Coupa update and advice to buyers of procurement technology

One of our meetings when Jason Busch was here last week was with Coupa. We know Alex Kleiner well, now the regional EMEA Vice President, but he also introduced two of his rapidly expanding team – Andy Lightfoot , Sales Director for EMEA and Ronan Kerouedan, Director, Solutions Consulting for EMEA also.

The speed of expansion and recruitment is impressive, and Coupa’s European wins are into double figures, with some very large deals at final stages (sometimes with competitors still in the frame, we should point out). They’re also developing their “channels”, with links to large systems integrators and consulting firms as well.

The team are finding that generally firms in Europe take longer to make decisions than their US counterparts – more caution and a wider circle of internal stakeholders to involve perhaps, with collaborative approaches to decision making the norm. The economic situation may play into this as well given Europe’s continued struggles, although effective procurement software should have a great ROI for most organisations. But we expect to see some impressive customer wins from Coupa through the rest of this year as they offer serious competition to both the ERP type giants and local European players.

And one positive development for the procurement technology industry generally is that “cloud” is bringing advanced technology within reach of mid-market firms for the first time, from the point of view of both cost and ease of implementation and management of the system.  That is reflected in Coupa finding that over 50% of their prospects are “Greenfield sites”, in the sense that they don’t have any current P2P installed platform.

But rather than just the Coupa update, we thought it would be interesting to pick the brains of the three Coupa experts. So we asked them a question.

“Given you’re in the middle of quite a few major tender processes, where CPOs or equivalent are investing in purchase to pay (and sometimes more), what three bits of advice would you give to anyone on the buy side in a similar position”?

That certainly stimulated a lively debate, and eventually we arrived at these three points.

1. Get your colleagues who are key stakeholders involved reasonably early in the process. “If the CIO or IT Director – or the head of Accounts Payable - only finds out that procurement want to introduce this new system at the last minute, they’re more likely to feel negative about it”, says Kleiner. It’s a bit like stakeholders not involving us in Procurement until the latter stages of contracts  – it doesn’t make us feel well-inclined towards being helpful. So we should apply the same principle here.

2.  Be very clear about costs and timescales. “We believe we’re very honest –there are no nasty surprises, but we’ve seen examples where firms have been surprised by additional fees, or by the time and money needed to actually get a customized, final product delivered.  Be explicit – for instance, ask directly for committed go live dates or whether there will be supplier fees”.

3. Get beyond the formal ITT or RFP –which should itself be manageable. “We see tender documents with over 1000 questions for us to answer”!  Often (and not surprisingly) these contain repeated questions, some irrelevant. And this can indicate a tick-box mentality generally. “Most importantly, meet the suppliers’ teams, try the platform – get behind and beyond the tick-box paper based exercise”.

However, one final note of warning. Testing and stakeholder involvement is great, says Kleiner,  but “ultimately someone has to make a decision!”  There does come a point where the elapsed time for the selection process must start cutting into the business case benefits.  If it taking you  a year or more to make a decision.. that probably means the process is simply too complex and too long.

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  1. Market Dojo:

    We could also add, 4. Understand change management. Too often we have seen clients with software solutions that they find difficult to use or have bought and never used. Now with many more solutions out there the criteria from making the decision on which solution is changing and you do have a greater choice.

    We have a very similar philosophy to Coupa and as with any good SaaS product, it should be very easy to implement and have great usability which encourages adoption from buyers and suppliers. This has a real cost attached to it and should not be underestimated.

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