PRO or Plus Content

A Critical Look at Category Management (Part 4) [Plus+]

Editor's note: This Spend Matters Plus brief is a refresh of our 2013 series on category management, which originally ran on Spend Matters PRO. 

In the last few weeks we’ve looked at some of the drawbacks related to what we might call “traditional” category management (Part 1, Part 2, Part 3). However, we should stress that they’re all aspects of the process that can be overcome by appropriate thought and management effort. The lack of stakeholder involvement we’ve sometimes seen — the overly procurement-centric approach — can be addressed by ensuring that the right engagement takes place. The risk of over-standardisation of approach can be mitigated by being aware of that issue and ensuring it doesn’t happen. But today’s discussion will consider an alternative approach that perhaps challenges more fundamentally the conventional steps in the category management process.

Program Management: The Missing Link in Procurement Technology Modules and Suites (Part 7 — SRM Technology Components) [PRO]

LinkedIn ProFinder

This series has explored the various aspects of a modern strategic procurement system that enables both enterprise-level programs and procurement-led programs and processes. We’ve explored in gory detail the elements for strong analytics, user experiences and agile architectures. The series began with strategic sourcing to illustrate that properly supported category management can be a pretty tall order. Within category management, we went from basic program management requirements that were quite demanding to in-depth program management requirements that, on the surface, might seem impossible to the average procurement software company, as well as analytics requirements that, at the present time, excludes most of the current vendors from the market. 

These requirements from a business standpoint are not unreasonable, but although the ability for most providers to meet them is certainly a work-in-progress, the value in doing so is compelling. Strategic personnel can truly do strategic functions, not spend their days filling out virtual paper and transcribing data. The biggest cost in procurement is the opportunity cost of wasting a professional’s time on firefighting, pushing paper, wrangling bad spend data amd “googling” for new suppliers, rather than creating the 5X–10X ROI that goes along with strategic procurement. 

But turning the tables is not easy. Take the last example from the list above regarding supplier discovery. Today's supplier networks are generally “walled gardens” built to support suppliers within the network, not to help buyers find suppliers beyond the network. This would require new approaches to supplier networks — and new technology building blocks. That’s why, in this post, we are addressing what those critical building blocks are.

Allocation: Vendor Snapshot (Part 2) — Product Strengths and Weaknesses [PRO]

FM Global Resilience Index

North America is a curious market for direct materials-centric procurement software. While many manufacturers currently use indirect materials- and services-centric applications (e.g., procure-to-pay, vendor management systems), few manufacturers have specialized direct materials-centric procurement tools as a part of their solution belt. And to note the elephant in the room, many manufacturing procurement organizations are still not even aware of what these solutions can do.

The exception to this is in Europe (especially Germany and Austria) where direct materials procurement software is generally well adopted, even among middle-market companies. Within this market segment, Allocation is one of a handful of leaders, with tailored capabilities for sourcing and supplier management — and it is expanding globally.

This Spend Matters PRO Vendor Snapshot explores Allocation’s strengths and weaknesses, providing facts and expert analysis to help procurement and finance organizations decide whether they should consider the provider. Part 1 of our analysis provided a company and detailed solution overview and a recommend fit list of criteria for firms considering Allocation. The third part of this series will offer a SWOT analysis, user selection guide, competitive alternatives, and additional evaluation and selection considerations.

Allocation: Vendor Snapshot (Part 1) — Background and Solution Overview [PRO]

When you start a vacuum cleaner, a number of things happen. First, the air pump creates a partial vacuum in the appliance. This results in air rapidly rushing in from the outside, through the attached hose or nozzle, pulling in dust, dirt and small debris with it. But the effects don't end there. The rapid movement of air from immediately outside the vacuum creates another partial vacuum that needs to be filled by the surrounding air, and this causes nearby particulates to also move and change position. And, thanks to the butterfly effect, this can have larger repercussions than one expects, creating unintended consequences. If pollen, mold or certain other once stationary particulates get into the air, people can sneeze, suffer allergic reactions or even get deathly ill.

What does this have to do with sourcing? When big firms buy smaller e-sourcing tools, vacuuming up the major standalone software companies in given niche, this creates a void — and kicks up a dust cloud, of sorts. From a manufacturing-centric sourcing perspective, this last year or so saw the acquisitions of Directworks (by Ivalua) and Pool4Tool (by Jaggaer). These acquisitions — not to mention Jaggaer’s prior acquisition of BravoSolution — took two specialist players in direct materials procurement and supplier management out of the best-of-breed market in North America, creating a new void. The result? The door was opened for new best-of-breed players from Europe to enter, and one of these players is Allocation.

But will Allocation benefit from the vacuum effect? It certainly has the pedigree. Founded in 1998, Allocation has been building its platform for two decades. Today it has 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.

This Spend Matters PRO Vendor Snapshot provides facts and expert analysis to help procurement organizations make informed decisions about Allocation’s e-sourcing and supplier management solutions. Part 1 of our analysis offers a company background and detailed solution overview, as well as a summary recommended fit suggestion for when organizations should consider Allocation. The remaining parts of this research brief will cover product strengths and weaknesses, competitor and SWOT analyses, and insider evaluation and selection considerations.

APEX Analytix: Vendor Snapshot (Part 3) — Summary and Competitive Analysis [PRO]

data analytics

APEX Analytix is far more than just a recovery audit and spend analysis software provider. It’s also a specialist in supplier management. This third and final installment of our Vendor Snapshot covering APEX Analytix’s supplier management solution provides a SWOT analysis of the company along with a competitive segmentation analysis and comparison. It also offers recommended shortlist candidates that can serve as alternative vendors to APEX, complete with solution selection guidance. Finally, this research brief provides summary analysis and recommendations for organizations considering APEX for supplier management. 

For background on APEX, we encourage you to review Part 1 of the series, which provided an in-depth look at APEX and its supplier management solution, and Part 2, which gave a detailed analysis of product strengths and weaknesses, as well as a review of the its user experience.

A Critical Look at Category Management (Part 3) [Plus+]

We wrote in the last article about the standardised nature of category management process and practice, and the dangers inherent in approaching different categories via that standard approach. Now let’s consider another failing of much “traditional” category management methodology and philosophy. We might define this as an overly procurement-centric approach to the whole task in hand. The buyer is placed in an almost deity-like position, controlling the whole process and with other participants fitting into their scheme and doing what they are told to by the all powerful category manager.

Beeline’s Acquisition by New Mountain Capital: Transaction Analysis and Competitive Impacts [PRO]

Beeline, well known in the contingent workforce and services sector as one of the top two global VMS solution providers, recently announced it is being acquired by New Mountain Capital (NMC), a private equity firm. NMC, which is focused on developing and growing companies in defensive growth industries, is now completing the last formal steps in its acquisition of Beeline from private equity firm GTCR. Spend Matters covered the acquisition announcement and followed up on the news with a subsequent interview of Beeline CEO Doug Leeby, who expressed enthusiasm about the deal and confidence in the new owner.

The acquisition comes at an interesting point in the evolution of the contingent workforce and services (CW/S) software market.  On the one hand, solution buying by enterprises continues to follow a customary pattern — we need a VMS or an MSP/VMS and a supplier-funded model — resulting in a commodified, competitive market. In such an environment, some VMS providers have focused on achieving economies of scale, exploiting solution adjacencies (e.g., SOW) and investing in new technologies (e.g., data analytics, artificial intelligence) to enhance solution value and differentiate their offerings.

At the same time, changing conditions on both demand and supply sides of the labor market (e.g., skill shortages, cost of talent, independent workforce, online platforms) have started to stimulate responses among CW/S intermediaries and software providers. Moreover, the application of state-of-the-art and leading-edge technologies is enabling incumbent and new providers to offer new types of solutions that may (or may not) address emerging business needs in the short term or the long term. In such an environment, having the capacity to invest — and a balanced but agile investment strategy — would appear to be critical to future success.

In this Spend Matters PRO brief, we add context to and take a closer look at the Beeline-NMC deal, which seems promising. We also offer our perspective on what the deal may mean for Beeline and the competitive markets it serves, in both short and long terms.

APEX Analytix: Vendor Snapshot (Part 2) — Product Strengths and Weaknesses [PRO]

spend analytics

Better known for its broader portfolio of recovery audit, overpayment and self-audit software, APEX Analytix also offers a specialized supplier management solution. APEX provides unique, out-of-the-box capabilities that support core supplier information management (SIM), validation and financial controls, as well as working capital optimization solutions. In addition, its supplier management solution delivers the broader configurability, workflow, rules, analytics, supplier portal and associated capabilities one would expect from supplier management software.

This Spend Matters PRO Vendor Snapshot explores APEX Analytix’s strengths and weaknesses in the supplier management area specifically, providing facts and expert analysis to help procurement and finance organizations decide whether they should consider the provider. Part 1 of our analysis provided a company and detailed solution overview and a recommend fit list of criteria for firms considering APEX Analytix. The third part of this series will offer a SWOT analysis, user selection guide, competitive alternatives, and additional evaluation and selection considerations.

APEX Analytix: Vendor Snapshot (Part 1) — Background and Solution Overview [PRO]

If you were to pick a single procurement software category that is remaking itself from the inside out thanks to technology, the recovery audit market would be it. And one provider at the vanguard of this transformation is APEX Analytix. APEX Analytix, a Spend Matters Provider to Watch since 2015, is perhaps best known for its core accounts payables (AP) recovery audit business. But it is a broad-based procurement technology provider in its own right, offering a range of overpayment prevention and self-audit software, supplier information management and supplier portal solutions.

In this Spend Matters PRO Vendor Snapshot series, we will focus our analysis of APEX Analytix on its supplier management solution, which will be featured for the first time in the Q3 2018 Supplier Management SolutionMap. APEX Analytix’s solution, which is best-in-class when it comes to certain areas of financial information management and validations, deserves to be considered on a standalone basis.

This Spend Matters PRO analysis provides an overview of APEX Analytix, focusing on its supplier management solution capabilities. It provides facts and expert analysis to help procurement and finance organizations make informed decisions about whether they should explore APEX Analytix on a stand-alone basis in this area. 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 APEX Analytix. The remaining parts of this research brief will cover product strengths and weaknesses, competitor and SWOT analyses, and insider evaluation and selection considerations.

Program Management: The Missing Link in Procurement Technology Modules and Suites (Part 6 — An Introduction to SRM Programs) [PRO]

Global Risk Management Solutions

In our last set of posts, we addressed the basic requirements for any organization that wants to stand up a modern application to support sourcing programs that not only have a great user experience but are also backed by deep analytics. We went from basic program management requirements all the way to those that might seem near impossible to the average provider. We assure you they are not, although the chances of many providers meeting them are improbable, as we are requiring big leaps in typical back-office platform functionality.

But this is absolutely necessary. When people say that the creative process is 10% inspiration and 90% perspiration, the corollary is that for the average procurement professional, business processes are 10% strategic and 90% tactical. Not a good use of a highly educated individual's time. The tables have to be flipped so that strategic personnel can truly do strategic functions, not spend their days wrangling spend data, searching for new suppliers, assembling supplier qualification documents or doing manual contract review.

Changing this is not easy, especially because of the wide variety of programs that an SRM manager needs to implement. To crystalize the need for such extensive capabilities, we discuss some typical projects and how the technology-enabled experience needs to change for each SRM program.

A Critical Look at Category Management (Part 2) [Plus+]

category management

Editor's note: This Spend Matters Plus brief is a refresh of our 2013 series on category management, which originally ran on Spend Matters PRO. 

As we wrote in Part 1 of this series, category management (“CatMan”) has been perhaps the most powerful sourcing tool in the procurement armoury for some years. But 20 years on from the beginnings of its widespread adoption in the general procurement world (it has earlier origins in retail), we think it s a good time to review the state of CatMan and ask some fundamental questions. Is it still relevant? Has it outlived its usefulness? Does it need radical updating? Or is it still fit for purpose?

LexisNexis Entity Insight: Vendor Snapshot (Part 2) — Product Strengths and Weaknesses [PRO]

LexisNexis Entity Insight (LNEI) is a modern, “self-service” supplier management solution that the global data/market intelligence giant built to satisfy increasingly surging market demand for all things supplier risk management. Designed as a cost-effective, off-the-shelf solution, LNEI helps procurement, finance and supply chain organizations manage risk across their own supply networks, regardless of how nested or complex.

This Spend Matters PRO Vendor Snapshot explores LNEI’s strengths and weaknesses, providing facts and expert analysis to help procurement organizations decide whether they should consider the provider. Part 1 of our analysis provided a company and detailed solution overview, as well as a recommend fit list of criteria for firms considering LNEI. The third part of this series will offer a SWOT analysis, user selection guide, competitive alternatives, and additional evaluation and selection considerations.