Author Archives: thedoctor

We Want to Be a Smart Company — What Else Can We Do! Part 1

We’ve read the dumb company: how to avoid the fork in the road (part 1 and part 2) and dead company walking: avoiding the graveyard (part 1, part 2, part 3, part 4, part 5, part 6, part 7 and part 8) articles, taken them to heart, admitted we’re making some mistakes and that we’re not doing some key functions as well as we could. Most importantly, we know we need to do more to avoid becoming a casualty of the next mass corporate extinction that’s coming. So, can you tell us what else can we do to avoid becoming a dead company walking (or, even worse, a zombie company*)?

01) Get Help to Identify Where You Need Help

We’ve (kind of) said this many times, but we’re saying it again. You don’t know what you don’t know. Get help from an expert who’s been in this space for at least a decade (and seen what’s worked pre- and post- the last two consolidations), and preferably the last two decades (as this cycle is going to be the worst since the late 2000s and most of the new generation of “thought leaders” and “experts” might not have a handle on what’s coming). There’s still a few of us left. See this posting where the doctor freely directs you to long-time experts in the space (which include areas he’s not the best suited to help you and areas he is … if you’re offering a solid solution to an industry segment that is currently helping your customers, he’d rather you get help and survive than not).

02) Improve Blogger / Independent Analyst Relations

Let’s face it, you’re probably not going to get much help from the big analyst firms. They’ll take your money and throw you their standard research that is mostly useless to you (because you need research customized to your niche and your needs); then take more of your money and only give you a mostly useless write up (with limited reprint rights in that you could do the write up yourself, but then you won’t have the logo) in return; then take even more of your money and put you on the map that everyone knows mostly consists of the same big companies year after year (due to limited analyst time) who are usually paying customers (as the analysts know them best) and typically only suited for F500/G3000s (because they are high priced suites); and then, if you still have any money left, take the rest of it and write about whatever tech you want them to and provide great shill for your marketers. But not once will they tell you if you’re going in the right direction or help you innovate (only if it is the current perceived market direction). It’s not their model.

03) Double Down on Education

It’s not just about what your product can do, but what your customers need to know to advance on the Procurement maturity ladder (where the majority of organizations are still on the floor reaching for the first rung, despite all the work done in the 2000s on how to climb the ladder). You need to educate them on what they should be doing, why, and then teach them what types of technology can help them even before you tell them about your technology. As per our dead company walking: avoid the graveyard series, education first is how you win in the end. Pace yourself while your competition runs themselves into the ground and drops dead. Always remember it was the tortoise (who can live 30 times as long) that won the race!

04) Thought Leadership Trumps Marketing Madness

Not only do you need to double down on education, but once you walk them from where they are to where they should be, and show them how your solutions solves a significant number of their primary problems, you still have to show them the wonders that lie ahead and accompany them on their journey through the dark forest until they, one day, reach the light. You have to convince them up front you are going to do this, do this through the implementation, be there every step of the way through the first few months as they get their tech legs, and then always be there to lend a hand when they need it.

While it might be time consuming at first, this won’t be as time consuming or strenuous as you think on an ongoing basis if you teach them how to learn for themselves and solve problems, as time goes on they’ll call on you less and less. It will eventually just be a quarterly check in to see how things are going and offer new thought leadership to help them up their game.

05) Focus on the Community

Find where they are engaged and go there, or, if they don’t have a place to engage, create one and bring them to you. Do you have a local chapter of a professional association where senior buyers or procurement leaders regularly engage? If so, go there. And, most importantly, leave your tech behind. Just educate them on an important topic and what they should be doing to ensure they are handling it appropriately. Seeing a big problem in tail spend in your clients, educate them how to identify it, manage it, and track it before high priced or unapproved purchases get out of control. Seeing a lot of companies unprepared for a new legislative requirement about to come into effect, show them how to identify which relationships need to be better managed, which contracts might need to be updated, and how to identify which risk mitigations are appropriate. Etc. If you impress them with your knowledge, they’ll come to you if they need help identifying a solution. Then, if yours is the right fit, and they’re a private company, they might even skip the RFP.

Stay tuned for Part 2!

A Company Should Never Build Its Own Enterprise Software Systems …

… and the fact that, apparently, hundreds are now thinking about building their own custom ProcureTech systems (as highlighted by a DPW Kearney presentation and referenced in THE REVELATOR‘s remote dispatch) demonstrates that the current marketing and methodologies being employed by software vendors, consultancies, and analyst firms are abysmal failures (and reinforces my statement that PROCUREMENT STINKS and that we have to clean it up)!

(The only partial exception is if a software company is building a piece of tech for a company of its size and industry, i.e. tech sourcing for startups, then it should use its own software and eat its own dog food, but it should not build any modules it doesn’t intend to sell.)

Why?

1. A company that is NOT a software company is NOT an expert in building products.

Moreover,

1b. A company that has not been validated to be best in class across the board in a function (and no such company exists, FYI) is NOT an expert in what it should be doing process wise, only on what it is doing process-wise.

As a result, it might not even be in the best position to design digital workflows, and especially not automated ones. Furthermore, even if it could do better than most on the digital workflows and automation, that doesn’t mean it can identify the right technologies for those workflows or the right stacks to build them on. And it certainly doesn’t have the chops to ensure the technology is secure, respects privacy rules, uses safe third party tech, keeps it up to date, etc.

In order to get these chops, they would have to hire a full IT team, which is very expensive, and would soar the lifetime solution cost to 10X or 20X what a solution offered by a modern SaaS provider with a multi-tenant stack would cost. With a significant percentage of that cost Up Front!

There only other option is to farm it out to a consultancy, and who are they going to choose? Probably a Big X. (You know, usually the exact opposite of who you should be hiring for niche / new technology, as pointed out in our post on When Should You Use Big X. )

2. Building takes years, and by the time it’s built, it’s out of date.

Companies need solutions now, not solutions in two, three, or five years … solutions that, by the time they are rolled out, are already outdated.

Moreover, by the time it’s rolled out, your other organizational systems are going to have changed, and then you have to integrate all the other systems to your custom solution on your own as your vendors won’t have out of the box connection options to your custom system, and that’s additional work and expense before you can get your outdated system rolled out.

3. It’s not about the product, it’s about the process.

Which means what a company really wants is a solution that embodies standard best practices with configuration options that allow the buyer to tweak it to their specific needs. As well as a solution that integrates well with their current ecosystem and provides the people who need it access when they need it as well as visibility when they need it. (In today’s verbiage, intake and orchestration, which is not new … intake was fully there in Coupa 1.0 [with respect to what the platform could do] in 2006 and Ariba was working on e-Forms back in 2000.)

3b. Furthermore, it’s about the data that drives that process!

And the most important requirement is the ability to export all system data in a standard format at any time! (Which is what almost everyone overlooks, because systems come and go, but as long as you have the data, it doesn’t matter.)

The Conclusion

And when you look at this, and you look at who’s out there, you have to wonder why more than a few companies couldn’t find at least 3 to 5 potentially good options for any ProcureTech need. The only reason, as far as I can tell, is they can’t identify them. (Because they are out there for almost every need in almost every organization in almost every industry across almost every region. As someone who has reviewed over 500 solutions in depth over two decades, the doctor says this with certainty.)

So why can’t these companies identify good vendors? As has been repeatedly commented on LinkedIn by the doctor and THE REVELATOR: there’s too much noise!

Marketing has devolved into a constant stream of one-way buzzword soundbites … which we tried to demystify a bit in the linked article earlier this year, but AI-backed, orchestration, autonomous, smart, etc. is all meaningless, and people know it.

In order to make a proper technology identification, a buyer needs to identify technology that solves the problems they are facing every day — which means they need focussed, educational, messaging that tells them about real problems the vendor’s technology was designed to solve. (Something we used to have a lot of in this space, but something I haven’t seen much of since the big M&A mania in the latter part of the 2010s where ProcureTech became the new FinTech, big enterprise investors moved in, and it became all about sell, sell, sell [and not solve, solve, solve].)

Now, this is something we should be seeing from analyst firms, but we don’t. We just see the same old maps with the same old enterprise vendors which hand over six, if not seven, figures a year to the firm to be included in their quadrants, waves, and marketscapes. Maps which are meaningless when each axis has like six different, usually subjectively scored, dimensions meshed into one.

And of course consultancies aren’t helping because the mid-markets exist by specializing in implementing smaller suites and best-of-breeds and living off of implementation referrals to the solutions they’ve learned to implement; while the Big X will quite happily tell you to build your own because they expect they will be the ones to design and build it, charging you tens of millions for something you might be able license for 1 Million a year, implement for 250K, and integrate for 500K if you are happy with an 80% to 90% solution (and then use the Big X for staff augmentation or custom extensions at a lower up-front cost, saving money for more valuable services later when you should use the Big X (and not cheap out on a low-cost consultancy without the experience).  (It would be very poor business for the Big X to turn you away!)

But at the end of the day, while it’s still buyer beware and a buyer should do his homework before engaging any vendor, we can’t help but think that a share of the fault lies with the majority of vendors who have abandoned solution first, education first methodologies and allowed revenue operations to switch to a marketing and sales first approach with no questions, please.

the doctor can’t wait for the coming rapture where THE REVELATOR has predicted that 75% of ProcureTech vendors won’t survive unscathed, because only two groups of vendors are going to survive — the really big suites with enough customers to keep going on current install base, and the new vendors who are smart enough to go back to basics, solve real problems, and lead with real solutions. Those are the vendors that SI has focussed on since it began, and the vendors that you need!

Advanced Supplier Management YESTERDAY — No Gen-AI Needed!

Back in late 2018 and early 2019, before the GENizah Artificial Idiocy craze began, the doctor did a sequence of AI Series (totalling 22 articles) on Spend Matters on AI in X Today, Tomorrow, and The Day After Tomorrow for Procurement, Sourcing, Sourcing Optimization, Supplier Discovery, and Supplier Management. All of which was implemented, about to be implemented, capable of being implemented, and most definitely not doable with, Gen-AI.

To make it abundantly clear that you don’t need Gen-AI for any advanced enterprise back-office (fin)tech application, and that, in fact, you should never even consider it for advanced tech in these categories (because it cannot reason, cannot guarantee consistency, and confidence on the quality of its outputs can’t even be measured), we’re going to talk about all the advanced features enabled by Assisted and Augmented Intelligence (as we don’t really have true appercipient [cognitive] intelligence or autonomous intelligence, and we’d need at least autonomous intelligence to really call a system artificially intelligent — the doctor described the levels in a 2020 Spend Matters article on how Artificial intelligence levels show AI is not created equal. Do you know what the vendor is selling?) that have been available for years (if you looked for, and found, the right best-of-breed systems [many of which are the hidden gems in the Mega Map]). And we’re going to continue with Supplier Management. (Find our series on Advanced Procurement — No Gen-AI Needed! Yesterday, Today, and Tomorrow; our series on Advanced Sourcing — No Gen-AI Needed! Yesterday, Today, and Tomorrow; and our series on Advanced Supplier Discovery — No Gen-AI Needed! Yesterday, Today, and Tomorrow through the embedded links.)

Unlike prior series, we’re going to mention some of the traditional, sound, ML/AI technologies that are, or can, be used to implement the advanced capabilities that are currently found, or will soon be found, in Source-to-Pay technologies that are truly AI-enhanced. (Which, FYI, might not match one-to-one with what the doctor chronicled five years ago because, like time, tech marches on.)

Today we move on to AI-Enhanced Supplier Management that was available yesterday (and, in fact, for at least the past 5 years if you go back and read the doctor’s original series, which will provide a lot more detail on each capability we’re discussing). (This article sort of corresponds with AI in Supplier Management Today Part I and Part II that were published in April, 2019.)

YESTERDAY

Auto-Fill Onboarding

While early 1st and 2st generation supplier management platforms required a supplier to create a full profile from scratch and enter all of their information, third generation platforms, which define expected formats for each field and have contextual awareness, can pull in the data from third party profiles, market databases, supplier forms, and even csv or xml exports of a supplier’s profile from another site.

Using classical semantic parsing, pattern matching, flexible reg-ex rules based data format validations, and any available meta data, even yesterday’s platforms could auto-fill the majority of a supplier profile form if the data was available in textual format for parsing.

Basic Community Intelligence

As per our coverage of supplier discovery, the reality is that this “AI” like functionality doesn’t require any “AI” at all. Community Intelligence just requires the amalgamation of data across customers, which is easy to do with multi-tenant SaaS as long as the customer agrees to sharing their reviews and insights (which could be part of the contract), and the supplier is made aware (which is part of the waiver to participate in customer events) of what is being shared.

It’s just math for averages, time series for trend series on those averages over time (of quality ratings, performance ratings, OTD ratings, etc.), and consolidation of tagged reviews. The only AI that would be needed is semantic processing if the platform provided a sentiment analysis across the community.

Real Time Performance Monitoring

As written five years ago, the last thing you want is to find out without warning that your primary supplier for a critical component in your new engine, control system, or IoT platform is bankrupt and no more shipments are coming; that a recent shipment has a 10% defect rate that is 10 times the acceptable, contracted, level; or that the custom factory redesign you just contracted for is going to take an extra six months when it should be 80% done.

Also, as written five years ago, none of this needs to be the case. There’s no reason a good platform could not alert you to leading indicators correlated with bankruptcy. Or a pattern of (slightly) late deliveries that is getting worse over time. That defect rates, even if within tolerance levels, have been increasing rapidly in recent shipments. Or that the last three key project milestones haven’t been met and the project is tracking to at least three months late.

With regards to early detection of bankruptcy, pull in financial risk scores monthly from your financial risk provider, look for downward trends (simple math), and monitor for alerts. Use the community intelligence identified above to identify late deliveries. Alternatively, if that’s not available, and it’s a big supplier with multiple customers in your country, monitor the public port data for its shipments … if they used to be every two months, but are now every three or four months, with an average volume per shipment that’s going down, that’s an indicator of trouble. With regards to your needs, track all of the rejected shipments at the warehouse, the returns, and keep a running tab on defect rate over time, again looking for trends in the wrong direction in terms of defects per shipment or returns per month.

There is so much you can do with just math. So do it!

Automated Issue Identification

As per our article five years ago, if the supplier management platform is integrated with organizational Sourcing, Procurement, and/or ERP systems, then the platform can automatically import objective supplier metric data as well as subjective supplier performance data from individuals across the organization that interact with the supplier.

Building on real time performance monitoring, the platform can monitor a whole host of metrics, trend them over time, identify drops that can signify issues, and alert the buyer if a dangerous drop is detected. Again, it’s just math.

Automated Risk Identification

The automated issue identification capabilities of a properly implemented and integrated supplier management platform are great, but as we have hinted above, the best platforms can also detect potential risks using leading indicators spit out by cross-organization metrics, trends, reports, and sentiment.

Remember, in addition to metric data, it can also take advantage of the community intelligence to identify early risk indicators. It can track the overall trend of promotion (against pre-existing tags) of a supplier for specific capabilities and the overall tone and sentiment of comments, and then compare that to the overall trend of anonymized price and performance data, and so on to detect when the performance or rating of a supplier is improving or declining, and, possibly, even how fast a rating might be declining which could indicate not just potential problems but risk.

Now integrate this to third party intelligence platforms with financial, CSR, operational, etc. risk and you start getting 360-degree risk profiles — and super early warning indicators since you never know where they are going to come from (the risk assessors, the community intelligence, or your own metrics). It’s all metrics, trends, and thresholds. Math. Good ol’ math.

Automated Resource Assignment

The best platforms support corrective action management, new product development, and supplier development initiatives. Each of these typically require project plans that require resources to support them, Always human resources and sometimes even physical organizational assets or IP assets (including software licenses).

If the platform is connected into a project management platform which has all of the information on organizational resources, and the organization’s asset management software, since the platform will know what skills are needed for the project, as well as what assets the supplier needs, it’s just a matter of best-match mapping. A great supplier management platform could do that through simple match computations and allocation tracking. When there are conflicts, it’s just a simple optimization problem for the best match.

SUMMARY

Now, we realize this was very brief, but again, that’s because this is not new tech, that was available long before Gen-AI, which should be native in the majority (if not the entirety) to any true best-of-breed Supplier Management platform, that is easy to understand — and that was described in detail in the doctor’s 2019 articles for those who wish to dive deeper. The whole point was to explain how traditional ML methods enable all of this, with ease, it just takes human intelligence (HI!) to define and code it.

Strategic Procurement for Strategic M&A

A recent article over on Fierce Healthcare on how strategic procurement can maximize M&A benefits noted that consolidating procurement can slash costs by standardizing purchasing processes and taking advantage of volume discounts for supplies because a smart business buying strategy involves using one technology platform for purchasing a wide variety of products from multiple sources.

The healthcare sector has also been ripe with M&A over the past few years, with $13 Billion in revenue now required to be a top 20 healthcare system, as many systems have grown significantly as a result of inorganic M&A growth over the past few years. According to the article, the recent M&A activity has been characterized by cross-geography deals designed to create value by scaling investments in platform capabilities across digital, analytics, shared services and workforce management.

But Procurement can find more value beyond shared products, shared supply base, and shared systems.

As hinted in the article, Procurement can also:

  • identify opportunities for shared services across the merged companies:
    this can allow for service provider contract consolidation and renegotiation for better rates
  • better workforce management:
    Procurement can help analyze the workforce needs across the proposed combined organization to better reallocate workforce needs (and possibly reduce the need for outsourced services)

But it doesn’t have to stop there.

An organization spends money across:

  • employees
  • contractors
  • facilities
  • utilities
  • products
  • systems

Procurement can help identify opportunities across each of these.

In other words, don’t overlook:

  • facilities:
    maybe you can reduce the number of locations through relocation of some personnel, and even reduce the overall cost through better facility identification
  • utilities:
    some states have energy deregulation, and there is significant opportunity in telco (like SaaS)
  • software: well beyond the S2P tools

Anywhere money is spent, Procurement can help provide an objective, fact-based view — not just on product-based spend.

Are the Seven Suites Sailing the Seven Seas Sans a Sextant?

Post Edit: The summary on LinkedIn has been removed. Note that this is an opinion piece and read why it was removed from LInkedIn in the Social Media Policy.  [Also note that this is about [marketing] direction, not about the actual platform, which we have covered, or advised the coverage on, here or on Sourcing Innovation!  We have recommended all of these suites and will continue to recommend them from a product and platform perspective where they are a great fit (even if we lament the [marketing] direction).]

You knew this was coming. It was foreshadowed in our top 10 ways to be labelled as a (Procure)Tech Noise / TroubleMaker article. (Where satisfaction was guaranteed if you followed the advice.)

Basically, in this new age where hype trumps straight-shooting, fake Gen-AI* trumps HI (Human Intelligence), intake and orchestration trumps the ability to actually do Proper Prudent Procurement, and carbon calculation trumps the ability to actually do anything about carbon reduction, the question becomes are the senior stalwart suites, who have an install base, good recurring revenue, and the ability to weather storms, staying the charted course or straying off towards the rocks and the siren’s call?

More specifically, are the seven suites that have ruled the enterprise Source-to-Pay Solution Maps since those maps were introduced still staying the course and slow and steady moving towards the next generation of real Source-to-Pay solutions that will solve real customer problems, or getting lured in by the siren’s call and sailing towards the rocks (and inevitably delaying the next great version of their platform)?

After noting we have links to previous in-depth coverage at the end of this article (so you can get the full picture), let’s take them one-by-one:

(SAP) Ariba

As far as we are concerned, SAP has been sailing without a direction since they acquired Fieldglass and Concur in 2014 (after acquiring Ariba in 2012) and formed the Intelligent Spend Group in 2015 (which has since seen numerous changes in leadership, direction, and even interpretation). They started off with a great idea (like Jaggaer who came up with “One” in 2018 after acquiring Pool4Tool and BravoSolution in 2017), but never really did anything significant with those acquisitions. (We can’t say why, but numerous leadership changes suggest disagreement on direction and priorities.)  They are still, more or less, three solutions, on three stacks, which aren’t deeply integrated … unless, of course, you buy their new brand-spanking new Spend Control Tower which will integrate all your Procurement, CWM, and T&E spend, as well as your HR/payroll spend and other un-captured spend if you have other SAP modules or modules that integrate with SAP.  (Or augment it with an orchestration interface that was built for SAP.)

Their top of page message about “automating spending processes and actively manage more spend for better control, greater value, and more savings” and “managing all sources of spend for increased control and business resilience” is pretty good, and one might think they are staying the course … still a decade behind the times in some ways (as Control Towers were so early 2010s), but staying the course. Unless, of course, you were paying attention to their most recent announcement pushing “SAP Business AI built into your procurement processes“. Even though they first announced an AI Co-pilot in 2018, it received pretty low fanfare, and was kept in the backroom, until this year, where it is now “super-charging” its AI Co-pilot with Gen-AI and other new capabilities!

While a bit behind the times (which makes sense for them as their enterprise customers don’t want to be suffering hit-and-miss innovation on the bleeding edge), everything was looking pretty good in our books until they started diving all in on the (Gen-)AI Co-pilot.

We’re especially saddened by the new, deep, focus on the (Gen)-AI Co-pilot because, and while this is as much on the SAP side as the Ariba side, they seemed to have been making some very good progress on the improvement and modernization of the direct side — catching up to the big specialists (namely Ivalua and Jaggaer) that were, through their DirectWorks and Pool4Tool acquisitions, respectively, working hard to build a better direct mousetrap and take SAP customers away).

Coupa

Well, you know our opinion here … the way things are going, this could be Coupa’s Third and Final Act. They replaced BSM with MMM, which they say stands for Make Margins Multiply, but what does that mean?

Even worse, they’ve apparently now gone all-in on AI, recently releasing 100+ AI powered innovations in their spend management platform and redoing their tagline to “optimizing your spend with the #1 AI total spend management platform“. Which is sad for us. It’s acquisition of Trade Extensions made it the #1 sourcing optimization platform and its acquisition of Llamasoft gave it the ability to optimize supply chain networks as well. It could literally optimize your spend across Souce-to-Pay and Supply Chain better than any other source to pay platform out there and yet it too has gone all in on AI, which does NOT optimize!

Ivalua

Ivalua, which, like Coupa, has been tracked by SI since the early days, was one of the platforms we felt was on the right track. Especially since it was one of the few platforms that was built up on one native, integrated, code base that allowed for true, integrated, end-to-end S2P processes that felt fragmented on other suites that built up their functionality by acquiring modular vendors and loosely integrating them.

At first glance, it seems like they are still on the right path. Off the top its “SIMPLIFY PROCUREMENT with a Unified Source-to-Pay platform” messaging is on course. Moving on to “complete transparency, seamless automation, and enhanced collaboration” elicits a hear, hear. “It will make you #LoveProcurement“. Doubtful in our books (unless you love it already because, if you love procurement, you love the process and not the tech). But you certainly won’t hate it with a good platform. “Make your spend matter with a complete, future-proof platform to manage all spend.” Not quite all spend, but certainly enough to make a big difference!

… and use “IVA to supercharge procurement with Gen-AI“. NOPE! It was a great start when they tried to be the first S2P vendor to create a true cross-platform search capability through a single search bar. Their early chat-bot interface which allowed for the execution of platform functions through simple statements, which could be learned and remembered, as they would be interpreted the exact same way every single time, was good for people who didn’t want to jump around through menus and modules and quickly access reports, documents, and simple system functions.

But when you introduce Gen-AI, you have unpredictability, the need to answer six or seven questions to explain, and get, what you hopefully want, and the opportunity for inappropriate (and if you hook it up to the web, even bad) data to be retrieved, which means bad decisions and bad results. In our view, they were so close, but now … we’re hoping they reverse course just a little bit.

Jaggaer

As we noted above, after the acquisition of Pool4Tool and BravoSolution in 2017, Jaggaer announced “ONE” in 2018, but under Accel KKR, they never achieved “ONE”, and, in fact, they didn’t even come close to true cross-platform data integration (level 1 on a 5 level hierarchy of integration) in our deep assessments (which included SolutionMap evaluations at the time), largely due to all the layoffs and operational cost reductions. It wasn’t until Cinven (who flipped them to Vista Equity earlier this year) acquired Jaggaer in 2019 that they started serious integration efforts (and, in the early 2020s, made very good progress).

Since then, they have continued to focus on:

1. “Harnessing the power of ONE intelligent S2P platform to turn procurement into a value-adding force with Jaggaer’s AI-powered, S2P solutions and supplier collaboration platform“, which is great.

2. “Unlocking the shared value in your procurement ecosystem to accelerate business outcomes, automate complexities, and manage spend with Jaggaer’s intelligent S2P and supplier collaboration platform“, which is greater.

3. “Accelerating your autonomous commerce journey to turn procurement into a value-adding force with Jaggaer’s AI-powered S2P solutions and supplier collaboration platform“, and there it is. Autonomous is okay when “autonomous” is just automating tactical tasks. But AI powered … especially when they are now going down the Gen-AI path, not good. Not good at all in our books. They have all the know how between old SciQuest (Indirect), Pool4Tool (Direct), and BravoSolution (Complex Services) to be one of the few suites that can handle any type of buy using best-in-class processes and capabilities. Continuing to bring that together, magnifying the opportunities, and continuing to introduce new capabilities and streamlined workflows and interfaces around that would not only be a huge differentiator, but one of the biggest in our book. Wasting talent on Gen-AI conversational interfaces which carry the risk of exacerbate as many complex events as they simplify, the exact opposite.  (As per our previous, grudging, admission, we believe Gen-AI has very few valid uses in Procurement, and believe that for most of those uses, Jaggaer already had better tech and approaches — and all that was needed was some streamlining and UX improvements.)

Edit: 2024-Nov-06: Jaggaer has reached out and indicated that while they believe in using Gen-AI wherever they think it has value, it is fully optional and they are more concerned with maintaining their focus on full platform integration and utilization of the right AI for automation where tactical processes can be automated.  Hopefully marketing can balance the messaging more going forward so people don’t make inferences to the contrary.

GEP

GEP used to be all about “SMART” Procurement. They named their suite, which was a complete re-write from scratch as a fine-tuned integrated suite, “SMART” back in 2013. They were playing a bit of catch-up, but it was a good, well oiled, integrated suite. Then they built NEXXE, so they could do supply chain, which, while not quite on the scale of a Big dedicated Supply Chain player (like Blue Yonder or Infor), given that they are also a full-service company, was more than good enough to support end-to-end S2P and Supply Chain for many of their G3000 clients.  (And if you knew who some of their clients were, you’d be amazed.  They support big names with very complex sourcing, procurement, and supply chain problems.)  By the end of the 2010s, the UX needed updating in both, but if you look at the Spend Matters Solution Map scores, it was more than enough to do the job. A few new advanced capabilities in a few areas and it was a great solution for their target market (G3000 who wanted end to end software and services across S2P and Supply Chain).

So where are they now? “GEP’s AI-First approach seamlessly integrates strategy, software and managed services, enabling enterprises to rapidly establish the infrastructure and capabilities necessary to build and run high-performance procurement and supply chain organizations.”

Why, why, why? First of all, in our experience, customers don’t buy GEP for AI-First, or even UX, they buy because they want the one-throat-to-choke solution-and-services model that works that GEP offers across source-to-pay and supply chain, which is something only SAP and Oracle can offer, and, more importantly, neither of them can offer it as a company that started as a S2P, and then Supply Chain, specialist (as SAP and Oracle both started as ERPs and also split focus across so many other areas — HR, CRM, etc.). Secondly, they want their their Procurement and Supply Chain managed, not run by a dumb bot who may or may not make random decisions on anything at any time. Thirdly they want predictable, repeatable results that they can bank on, as well as the ability to get to the root cause when something is screwed up. None of this says, or even implies, AI.  And definitely not Gen-AI!  Ugh.

Zycus

While much less visible in North America over the last few years, Zycus for a while was making a splash as the “affordable” solution that could be obtained in the six (and not seven) figures and do the majority of what most large mid-markets (LMM) and enterprises needed, especially in industries that didn’t require a lot of “direct”. It was a great solution for LMM multi-nationals on the rise to true global enterprises. And their messaging was straight to the point: the “Power of Procurement” through their Source-to-Pay Procurement Suite. It was clear what they did, what they offered, and why you wanted to use Zycus to go digital. Even the most novice of Procurement practitioners could understand it. Heck, they were one of the first to build a custom intake module (iRequest) for their entire platform a decade ago. (It should have been built in at the core, but not many suites would admit this oversight halfway through their journey and actively work to correct it.  Zycus deserves big props for this.)

Where are they now? “Make Procurement Intelligent: World’s first Generative AI powered S2P Platform that helps you achieve 10X speed and efficiency in procurement.” All-in on the Gen-AI hype train! (And given how many specialists launched on Gen-AI over the last couple of years, and how they are usually showing up after the party starts, following a best value approach, we will tell you that while they are one of the first, they are definitely NOT the world’s first.  However, in fairness, we will note that they were undeniably one of the first to investigate and deliver automated spend classification, and were so early in doing this they could have been the first full source-to-pay suite to have it, all depending on your definition of suite.)  Basically, more of our hopes and dreams that the big suites are resisting the Gen-AI hype are dashed.

Interlude

So where are we now? That’s six suites all in on AI, and, for the most part, Gen-AI, and, in our opinion, sailing the seas sans a sextant (at least with respect to their marketing direction)! (After all, despite the fact that it continues to perpetrate the Gen-AI hype, Gartner recently reported 85% failure rates in AI projects last year — and Bain is now reporting technology project failure rates of 88%, an all time tech failure high! This should be more than enough to turn away from Gen-AI, even without a discussion of all the problems Gen-AI comes with and all the risks Gen-AI entails. [Hallucinations, sleeper code, implanting false memories, etc. etc. etc.])

This is very sad in our view as these are six suites that grew and attained their status by attempting to, and then building, real solutions that solved real customer problems sufficiently enough to sign big customers, keep big customers, and grow big customer accounts. Since, with the possible exception of Ariba (that might have been added on by a SAP ERP customer), these aren’t ERP vendors with ERP lock in, you know they had to, and have to, be doing something right! Why risk that track record on unproven (and usually inappropriate) (Gen)-AI?

Now, as per our Coupa coverage, we hope we are dead wrong, that they all have a plan to continue building great solutions without Gen-AI (dominance), that they will continue to remain strong suites, and that we will be covering them for years to come (if they ever return our emails and messages and answer our demo requests).  We’ve invested almost two decades covering these solutions, and, more importantly, we have recommended and strongly recommended all of these solutions in the past and fully expect to keep doing so.  (Some clients need a suite, and we base our recommendations on current product capabilities, not how good the vendor is at marketing those capabilities.  That’s the advantage of having a deep understanding of technology!)

This just leaves us with:

Oracle

Specifically, their Fusion Cloud Procurement, which, to be honest, was the one suite we would almost never put on a shortlist for a company looking for a specialist S2P solution since they were usually less extensive and less feature-rich than the other suites that started as best-of-breed. (But definitely would for Oracle Shops that liked strong S2P integration with the ERP.)

However, when you go to their page, you see their messaging is all about asking if “your procurement suite can automate procure-to-pay, strategic sourcing and supplier management processes“? Then their messaging about how their “Fusion Cloud Procurement capabilities, built-in collaboration and analytic insights drive agility, manage risk and increase margins“. Moreover, “Oracle Fusion Cloud Procurement is an “integrated source-to-settle suite that automates business processes, enables strategic sourcing, improves supplier relationship management and simplifies buying resulting in lower risk, improved savings and greater profitability.” And, finally, it consists of modules for supplier management, sourcing, procurement contracts, purchasing, direct procurement, and procurement analytics.

Moreover, not a single mention of ANY AI on their main page. Just straight to the point messaging an average buyer and executive can understand. Moreover, searching for AI immediately takes you to Oracle AI for Fusion applications where you have a list of traditional AI for spend classification, predicted shipment and cycle times, dynamic discounting, supplier recommendations, demand sensing, anomaly detection, etc. No Gen-AI out of the box. If you dig deep, you find that you can have a Gen-AI based Procurement Tool with Natural Language Queries if you want it (and you are willing to custom build, configure, and train it), but they aren’t pushing it, you have to look for it, and ask for it. In other words, if you really want it, you can have it (because some customers will want it without researching it and they do give customers what they want), but they recognize you don’t need it for value, so they aren’t focussed on selling it (or even marketing it). (Just like they didn’t fall for The Cloud is a Crystal Ball hype, they ain’t falling for the Gen-AI Hype [yet].)

And that makes them the only suite that might not be sailing the seven seas sans a sextant (at least as far as their marketing direction is concerned). Now, we’re not saying they’re the best at using the sextant and charting a course, as they are typically behind most of the other suites in leading S2P functionality, but the simple fact they know that getting to your destination requires staying the course says something, and, in our book, that now makes them definite short-list material. Plus, like SAP, most of their customers are big enterprises that don’t want leading (and definitely don’t want bleeding) edge and instead want tested tried and true solutions.  And that’s why they’re going to be around for their 50th anniversary in 2027 and, if they so desire, might even be around in 2077.

In other words, they might be the tortoise, but we know in the end, if it stays the course, it eventually wins the race. (And this is something we never thought we’d write about Oracle in the early days. After all, Davie left Oracle to start the Coupa Factory in 2005 because he didn’t think they’d ever get where was needed in a timely fashion. How times have changed!)

Markets evolve, suites evolve, and messaging evolves.  Maybe when the Gen-AI hype dies down, we’ll see clearer messaging and be able to see the routes the suites are charting.  Only time will tell.


* Gen-AI stands for Generative Artificial Intelligence but should stand for Generative Artificial Idiocy as none of the generic Gen-AI LLM tools are intelligent and, moreover, can’t even do basic reasoning. Only the “generative” part is accurate, as generative literally means “make stuff up” and that’s what this hallucinatory technology does all the time!  (And that’s why SI is so scared when vendors start trying to rapidly incorporate it into their products.  As per previous coverage, their aren’t many valid uses cases with high reliability.)

Now, in full disclosure, SI hasn’t reviewed any of these solutions, except for two discrete modules in Coupa (Sourcing Optimization and Supply Chain Solutions), in the last 2 years, but this is not for lack of trying. SI has reached out (multiple times) to all but two of these companies, and, despite being one of the first sites to cover some these companies in the past (and do so in the early days when no one else would), has either been declined or completely ignored. (All the suites seem to care about now is Gartner and sometimes Spend Matters.)

First Coverage of:

  • Ariba: one of the few vendors that would not talk to SI in the early days, first covered by the doctor on Spend Matters in a 2-part piece in 2018 on Sourcing Decision Optimization Part 1 and Part 2#
  • Coupa was first covered in 2006 on the first Procurement Independence day
  • Ivalua was first covered in 2010 in a two-parter on end-to-end sourcing and procurement (Part 1 and Part 2)
  • Jaggaer is rebranded SciQuest, which was another vendor that wouldn’t talk to SI in the early days, even though the majority of its acquisitions, including AECSoft, Upside Software, Spend Radar, CombineNet, Pool4Tool, and BravoSolution, all did; the doctor did advise on Jaggaer coverage on Spend Matters as Lead Solution Map Analyst, but did not cover them directly;  he would advise checking out Spend Matter’s coverage if you have access: (S2C 1, S2C 2, and
    S2C 3 as well as P2P 1, P2P 2, and P2P 3)
  • GEP was not covered on SI, even though it acquired Enporion which was, as GEP was not highly relevant for SI’s market (focussed on companies who wanted insight into DIY platforms); the doctor did work with Xavier Olivera, Pierre Mitchell, and Jason Busch to do a deep dive in 2019 (Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7) which was the 6th most popular PRO article of the year! (Source)
  • Zycus, unfortunately, was not covered on SI as they never made our radar until the doctor started contributing to Spend Matters, where he advised on coverage, but did not do the vendor coverage (which included the 2018 Vendor Analysis, which we recommend: Part 1, Part 2, and Part 3)
  • Oracle, another of the original vendors that would not talk to SI, was never covered on SI, and while the doctor did consult on their platform capability during Solution Map capabilities, never contributed to a write-up (but would recommend anything Xavier Olivera or Jason Busch ever wrote about them, including Cloud Surprise, Part 1, Part 2, Part 3, and Update 1)

# Note that the Spend Matters site migration of June 2023, in addition to removing all articles pre-2013 and many more pre-2020, also dropped co-authors on many articles as well. Most of what the doctor wrote in the early days was always co-authored with Jason Busch who usually received lead credit (and, thus, was the author who survived the migration).