eProcurement / Procurement Content

(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 Xavier Olivera lays out the predicaments faced in the procure-to-pay sector. And for our PRO subscribers, this post also offers his predictions for 2020.)

The market for procure-to-pay (P2P) solutions — including its submarkets for e-procurement, invoice-to-pay and AP automation solutions — came a long way in the 2010s.

For e-procurement providers, we saw a strong focus on improving the overall user experience of their tools; a push to help organizations increase their percentage of spend under management; new approaches to identifying and eliminating maverick spending; and increased availability of intelligent analytics that can recommend strategies and action items that lead to better purchasing decisions.

Invoice-to-pay providers, for their part, didn’t sit still either. In fact, many solutions in the I2P and AP automation sectors evolved to better digitize and automate processes around invoice capture, validation and approval — primarily through the application of AI and machine learning to their tools.

That doesn’t mean there aren’t still problems, of course. So as we start 2020, we wanted to take a step back and look at two persistent predicaments in the P2P space that procurement organizations and their technology providers are facing:

* In e-procurement, there’s one problem in particular that will continue to plague vendors over time, requiring new capabilities and creativity to solve it: the need for procurement organizations to generate new savings year after year, especially when savings tend be viewed as related to sourcing while P2P is viewed as more transactional and focused more on efficiency savings.
* In I2P/AP automation, the real challenge is to support the broader organization's goal of improving cash flow and optimizing working capital while balancing the needs of suppliers, who want to be paid as soon as possible. Balancing these goals requires improvements in the current P2P solutions capabilities, such as by incorporating functionality for payment processing, supply chain financing, and the ability to move money worldwide at a lower cost (especially in cross-border payments).

We consider these two challenges critical not just for procurement transformation but also for supporting value creation across the whole business. So now that we are entering 2020, this Spend Matters PRO also offers some predictions in regards to these challenges for what we believe P2P providers will do this year — or at least we wish they would. Issues include the need for total costs to be calculated in e-procurement, and for better P2P answers to working capital, financing and payments.

Tradeshift, a solution provider known for its network, supply chain payment offerings and marketplaces, announced today that it has a funding round of $240 million in equity and debt that sets “the company on a direct path to profitability in the near future,” the announcement said.

CEO Christian Lanng spoke with Spend Matters and said this marks a time for refocusing on high-value efforts and restructuring the company, which was founded in 2010.

“It's been a very long journey to get critical mass. It actually doesn't feel this long today. Ten years is quick in our space,” Lanng said.

Read more about the changes at Tradeshift.

This week’s SolutionMap Customer Insights report focuses on customer reviews for BuyerQuest, a provider of e-commerce solutions. The applicable SolutionMap category for this report is in E-Procurement.

SolutionMap Insider members can read about BuyerQuest in our latest report.

In each Customer Insights report, we provide a one-page summary of details from the SolutionMap peer review process. It includes ratings on how well the vendor meets its customers' expectations, three key differentiators for the vendor and a list of quotes from customers about the vendor’s greatest strengths.

The e-procurement solutions market has been growing for the last seven years. Because of this rapid growth, the market is also fragmented, with numerous vendors competing for procurement organizations’ attention. Yet no one vendor is an ideal fit for all companies, due to the unique requirements of different organizations’ sizes, industry/vertical and prior technology investments (or lack thereof).

So how can companies with different needs evaluate procurement solutions amid an array of vendors with different capabilities?

Spend Matters’ vendor rankings in SolutionMap account for these differences using a persona-based approach. Each SolutionMap persona is calibrated to weight evaluation requirements so that it reflects the profile of certain kinds of buyers. For example, the “Nimble” persona reflects small and medium-size businesses that prioritize fast time-to-value and ease of use in the selections; the “CIO Friendly” persona emphasizes technical foundation and interoperability with other enterprise systems to make for a straightforward implementation.

So what do SolutionMap personas look at for e-procurement, and how can they help your organization make better technology decisions?

In a series of PRO articles, we’ll analyze the market according to the different SolutionMap E-Procurement personas: Nimble, Deep, Configurator, Turn-Key and CIO Friendly. (See persona definitions* below.)

This review is organized just like our RFI sent to vendors that are ranked in SolutionMap, according to these topics: platform capabilities, services, features & functionalities, and customer value.

Let’s look at the e-procurement features and vendors as viewed by the CIO Friendly persona.

The e-procurement solutions market has been growing for the last seven years. Because of this rapid growth, the market is also fragmented, with numerous vendors competing for procurement organizations’ attention. Yet no one vendor is an ideal fit for all companies, due to the unique requirements of different organizations’ sizes, industry/vertical and prior technology investments (or lack thereof).

So how can companies with different needs evaluate procurement solutions amid an array of vendors with different capabilities?

Spend Matters’ vendor rankings in SolutionMap account for these differences using a persona-based approach. Each SolutionMap persona is calibrated to weight evaluation requirements so that it reflects the profile of certain kinds of buyers. For example, the “Nimble” persona reflects small and medium-size businesses that prioritize fast time-to-value and ease of use in the selections; the “CIO Friendly” persona emphasizes technical foundation and interoperability with other enterprise systems to make for a straightforward implementation.

So what do SolutionMap personas look at for e-procurement, and how can they help your organization make better technology decisions?

In a series of PRO articles, we’ll analyze the market according to the different SolutionMap E-Procurement personas: Nimble, Deep, Configurator, Turn-Key and CIO Friendly. (See persona definitions* below.)

This review is organized just like our RFI sent to vendors that are ranked in SolutionMap, according to these topics: platform capabilities, services, features & functionalities, and customer value.

Let’s look at the e-procurement features and vendors as viewed by the Turn-Key persona.

Basware faces significant competition from multiple segments of the procure-to-pay market. It competes against a range of vendors, including ERP providers that offer e-procurement and supplier network capabilities (along with varying degrees, based on vendor, of e-invoicing capabilities). It also competes against e-invoicing and supplier enablement specialists, regional supplier network/e-invoicing providers, independent e-procurement providers and traditional AP automation and scan/capture providers.

As a trend, competition is increasing (not decreasing) for Basware, which represents a challenge given the lack of brand awareness within procurement and P2P. Further, the marketing effort it has expended thus far in the trade financing area (which has not yet resulted in material payables or receivables financing volume) and the fact Basware is largely unknown in North America as an e-procurement provider also represents hurdles from a competitor perspective.

This final installment of our three-part Spend Matters PRO Vendor Snapshot Update series covering Basware offers a competitive analysis and comparison with other procure-to-pay, AP automation and supplier network providers. It also includes a SWOT analysis and summary evaluation and selection considerations. Part 1 and Part 2 of this Update series provided a company and deep-dive solution overview, product strengths and weaknesses, and a recommended fit analysis for what types of organizations should consider Basware’s product line.

Basware, a Nordic procure-to-pay (P2P) provider that until recently adopted a conservative global growth strategy, is not as well known outside its customer base for its set of differentiated and robust capabilities, especially in the AP automation, e-invoicing and supplier network areas. Through its acquisition of Verian, it added sufficient e-procurement capability to compete against other best-in-class purchasing technology providers (previously, its cloud-based Alusta platform, which forms the basis of its AP automation and invoicing capability, was not competitive in the e-procurement market against specialized providers). In the trade financing area, we have applauded Basware in the past for taking a highly strategic approach in partnerships to both payables and receivables financing. And we now applaud its more competitive approach in adding partnerships to its multi-funder capability and “on demand” programs.

This Spend Matters PRO Vendor Snapshot Update (Part 2) explores Basware’s strengths and weaknesses in the P2P, supplier network and trade financing areas, providing facts and expert analysis to help organizations decide if they should shortlist the vendor as a potential provider. Part 1 looked at updates since our 2016 brief, offering a company and detailed solution overview, as well as a recommended fit suggestion for what types of organizations should consider Basware. Part 3 will include analysis and commentary.

The Spend Matters team has known Duncan Jones, the lead author of Forrester’s latest E-Procurement Wave, for just about as long as the average technology solution provider in this sector has been in business. Duncan is known for trading humorous barbs with Jason Busch, Spend Matters’ founder, at various industry events with his typical acerbic British wit. However, there is nothing humorous about Forrester’s latest Wave when it comes to singling out SAP Ariba for failing to live up to its past prowess, especially in the technology area. What's going on with Ariba's product performance and personnel churn?

This week’s SolutionMap Customer Insights report focuses on customer reviews for Vroozi, a provider of spend management, marketplace and invoicing automation solutions. The applicable SolutionMap category for this report is in E-Procurement, Invoice-to-Pay and Procure-to-Pay. SolutionMap Insider members can read about Vroozi in our latest report.

In each Customer Insights report, we provide a one-page summary of details from the SolutionMap peer review process. It includes ratings on how well the vendor meets its customers' expectations, three key differentiators for the vendor and a list of quotes from customers about the vendor’s greatest strengths.

Spend Matters today released its Q4 2019 SolutionMap, ranking 59 procurement software companies across 12 solution categories, including E-Procurement, Sourcing, Spend Analytics, Supplier Relationship Management, Contract Lifecycle Management and Contingent Workforce & Services. Click on this article to see which new providers joined the rankings this quarter — and to see how to access the rankings for free!

This SolutionMap analyzes a select group of E-Procurement solution providers. It is part of our Q4 2019 SolutionMap report series, also featuring Spend Analytics, Sourcing, Supplier Management, Contract Management and Invoice-to-Pay providers. Our Q4 release also features SolutionMap for Procure-to-Pay and Strategic Procurement Technology suites.

This Spend Matters SolutionMap Insider Release Note provides insight into the Q4 2019 SolutionMap release for E-Procurement, Invoice-to-Pay (I2P) and Procure-to-Pay (P2P), reviewing the process that we follow and highlighting what has changed since the last release.

The E-Procurement, I2P and P2P customer reference set added 20 new individual customer references in Q4. There were no new providers added for Q4, although Jaggaer One (formerly Jaggaer Indirect) has successfully been scored against the new Q2 2019 RFI requirements for the first time.

*Get a first look at the Q4 SolutionMap comparative quadrant graphics here.