Technology Content

Allocation: What Makes It Great (Sourcing SolutionMap Analysis)

Direct materials procurement technology has always been a bit of a blind spot for North American manufacturers. Many such businesses are already using indirect materials-centric and services-centric applications (e.g., procure-to-pay, vendor management systems), but few also have specialized direct materials-centric procurement tools as a part of their solution belt. A host of factors, however, is starting to change this, to include recent trade volatility, digital transformation of manufacturing alongside business in general, and increasingly complex supply chains that demand a more advanced approach to sourcing and supplier management.

Well-poised to address these drivers is Allocation, a German solution provider that, based on its performance for the past year in our Sourcing SolutionMap vendor rankings, offers one of the broadest and deepest platforms for direct supplier management and direct material sourcing on the market today. With a strong customer base in discrete manufacturing, Allocation can walk into just about any automotive, aerospace, CPG or other manufacturing-based procurement organization and talk the talk, backing up its knowledge with a set of specialized capabilities.

But where does Allocation stand out most and help “set the bar” in sourcing, and why should this matter for procurement and finance organizations? Let’s delve into the SolutionMap benchmark to find out where Allocation is great.

“What Makes It Great” is a recurring column that shares insights from each quarterly SolutionMap report for SolutionMap Insider subscribers. Based on both our rigorous evaluation process and customer reference reviews, each brief offers quick facts on the provider, describes where it excels, provides hard data on where it beats the SolutionMap benchmark and concludes with a checklist for ideal customer scenarios in which procurement, finance and supply chain organizations should consider it.

Mintec: Vendor Introduction (Part 1 — Background and Solution Overview) [PRO]

No matter how well they prepare, commodity buyers can do nothing about the weather. So until a supervillain decides to make a mid-life career shift to be a SaaS vendor — weather-as-a-service (WaaS), anyone? — procurement organizations buying in the food & beverage categories will have to manage commodity price volatility as it happens.

To do that, many businesses in the food retail, food manufacturing and hospitality industries turn to Mintec. Founded in 1982, Mintec is a UK-based provider of commodity data and analytics tools for the food and drink vertical. It collects, validates and organizes data across hundreds of agricultural commodities and related inputs (e.g., packaging, plastics, labor), which it then distributes via a SaaS platform designed for category planning and analysis.

This Spend Matters PRO Vendor Introduction offers a candid take on Mintec and its capabilities. It includes an overview of Mintec’s SaaS offering (Mintec Analytics). Part 2 will offer a breakdown of what is comparatively good (and not so good) about its solution, a SWOT analysis of Mintec, and a selection requirements checklist for businesses that might consider the provider.

This week, Spend Matters Nexus starts with a bang! Thank you, Workday and Scout RFP

Today was supposed to end a relaxed week, with two days of PTO for a variety of family activities. Instead, the week went wild — when Workday caught everyone slightly off-guard Monday as it announced that it would acquire Scout RFP.

That news launched a flurry of activity here, because I love real-time coverage of procurement sector M&A.

And with the investment-focused Spend Matters Nexus officially launching the same day as that breaking news, the timing, except for my scuttled plans to relax a bit more than usual, could not have been more perfect. This week I also ended up having some meetings with clients. And the lessons from the Workday and Scout news have resonated in many of the meetings. (See our Nexus coverage from this week that led to the insights.)

E-Procurement Tech Selection and the Deep Persona: Analysis & Commentary [PRO]

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 e-procurement personas: Nimble, Deep, Turn-key, Configurator and CIO Friendly. (See persona definitions* below.)

This review is organized just like the RFI for SolutionMap, according to these topics: platform capabilities, features & functionalities, and customer value.

Now let’s look at the e-procurement features and vendors as viewed by the Deep persona.

Workday acquiring Scout RFP (Part 4: Potential Areas of Solution Integration)

integration

Our final Spend Matters Nexus brief for the week analyzing Workday’s acquisition of Scout RFP focuses on potential product and workflow integration touchpoints between the providers, based on activities that Workday and Scout worked on while “partners only” as well as more strategic considerations. (See the first three installments here, here and here, covering general deal analysis, Scout capabilities + strengths/weaknesses, and competitive sector analysis.)

Today’s analysis begins with a list of generic sourcing integration touchpoints with broader source-to-pay and procurement technology capabilities.

As our Nexus coverage has shown, we tend to look at the acquisition of Scout as a clever, innocuous way for Workday to get into the edges of procurement with a standalone, crowd-pleasing solution. But we also think there’s much more to come from a Workday product roadmap perspective — and that this move is only one of the first acts of a much longer play.

Note: This analysis will be updated next week based on a briefing call with Workday.

 Jason Busch serves as Managing Director of Spend Matters Nexus, a membership, research and advisory organization serving technology acquirers (private equity, corporate development, etc.) and CEOs in the procurement and finance solutions marketplace (including contract management, B2B marketplaces/connectivity, indirect procurement, services procurement, direct procurement, commodity management, payment, trade financing, GRC/third-party management and related adjacent sectors).

Afternoon Coffee: Upwork’s Q3 financials show progress; Toptal launches Staffing.com; Soybeans under fire; China agrees to cancel tariffs in phases

China's Commerce Ministry has said China and the U.S. have consented to scrap the tariffs imposed in the on-going trade war, but in phases. Upwork Inc., the largest online talent solution based on GSV (gross services volume), reported its Q3 2019 financial information Tuesday with positive results across the board. Talent network Toptal announced the launch of Staffing.com to foster conversations pertaining to the future of procurement and staffing at large enterprises, among many other things. And U.S. soybean cargo was caught in a duty crossfire in — where else? — China. Afternoon Coffee: your source for procurement and supply chain news.

CPO Masters of Complexity (Part 1)

It sure seems like most everyone’s life is getting more complex. When I casually ask friends how they’re doing, the response is usually something about being ridiculously busy and barely being able to keep their head above water. In this age of constant connectivity, rampant over-scheduling at work and home, and constant barrage of information, complexity seems like the new norm.

The same is true for chief procurement officers (CPOs). According to our eighth annual “Global Chief Procurement Officer Survey,” CPOs largely see procurement-related risk on the rise — nearly 60% of the 481 respondents indicated that risk has risen either significantly (19%) or somewhat (42%). This is part of a broader theme of increased complexity that came out in the survey findings, where we profile complexity in four main areas: external complexity (headwinds coming from outside of the four walls of procurement), internal complexity (challenges of managing internal relationships and alignment with business objectives), talent complexity (building effective procurement teams and operating models), and digital complexity (defining and executing on digital strategies that are aligned with broader digital transformation efforts). In this post, I will focus on the first two areas of complexity. A subsequent post will discuss the last two areas.

Not all ‘digital’ transformation is the same: 6 degrees of difficulty [PRO]

Buzzwords abound out there, and a lot of common words are used by folks without necessarily having a common understanding of the meaning. For example, take the phrase “digital procurement transformation.” Even the individual words themselves alone can have different interpretations:

* Digital — Does this mean digitization of procurement processes through workflow automation, or is it something broader?
* Procurement — Is this all of source-to-pay or just procure-to-pay? Or just everything that a procurement department does, including broader supply chain efforts?
* Transformation — Can this just be incremental, continuous improvement, or does it have to be a more discontinuous transformation program?

The problem for practitioners is how to cut through the clutter of this terminology and more easily learn from others surrounding adoption of “digital” in different ways. For example, there is certainly a lot to learn just in terms of better implementation of systems for automating good old-fashioned sourcing, requisitioning, ordering, receiving and paying.

But, there are also higher order digital capabilities that go beyond just automating the proverbial cow path. For example, advanced analytics such as bid optimization can enable new sets of sourcing processes that were not really feasible before. Similarly, techniques such as community-based procurement that use technology across firms can create new value beyond automating within a single firm.

There is actually a spectrum of digital related competencies from basic source-to-pay workflow automation all the way through to procurement-enabled disruptive value chain initiatives. So, if you have mastered some of these basic capabilities for digital transformation and procurement, it is time to raise the “degree of difficulty” and see how others are faring in terms of picking the higher hanging fruit.

In this Spend Matters PRO analysis, we will outline six levels of digital procurement sophistication, and also see how more than 400 organizations stack up based on the latest research.

Workday’s acquisition of Scout RFP (Part 3: Suite and Best-of-Breed Competitor Analysis and Recommendations)

Earlier in the week, the finance and HR solutions provider Workday announced it was buying Scout RFP, a sourcing solution for those who would rather use Uber than maintain an old car (I make this observation with full cynicism intended because my 25-year-old car has been in the shop for three of the past six months ).

You can find previous free coverage of the transaction news on Spend Matters here and here. In our first Nexus subscriber brief covering the procurement technology sector’s M&A news, we offered background on Scout RFP, explored the provider’s strengths and weaknesses, and gave our initial insights into the rationale for the transaction. The second brief explored the competitive implications of the transaction on Workday’s ERP competitors.

As we continue our analysis on Spend Matters Nexus, we turn our attention to landscape implications of the transaction that may affect other, specialized procurement technology providers. We also offer lessons learned for this group as well in terms of what really matters with driving customer success, growth and, subsequently, valuation. Today’s research brief provides a competitive analysis for the source-to-pay suite market segment (e.g., Corcentric, Coupa, Ivalua, Jaggaer, SAP Ariba, SynerTrade, Wax Digital and Zycus) as well as specialty providers that emphasize the sourcing area. U.S. and European sourcing specialists include Allocation Network, Bonfire, EC Sourcing Group, K2 Sourcing, Keelvar, MarketDojo, Promena and ScanMarket and my favorite, at least for its name, SourceDog.



Since the other dog is my car right now and I’m late for a meeting, let me call that proverbial Uber and get on with this analysis.

Jason Busch serves as Managing Director of Spend Matters Nexus, a membership, research and advisory organization serving technology acquirers (private equity, corporate development, etc.) and CEOs in the procurement and finance solutions marketplace (including contract management, B2B marketplaces/connectivity, indirect procurement, services procurement, direct procurement, commodity management, payment, trade financing, GRC/third-party management and related adjacent sectors).

Customer reviews for Determine (Corcentric) are in the new SolutionMap Customer Insights report

This week’s SolutionMap Customer Insights report focuses on customer reviews for the suite  provider Determine, a Corcentric company.

The applicable SolutionMap categories for this report are Source-to-Pay, Procure-to-Pay, and Strategic Procurement Technologies (SPT includes Sourcing, Analytics, CLM and SRM). Determine has been bought by Corcentric. Integrations between the two provider platforms are not factored into the Customer Insights analysis, which is entirely based on Determine’s capabilities.

SolutionMap Insider members can read about Determine 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.

Orpheus: Vendor Snapshot (Part 3) — SWOT, Competitive Analysis and Summary [PRO]

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.

Workday’s acquisition of Scout RFP (Part 2: ERP competitors analyzed)

Yesterday, the finance and HR solutions provider Workday announced it was buying Scout RFP, an easy-to-use sourcing solution. You can find previous free coverage on the transaction on Spend Matters here and here. In our first Nexus subscriber brief covering the procurement technology sector’s M&A news, we offered background on Scout, explored the provider’s strengths and weaknesses, and gave our initial insights into the rationale for the transaction.

As we continue our analysis on Spend Matters Nexus, we turn our attention to landscape implications of the transaction that may affect other technology providers. Today’s research brief provides a competitive analysis for the ERP market segment including providers such as Epicor, Infor, Oracle, Microsoft, Netsuite (Oracle), SAP, Sage and Unit4.

In this analysis, we also provide context via a brief history lesson on how (and why) ERP providers have traditionally offered procurement capability as an extension of financials, tracing the emergence of ERP from MRP. Specifically, we trace how and why this legacy has led to a situation of technology that is inadequate for procurement’s needs (which gave rise to the source-to-pay technology market in the first place).



Subsequent competitive analyses of the transaction will consider both suite and best-of-breed / independent procurement technology providers, including the valuation impact on the sector (and what some of the key drivers to valuation have been recently). We will also explore in greater detail the process, sales and technical integration considerations for Workday as it digests this procurement amuse-bouche.

But for now, let’s dust off our competitive bifocals as we magnify the competitive considerations of the deal, examining Workday’s ERP peers competing for their share of the $50 billion procurement technology total addressable market (TAM), as estimated by Coupa’s  Business Spend Management TAM.

Jason Busch serves as Managing Director of Spend Matters Nexus, a membership, research and advisory organization serving technology acquirers (private equity, corporate development, etc.) and CEOs in the procurement and finance solutions marketplace (including contract management, B2B marketplaces/connectivity, indirect procurement, services procurement, direct procurement, commodity management, payment, trade financing, GRC/third-party management and related adjacent sectors).