Plus or PRO Content

eBid Systems: Vendor Snapshot (Part 3) — Summary & Competitive Analysis [PRO]

contract

Spend Matters has often noted that the market for strategic sourcing solutions is highly fragmented, with no clear leader or collection of leaders. This stands in contrast to the e-procurement and invoice-to-pay markets, where best-of-breed vendors are still thriving but consolidation among larger providers is influencing industry dynamics and many selection processes. Yet within the strategic sourcing market, it is difficult to point to any single vendor or set of vendors, look at any metric and say anything but vendor fragmentation is the rule.

This is both a positive and negative for providers like eBid Systems, given the challenge of competing against so many providers rather than aiming at a single target. Within this competitive environment, this final installment of our Spend Matters PRO Vendor Snapshot series covering eBid Systems offers a competitive analysis and comparison with other strategic sourcing providers for shortlist consideration. It also includes a SWOT analysis, user selection guide, summary evaluation and selection considerations. Part 1 and Part 2 of this PRO research 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 eBid Systems.

Hone Your Procurement Negotiation Skills By Learning the Right Way to Think [Plus+]

In our previous piece looking at Daniel Kahneman's brilliant book, Thinking Fast and Slow, and its implications for procurement thinking and practice, we looked at the concept of Priming.

Granted, Kahneman published the book in late 2011, but is still immensely valuable for procurement practitioners to keep on their bedside tables today — and here's why.

One of the central premises of Kahneman's book is how our brains look for the easy route at all times, what he calls "System 1" thinking. If we can draw a conclusion, make a decision, or find a belief without actually going through a time-consuming and exhausting process of really thinking, we will. That is not our conscious decision — our brains are wired that way. "System 2" thinking, which is more logical, analytical and difficult, is something our brains avoid if they can.

So Priming is the phenomenon whereby something we've seen or heard recently influences our next thoughts. If I ask you to name an animal, and you've just walked past an advert for the zoo illustrated with an elephant, you are more likely to say "elephant." And remarkably, this is true even if you don't recall seeing the advert. Our sub-conscious is quite capable of priming our future thoughts.

In this Plus brief, we will consider what is in effect a particular sort of priming, with an obvious implication for procurement and negotiation behaviour specifically. Anchoring is the tendency for us to fix our thoughts around a particular number, point, or fact rather than thinking logically and independently about a decision.

In Kahnemann's words, "it occurs when people consider a particular value for an unknown quantity before estimating that quantity." The estimates then stay close to the number considered. And this is one of the most tested and robust results in experimental psychology; it is an absolutely proven phenomenon.

In a somewhat frightening example quoted in his book, German judges were asked to throw a dice before being asked what sentence they would give for a particular crime. The dice came up with either the number 3 or 9. When the dice said 9, the average "sentence" was 8 months. When it said 3, the average was 5 months!

Anchoring and Procurement Negotiation

The implication for procurement is very clear in the negotiation arena. Whatever number gets anchored in your brain is in danger of becoming the starting point and indeed the expectation for the negotiation. You may work up or down from there, but it is difficult not to mentally accept that as an anchor for the discussion.

Let's get into some tangible examples.

eBid Systems: Vendor Snapshot (Part 2) — Product Strengths & Weaknesses [PRO]

RFP

eBid Systems is one of more than 30 technology providers that Spend Matters tracks that provide strategic sourcing solutions to private firms and public sector organizations around the globe. eBid Systems recently re-platformed its solution, an effort which included enhancing a range of modular and functional areas — as well as the user interface — making it more competitive with other solutions in the global market. Over 50% of eBid System’s 300-plus customers are public sector organizations, almost entirely at the smaller state and municipal level, but private sector companies may also value the combination of low-cost licensing, core e-sourcing, full audit trails, rules-driven compliance, vendor management and associated capabilities provider offers.

This Spend Matters PRO Vendor Snapshot explores eBid System’s strengths and weaknesses, providing facts and expert analysis to help procurement organizations decide whether they should consider it for their needs. The first installment of our analysis provided a company and solution overview and a recommend fit list of criteria for firms considering eBid Systems. Part 3 will offer a SWOT analysis, user selection guide, competitive alternatives and additional evaluation and selection considerations.

eBid Systems: Vendor Snapshot (Part 1) — Background & Solution Overview [PRO]

Oracle

There is no shortage of strategic sourcing technology vendors in the market today. Customers have choices ranging from per-event pricing with smaller providers to integrated solutions that combine rich supplier management, contract management and transactional procurement capability — not to mention specialty solutions that bring generalized technology differentiation, category-specific or other unique capabilities.

Within this smorgasbord of choice — and yes, there are even vendors that started in the Scandinavian market to chose from globally now — one provider from the Pacific Northwest, eBid Systems, has carved out a distinct customer niche in state/local publication sector and higher education sourcing. Nearly 20 years since its founding, it counts 200 public sector customers and 100 private sector organizations using its technology.

This Spend Matters PRO Vendor Snapshot provides facts and expert analysis to help procurement organizations make informed decisions about eBid Systems strategic sourcing technology capabilities. 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 eBid Systems in the procurement technology area. The remaining parts of this research brief will cover product strengths and weaknesses, competitor and SWOT analyses, and insider evaluation and selection considerations.

Rethinking and Reclaiming “Tail Spend”: 6 Key Variables to Consider [Plus+]

AnyData Solutions

The idea of “tail spend” doesn’t seem very complicated at first.

Run a Pareto analysis on your spend categories and suppliers to make a cutoff at, say, the 80% that represent only 20% of your spend. Your numbers will, of course, vary, but the idea is to find a way to better manage such “nuisance” low-dollar spend that doesn’t detract from your efficiency, or worse yet, from spending time managing the truly strategic spend categories more deeply.

You might think of this as the spend in the lower-left quadrant of the famous Kraljic 2x2 matrix, which describes a strategy of “purchasing management” to manage non-critical, abundant supply that can be sourced locally in a de-centralized manner for maximum efficiency. And, maybe, if you manage this nuisance spend properly, you can even extract some value from it (e.g., a “quick source” process to gain some speedy spend savings).

Sounds straightforward, right?

Well, it’s not, and I have purposefully led you astray to prove a point.

The problem is that I never really defined tail spend in the first place – and if you can’t define it or see/measure it, you can’t manage it. And herein lies the rub (and the opportunity):

Tail spend could better be described as “nuisance spend” or “tactical spend,” and is comprised of many sub-segments — not just one or two.

Let’s return to our examples above. Segmenting on a spend-per-supplier basis, like in our Pareto diagram, is by no means perfect. What about low-spend, sole-source suppliers tied to large revenue or profit? OK, well, you might then refer to the Krajlic matrix as the solution. It’s better, because it helps profile the categories into complexity vs. impact (or risk vs. reward if you view it as such), but again, these are only two variables, and do not factor in any others.

Which ones? Let’s list six of them and ask whether you’d consider the resulting spend segments as ‘tail spend,’ or at least ‘nuisance spend.'

Beyond the Traditional SRM Scorecard: Supplier Management Metrics to Diagnose Your Supplier Management Operations (Part 1: Search and Enablement) [PRO]

In recent years, prominent procure-to-pay (P2P) providers have increasingly offered opt-in peer benchmarking capabilities. This newly available data has changed the way consultants and advisors evaluate procurement performance. Benchmarks and key performance indicators (KPIs) once analyzed on a periodic basis, for instance, are now becoming embedded into procurement processes and continuously updated with new information as it becomes available.

Because of this, procurement organizations are becoming increasingly aware of the benefits measuring performance based on a standard set of benchmarks and KPIs can bring to overall P2P performance. Yet the same cannot be said of supplier management activities, despite the significant cost and risk they pose to procurement. In fact, Spend Matters has found that most procurement organizations are not yet measuring a complete set of KPIs to manage the lifecycle of supplier activities and associated supplier information. Solution providers have not helped this situation, either, instead glossing over supplier management in favor of KPIs and peer benchmarking services in core transactional procurement areas.

It’s time to change this. To give procurement organizations operational metrics that mirror the KPIs available in P2P, this multipart Spend Matters PRO series provides an action guide for measuring and quantifying some of the benefits of "day in the life" operational supplier management activities. It also provides a roadmap and foundational input for building a business case to support these initiatives, including investments in dedicated technology solutions and tactical KPIs for managing them.

Part 1 of this series offers diagnostic KPIs for self-assessing supplier search and enablement performance. For each metric, we include commentary and insight on why it matters to procurement, guidance on enablement and measurement, suggestions for procurement technology systems that can be used for support and variable inputs for tracking.

We also encourage all Spend Matters readers, including non-Spend Matters PRO subscribers, to download our recent 2017 landscape definition and overview on supplier management and supply risk management, which provide details on the different technical components of these solution areas.

Work Intermediation Platforms: Examples Within 3 Basic Categories [Plus+]

In a series last year, we set out to explore the digital evolution of the contingent workforce supply chain — a specific area of the services procurement world that, dare we say, has been getting hot.

We began tracing a line from the vendor management system (VMS)-dominated atmosphere starting over 15 years ago up to the more recent technology-enabled platforms such as Work Intermediation Platforms (WIPs).

Related: Join me and Jason Busch for a free webinar next week on 2017 Tech Trends and what they mean for contingent workforce practitioners.

But as we know, launching into heady discussions on the topic may be rough without laying down some simple definitions first. For that reason, we want to give services procurement practitioners a bit of a primer on three basic categories — marketplaces, service providers and private pools/networks — and examples of WIPs that fall into each (or more than one) of them.

Whoa, What’s a WIP Again? Here’s a Super Quick Review

First, let’s just quickly define WIPs. While well-known platforms such as Amazon, Uber and Airbnb have arisen in the retail, transportation and hospitality areas, tech-enabled platform businesses, functioning as new intermediaries between demand for and supply of work/services, have been proliferating. Spend Matters refers to these platforms as work intermediation platforms (WIPs).

These platforms have been able to engage workforce populations that have not  been previously accessible (e.g., talent in other countries). They have created new efficient ways of executing work arrangements (direct sourcing to electronic payment); performance and fulfillment of work/services (e.g., online end-to-end); and new models of engaging workers (e.g., crowdsourcing).

After 10 years, WIPs are still at a very early stage of development. However, such a rate of maturation and acceptance is not atypical for technology-driven innovation. In our view, many WIPs around today will evolve to be successful, and new WIPs will emerge with successful formulas and models right out of the gate.

So, WIP Category #1: Examples of Marketplaces



The above platforms basically fit the marketplace model (and Upwork would also fall into Private Pools/Networks), but there are variations. So let's dig into them, shall we?

Accenture Spend Trends Category Insight

Top 10 Airline Sourcing Strategies [Plus+]

This month’s installment of Accenture’s category insights may just to be the best yet in terms of rigor and practicality. The specific spend category in question is airlines, but there are also broader issues here surrounding travel management in general. Although consumerized airline shopping can make this category seemed commoditized, it is anything but. You have an extremely diverse set of stakeholders with different business objectives surrounding the airline travel, and a supply market that looks like a supply chain transportation market, which in a sense it is, if you think about air freight — except the freight is a business traveller.

The 10 strategies outlined are a perfect example of how to manage a complex category. Understanding the demand side of Airline sourcing, for example, is essential, especially related to stakeholder management. Corporate “road warriors” are usually critical talent to be empowered and supported. Loyalty programs are key enablers (and barriers) to success, and the change management and time involved for sourcing require strong planning and commitment. The article gives some excellent guidance on negotiation tactics, but also on some of the “softer” strategies that are no less critical to this fast changing category.

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

ClientLoyalty competes in what we could most accurately describe as a “sub-sub” segment of the supplier management market. Usually such niches relegate solution providers to a small corner of market obscurity, often to build profitable businesses that go unnoticed by most. But there is actually a real potential market in what ClientLoyalty is attempting to create alongside a select number of other technology providers also focused on the management of strategic supplier relationships: a market for a true supplier relationship management solution.

While there are many solutions today that address supplier information management (SIM) and also supplier performance management (SPM), only a handful actually focus on supplier relationship management — which we are hesitant to call SRM, because the term was usurped by ERP years ago and given an entirely different meaning. ClientLoyalty is one of the few, avenging the “SAP SRM” and “Peoplesoft SRM” product names that did such an original disservice to what SRM is really about. (Hint: It’s not e-procurement!)

This final installment of our Spend Matters PRO Vendor Snapshot series covering ClientLoyalty offers a competitive analysis and comparison with other supplier management providers for shortlist consideration. It also includes a SWOT analysis, user selection guide, summary evaluation and selection considerations. Part 1 and Part 2 of this PRO research 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 ClientLoyalty.

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

ClientLoyalty, a specialized supplier management technology provider, would argue that true supplier relationship management is not just about gathering and managing supplier information, performance metrics and action plans. Rather, it is a class of solution that addresses the fundamental aspects of strategic relationships including tracking, measuring and managing feedback (from the organization and the supplier). But it must also serve to monitor the evolution of the relationship — not just performance — and allow for the collaborative creation of action plans to improve the relationship. In other words, from a procurement perspective, ClientLoyalty is closer to serving as a data-driven co-therapist chair for buyers and suppliers in strategic relationships than anything else.

But is this a niche market or something more? This Spend Matters PRO Vendor Snapshot explores ClientLoyalty’s strengths and weaknesses, providing facts and expert analysis to help procurement organizations decide whether they should consider it for their needs. The first installment of our analysis provided a company and solution overview and a recommend fit list of criteria for firms considering ClientLoyalty. Part 3 will offer a SWOT analysis, user selection guide, competitive alternatives and additional evaluation and selection considerations.

ClientLoyalty: Vendor Snapshot (Part 1) — Background & Solution Overview [PRO]

Supplier performance management is quickly becoming a "hot topic" among procurement organizations that want to create step change improvement as part of their supply management journey. This technology segment is actually a sub-segment of the supplier management technology market, which is more broadly comprised of what we often describe as “strategic procurement technologies” (see Spend Matters’ Sourcing, Contracting and Supplier Management Landscape Definition and Overview report for more detail). But supplier performance management, while a hot topic among procurement people and among those marketing solutions on the vendor side, is unfortunately not a hot topic among developers, especially as it pertains to managing the relationship aspect of supplier collaboration. While many procurement suite technology providers offer supplier management solutions, the reality is that the majority of these emphasize collecting and managing supplier master data and limited supplier performance management requirements.

ClientLoyalty, a somewhat ironically-named technology provider based on its orientation to managing suppliers, is hoping to change this. ClientLoyalty was founded with the desire to bring strategic supplier relationship management to companies that realized the critical importance of relationship management in order to get the most value for their money from suppliers. This Spend Matters PRO Vendor Snapshot provides facts and expert analysis to help procurement organizations make informed decisions about ClientLoyalty’s supplier management capabilities. 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 ClientLoyalty in the procurement technology area. The remaining parts of this research brief will cover product strengths and weaknesses, competitor and SWOT analyses, and insider evaluation and selection considerations.

Coupa Release 17 Analysis — And a General “How To” Lesson for Upgrading Products [PRO]

On Jan. 27, Spend Matters published a quick post on first update of the year, Release 17. It offers a new application called “Perfect Fit Insights” for cross-customer B2B insights and more than 50 features across the platform, including new collaboration mechanisms to work with suppliers (SMS messaging and extended sourcing communication windows), additional e-invoicing compliance templates, and additional system configurations options such as extended customer branding. Recently, Donna Wilczek (VP of Strategy and Product Marketing at Coupa) and Gabe Perez (General Manager of Power Applications at Coupa) gave us a demonstration of Release 17 and talked to us about their innovation process and other analyses they do to continually improve the user experience, usability and value of their platform.

Coupa has a long history of out-innovating the competition, and this is not an accident. The company uses a rigorous process to identify, prioritize and implement ideas — putting the customer front and center in helping drive innovations that have the highest probability of actually being adopted.

In this Spend Matters PRO analysis, we’ll share what we’ve learned about Release 17 including expanding more on its new features and our key takeaways from them. We’ll also discuss Coupa’s general release planning, development and roll-out methodology to capture ideas that drive practical (and usable!) innovation for customers.

These are critical lessons that should not be lost on organizations evaluating Coupa in comparison to other vendors (which generally innovate more slowly), let alone any other provider developing technology to bring to market.