Last month, we examined the current constraints on procurement today and discovered that data spend quality is an issue that’s holding organizations back. Digging in further, we found that spend classification is a big factor affecting organizations’ abilities to get high-quality data. The reality is you don’t know what you’re actually spending in each category. For many procurement teams, getting the insights they need is challenging because classification is painful and time-consuming, and they don’t know how to make things better.
Let’s take a deeper dive into some of the problems with spend classification today:
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.
In most businesses, their millions of dollars in leasing spend represent a hidden opportunity for procurement and finance departments to find savings and create strategic value.
With every department in a business juggling leasing terms, financing and renewals for things like warehouses, offices, computers, supplies, furniture and fleets, it’s a daunting task to think any single department could manage it all. These are some reasons why lease spend isn’t managed well. But technology has developed to the point that it would be unthinkable to leave all of that spend unmanaged.
So it's clear that lease spend should be its own category, but why is that becoming apparent now?
Spend Matters welcomes this guest post from Rich Ham, the CEO of Fine Tune, which partners with companies to source, negotiate, manage and audit certain burdensome expense programs.
Procurement, operations and accounting are three disparate parts of organizations that are simply not equipped to efficiently share information and work together so that individual expenses are optimally managed. This fundamental disconnect between them is costing millions and impacting the growth of companies everywhere.
Let's look at the issues and four strategies to help.
Procurement teams globally are facing the same common challenges. We hear it over and over: CPOs are constantly being tasked with cutting costs and doing more with less … yesterday. But how are they doing in actually overcoming these challenges? Let’s take a look.
Today, many procurement organizations are attempting to solve these challenges by turning to robotic process automation (RPA) as a solution. But RPA, while serving as an important automation tool, operates in a regime that accepts current constraints as a given and works within them. It represents an incremental advance in the evolving technology frontier by addressing a subset of procurement domain competently, but it cannot be justifiably elevated to the status of a breakthrough technology.
Xeeva’s patented specialized procurement AI demolishes the resident constraints in procurement by transforming spend data and digitizing domain expertise.
If you’re at a company that’s looking for more insight into its spend, you may be considering a procure-to-pay solution or you may just need to go with a spend analytics tool.
So, how does a business decide between the two?
P2P is often a robust system that a business considers when it needs to upgrade its processes as well as its technology. It’s often deployed when legacy systems need replacing or old workflows take too much time and effort from your staff.
A company choosing this option should be ready for a long implementation process that has costs beyond the hefty price of the system itself. Implementation, change management and staff training take time and money. And hidden costs can include poor user adoption of the system, which cuts into the return on investment if your personnel don’t use the system you just bought.
A spend analytics solution may be a better fit for established businesses that already have serviceable technology and sound workflows. Those companies may just need a system that offers more insight into the data they already have. That’s when you’d look for a best-of-breed spend analytics solution.
Tech selection requires evaluating a lot of procurement software vendors before making a choice, and our coverage typically focuses on the early part of the process to help companies buy a solution that’s the right fit for their needs. But we wanted to talk with a company well after its tech selection to gain insights on the process.
The strategic business enabler Tecom Group and its parent company, Dubai Holding, have gone through two rounds of tech selection to find a spend analytics firm to help them analyze high value transactions, find common spend areas, save money and add visibility for new business strategies.
To find out more about the tech selection process and its results, we did a Q&A with Cory Thwaites, Tecom’s executive director of procurement, about his efforts to bring in a spend analytics firm.
“I was like the most hated guy in the office for a while,” Thwaites said about trying to convince the staff that Tecom needed to know more about its spend.
He said that all changed once his team started seeing the dashboards that showed the actual state of Tecom’s spend.
Tradeshift is a cloud platform that connects buyers and suppliers with the goal of digitizing supply chain relationships, processes and information, while also enabling everyday procure-to-pay activities. Its capabilities span the buying of goods and services through to financing and payment — and significant capability in between, especially in the invoice-to-pay area.
In addition to providing its own procure-to-pay modules, Tradeshift offers an open integration framework that allows other technology firms (and customers) to integrate and/or development third-party apps, primarily centered on supplier connectivity, transaction enablement and collaboration. Tradeshift can even integrate alternative procure-to-pay providers in cases where specific enabling capability is desired.
This three-part Spend Matters PRO analysis provides an update on Tradeshift capabilities, both as a platform-as-a-service (PaaS) provider and as an e-procurement and invoice-to-pay technology vendor.
The updates since last year's review include information about real-time collaboration; a single sign-on; centralized access to POs, invoices, etc.; an AI-assisted chatbot named Ada; buying topics about GPOs and direct materials; global support; and new sections on payments/trade financing, analytics, services, integration and technology like blockchain.
The PRO analysis is designed to provide facts and expert analysis to help procurement and finance organizations make informed decisions about whether they should consider Tradeshift for both traditional “in-the-box” procure-to-pay requirements as well as unique marketplace/platform-type digital initiatives.
Part 1 of our analysis provides a company background and detailed solution overview, as well as a summary recommended fit suggestion for when organizations should consider Tradeshift as a complement to other procurement and finance solutions. The remaining parts of this research brief will cover product strengths and weaknesses, competitor and SWOT analyses, and insider evaluation and selection considerations.
Last week, Spend Matters Europe did a great job of summarizing the Coupa Inspire event in London, including a look at the biggest items that Coupa was pushing on its product agenda.
This was great, but the best product-related announcements weren't in the keynotes, and they barely even got more than a mention in the breakout sessions.
So today, we're going to focus on two developments — connectivity and analytics encapsulation — because these innovations can totally change the game in business spend management and should not be overlooked!
Spend Analysis. Every company needs it, but not every company knows what they need or how to use it. As per our first post, it could be defined as:
* An extensive set of canned reports across a defined data set * User Defined Reports and Views on a static ROLAP Cube * Dynamic Cube Construction and View Creation on a predefined data set * Dynamic Cube Construction and Federation on an extensible, user-defined data set
Depending on the provider, it may or may not include:
* Data Consolidation and Cleansing * Data Enrichment * Data Classification and Categorization * Data Synchronization with Source Systems
And that’s just the tip of the iceberg on what one has to consider before even inviting a pool of candidates to an RFI, yet alone whittling down to three that all have the core capabilities the organization needs and that can all, more-or-less, be compared apples-to-apples when the RFIs come in.
That’s why in the first part of this three-part series we took our time to define Orpheus and its solutions, including components and capabilities not offered by every spend analysis vendor on the market. Then, in Part 2, we dove deep into the solution, highlighting particular strengths and bringing to light some of the weaknesses compared to peers (which may or may not matter depending on what your organization is looking for). Now, in our third and final part, we will provide a SWOT analysis, a competitive market analysis and a summary with commentary.
In Part 1 of Spend Matters’ three-part PRO Vendor Snapshot on Orpheus, we started out by explaining how the definition of spend analysis differs from client to client and how it is a buyer-beware market — as not all vendors have the same technological capabilities, and you can’t compare their quotes as apples-to-apples. That’s why it’s important to understand what a vendor can do, and what it can’t, before whittling down to the final three and definitely before making a selection — because not all vendors will have what Oprheus has to offer.
While many vendors can slice and dice, cube and derive, and find opportunities on the fly — not all have initiative tracking, not all have AI, and not all have the experience of classifying over half a billion transactions across 4 million suppliers for 15 years of operation. This is pretty distinctive, and we’ve only completed the introduction so far.
In today’s post, we will dive into the strengths and weaknesses, giving you deep insight into the platform.
In Part 3, we will provide a SWOT analysis of Orpheus and discuss the competitive market that surrounds it. We will conclude with some commentary and hopefully will leave you with deep insights into who Orpheus is and what it can do.
“Spend analysis” is one of the most misused terms in the solution space, especially since the exact scope of what a vendor offers with respect to spend analysis varies by vendor and the scope of what a buyer expects when they buy a spend-analysis solution varies by the buyer. You see, what a vendor offers depends upon their philosophy to analysis and where they are on the development curve with respect to that. What a buyer expects depends upon their level of procurement maturity, what they are aware of as being possible with a modern spend analysis tool, and their level of master data maturity.
You see, "spend analysis" has been, is and will be defined in various ways by various vendors. Depending on the vendor, it could be defined as:
* An extensive set of canned reports across a defined data set * User Defined Reports and Views on a static ROLAP Cube * Dynamic Cube Construction and View Creation on a pre-defined data set * Dynamic Cube Construction and Federation on an extensible, user defined data set
Depending on the provider, it may or may not include:
* Data Consolidation and Cleansing * Data Enrichment * Data Classification and Categorization * Data Synchronization with Source Systems
And depending on the provider philosophy, the classification may be:
* Rules-based * Automated using statistical / clustering / neural networks * Machine learning that adjusts the rules to improve the classification over time * Hybrid approach that does auto-classification and allows for pre-classification using fixed rules and post-classification for mapping corrections * Machine learning that identifies fixed, deterministic classification rules that are applied with user defined rules for all classification
And the data may or may not be limited to:
* Integrated data sources in the platform that the analysis tool is integrated into * Integrated data sources, pre-integrated ERP and select API feeds * A data lake maintained by the provider * Any data you can push into the data lake it is configured to work on
And so on. In other words, what a vendor offers when they offer spend analysis varies by the vendor, and what a buyer might get can vary widely.
So in this three-part Spend Matters Pro Vendor Snapshot on Orpheus, we will try to leave you with a clear understanding of exactly what Orpheus offers with respect to spend analysis and whether they might be the right provider for you.
In Part 1, we will provide a brief company overview and a look at Oprheus' main offerings.
For Part 2, we will provide a breakdown of what is comparatively good (and maybe not so good) about the solution.
In Part 3, we’ll offer a high-level SWOT analysis, some market implications and a summary.
