Author Archives: Nick Heinzmann



Sourceit: Vendor Introduction, Analysis and SWOT

Marketing procurement can be a touchy subject for businesses. This critical category can make or break a company’s ability to attract new customers, yet it is rarely managed in an efficient, effective manner — at least as a procurement professional would define it.

Within most businesses, marketing procurement is plagued by poor corporate governance, uncompetitive sourcing practices and unfocused project management, frequently leading to cost overruns and delivery delays. This in turn leads to a strained relationship between marketing departments and their peers in procurement, who find it difficult to overcome their seemingly incompatible goals. The problem is so bad and so distinct to this particular category that it practically begs for a niche technology solution to address it.

This is precisely the inspiration behind Sourceit, a four-year-old provider of sourcing and e-procurement tools for marketing services. Born out of a homegrown print sourcing solution at Finsbury Green, an Australian printer and managed services provider, Sourceit market and catalog offers a targeted set of capabilities that illustrate a deep understanding of the common hurdles of marketing procurement as it applies to print technology. The technology was spun out of Finsbury Green in 2015 as a standalone SaaS platform, then over the past four years has expanded from Australia into the UK, Canada, Brazil and, as of 2017, the U.S., under a reseller model in each market.

This Spend Matters PRO Vendor Introduction offers a candid take on Sourceit's capabilities. The brief includes an overview of “sourceit market” and “sourceit catalog” applications, a breakdown of what is comparatively good (and not so good) about the solution, a SWOT analysis and a selection requirements checklist for companies that might consider the provider.

Simplify Workforce: Vendor Introduction, Analysis and SWOT

Because of recent M&A consolidation and multiple external drivers, the market for vendor management system (VMS) solutions has become fairly complex. Competing vendors have been absorbed or combined, draining the field of vendor choices that can be applied in a wide number of scenarios. Concurrently, businesses have shifted away from their focus on temporary staffing labor to a rising emphasis on statement of work (SOW) spend, while also exploring new talent engagement models that increase program complexity, to include the exploratory enterprise adoption of the “gig economy” in the form of independent contractors. Add in the typical challenges of effectively operating a temporary staffing program — from cost control issues to quality maintenance and the management of intermediaries like MSPs — and it’s easy to see why procurement organizations are finding the old paradigm for VMS solutions is no longer holding up.

Going against the grain of complexity is a newer VMS provider that incorporates simplicity (i.e., ease of use) into its name — and its solution. Founded in 2016, Simplify Workforce provides an end-to-end SaaS solution for managing the extended workforce.

The Jersey City, New Jersey-based provider enables this through separate modules for contingent workforce (or in our SolutionMap classification, Temp Staffing) and statement of work (Contracted Services/SOW), with an emphasis on configurability, adaptability and ease of use that has typically eluded past VMS solutions. In doing so, Simplify Workforce aims to address the long-underserved middle market — specifically, businesses with annual contingent workforce spend of $1 million to $100 million — with the ability to scale up or down on spend easily, with a VMS and SOW solution that can solve the majority of daily contingent workforce challenges without overwhelming users, implementation teams and budgets with unnecessary complexity.

This Spend Matters PRO Vendor Introduction offers a candid take on Simplify Workforce and its capabilities. The brief includes an overview of Simplify Workforce’s offering, a breakdown of what is comparatively good (and not so good) about the solution, a SWOT analysis and a selection requirements checklist for companies that might consider the provider.

SourceDay: Vendor Introduction, Analysis and SWOT

The broader procurement technology market has always had a tenuous relationship with the direct procurement technology solutions. Old timers may remember SupplyWorks from the early 2000s, but it folded — and the SupplyWorks brand name now belongs to a janitorial/sanitation service provider (we won’t go down the easy joke paths on this one). More recently, DirectWorks, a perfectly decent solution for direct materials sourcing, also struggled until getting picked up by Ivalua.

Part of the challenge is that direct procurement is not only a subset of spend but also a superset of processes, because it’s essentially infused into the broader supply chain. This makes it addressable from multiple solution sectors like SCM apps, supply chain networks, integration players and industry players.

Source-to-pay application suites, for their part, are picking off some low-hanging fruit functionality here, but the broader requirements are spelled out well in our coverage of a distinct segment that may be forming for direct materials procurement solutions.

Manufacturers today are slowly seeing an expanding set of purchasing tools beyond ERP and MRP alone, and choice is generally a good thing if you have your overall solution strategy/approach nailed down before you go tool shopping. Many will be more than happy to explore this new market.

One of these newer choices is SourceDay, an Austin, Texas-based vendor that directly integrates with ERP and MRP systems to automate the management of purchase orders and supplier performance. By providing a more usable and procurement-centric layer over the data housed by a legacy ERP or supply chain application, SourceDay takes on many of the problems that procurement organizations find in managing direct materials spend.

The result is that procurement can save time, reduce errors and systematically manage supplier performance from a common cloud or mobile interface while still claiming the benefits that an ERP system can offer. There are obviously caveats to this statement — namely around integration — but we’ll touch on this later.

This Spend Matters PRO Vendor Introduction offers a candid take on SourceDay and its capabilities. The brief includes an overview of SourceDay’s offering, a breakdown of what is comparatively good (and not so good) about the solution, a SWOT analysis and a selection requirements checklist for companies that might consider the provider.

Sustainability, Environmental Stewardship and CSR: The CPO’s Outside-In Agenda (Part 2B)

sustainable supply chain

In our last article in this Spend Matters PRO series, we focused on several pressing issues that are shaping procurement from the outside in, yet chief procurement officers are primarily still concerned with issues set by an inside-out agenda — that is, cost-cutting and supply assurance targets mandated by upper management. However, our PESTLE analysis of factors shaping the modern CPO agenda identified broad outside-in trends that an organization needs to consider if it wants to truly tap and manage the opportunities (and risks) offered by external supply markets. (Read the CPO’s Conundrum: Parts 1A and 1B.)

Nowhere is this more readily apparent than with the topic of sustainability and environmental stewardship, the focus of today’s brief. The environment is an inseparable component of any business. It forms the platform layer off which all goods and services are produced, and cannot be ignored. And the difference between effective and sustainable management and ineffective and unsustainable management, as pointed out in yesterday’s article, is shocking. Not only would investments in environmental sustainability focussed companies over the past two decades doubled an average rate of return, but millennials will pay a (small) premium for sustainably (and ethically) sourced products and you are ensuring that you will have raw material supply for years (and decades to come).

Sustainability, Environmental Stewardship and CSR: The CPO’s Outside-In Agenda (Part 2A)

leading cross-functional teams

In this first installment of this Spend Matters PRO series (see Part 1A and Part 1B), we noted that a number of pressing issues are shaping procurement from the outside in, yet chief procurement officers (CPOs) are primarily still concerned with issues set by an inside-out agenda — that is, cost cutting and supply assurance targets mandated by upper management. Our PESTLE analysis of factors shaping the modern CPO agenda identified broad trends like economic instability, globalization, changing digital business strategies and the need to address corporate social responsibility (CSR) as areas that procurement organizations need to consider if they want to truly tap and manage the opportunities (and risks) offered by external supply markets.

Perhaps nowhere is this more readily apparent than with the topic of sustainability and environmental stewardship, the focus of today’s brief. The environment is an inseparable component of any business. It forms the platform layer off which all goods and services are produced, and, more fundamentally, the resulting ecosystem services from which humans benefit create the foundations for our species’ survival and quality of life. Due to multiple ongoing trends, however, the environment is changing, as are the ways that consumers, investors and governments think about our relationship to the environment.

Accordingly, Part 2 of this series on the CPO’s Conundrum examines the outside-in drivers pushing sustainability and environmental stewardship higher on the procurement agenda. It also explores recent examples of how businesses are integrating these issues into their supply management strategies, while simultaneously addressing them in balance with traditional procurement objectives, such as category management, supply base alignment and demand shaping.

K2 Sourcing: Vendor Introduction, Analysis and SWOT

The history of e-sourcing software stretches back to before the dot-com bubble burst, yet few of the original providers of RFX and auction management tools exist today as they did at their inception.

Some were bought and consolidated into the mega organizations we know today (e.g., SAP Ariba, which acquired FreeMarkets and Procuri), while others have slowly drifted into oblivion (RIP Emptoris). The result is that, with a few notable exceptions, procurement organizations today have few choices for standalone providers of e-sourcing tools.

One of those remaining options is K2 Sourcing, a provider of RFX and auction management software that has quietly served mid-market procurement organizations since 2003. Based in the Milwaukee area, K2 grew out of its founder’s frustrations as a procurement professional with the RFX and reverse auction platforms available then.

The young provider set out with one of the first cloud-based solutions in the space with a goal to “create the fastest, easiest and most transparent method for buyers to screen and select suppliers.” And while a lot has changed in the procurement and technology worlds in the past 16 years, K2 has managed, through a combined offering of subscription software and supporting sourcing services engagements, to build a stable and respectable client base, counting brands as varied as Verifone, Lozier Corp., Big Lots, Milwaukee Tool, Tempur Sealy, Kaiser Permanente and others.

This Spend Matters PRO Vendor Introduction offers a candid take on K2 Sourcing and its capabilities. The brief includes an overview of K2 Sourcing’s offering, a breakdown of what is comparatively good (and not so good) about the solution, a SWOT analysis and a selection requirements checklist for companies that might consider the provider.

Fairmarkit: Vendor Introduction, Analysis and SWOT (Part 2) — Summary and Competitive Analysis

The question of how to manage tail spend is as much a philosophical question as a technical one. There are issues around the thresholds that define tail spend, challenges around rogue spend that creates the long tail and the ultimate decision about who should be responsible for taming the tail.

But for most procurement organizations, the tail spend discussion is left unexplored.

Instead, the status quo way of managing tail spend often reigns. It’s rarely effective, so you’re left with the problems: wasted time by procurement and non-procurement staff, long lists of unknown or untrusted vendors, no clean data or visibility into savings left on the table.

Challenging this status quo is what Fairmarkit, a provider of tail spend management software out of Boston, seeks to do with its RFQ and analytics solutions. But where does Fairmarkit fit compared with other sourcing and tail spend management providers in the procurement technology market, and what are its relative strengths and weaknesses compared with direct and indirect competitors?

This Spend Matters PRO Vendor Introduction offers a candid take on Fairmarkit and its capabilities. Part 1 of this brief provided an overview of Fairmarkit’s offering and a detailed solution tour. Part 2 includes a breakdown of what is comparatively good (and not so good) about the solution, a SWOT analysis and a competitive breakdown of other providers that a procurement organization might consider while evaluating Fairmarkit.

Fairmarkit: Vendor Introduction, Analysis and SWOT (Part 1) — Background and Solution Overview

Tail spend is a growing area of concern for procurement. Given the granular, dispersed and opaque nature of such spend, many organizations find the task of taming the tail daunting.

Purpose-built tools have long existed that adequately address strategic sourcing activities (e-sourcing) and route internal users to pre-approved catalog items (e-procurement), yet technology to support the 20% of spend that is not actively managed by procurement has comparatively lagged.

Instead, the answer for most procurement groups has been to either attack tail spend with a patchwork of variably effective methods (p-cards, marketplaces) or outsource the problem entirely, like to a BPO firm.

Yet neither of these methods is particularly attractive. With the patchwork approach, issues around risk and control are poorly addressed, and while routing purchases under a low threshold (e.g., $500) into a marketplace can satisfy the typical spot buy, this hardly represent a strategy around optimizing tail spend.

BPOs offer expertise and a “set-it-and-forget-it” mentality, but organizations often find that the process efficiencies that they had hoped to gain don’t materialize as promised.

Finding a third way between the patchwork and complete outsourcing is at the heart of how Fairmarkit, an upstart vendor out of Boston, is trying to solve the tail spend management problem.

By using machine learning to analyze purchasing patterns and vendor fit, Fairmarkit automates the RFQ process for variable purchases that fall in the roughly $500 to $250,000 range. In the process, it wants to challenge the status quo for how businesses think about tail spend, enabling procurement groups to automate bidding and analysis on low-value purchases so they can assign team members solely to strategic events. And Fairmarkit already has had success doing so, claiming an average of 6% to 12% cost savings with clients as varied as the Massachusetts Bay Transportation Authority (MBTA), Univision and Yeti.

This Spend Matters PRO Vendor Introduction offers a candid take on Fairmarkit and its capabilities. It includes an overview of Fairmarkit’s offering, a breakdown of what is comparatively good (and not so good) about the solution, a SWOT analysis and a selection requirements checklist for companies that might consider the provider.

Icertis Blockchain Framework: A Glimpse of CLM’s Expanding Footprint into the Supply Chain

blockchain

Icertis recently announced it has developed, in partnership with client Mercedes-Benz, a blockchain framework to address multi-tier supply chain visibility challenges. Called the Icertis Blockchain Framework, the new offering allows companies to deploy a permissioned, standards-based blockchain (using one of the ecosystem standards through Hyperledger) within the core ICM platform on Microsoft Azure, as well as record specific transactions based on rules and metadata. Icertis developed the framework as an initiative within Mercedes-Benz Cars to better enforce requirements for CSR and compliance obligations without compromising contract confidentiality.

A ‘Human Touch’: VectorVMS Talks Rebrand and What the Future Holds

workers

The market for contingent workforce solutions has been evolving rapidly, including a new name for a vendor that has a deep history in the sector. VectorVMS, a Raleigh, North Carolina-based provider of a vendor management system (VMS) solution, recently became its own brand after spinning off from PeopleFluent, which had been Peopleclick. Since “people” are a prominent thread here, we caught up with Marc Husain, the general manager of VectorVMS, for a Q&A on the company's new developments.

Enabling the Living Contract: A Q&A with Icertis’ Co-Founder, CTO Monish Darda

Will procurement settle for merely a digital upgrade to contract management, or will it seize the opportunity to reimagine what contracts can be altogether? As Spend Matters framed it in our previous article in this series, the question comes down to a distinction between “smart” contracts and “live” contracts. To help organizations see the possibilities, we sat down with enterprise CLM provider Icertis’ co-founder and CTO, Monish Darda, for a Q&A exploring the live contracting concept, along with active use cases and a projection of what the future holds for contract management technology.

The Perils of Rogue Spend in Contingent Workforce Management

contingent workforce

Rogue contracting of freelance resources can, with the right supporting technologies, be turned from an operational risk to an attractive business opportunity — to drive savings, reduce compliance risks and provide improved visibility into and intelligent insights about this segment of the workforce to senior leadership. In this article, we examine the drivers and resulting issues of the increasing presence of rogue spend within contingent workforce management programs, and then we explore the opportunities and solutions that businesses can use to address this challenge.