Daily Archives: November 12, 2007

the doctor Wonders If The Sourcing Nation Has A Prozac Problem

I’m a man of the land, I’m into discipline
Got a Bible in my hand and a beard on my chin
But if I finish all of my chores and you finish thine
Then tonight we’re gonna party like its 1699
   from “Amish Paradise” by Weird Al Yankovic

After talking to companies like Vinimaya and Co-exprise over the past few weeks and then reading the latest “press releases” to come out of companies like Ariba and Sterling Commerce, I can’t help noticing how appropriate that verse seems to be. It seems to me that too much of the sourcing nation is still stuck in 1999, which, relatively speaking, was the 1699 of e-Sourcing solutions, and, more importantly, that too much of the sourcing nation seems to be happy about it!

Let’s think about this. A major vendor comes out with a new release that is, more-or-less, rather ho-hum, but still it gets picked up on by every channel out there because the vendor is in a Gartner magic quadrant or a Forrester outlook report (the “bibles”), because that’s just what these publications do (the “discipline”). It’s then accepted by the current customers (the “men of the land with the beards on their chin”) as the next big thing, put in the implementation queue (the “chores”), and when the implementation is completed, it’s celebrated (the “party”).

Meanwhile, when someone like Vinimaya comes along with a new solution to a problem that is, in some ways, down-right revolutionary and starts to actually solve a problem that was never really solved before, you barely hear a peep. It’s put in the closet with the skeletons when it should be put on display in a trophy case. Meanwhile, new offerings that are merely incremental improvements of previous offerings that never really solved the problem anyway continue to get the limelight. Sourcing Nation, we need to stop this!

Now, I know we can’t put all of the blame on the analysts. After all, the analysts have to spend a lot of time talking to the vendors that fund the company they work for, and, unfortunately, many of these innovative new vendors are a lot better at building the solution than communicating what the solution does, the problem it solves, and the value it offers. But still, it doesn’t mean we shouldn’t try to understand what the new vendors are doing and why it’s important.

I do know that many of the new solutions aren’t perfect, but then again, no solution is perfect, and at least some of the new, innovative, vendors are trying to solve real problems and taking risks – something that more companies need to do if they want to ever truly achieve innovation. And sourcing innovation is something the sourcing nation needs to achieve as a whole if it’s going to take its rightful place as the driver of the modern business world! (And you can’t even spell sourcing innovation without a sourcing nation to support it!)

So the next time an old-school vendor hands your colleague a cup o’ kool aid, do him a favor – test it for fluoxetine before you let him drink it – just to be sure it’s free of antidepressents. (It’s not an expensive test – fluoxetine reacts with hypochlorite variants, and that’s basically bleach.) After all, don’t we all deserve real happiness?

Vinimaya: The Next Wave in Product Catalogue Management (PCM)

A little over a week ago, in Networks are ok. Catalogs are Good. Punch-outs are Better. But Agents are King!, I introduced you to Vinimaya – a little known company from Shelton, Connecticut (apparently, it’s not a total wasteland) that may be the only company in the space with a real answer to the Supply Network 2.0 Challenge.

Billing themselves as a Supplier Enablement Solution for e-Procurement with their Catalog Integration System based on distributed search technology, their product truly does allow an e-Procurement system to access supplier web-sites, online catalogs, and internally managed catalogs concurrently from a single user interface.

Unlike today’s supplier networks which only support hosted catalogs and punch-out enabled sites, constitute a large expense for the buyer and the supplier, have a long enablement cycle, and provide the buyer with almost no control over access, Vinimaya‘s new Product Catalogue Management (PCM) solution, which they sometimes call a Virtual Punch-out or Virtual Supplier Network (the VSN), supports ANY site (be it a punch-out, catalog, market-place, or plain old web-site), does not cost the supplier anything (as any solution that charges the supplier only adds to the buyer’s cost as the supplier has to raise their prices to compensate for the cost), can be enabled in a day, and gives the buyer total control over access, view, and pricing with their local pricing and audit engine capabilities.

Furthermore, they can easily enable standard and custom terms and pricing to each buyer. Since most suppliers plugged into a supplier network accomplish this through a separate, protected, landing page that contains pricing customized for a particular buyer, all Vinimaya has to do is program that link (and the login) into the agent instances used by that buyer, and, presto, the buyer gets standard terms and conditions and – more importantly – gets those terms and conditions in the standard view which allows them to compare the terms and conditions across all products from all suppliers that meet the identified need. Alternatively, if the supplier cannot do this, the buyer can create discount rules or override SKU prices on a supplier (by supplier) basis in the local pricing and audit engine. No need to have a third party involved, as all the third party does is take a cut of the transaction and significantly raise the transaction cost by performing a service that the buyer can easily do on her own.

And the system works. They already have over 12M skus from over 150 leading suppliers in a single instance (with over 200 suppliers enabled for general use), and the interactive distributed search works in a couple of seconds for a new query, and under a second for a query that is similar to, or a repeat of, a previous query (as the system caches relevant results). It’s also very scalable – in their five largest implementations, they support over 30K users and hundreds of suppliers. (And, as indicated in my last post, they can quickly enable new suppliers by extending and customizing existing agents in their database. On average, they can enable a new supplier in a couple of hours, and have found that over 75% of US suppliers fall into this “quick enable” category. Furthermore, when they encounter a supplier that uses a non-standard web-site design or custom protocol, do to the distributed nature of the technology, they find that, on average they can still enable the supplier in about a day.)

The things to remember are that we don’t need a separate “network”, we have one already, it’s called the internet; we already have all the content we need on supplier websites (the supplier doesn’t have a web-site you say?* that’s okay, the supplier network 1.0 options are still available); and web-services allow a lot more functionality than some of the big dogs (who haven’t innovated in ages) would have you believe.

I applaud Vinimaya for cutting through the noise and offering the direct-connect solution that probably should have been designed in the first place. The reality is that today’s supplier networks are nothing more than bad implementations of what is fundamentally a really good idea. The technology has to use what’s there, bring it all together, and do it quickly in a seamless fashion. Otherwise, your procurement department will be spending too much time on the tactical when they need to be focussing on the strategic.

* If the supplier isn’t on the web, then all of the supplier network 1.0 options are still available: the supplier can upload the catalogue using excel or use an e-form. If the supplier doesn’t have web access, then either Vinimaya or the buyer can load the catalog on behalf of the supplier. (But if the supplier doesn’t even have web access, then I think you have to ask if you’re sure that you’re using the right supplier.)

Where Is My Market Going?

Although it is impossible to tell precisely how many visitors a site is getting without having access to complete logs, and similarly difficult to tell how one site stacks up against another (especially when some site masters don’t know how to differentiate image hits from page hits, etc.), there are third party traffic tracking tools that provide one methodology of roughly benchmarking one site against another (although the accuracy may be questioned).

One such site is Alexa, and as noted by Jason Busch over on Spend Matters in November of 2007, Sourcing Innovation, the only other independent blog in the sourcing / procurement / supply & spend management space that publishes on a daily basis, was not only the 7th most visited publisher of original content in the space, but the fastest growing content publisher in the space! With a three month change of 672,310 in the rankings, Sourcing Innovation’s growth rate was almost triple that of Spend Matters and essentially five times that of Supply Chain Digest, which was growing slowly while all of the other publications were essentially standing still. Not bad for an upstart blog that had been publishing for slightly less than a year and a half at the time!

The specific metrics on November 17, 2007 were:

SITE 3 month Rank
ISM 291,694
Purchasing 318,350
Spend Matters 462,297
Supply & Demand Chain Executive 543,729
Supply Chain Management Review 597,277
Supply Chain Digest 813,504
Sourcing Innovation 1,306,592
SITE 3 month Change
Sourcing Innovation +672,310
Spend Matters +244,446
Supply Chain Digest +122,600
Supply Chain Management Review +59,753
ISM +11,412
Purchasing -17,671
Supply & Demand Chain Executive -87,098

Another such site, which I find to be much more reliable and consistent in rankings from month to month, is QuantCast. Between December 1, 2007 and March 8, 2008, Sourcing Innovation‘s ranking steadily increased from 5,530,305 to 434,201, making it, according to Quantcast, the fourth most trafficked publication in the space, preceded only by ISM’s Inside Supply Management, Purchasing Magazine, and Supply Chain Digest.

ISM 110,228
Purchasing 141,455
Supply Chain Digest 271,697
Sourcing Innovation 434,201
Supply & Demand Chain Executive 707,417
Spend Matters 2,116,255
Supply Chain Management Review 2,732,943
SITE 3 month Change
Sourcing Innovation +5,096,104
Supply Chain Digest +122,880
ISM 24,969
Purchasing -20,688
Supply & Demand Chain Executive -400,602
Spend Matters -933,989
Supply Chain Management Review -2,332,445

In addition, Sourcing Innovation is now peaking at an average of 15,000 unique page views a day! With the average visitor viewing an average of 1.5 pages per visit, it’s easy to see that peak days on Sourcing Innovation now attract almost 10,000 unique visitors, with average days generating over 8,000-plus page views and 5,000-plus unique visitors.  The following graph, complied using the built-in analytics package that accompanies the blog software, demonstrates how Sourcing Innovation hit this peak for the weeks ending January 19th and April 19th and that, once a peak is hit, daily SI traffic will eventually rise to that level!

Moreover, this traffic is starting to become truly global in scope!  Although the US still accounts for the majority of traffic at roughly 57%, we now have Canada representing 7%, the UK and India coming in at 6% each, China accounting for 3%, Germany and Australia with their share at 2%, and France and the Netherlands accounting for over 1% – and over 150 countries are represented in the last 15%!

However, the best measurement of this blog’s success is the bandwidth consumption rate, which is the most carefully tracked metric by any ISP. This blog is now serving up over 14 GigaBytes of pure text a month! (All images are hosted on separate sub-domains or web-sites with their own bandwidth allocations.) To put this in perspective, this is roughly equivalent to serving up the *entire* text of the Encyclopedia Britannica over fifty two (52) times each month!