Plus or PRO Content

The Contingent Workforce and Services (CW/S) Insiders’ Hot List: December 2020 ‘Special Edition’ [PRO]

Spend Matters has been publishing the monthly CW/S Insiders Hot List — our monthly look at new technology and innovation in the contingent workforce and services (CW/S) space — since the start of 2018. Today we are publishing this “Special Edition” to mark a change in our publishing schedule and look back at the key trends and themes that emerged over the course of this year.

For nearly three years, we have published the Hot List at the beginning of every month and covering developments of the previous month. As such, the November Hot List would cover the developments that transpired in October. To align titles and converge periods, starting next month, the January Hot List will be published at the end of January and will cover the developments that took place in January. We will maintain that convention going forward.

In this December 2020 Special Edition, we will also be looking at and discussing some of the key trends that the Hot List covered over the months of 2020. But before turning to that discussion, we will provide a summary round-up of notable events/developments in December.

The 5 Levels of M&A Technology Integration: Stage 2 [PRO]

In this Spend Matters PRO series, we define, introduce and explore the five levels of M&A technology integration that vendors must go through when bringing together different modules and platforms. We should note, however, that bringing together different applications and technology stacks is not a requirement of any acquisition. But anytime a technology provider wants to market and achieve customer synergies through a transaction outside of “cross-sell/up-sell” the degree of integration planned, its timing and ultimate realization should be a priority for investors and customers alike.

Today, we explore the second level of integration that occurs in a post-merger situation or when vendors replatform old technology onto a new stack while still having to maintain existing solution capability on the legacy platform. From a vendor perspective, we define how to do it and provide examples of this type of integration. And from a user perspective, we suggest tips and tricks for technology buyers to discern this level of integration compared with others.

If you’re new to this series and want to learn the five levels of integration, start with this introduction. In the previous installment, we cover Stage 1 integration in detail.

LevaData: Vendor Analysis, 2020 update (Part 2) — Detailed Module Overview, SWOT, LevaData Competitors, Summary [PRO]

LevaData

In Part 1 we re-introduced you to LevaData, a unique provider in the direct sourcing and procurement space that brings a distinctive mashup of analytics, should-cost modeling, constraint-based optimization, and risk insight to direct (bill-of-material based) sourcing —  particularly in the electronics supply chain.

It was, and still is, one of a small set of vendors pushing "cognitive" procurement technology, and while there is a lot of significantly advanced technology under the hood of LevaData’s solution, no vendor truly is there yet. However, the goal of technology is to augment our intelligence, not replace it, so there is no need for technology to actually be cognitive if it gets close enough and solves the problems the user needs it to solve.

Founded by veterans of the Cisco procurement and supply chain organization to close a number of gaps they saw in analytics, sourcing and supply management platforms around supply availability, accurate cost information and potential risk, they've made great strides since that day seven years ago, building a solution that solves the majority of the critical problems in the electronics supply chain, especially in the high-tech sector.

As indicated in our last part, not only does LevaData’s solution now revolve around three distinct offerings — Cost Optimizer, New Product Accelerator and Risk Navigator — but the distinct strengths it brings to the table has no peer across all its offerings and only a few in each. And those offerings that it does have each come with unique strengths that can be quite valuable.

In Part 2 of this Spend Matters PRO, we’ll examine the solution modules in detail, offer a SWOT analysis, check out LevaData’s competitors (like SAP Ariba or Ivalua in procurement technology, Sievo in the analytics market, and vendors in other market sectors) and close with a summary analysis.

LevaData: Vendor Analysis, 2020 update (Part 1) — Direct Materials Solution Overview, Strengths/Weaknesses, Tech Selection Tips [PRO]

direct materials LevaData

When Spend Matters covered LevaData three years ago, we noted that outside of core ERP and supply chain planning systems, the technology market for direct materials procurement and sourcing was almost too nascent to even be considered fragmented. And, we're sorry to say that not much has changed. The existing players are more mature, but start-ups are few and far between, and pretty much any player of note in 2020 existed in 2017.

Direct solutions tend to fall into the following categories:

  • Suites that have acquired direct sourcing and/or procurement capabilities (like Ivalua, that acquired DirectWorks, and Jaggaer, that acquired Pool4Tool)
  • Specialized niche players like Allocation (that have been doing custom sourcing and SIM for 20 years) and Procurence (that have extremely specialized supplier management capabilities)
  • New players like Xeeva and LevaData that are trying to bring "cognitive" capabilities to direct procurement, making use of big data to provide deeper insights than their peers

When we first covered LevaData in 2017, we noted it was an emerging technology provider that had capability spanning direct material procurement and cost analytics, bill of materials level spend visibility, market/commodity intelligence, and sourcing. We also noted it was one of the first entrants into the "cognitive" sourcing space that offered a platform that leveraged artificial intelligence (AI) capability to make both part- and component-level sourcing recommendations, especially in the electronics industry where LevaData has the majority of its customers (and products in its database).

Since then, it has become more established and added deeper capability in sourcing, analytics, and prescriptive cost management and reduction. LevaData also has significantly increased the (community) intelligence it offers in the electronics supply chain, and it refactored its solution into three primary offerings: Cost Optimizer, New Product Accelerator and Supply Risk Navigator.

In this new two-part series, we will cover each of these modules as well as provide an overview of the common core capabilities these modules are based on.

But first, let's give a brief introduction to LevaData for new readers.

The 5 Levels of M&A Technology Integration: Stage 1 [PRO]

integration

In this Spend Matters PRO series, we will define, introduce and explore the five levels of M&A technology integration that vendors must go through when bringing together different modules and platforms.

Today, we explore the first level of integration that occurs in a post-merger situation or when vendors replatform old technology onto a new stack while still having to maintain existing solution capability on the legacy platform.

From a vendor perspective, we define how to do it and provide examples of this type of integration. And from a user perspective, we suggest tips and tricks for technology buyers to discern this level of integration compared with others.

If you’re new to this series and want to learn the five levels of integration, start here with our Introduction post.

The 5 Levels of M&A Technology Integration: An Introduction [PRO]

integration

In this Spend Matters PRO series, we will define, introduce and explore the five levels of M&A technology integration that vendors must go through when bringing together different companies and platforms.

We hope this will allow everyone in the market — customers especially — to plan for and assess different levels of vendor integration, and ultimately, will contribute to aligning the value created over an extended time horizon for technology buyers and shareholders alike.

This is important because while mergers and acquisitions (M&A) often generate value for shareholders, they do not always do so for customers — or at least not at the level they are “sold.” Such a strategy can create obfuscation for users and result in solution components that do not necessarily “talk to each other” or “work together” as well as a PowerPoint or demonstration might suggest.

And since every suite vendor in the source-to-pay market (except Zycus) got to where they are at least in part — and sometimes as a primary strategy — by acquiring other providers, this is a particularly important topic. We should note Zycus does not get a free pass here either: It has had its own issues making different, internally developed platforms and codebases talk to each other, however, which mirror M&A integration challenges.*

Today, we introduce and define the five levels of M&A technology integration, where Stage 0 is no integration at all. And we’ll explain why the five stages matter, starting first with establishing a reference framework for customers, vendors, consultants and investors.



* This topic applies beyond M&A as well, in cases of internal vendor re-platforming of solutions, integrating different internally developed platforms and customer migration (e.g., a transition from enterprise software or early SaaS or to a modern cloud architecture).

Now let's delve into the details about solution integrations.

Coupa and complexity: Acquisitions, tech integration and customer issues [PRO]

As veteran industry analysts in this space, we closely watch procurement technology developments — engaging with solution providers, their customers, implementation consultants and the broader market. Coupa’s aggressive M&A activity over the last couple of years (four this year alone) has shifted the market landscape, but also the Coupa solution landscape for its current customers.

We’ve covered Coupa since it was a scrappy start-up with a really simple, easy-to-use solution at a very low price point. Now it is integrating all of its acquisitions to fulfill Coupa’s vision for business spend management (BSM).

Simplicity was really important to Coupa. Yet, with growth comes complexity, and after a series of major acquisitions, some customers that we’ve spoken with aren’t seeing a fully integrated, simpler solution.

In this Spend Matters PRO piece, we’ll explore:

  • How Coupa is facing integration issues stemming from its strategy of increasingly larger acquisitions
  • The issue of master data fragmentation (with supplier master data in particular) on workflow and analytics — and on a common supplier portal interface
  • Coupa’s expansion beyond spend management into supply chain management
  • Our point of view on Coupa’s continued growth strategy through acquisitions

Spend Matters is making this piece available outside of a PRO subscription for procurement practitioners. Please email pierre@spendmatters.com for your copy.

Let the bots battle to their elimination. They won’t help you either! [PRO]

robot

Editor’s note: This Spend Matters PRO post has been unlocked to continue our exploration of how to get the most value out of your procurement technology and to provide a sample of the depth we go into in our PRO material.

In our piece titled “Have You Mastered the Procurement Basics yet? we explained how AI won't save you if you haven't covered the basics, because even the best AI needs Big Data (which is likely bigger than you have) to learn from and considerable training to be effective.

Furthermore, while we briefly mentioned Automation, we didn't discuss it in depth, nor did we discuss it outside of AI. Nor did we discuss Robotic Process Automation, or Bots, which various vendors are vigorously vending to the virtuous, who will not gain from their implementation and, in fact, may lose dearly.

This is because, despite all the marketing claims to the contrary, at least today, Bots are nothing more than packaged automation scripts with simple rules and context that can be used to automate basic tasks, tasks that sometimes are less complex than those that can be figured to be handled automatically in more mature platforms.

An update on Mastercard Track Business Payment Service & B2B Payments [PRO]

purchase-to-pay

“We see every single invoice rendered by a supplier sent to a buyer as an opportunity for a better outcome for both buyer and supplier. That is a foundational principle.” — James Anderson, Executive Vice President, Commercial Products, Mastercard

When I first heard of Mastercard Track Business Payment Service a few years ago, it caught my eye as Mastercard realized that not all B2B payments were going to go on a card.

Mastercard launched Track in 2018 as a trade platform to address identity, compliance and payment management needs.

The initiative was driven out of the Enterprise Partnerships group with a focus on expanding Mastercard’s presence in the B2B payments world by addressing three problems in the Buyer-Supplier relationship:

  1. Identity: Easier supplier onboarding
  2. Data: Create the ability for richer data exchanges
  3. Payment Efficiency: Lowest cost rail given supplier preference

Mastercard Track Business Payment Service started by wanting to make the screening and onboarding of suppliers more efficient. This was both an ambitious and expensive project. My first thought was geez, another KYC tool in a space that was becoming increasingly crowded. My second thought was around the quality of the supplier data, particularly for the varied onboarding needs of banks, fintechs, payment agents and others. Standards for these different actors go from relatively lite (very lite) to extensive (banks and their requirements for beneficial ownership rules, etc.).

During that time, Mastercard had announced relationships with a number of source-to-pay and procure-to-pay solution providers — Basware, BirchStreet, Coupa — to name a few. The goal was to be a single point of contact for the data contained within all these networks, plus data on suppliers outside the network.

For the Spend Matters PRO, I caught up with James Anderson, the guy from the quote above who labels himself as a “swing for the fences” guy. James took over commercial two years ago with a mandate to grow the B2B business. Coming from the consumer side of Mastercard, he was surprised at how low-tech and manual B2B payments and AP were.

We discussed how he transitioned the initial start of Track to center on payments and the data around payments. Mastercard was trying to address payments from a card network approach, and James said this would not work at scale. James decided to flip the narrative, and focus on developing Mastercard Track Business Payment Service to support payments, not a separate business in and of itself. Mastercard Track Business Payment Service was not going to be another KYC tool, but a database of supplier payment preferences to deal with the massive complexity intrinsic to B2B transactions and payments.

Kissflow Procurement Cloud (KPC): Vendor Analysis — Solution Overview, Roadmap, Customer Feedback, Kissflow’s Competitors, Analyst Insights  [PRO]

This Spend Matters PRO Vendor Analysis will give an overview of the Kissflow Procurement Cloud (KPC) solution.

Cloud-based solutions have been great at improving accessibility in the market because they lower the total cost of ownership (TCO) and speed up implementation of business solutions like e-procurement or procure-to-pay.

However, cloud platform technology and solutions have limited the ability to develop custom functionalities or processes that are still required or used in some businesses and specialized industries. This isn’t about configuration capacity, but custom developments.

Solutions with a PaaS model offer the advantages of a cloud-based solution, and the ability to carry out customized functionalities or processes for their clients. This is a highly desirable value proposition for many organizations and industries.

Kissflow Procurement Cloud is one such platform solution that offers both benefits for its customers.

This Vendor Analysis also will offer a look at Kissflow’s platform and services, a brief description of its solution functionalities, a vision of its roadmap, feedback in a verified customer reference analysis, a competitive market analysis, and some key analyst takeaways.

The Direct Sourcing of Workers/Services (DSW/S) Solution Market Landscape [PRO]

direct sourcing contingent workforce

Spend Matters Contingent Workforce/Services SolutionMaps are made up of three maps covering the main enterprise software solutions used by organizations to manage contingent workforce and services (CW/S) procurement.

These three maps represent purpose-built solutions for:

  • Temporary Staffing (solutions known originally as VMS (vendor management system) has been the key enterprise technology for over 25 years)
  • Contracted Services/SOW (solutions — whether suite modules or stand-alone — designed to variously enable the management of corp-to-corp, third party services)
  • Direct Sourcing of Workers/Services (DSW/S) (solutions designed to enable enterprises to directly source and manage independent workers and small service providers or SSPs)

This Spend Matters PRO market landscape report covers the Direct Sourcing of Workers/Services (DSW/S).

Workday Strategic Sourcing (formerly Scout RFP): Vendor Analysis, Part 2 — Deep Dive on 7 Modules, SWOT, Competitors in E-Sourcing, Commentary [PRO]

tech

Scout RFP entered an already crowded e-sourcing market back in 2013 with a singular focus on ease-of-use, not unlike that of Coupa in the P2P space some years earlier. This focus, combined with rapid development of additional features and adjacent capabilities in project management, supplier management and contract management led to Scout RFP being acquired by Workday in 2019. Since the acquisition, it has been renamed Workday Strategic Sourcing and development has continued.

In the first part of this updated Spend Matters PRO Vendor Analysis, we looked at the company background and solution overview, solution strengths and weaknesses as well as a simple tech selection guide.

In this second part, we will do a more detailed solution overview, offer a SWOT analysis and take a look at Workday Strategic Sourcing's competitors in the e-sourcing market.