Over on Purchasing Insight, Pete Loughlin ran a great post on the “build or buy decision tree for Purchase-to-Pay” that should not be overlooked because it gives every organization a very simple answer that even the most luddite of C-Suites can understand … NO!
You do NOT build a P2P system in-house. In fact, you should NOT have been building or maintaining a P2P system in house since the early part of the last decade — but with so many suite providers to choose from now, the fact that some organizations are still even considering building a P2P solution is almost inconceivable in-and-of itself.
As Pete Loughlin clearly states, when facing the build-or-buy question you first need to to ask yourself if the problem you are trying to address is new, uniquely different or so rare that a suitable solution doesn’t exist already. And the only reason you’d build in-house is if you could honestly answer no. In the days where there were only a couple of solutions, and they only worked well with ERPs or indirect purchases, there might have been good reasons to say no, but now that there are dozens of options, that can be focused on indirect, services, direct, or the whole kit-and-kaboodle, the only reason you’d say no is if you were completely unaware of what has happened in the space in the last 20 years — and if that is the case, you really shouldn’t be making the decision.
However, the reason SI is drawing this to your attention is not just because you shouldn’t be building P2P in-house, but because you shouldn’t be building S2C and, most definitely, shouldn’t be building S2P (or any component there-of) in-house either! But the real reason SI is bringing this to your attention is the flow-start doesn’t stop there … it continues. Not only should you NOT build in-house, but you should not formalize the short-list in-house without the help of an expert advisory partner. There are 100s of companies out there, and just shortlisting SAP Ariba, Coupa, and Oracle is not the right answer — and it’s even worse if you shortlist Basware, Coupa, Oracle, and ScanMarket for S2P. While these are all great providers in their own right, they are not all S2P and it’s not an apples-to-apples comparison. And when it comes to best-of-breed solutions, the doctor has seen even worse shortlists!
This one of the reasons the doctor worked on the development of SolutionMap — by creating a custom profile, it can be used to identify the companies that best-match an organization’s need on the tech-axis, which allows the organization to shortlist the right vendors to invite to the RFI. Vendors that can meet basic tech needs and be compared in an apples-to-apples comparison … allowing the organization to focus on finding the provider that can best serve the organization overall and match their culture, versus focusing on basic check-the-box technology features just to find out 2 of the 3 shortlist providers don’t even meet the basics. (And this usually ends up with the organization having to go with the vendor that’s left versus selecting the vendor that’s the best.)