Author Archives: Andrew Karpie



HCM Strategies: Vendor Introduction, Analysis and SWOT

This Spend Matters PRO Vendor Introduction offers a candid take on HCM Strategies and its capabilities — features that help companies establish market-based salary/pay-rate and contingent labor rate benchmarks and gain related insights into the market and their own business patterns. The company provides services within the U.S. today but is targeting the UK for 2020.

This PRO brief also includes an overview of HCM Strategies and its solution offerings, a summary solution evaluation, a SWOT analysis and a selection checklist for companies that might consider the provider.

The Contingent Workforce and Services (CW/S) Insider’s Hot List: February 2020

supply risk

Welcome to the February 2020 edition of Spend Matters Insider’s Hot List, a monthly look at the contingent workforce and services (CW/S) space that’s available to our PLUS and PRO subscribers. For those new to the Hot List, each edition covers the prior month’s important or interesting technology and innovation developments.

In the last Hot List, we covered the investment rounds at VNDLY and Qwil; Degreed’s acquisition of Adepto; Aquent’s solution for encouraging companies to provide “benefits” to their freelancers; and the kind of far-out idea (and reality) of a temporary staffing agency for robots and robots-as-a-service.

In the first month of 2020, we saw developments like wider adoption of blockchain, technology changes, big fundraising, more freelancer banking/payments, crowdsourcing and "New Law" in the area of outsourcing.

2020 & Direct Sourcing of Workforce/Services: What to Know

Direct sourcing of workforce/services (DSW/S) has been one of the most consistent, rising trends in the evolving contingent workforce/services (CW/S) procurement space in recent years. To a limited extent, the sourcing of contingent workers with little or no involvement of third party intermediaries has been practiced by most organizations for decades. But more recently, it has been changing in several ways, driven by a number of factors, including the emergence of fit-for-purpose technology. It is no coincidence, therefore, that there is a Spend Matters SolutionMap category — Direct Sourcing of Workforce/Services — that currently ranks nine technology solution providers (with more set to participate).

While the idea of sourcing and engaging workers directly (e.g., not through a traditional staffing supplier arrangement) seems simple enough, there are various forms that direct sourcing takes (depending upon the business use case) and a variety of ways that technology is being used to enable it. In that respect, it is not that simple. But it is something CW/S practitioners should be following — and probably getting prepared to evaluate — in 2020.

This Spend Matters PRO brief explains direct sourcing of workforce/services (DSW/S) in the context of 2020 and provides input for practitioners trying to understand how direct sourcing applies in their own specific business contexts/use cases. It discusses the considerable diversity of solution providers/solutions (based on our SolutionMap data and other observations) and how that diversity is relevant to supplier shortlisting and selection (including the role of the Spend Matters’ DSW/S SolutionMap framework).

2020 Predicaments in Services Procurement — No Light at the End of the Tunnel

(Editor’s note: Spend Matters’ analysts are taking on the new year by looking at their areas of procurement technology to see what’s broken and what can and should be fixed this year. Here, analyst Andrew Karpie lays out problems in services procurement. In another piece also published today for our PRO subscribers, he lays out his predictions for 2020.)

In some industry verticals, services is the largest and most poorly managed non-payroll spend category. But the buying and consuming of services is nearly always poorly managed and controlled within enterprises — leading to potentially billions of dollars of unnecessary spend and opportunity costs (lost value). A problem of such enormous scale and complexity is not going to be addressed overnight.

Various estimates suggest that, in the U.S., spend on temporary staffing services represents an average of only about 33% of total services spend across all enterprises (though that percentage can vary widely, depending upon the type of business/industry). But outside of spend on temporary staffing services, most enterprises have had, at best, fragmented and limited visibility into their non-staffing contingent workers and their complex services spend — to say nothing of control over the whole services source-to-pay lifecycle.

Part of the problem is organizational, as procurement and HR often view the contingent workforce segment of services spend very differently in terms of priorities and the strategies (and service/solution providers) used to manage it. Technology solution fragmentation is also a major problem. The inadequacy, fragmentation or absence of complete, fit-for-purpose technology solutions for managing the broad range of different services spend types represent one set of obstacles to making major gains in management of services spend in the short run. This set of obstacles is tied to the non-technological barriers of legacy enterprise architecture (i.e., silos, etc.), run-of-the mill organizational inertia and the difficulty of changing, even as the services world evolves.

As we head into 2020, thinking about the future of services procurement, what should we know about the technological obstacles and non-technological barriers to significant progress on addressing what must be overcome?

2020 Predictions for Services Procurement: Scenarios and Black Swans

As discussed in “2020 Problems in Services Procurement — No Light at the End of the Tunnel,” services constitutes the largest and perhaps most poorly managed non-payroll spend category. It covers an expansive set of sub-categories, from temporary staffing to other forms of directly sourced contingent workforce to a multitude of contracted B2B services (consulting, MRO, travel, IT management, legal, marketing).

“Human performance,” usually connected with the use of tools and resources/assets, has traditionally been the basis for the production and delivery of services. But services also have been becoming more digitized, both in terms of production and delivery. And there are now pure digital services, the production and delivery of which involve little or no human performance. Many are familiar with IBM Watson, but for nearly every form of human-based service, there is some type of digital/augmented solution that exists or is being worked on by an upstart firm. Look no further than the legal services industry, transportation or BPO industry and the impact that AI is having on those services.

There is no hiding the fact that gaining control over services represents a massive, complex undertaking — without exaggeration, a new frontier — for procurement. And obstacles and barriers to making significant, rapid progress abound, including inadequate (incomplete, fragmented) technology solutions and legacy enterprise architecture as well as organizational inertia. Still, there is hope — and there is innovation afoot.

This outlook and backdrop strongly conditions our view on what is likely to happen in 2020. Most of us would probably place our bets on a continuation of recent trends in the space (see “Incremental Scenarios” below). But we cannot rule out unexpected events/developments over the course of the year, either (see “Disruptive Scenarios” below).

Coupa buys Yapta: A look at the T&E deal and provider capabilities

This week, Coupa, a provider of business spend management solutions, announced its acquisition of Yapta, a solution provider that enables businesses to automatically monitor and re-book air and hotel reservations when prices drop. Yapta also provides category specific spend analytics and intelligence. The terms of the deal were not disclosed.

While likely not a large market shakeup, the acquisition of Yapta still catapults Coupa from one of many brands competing against “the big T&E kahuna,” SAP Concur, in the enterprise and SMB space to one of the few specialized technology providers that can tell a broader story that includes truly non-invasive travel savings and category management.

Travel is a very significant category for most companies. According to the 2018 GBTA BTI Outlook — Annual Global Report & Forecast report, travel spending reached $1.33 trillion in 2017, up 5.8% over 2016 levels. The report also forecasted that business travel spend would expand to $1.7 trillion by 2022.

Business travel spend as a percent of total spend varies by industry and company. However, available market data suggests that aggregate global business travel spend is approximately 2-3X the aggregate global spend on temporary staffing services. In other words: Too significant for procurement to ignore.

Spend Matters spoke to Yapta CEO James Filsinger and Coupa’s Donna Wilczek, senior vice president of product strategy and innovation, about the acquisition. Coupa told Spend Matters the Yapta solution will augment and integrate (and ultimately be unified) with Coupa’s business spend management (BSM) platform with offerings in both its Travel & Expense and Spend Analysis segments. This Spend Matters PRO analysis provides an introduction to Yapta and offers an analysis of the combination.

PeopleTicker: Vendor Introduction, Analysis and SWOT

This Spend Matters PRO Vendor Introduction offers a candid take on PeopleTicker and its capabilities — features that help companies establish market-based salary/pay-rate and contingent labor rate benchmarks and gain related insights into the market and their own business patterns. The brief includes an overview of PeopleTicker and its solution offerings, a summary solution evaluation, a SWOT analysis and a selection checklist for companies that might consider the provider.

The Contingent Workforce and Services (CW/S) Insider’s Hot List: January 2020

Welcome to the January 2020 edition of Spend Matters Insider’s Hot List, a monthly look at the contingent workforce and services (CW/S) space that’s available to our PLUS and PRO subscribers. For those new to the Hot List, each edition covers the prior month’s important or interesting technology and innovation developments in the CW/S space. Let’s catch up on developments in December as we head into a new year. Seasonally not an active month, December was punctuated by a few key investments in CW/S solution innovators and a number of developments, which indicates that innovation continues to gather steam in the CW/S space.

Preparing for 2020: Digital Procurement Trends in Review (Part 2: Vendors and Capabilities)

Zycus Horizon

For our first Spend Matters PRO series in 2020, we’re preparing for the future by understanding recent trends. So we’ll look at last year through the lens of category management. Since Spend Matters’ analysts are essentially category managers for the mega supply market of over 1,000 providers that help buy-side practitioners manage their spend, supplies, services and suppliers, we’ll look back at 2019 trends through both the demand-side lens of practitioners/buyers and the supply-side lens of providers. In this analysis, we’ll use:

— Findings from our advisory work with procurement practitioners (and supported by primary research)
— Trend analysis of top provider performance taken from our SolutionMap database — from a solution scoring standpoint and also from a customer satisfaction lens
— Observations from our M&A due diligence advisory work from our Nexus service offering
— Solution development activities from the providers in the market
— Insights from service providers in the market who are increasingly themselves developing technology to create hybrid service offerings

Part 1 focused on the practitioner trends of 2019, and Part 2 will review vendor trends in innovation, supplier networks, contingent workforce/services, M&A and other areas where our analyst team has weighed in.

Preparing for 2020: Digital Procurement Trends in Review (Part 1)

For our first installment of Spend Matters PRO in 2020, it’s important to know the past as we prepare for a new year. So we’ll look at last year through the lens of category management.

Since Spend Matters’ analysts are essentially category managers for the mega supply market of over 1,000 providers that help buy-side practitioners manage their spend, supplies, services and suppliers, we’ll look back at 2019 trends through both the demand-side lens of practitioners/buyers and the supply-side lens of providers.

In this analysis, we’ll use:

— Findings from our advisory work with procurement practitioners (and supported by primary research)
— Trend analysis of top provider performance taken from our SolutionMap database — from a solution scoring standpoint and also from a customer satisfaction lens
— Observations from our M&A due diligence advisory work from our Nexus service offering
— Solution development activities from the providers in the market
— Insights from service providers in the market who are increasingly themselves developing technology to create hybrid service offerings

The two-part series will focus primarily on the overall market, and then dive into specific areas where our analyst team has weighed in. Finally, we’ll foreshadow some predictions that we’ll be making in the coming weeks regarding the biggest problems that still need to be solved in the market — issues that actually have a chance of being meaningfully addressed in 2020.

Sourcing and Engaging the Independent/Freelance Workforce — An Emerging Ecosystem? (Part 5)

This Part 5 is the conclusion of a Spend Matters PRO series that has explored different aspects of the state of an independent contract workforce (or ICW) ecosystem and its current importance for contingent workforce/services (CW/S) procurement practitioners and executives in enterprise organizations.

Part 1 of this series was published a year ago, and an impetus for this series was a research brief published in late 2015 (“Sourcing and Engaging the Independent Workforce: FMS and Beyond — Filling in the ‘White Space’ ”). That post first raised the question of whether we could expect the formation of a new type of digital ecosystem that enabled enterprise organizations and IC workers to engage in a sustainable, mutually beneficial way. Three years later, the question was taken up again, but in the context of whether enterprise CW/S procurement practitioners should be paying more attention to — or doing more to leverage — ICWs.

The final part of this series summarizes the research in Parts 1-4. It also presents our thinking on whether CW/S procurement practitioners should become more serious about ICWs as a part of their contingent workforce programs. Part 5 concludes with some suggestions for practitioners.

VNDLY — A different breed of VMS or a different solution species altogether?

VNDLY, the cloud-based workforce management system (WMS) provider that has been creating waves in the VMS solution market, recently announced a $35 million Series B round. The equity funding to date of $49 million since the company’s inception in 2017 features some big hitter investors such as Insight Partners and Battery Ventures (and ServiceNow — but more on this later). According to the announcement, the $35 million from the Series B will be used “for continued product innovation, global expansion, and the continued investment in customer service and support” (a somewhat vanilla description of what is to come for a self-proclaimed innovator in the space). Nonetheless, VNDLY’s recent news has, in effect, thrown down a gauntlet to incumbent VMS providers — and also thrown up a flare to attract the interest of contingent workforce and services procurement managers looking for a next-generation platform (not just applications) to quickly build out diverse use cases.

The investment ramp up seems to confer increasing confidence in VNDLY, its next-generation platform, business strategy and its ability to execute. Moreover, the company has reported traction in the marketplace, having added “multiple new clients (over the past) year, including 12 Fortune 500 companies.” VNDLY’s co-founder and CEO, Shashank Saxena, has stated, “we've not only been able to validate the market’s readiness for a new and modern cloud-native VMS platform, but also validate that large enterprise customers are willing to replace their legacy VMS solutions to upgrade and modernize with VNDLY.”

In this Spend Matters PRO brief — keeping contingent workforce and services procurement practitioners in mind — we provide some information about the VNDLY solution and approach to the market. Note: We have already covered VNDLY extensively in the past year in the Temp Staffing SolutionMap as well as related SolutionMap and PRO content (see VNDLY: What Makes It Great (Temp Staffing/VMS SolutionMap Analysis) and VNDLY Closes $11 Million Series A Funding Round: A VMS Category Buster in the Making? [PRO]). We will also discuss the bigger picture — the coincidence of VNDLY’s emergence and seemingly accelerating evolution in the contingent workforce and service technology space and what practitioners should be aware of as they think about addressing contingent workforce and services in the future.

So what is VNDLY? Let's find out.