors and payments.
- Easier ESG compliance, with opportunities to systematically prioritize target suppliers, including minority-owned and eco-certified categories.
- A global/regional presence with sourcing operations close to users and supply markets.
“Kearney is thrilled to partner with Simfoni to provide our clients with access to the most comprehensive digital procurement solutions in the market,” said Alex Liu, managing partner and chairman of Kearney. “We are confident our clients will benefit from improved visibility and increased efficiencies as they continue to regenerate their business models and performance.”
The collaboration’s implications reach far beyond the immediate realm of tail spend in procurement. It offers a glimpse into a future where digital transformation is democratized and every business can access technology that ensures every aspect of the procurement process is optimized for success.
Simfoni’s innovative approach, fortified by Kearney’s strategic backing, promises to unlock the true potential of tail spend, leading to substantial cost savings and increased operational efficiency for all.
Learn how you can benefit from a Simfoni/Kearney tail spend solution.