Daily Archives: July 17, 2017

The UX One Should Expect from Best-in-Class Spend Analysis … Part I

Our last series, which was a doozy at four parts, covered The UX One Should Expect form Best-in-Class Optimization (Part I, Part II, Part III, and Part IV) and while it probably left even the best-in-class optimization vendors quivering in their boots (as no vendor meets every criteria on our list, and the majority don’t even come close), it had to be done. No other advanced sourcing technology can identify, and capture, as much value year-over-year as optimization and with costs risings, budgets shrinking, competition escalating, and global conditions changing constantly, this technology is becoming a must-have for every sourcing organization period. But, as the Brits like to say, the maths are hard and you can’t expect an average buyer without an advanced degree in math, engineering, computer science, etc. to know this stuff, so it has to be useable. Very useable. It has to be stupid easy to select a cost model, pick and choose english constraints, import the costs, enter a few parameters (like maximum number of suppliers, preferred award split, etc.), and run the model. And if it’s unsolveable (because it’s over-constrained or data is missing), the reason, and the fix, has to be made crystal clear to the user.

But it’s not the only important advanced sourcing application that every sourcing organization should have. The other is spend analytics. It’s the only other advanced sourcing technology that can identify year-over-year value of 10% or more. (And while it can’t always capture that value as you will need to do a sourcing event to capture it, if you’re not doing the right sourcing events on the right categories at the right time, you’ll never realize the full extent of value that can be realized. It’s not uncommon to realize a cost reduction of 30% or more on your first appropriately designed optimization-backed multi-level global services event where you bid out at the global, national, regional, and local levels and get the right mix of the right providers in the right places for the needs at hand.) You need spend analysis, but not everyone has an advanced computer science or quantitative analysis degree, and first generation tools were so hard to use that once all of the categories in the top n report were sourced and all the suppliers in the top n suppliers put under contract, there was no more value to be had. But with an easy to use tool, the true value of analysis is exposed, and your top analysts will be finding new opportunities every day, week after week, month after month, and year over year.

But, as with optimization, it’s hard to create the right UX. It’s not just a set of fancy reports (as static reports have been proven to be useless for over a decade), but a set of capabilities that allow users to cube, slice, dice, and re-cube seven ways from Sunday quickly, easily, and repeatedly until they find the hidden value. It’s innovative new reporting and display techniques that makes outlier identification and opportunity analysis quicker and easier and simpler than its ever bin. It’s real-time data validation and verification tools that insure that a user doesn’t spend a week building a business case around data where one of the import files was shifted by a factor of 100 because of missing decimal points, destroying the entire business case in 4 clicks. And so on.

That’s why the doctor and the prophet are bringing you an even longer and more in-depth look at what makes a good User eXperience for spend analysis. In a time where there seems to be a near universal playbook for spend analysis solution providers when it comes to positioning the capability they deliver, when many vendors sound interchangeable, and when many vendors are fungible in a way that is not necessarily negative, this insight matters more than ever. Last week, over on Spend Matters Pro [membership required], the doctor and the prophet published our first piece on What To Expect from Best-in-Class Spend Analysis Technology and User Design that begins our in-depth foray into this critical, but often ill-explained, technology.

So what is required for a best-in-class spend analysis user experience? Dozens of things, but one key thing is integrated dynamic dashboards. Unlike the first generation dashboards that were dangerous and deadly (as the doctor has written about dozens of times on SI over the years, including rants here, here, here, and here), true, modern, next generation dynamic dashboards are actually useful and even beneficial. They’re ability to provide quick entry points through integrated drill down to key, potentially problematic, data sets can make sharing and exploring data faster, and the customization capabilities that allow buyers to continually eliminate those green lights that lull one into a false sense of security is the key to analytics success.

For a deeper dive into what an integrated dynamic dashboard is, check out the doctor and the prophet‘s initial description of What To Expect from Best-in-Class Spend Analysis Technology and User Design over on Spend Matters Pro [membership required] and stick around for the remainder of the series where all will become clear.