Gartner Procure-to-Pay Report: Useful But Do Consider What YOU Need

We don’t tend to report on Gartner “magic quadrant” type reports much,  to be honest in part because Spend Matters, in particular our subscription PRO product, is a competitor. (If you want really deep insight into procurement technology, we’d argue PRO goes much further than Gartner generally). We wouldn't want to "dis" Gartner for one other reason - our esteemed colleague, Nancy, is an alumni, and was Head of Publishing EMEA for Gartner some years back.

However, the recent Gartner magic quadrant for “Procure-to-Pay Suites" has popped up in conversation a number of times recently, so we thought it was worth some remarks for us. You can get hold of it from most of the software firms who do well on the review (surprise, surprise!) So for instance here is the access via Basware’s website – that firm comes out of it very well, as do Coupa, Ivalua and SAP, with others such as Wax Digital, Perfect Commerce, GEP and Birch Street Systems (who I confess, I don’t know at all) all having respectable showings.

Indeed, the report has been made more freely available than previous Gartner work, it seems to us, which is very positive. It is a thorough piece of work; Gartner are diligent about talking to multiple clients of the firms featured, for instance. All in all, it is certainly useful, and the two-axis model is easy to understand. The x axis relates to “completeness of vision” – simplistically, you might say that covers how much capability the product contains. The other y axis is “ability to execute”, which is more about the firm, its coverage, partners and so on rather than the detail of the product.

We would however strike some notes of caution. Firstly, the entry conditions are pretty strong. Indeed, even though there are only 12 firms featured, including Basware twice (because of their recent Verian acquisition), we’re surprised some of them got through. Have some of the firms listed really met this criterion - “A minimum of 50 procure-to-pay suite clients with a 2014 revenue or operational budget of $1 billion or more”?

Anyway, that means it is a pretty narrow field, which means that there may be firms that are well matched to your requirements, particularly regional players, who are very much in the market but not mentioned here. You should also consider whether you want and need all the features that qualify the firms here. For example, geographic coverage is one factor that can move a firm “down” the y axis on the quadrant. But if you are an organisation that is purely based in the UK, or France, or even “just” in Europe, you don’t really care about how good the service is in three other continents.

There is also the rate of change in the industry to consider. Younger firms struggle to meet the conditions of course, but other factors can change things rapidly. We saw the BravoSolution acquisition announcement last week, so with Puridiom’s technology integrated presumably they will feature next time around with the expanded P2P capability. But they should be serious players in this space well before that next iteration of the quadrant comes along. Other firms such as Tradeshift that don’t feature here are rapidly building capability too.

However, as we said, this is still an interesting and useful read. One obvious and striking factor is the absence of two industry software giants. Oracle E-Business Suite and Oracle PeopleSoft drop out of the quadrant “because they did not meet this year's more stringent inclusion criteria”. Are they being left behind by the likes of SAP and Coupa in this sector?

And IBM have never had real P2P capability – it does seem remarkable that the firm plays fairly seriously in some parts of the  procurement software space yet has not done what others such as Basware and BravoSolution have done and picked up a fill-in acquisition to round-out their offering. (IBM could have bought Verian or Puridiom with the spare change down the back of their South Bank office sofas).  As we’ve reported previously, IBM and Coupa do partner on some bids when the client wants an end-to-end source-to-pay solution, but that hardly seems a satisfactory long-term position for a company of IBM’s standing. There is a lot of hope for the Watson analytics development, but without the building blocks of P2P or S2P in place, this may not be enough to keep IBM as a front-of-mind option for procurement leaders.

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Voices (4)

  1. Eric Lynch:

    Shocking you don’t even mention BuyerQuest seeing we are competing and WINNING some of the largest P2P global deals vs. Ariba and Coupa! What gives, Jason?

    1. Peter Smith:

      Don’t blame Jason, this was all my own work! I guess BuyerQuest don’t have quite the profile in Europe yet that you do in the US so you weren’t front of mind when I wrote this. But look forward to seeing you here soon though!
      Peter Smith

      1. Eric Lynch:

        Hi Peter. Thank you for the clarification.You WILL be seeing us soon in your neighborhood!

        Sorry Jase!

  2. Christopher Jablonski:

    This is a great analysis. A buyer should also look at community-driven reviews such as G2 Crowd and compare end-user profiles to those who’d be using the software in his/her organization.

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