SaaS Procurement for S2P+ Goes Beyond Basic Buying Etiquette for IT Procurement

Medium recently posted an article from ArmourZero, a cyber-security platform provider*, on IT Procurement Etiquette for User and Vendor, which I guess goes to show the lack of knowledge on how to buy among some organizations. It doesn’t go nearly far enough on what S2P buyers need to know, but it does provide basics we can build on.

The advice it provides for a user are:

  1. Do Your Homework (Create a Proper SoW): take the time to provide a proper Scope of Work (and don’t just take a vendor’s sample SoW, edit it slightly, and send it out, especially to the vendor you took it from)
  2. Professional: be neutral and don’t favour any specific vendor
  3. Transparent: be clear about the process, and if all bids exceed the budget and a reduced bid is required, be clear about the reason for going back and any modifications to the SoW to allow vendors to be within a budget range
  4. Fair: stick to the rules; not even incumbents get to submit late; if you have a minimum number of bids in by the deadline, you work with those; you weight on the same scales; etc.
  5. No Personal Interest: don’t accept gifts; don’t vote on the bid where you have a relationship; etc.

However, in our space, you have to start with:

  • Do Your Tech Market Research: make sure you understand the different types of solutions in the market, what the baselines are, and what the standard terminology is (sourcing != procurement)
  • Do Your Deep Dive Tech Market Research: once you figure out the major area, figure out the right sub area — a Strategic Sourcing Solution is not a Strategic Sourcing Solution is not a Strategic Sourcing Solution; a CLM (Contract Lifecycle Management) is not a CLM is not a CLM; and an SXM is definitely not an SXM which is definitely not an SXM; in the case of Strategic Sourcing, do you mean RFX? e-Auction? or optimization-backed sourcing? in the case of CLM, do you mean Negotiation, Analysis, or Governance? in the third case, which element(s) of the CORNED QUIP mash are you looking for: compliance? orchestration? relationship? network? enablement? discovery? quality? uncertainty? information? performance? No vendor does more than half of these, and those vendors will only do a couple of areas really deep and more-or-less fake the rest!
  • Write a Process and Results Oriented RFP (& SoW): it’s not features or functions (beyond the foundational functions all applications in the class need to support) it’s the processes you need to support, the systems you need to integrate with, and the results you need to get — let the vendors describe how they will solve them, not just check meaningless yes/no boxes … they might have a more efficient way to support your process, a faster way to get results, etc.; the same goes for any implementations, integrations, services, etc. — make sure it focusses on what you need to accomplish, not meaningless check-the-box exercises
  • Do Your Due Diligence Vendor Research: once you have figured out the solutions you need and the primary capabilities you are looking for, make sure the vendors you invite not only offer the type of solution, but have (most of) the foundations of the capabilities you are looking for; use analyst firms, maps, tech matches, and expert analyst consultants to build your short-list of mandarin to tangerine to orange vendors vs random google searches that, if you are lucky, will give you apples to oranges, and if you are not, will give you rutabagas to oranges to tofu vendor matches

Then apply the rest of the advice in the linked article by ArmourZero.

You’ll have better success in your RFP, negotiations, and your implementation if you do all of your homework first, even though it is a lot more extensive than you want it to be. (But remember, there are expert analyst consultants who can help you. No one says you can’t hire an expert tutor! And the reality is that you should spend five figures before making a six to seven figure investment (as there will be implementation, integration, and support costs on top of that six-plus license fee), and maybe even do a six-figure deep dive process and technical maturity assessment, market scan, and custom RFP/SoW generation project with an expert analyst consultant before signing a recurring [high] seven figure suite deal.

* A CyberSecurity firm is the last vendor you’d expect to be authoring such a post (given the massive increase in CyberAttacks since 2019), but I guess it shows just how bad buying can be if they felt the need to write on this vs. a SaaS Management Vendor

OneMarket Sources Your Contracts with Insights in its new Integrated Source-to-Contract Portfolio

LogicSource was founded in 2009 by experienced professionals who wanted to improve sourcing and procurement in organizations that didn’t have the knowledge, experience, and infrastructure to execute in an efficient, effective, and transparent manner. Their view was that every consultancy can offer advice, but not every consultancy can help the customer implement that advice and get results.

In order to do this, they built an in-house product which they released to the market as OneMarket three years later, and which we covered here on Sourcing Innovation back in 2014 when we discussed their Interesting Solution for Sourcing Projects. In 2018, they released OneMarket Insights which was followed by OneMarket Portfolio, Sourcing, and Contracts in 2020. Then, a year and a half ago (in 2022 Q4) they released a new version with a new UX which tightly integrated their Insights, Portfolio, Contracts, Sourcing, and Supplier Management (and P2P, which will be covered in a separate update) modules.

The new UX and design, which was built with intake and visibility in mind, and their new Portfolio Management capability, was built with one goal: to be the SalesForce.com for the indirect Sourcing Professional who needed a platform, and a third party, to help with Sourcing and Procurement, and, more specifically, an easy way to follow along, provide input where needed, and learn to take over sourcing programs, projects, and processes when they are ready.

Sourcing

Sourcing in OneMarket is organized into Programs, which are broken down into Sourcing Projects that are managed within the OneMarket Portfolio product. The meaning of each Program is organization dependent, and allows organizations to structure their sourcing efforts by category, department, budget authority, etc. depending on what makes the most sense for the organization. For example, a Retailer may want a Program by geographic region or organizational category (Internal, Services, Resale, etc.), and projects by individual goods and services being sourced (IT, Office Suppliers, and MRO for internal; Legal, Janitorial, and Marketing for services; individual goods categories for resale).

Programs will require very little definition to define — as little as a name and an ID can set the Program up (if the organizational users understand their individual portfolios) as most of the detail is in the associated projects. When it comes to projects, it just needs a corresponding program, a category, an owner and a leader, an expense type, a starting date, an expected cutover date, an expected savings (effective) date, a priority, and an estimate of the value and effort (as a few indicators help with the future analysis and system level statistics).

Projects in OneMarket go beyond just the initial sourcing event and live from the time they are created until the last unit of the good or service is delivered as the OneMarket platform was built to track projects from start to finish, as well as savings and process (time) statistics. Projects also support detailed project plans with as many milestones as desired, each with their own start and end dates. The system will also track the actual end dates, the estimated versus actual duration, and allow the buyer to do analytics across projects.

Furthermore, projects can be templated for quick launch and LogicSource can provide the customer organization with a set of project plans that cover the breadth of their sourcing categories for a quick start upon LogicSource engagement and OneMarket go live. In addition, the Sourcing platform contains an attachment library that can be used to store all standard eligibility documents, contracts, product specifications, and other documents that need to be regularly used in projects. LogicSource can help the client organization load this on implementation to further simplify quick and easy project creation.

After every milestone is complete, the buyer can record key developments, (remaining) issues, next steps, and update the current project status. In this way, a complete project record is maintained in the application. This not only serves as an audit trail but allows the client to have a record of what happened they can refer back to in the future. This way, when the client is ready to take over more activity on their own, they have a guide for future instantiations of the project.

Projects can also be associated with strategies, (project) types, and event types. For example, it can be a cost avoidance event centered around an RFP, a cost savings event centered around an auction, or a supply assurance event centered around a contract renewal. Once the sourcing event project is created, the buyer defines the prerequisites for supplier participation (must agree to the payment terms and delivery timeframes, must complete the environmental assessment, must complete the security assessment, etc.), selects the suppliers, defines the schedules, attaches any necessary documents that must be agreed to and completed, and when the buyer is ready, it goes out to the supplier.

Projects in OneMarket Sourcing are completely document centric, including bidding, which centers around bid sheets compatible with every Procurement Professional and Sales Professional’s favourite tool — Microsoft Excel. When we say centers around bid sheets, we actually mean it is entirely based on the bid-sheets as there is no in-tool bidding (or even bid-comparison, you need to use an analytics solution for that). This is contrary to most sourcing platforms which have in-tool bidding and bid-sheet export and import (usually in a rigid format), but this is because they primarily support organizations that want Sourcing-as-a-Service/Procurement-as-a-Service (from LogicSource), are used to working in documents and sheets, and want to stay with what they are comfortable with.

Unlike big self-serve suite platforms that try to be everything to everyone, LogicSource has found that the companies bringing them in for help are overworked, understaffed, need to get more spend under control, and just need to run more sourcing events — and do so without having to adapt to a new tool or drown in the details for low-cost, low-volume, tactical, or tail spend. For them, this means the ability to quickly instantiate a project, send out the documents, get the results, select a winner, cut a contract or append to a master contract, and keep going — and do so with the tools they already use every day — email, Word/Adobe and Excel. Their redesign went document-centric because this is what the subset of the market they serve go after. Some of their customers in retail and food and beverage have teams of less than ten (10), and sometimes five (5), responsible for eight (8), nine (9) and even ten (10) figure events and their ability to focus on just what they need to is paramount — this is especially common in their market suite spot of 500M to 5B companies that have smaller Procurement departments.

Similarly, their platform was re-built from the ground up to support third party organization observation and management, allowing them to run higher-volume, higher cost, and/or strategic events for their customers and let them observe or serve as the project owner for the events they don’t want to manage themselves, which they run while the customers observe.

Once a bid sheet is accepted, the key commercial terms can be captured in the project as well as the total addressable spend and target savings, and all of the commercial terms can be pushed into the contract module that captures everything Legal needs to craft the contract. Once the post-sourcing procurement process starts, after each invoice is paid, the buyer can track the approved savings (as well as the date the savings were approved).

Supplier Management

The Supplier Management module, which tightly integrates with the Sourcing and P2P modules, maintains supplier information. In addition to the standard supplier information, it also stores the categories that the supplier provides products and services in, with the ability to associate the supplier all the way down to Level 3.

Core information associated with a supplier are its NAICS, DUNS, and EIN number, diversity status, and location. It also stores contact information, associated documents, eligibility status (for inclusion in sourcing events), and associates the supplier with all sourcing events it is part of.

As with Sourcing, Supplier Management is document based, including eligibility. For each prerequisite, the supplier uploads a document, possibly a revised (executed) version, and then it is a buyer’s decision as to whether the (executed) document meets the eligibility requirement or not.

Note that the standard information fields are not yet extensible (but this capability is planned for a future release), but you can add and associate as many forms as you like to keep track of relevant supplier information. The Supplier Management module was not designed to be a supplier master, as most companies have ERPs/MRPs that house the master data, but to house all of the relevant data for Sourcing and Procurement and help the organization keep the master data up to date, as they can push updates to the ERP (as well as pull suppliers in for onboarding during system implementation).

When it comes to onboarding, LogicSource manages the onboarding and helps the suppliers with any questions or issues they have or training they need, making it as easy as possible for the client to determine supplier eligibility, conduct sourcing events, or just follow along with what a LogicSource sourcing professional is doing on their behalf.

Contract Management

The contract management system is primarily a governance system that revolves around a contract repository of all contracts which are indexed by appropriate contract detail metadata. The system captures all of the commercial terms that come out of the sourcing event for the Legal team to cut and negotiate the contract, and once the contract is signed and executed, it captures all of the relevant metadata (through AI extraction that can be corrected and augmented by the user) and allows for contract management from that point on.

Key information includes company, supplier, parent contract (if it’s a subcontract to a master), category, owners, effective and expiry dates, and associated sourcing event. Currently, it can also store up to 84 fields per contract, including related party information, renewal and termination details (and associated alerts), pricing & payment details, key terms, associated attachments, etc.

Search is quite advanced and can be on any collection of meta data fields.

Analytics / Insights

OneMarket Insights is a service-driven solution designed first and foremost to provide the client with insights, and not necessarily deep analytics — although that is there if you have the right depth of data and are willing to learn how to use the Do-It-Yourself Cube Explorer.

Integral to the analytics process is the preparation of a normalized, categorized and enriched spend dataset where various sources of spend data, including P2P, ERP, Expenses and Card data files are consolidated by LogicSource into a single spend dataset, which is then enriched to extend the number of data fields available for the analysis experience. Each month the most recent spend data is ingested into this tool so customers always have the last month’s spend data on hand.

The solution revolves around a set of custom developed and delivered dashboards that are relevant to your organization and your efforts, as determined during the initial needs assessment and the results of the initial spend assessment exercise that looks at 16 different standard spend views across spend, compliance, and traditional opportunities. The standard areas that LogicSource will look at, once they get all of the relevant data integrated and loaded, are:

Overview

  • By Company / Division – how is the spend breaking down across companies or divisions
  • L1 Category – what are the top categories of spend
  • L2 Category – what are the top subcategories
  • Suppliers – what are the top suppliers
  • Sourcing Segment & Tier – how does the spend breakdown under an ABC analysis
  • Buying Channel – how does the spend breakdown by buying channel

Compliance

  • Purchase Order – how much is on PO
  • After-the-Fact Purchase Order – how much is on after-the-fact PO
  • Payment – how many payments are compliant with terms
  • Spend Under Contract (by Category) – how much category spend is contracted
  • Spend Under Contract (by Supplier) – how much supplier spend is contracted
  • IT Spend on Expenses/Cards – a policy view of what IT spend should be on PO/Invoice

Discovery

  • Unmanaged Spend – usually one of the largest opportunities
  • Top Suppliers by L2 – large opportunity if NOT under contract
  • Monopolies – single sources can be uncompetitive
  • Fragments – overly fragment spend presents opportunities as well

Once LogicSource gets an understanding of the organization’s spend, they work with the organization to customize dashboards that will provide the management, sourcing professionals, and analysts with the insight they need to track spend, do fact-based negotiations, and identify potential opportunities for future sourcing, supply base consolidation, payment term standardization, and other initiatives.

They will start with their standard dashboards for Spend, Compliance, Opportunity, Variance, Supplier Analysis, Category Manager, and Diversity, customize them to the most relevant metrics and insight, and promote the most insightful metrics to the CPO and/or CFO Dashboards.

Dashboards have the standard, expected, interlinked views that can be filtered on any and all data dimensions. For example, the Category Manager dashboard overviews spend by category, top 10 suppliers for the categories in view (all, some or just one), invoice supplier count by category, spend trend by quarter and volume, graphical views by country and state for key countries, PO compliance, Payment Performance, and Spend Metrics, etc. The Diversity dashboard summarizes key metrics, suppliers by diversity type, diverse spend trends, and other information of interest to the company and can be broken down by category if the organization has the raw data.

It’s not just limited to spend data, should the organization have the appropriate metadata, they also have a contract clause summary dashboard that allows the organization to query contract statistics by expiration, summary, status, type, category, payment terms, renewal terms, termination type/terms, privacy clause presence, FCPA clause presence, PII clause presence, etc.

The heart of the insights application is the cube explorer that allows the user to select any dimension as a row, any dimension as a column, and any of these as aggregates for pivot-table based exploration of the spend. With the cube explorer it is possible for the analyst to drill in and see any cross section of the data they deem appropriate, and, of course, when they get down to the L3 Category by Supplier by Quarter by Division, for example, they can drill down to the source transactions.

The cube explorer can work on any cube supported by the application, and the application can support as many cubes as you like. Whereas some spend analytics applications try to build one master cube that will support all of the analytics that a user is expected to perform, LogicSource realized that one cube is not always enough. First of all, if you try to augment a record with every piece of data possible, the cube will become bloated to the point of uselessness when the cube gets so large that you can’t do real time drill downs. Secondly, if there are hundreds of fields in a record, the record becomes incomprehensible. Thirdly, it doesn’t make sense to mix spend data with detailed contract data with detailed product data etc. Moreover, sometimes you just want to look at a subset of data, or federate only some of the data across systems.

In addition to the cube explorer, there is also the cube manager that allows the user to select the cube of interest and the cube viewer, which allows the user to easily manipulate any bookmarked cube view that was custom tailored for a specific purpose through easy on-off filters on each dimension and easy drill downs. This is especially useful when the data has been segmented into tiers (strategic, tactical, tail; ABC, etc.) through aggregation and you want to get to the largest tier 2 / 3 unmanaged categories or the categories with the largest variance (if the organization has detailed line item data available). (Any customized view in the view explorer can be bookmarked by a user.)

In other words, it’s a considerably more powerful spend analysis solution than one might expect from a services-based firm (since the user can define aggregates and derived dimensions and measures using complex formulas in the cube explorer), but it does depend on the right cubes being defined, the data being appropriately categorized, and the data being refreshed regularly. This work is all done by LogicSource, as they do not support self-serve categorization, updates, or enrichment. They can also enrich and standardize your supplier data during the process, as well as create a supplier ownership cube that tracks parent-child relationships. And, of course, if you want your data enriched from third party diversity, risk, or compliance sources, they can do that as well.

The LogicSource process is to work with the organization to help them define the right taxonomy, and the majority of clients use a subset of the LogicSource 3-Level indirect taxonomy with over 500 Level 3 sub-sub-categories (that LogicSource has refined based on over a dozen years of sourcing projects), while the minority use a customized version that starts with the LogicSource taxonomy as a base and customizes it to specific needs. Once the taxonomy is defined, LogicSource works with the client to identify the appropriate data sources; extract the data, do the mappings, cleansing, and cross-system enrichment; and build the initial cubes for data review and verification. Then they replicate and customize their standard dashboards to support each user (type) that will be using the application, and, finally, they define a refresh interval where they will handle all the updates and verifications of the data. All data is tagged by source, so that the user always knows the source of the data, and can even compare data (and totals) across systems, which is useful to identify any potential process and data gaps and leakage, which could signify process abuse, waste, or even fraud within the organization that needs to be stopped immediately. Note that while they automate the categorization and updates, there is a “human in the loop” for all initial classification, so no matter what technique they use, the data is always verified.

Finally, in addition to cubes and dashboards, they can also automatically generate reports of interest on a schedule and share/send those to affected and interested parties. As they can be output to Excel with all the underlying data, this also enables offline data exploration as well.

Furthermore, since they realize that most clients who haven’t had a proper analytics solution before or done analytics don’t always know where to start, their offering includes training on what to look for and how to use the tool to get the client going as well as a number of work-alongside projects and monthly review sessions to keep their clients on track.

Summary

LogicSource OneMarket platform is an indirect sourcing suite that was custom designed for companies that wanted a services-led solution where the provider either handled key sourcing events for them, where they followed along and provided input on the goal and the bids, or where they handled tactical or lower cost categories, but could tag in the services firm for guidance or help as-needed as their sourcing/account manager always had visibility and could tag in help when he needed it.

As such it has more functionality than one might initially expect (as classical S2C offerings from services-centric firms didn’t always compete well with best-in-class pure SaaS providers), and offers a solid solution for mid-market and larger firms that have a lot of indirect spend and need assistance getting it under control. And while some features may not be best in class or on par with standard expectations (e.g. no in line bid comparison in RFX), they were developed to support the processes typically used by over worked, under resourced, and tech inexperienced Procurement shops that wanted to be able to use their tools of comfort (documents, spreadsheets, traditional data repositories) but still have a best-in-class Sourcing Process. So if you’re looking for services-led or services-supported integrated Source-to-Contract solution for indirect spend, the new iteration of LogicSource‘s OneMarket is one you should definitely check out.

The B2B Software Marketplaces Will Rise. Then the Hammer will Fall!

Thanks to Apple, every consumer thinks there’s an app for that. And for most consumer desires, there probably is. Especially since Apple’s App Commerce climbed to 1.1 Trillion in 2022. Yes, that’s 1,100,000,000,000 US Dollars! That’s a lot of money, especially when most apps are being sold for a few bucks.

When you consider:

  • consumer app marketplaces are now a Trillion dollar business
  • enterprises are buying more SaaS than ever, as every employee in every department wants an app(lication) to support every task they do
  • enterprises pay 10X to 100X what individuals pay per user license, and, thus, the opportunity of enterprise app marketplaces is in the tens (to hundreds) of Trillions
  • enterprises want easy, centralized, acquisition to limit the number of vendors they need to deal with / handle subscription invoices from

It’s easy to see why all the big software / cloud vendors are opening their own app marketplaces. A recent article on IOT Analytics shouted the rise of the B2B software marketplaces while quoting their B2B Technology Marketplaces Market Report (2024-2030) that noted that:

  • they are the fastest growing procurement channel (for software)
  • dedicated platform providers are seeing success
  • some sellers make Billions

And they will continue to grow for a few years. But then, the hammer will fall.

What one has to remember is the following:

  • many of these marketplaces are taking a big cut, like 30% or more, which is what a sales partner would have taken to compensate its employee(s) that actively sold the product, but they are doing NOTHING but creating a listing, making it searchable, taking an order, collecting a payment, and providing a license key … even when you consider cloud fees, payment processor fees, platform maintenance fees, they could be very profitable at 13% (remember that recent article on how roughly half a trillion dollars will be wasted on SaaS spend this year … well, this is only going to increase that as you’re paying almost 20% more than you need to for the licenses you do need and use)
  • apps, licenses, and overspend is going to proliferate rapidly as “approved” app stores make it easy for every employee with a p-card to buy what they want, when they want
  • those SaaS audits and rationalizations that identify 33%+ overspend are only going to reclaim at most 20% of that, if you’re lucky, because, even if the software developer is willing to refund unused licenses, they’re not going to refund that 30%+ they already paid the marketplace … and that’s if they’ll even talk to you because you acquired the license through a third party
  • there’s no real negotiation opportunity when you buy from a marketplace

So as businesses race to digitization, they will embrace the marketplace as it will help them get part of the way there very quickly, but then when they realize just how much they are spending on app(lication)s, and turn Procurement on strategic procurement of SaaS, the first thing to go will be the app marketplace purchases … and then … it will be time for the hammer to fall.

Keep Your Procurement On PACA with FSMA with Procurant!

We don’t cover specialist Procurement providers much here on SI because many don’t have much in the way of domain specific product functionality (and differ primarily on domain knowledge, terminology customization, and service offerings), but some, like Procurant, go beyond the basics and offer domain specific functionality of relevance that the market needs to take note of. Especially when such functionality can help an organization be compliant with current and, most importantly, incoming regulations they are not ready for.

Procurant, marketing itself as a strategic platform for perishables that does Procurement AND Food Safety, offers the following core functionality:

  • P2P (Procure to Pay) for Perishables
  • Inspections (recording and auditing)
  • Traceabillity that is mobile-enabled and FSMA 204 compliant
  • Market Intelligence
  • Food Safety (workflow and remote sensor integration) (not covered in this article)

It’s the one-stop solution for retail grocers, especially those with US operations, that need to manage their perishable supply chain in a manner that is both PACA and FSMA compliant. (And if you’re a grocery retailer that does NOT know what those acronyms stand for … Uh-Oh! Better find out and give Procurant a call ASAP — because failure to comply can not only result in fines but [supply chain] shutdowns.)

Procurement/Procure-to-Pay wise there isn’t much that’s unique in core functionality (as the uniqueness is with the integrated support for the perishable space), but it’s all there, and we’ll start with the core so you can be confident the core is on par with other best-of-breed Procurement solutions.

With respect to quote management, the platform contains integrated RFQ / price request that makes it really easy to not only request (updated) quotes from suppliers, but get a commitment on that price (for a certain time or volume; i.e. one week or 100 pallets). When you get a commitment, the system tracks orders against that commitment, and then lets you know when the quote has expired because the commitment has been used up (and if you still need more product, you need a new quote with a new commitment).

With respect to order management, the solution makes it easy to select products for orders from the built-in catalog, from order templates (guides), or from demand forecasts (which can pulled in from the forecasting/demand management system OR created natively in Procurant using weighted average outbound for the last 12 weeks, with more forecasting algorithms coming in a future release). The platform even supports the definition of automatic (replenishment) orders, should the organization choose that functionality. Once the order is assembled, it’s very easy to send it to the supplier for fulfillment.

Moreover, as Procurant ‘s P2P also contains integrated support for carriers and logistics (due to the need to monitor the entire produce supply chain and ensure food safety every step of the way), in Procurant, you can also assemble orders by truckload, as you don’t want to be under-shipping if not absolutely necessary (as it takes the same amount of energy to maintain the temperature when refrigeration is necessary whether the truck is almost full or almost empty) and it’s easier to trace when you decide who is shipping what, when, and on which truck. One great feature of the platform is that it’s super easy to assemble an order for a carrier. It’s just a matter of dragging and dropping order line items until the platform notifies you that the last line won’t fit in the truck (as you can encode a max # pallets, weight, and volume by truck and as soon as one limit is reached, the platform lets you know). No complex training on a sophisticated TMS required.

As a result of this deep support for logistics and carriers, purchase orders can be incredibly detailed and include shipping dates, carrier, load reference number(s), and even cross docks.

Also, order management is multi-state and the system will track and notify if there is an:

  • order modification by the buyer
  • order modification by the supplier
  • order cancellation by the supplier
  • order reconciliation by the supplier (on being notified the goods received didn’t match the PO)

and all changes by any party are maintained in a secure, unalterable, audit log.

With regards to order management, the buyers can choose whether or not the supplier can split orders, remove items, or add substitute orders. Whether or not they can change prices (or just quantities to match availability), and even when modifications will be accepted. Similarly, the administrator can determine the order creation capability the buyers have access to … whether or not they have (to use) guides, whether they can create cross-dock orders, etc.

With respect to invoice management, it’s super easy for a supplier to flip a PO to an invoice. All they have to do is enter the actual quantity shipped by line item and submit. The invoice then goes into a wait state until a receipt is entered, at which point if there is a discrepancy, the invoice is sent back to the supplier for correction before it goes into the normal processing queue, where it would be held up until the discrepancy was resolved, which could delay payment considerably if the organization has long approval chains for corrections and exception processing.

The platform also tracks supplier fill rates, so you can quickly see which suppliers are fulfilling the POs they accept and living up to your expectations and which suppliers are not. It also has price watch capability, and can alert you whenever PO or quote prices exceed current (or historical) prices by a certain percentage.

And, of course, there’s a dashboard which summarizes current tasks and open orders and great search and filter functionality to find just the orders, invoices, or quotes you are looking for.

The platform also integrates the inspection reports from their inspection app and, for any fulfilled order, you can quickly bring up the full report that summarizes the inspection (packaging, appearance, condition, flavor, and quality) on each item delivered as well as the number of items rejected. Also integrated with the Procurement platform is the Inspection Module that contains the overall inspection summary dashboard, dill downs by supplier, scorecards by supplier, and other key reports and data points on inspections. The inspect application is a mobile app that workers can use at the warehouse on or the dock to inspect the quality of goods as they come in and, if necessary, reject them on the spot.

What’s really cool is the Track and Trace capability where, for any item, you can see the entire journey from the source lot to the warehouse or the store shelf, as appropriate. You just need a GTIN, lot number, order number, SKU, or product description and, optionally, a date range and you see the store shipments, receivings at your warehouses, vendor shipments, and base lots. And you can click into each store shipment, receiving, vendor shipment, or lot and see complete details (such as the ship to, date, and receiver for a store shipment; order #, sales order, Lot, shipper, shipment date, and cases for a vendor shipment; etc.). And with their next release, the (default) output report formats will be usable for FSMA compliance. (Again, if you do grocery retail and you don’t know why this is critical, you better find out soon!)

Finally, their Market Intelligence Capability in Procurant Connect provides Commodity Pricing, Weather, and Transportation analytics and tracking. The commodity pricing tracks price movements across all commodities by region; the weather pane integrates forecasts down to the county level; and the transportation analytics tracks average load fees by lane (defined by city pairings), as well as price changes and shipper / transportation availability (surplus, slight surplus, adequate, slight shortage, or shortage).

Procurant can integrate with your ERP and AP (payment) system, your TMS (or onboard carriers natively, which is something not many P2P systems can do as carrier management is critical in perishable supply chain management), and your supplier master (for supplier onboarding) if it’s not your ERP.

All-in all, Procurant is a fantastic solution for the perishable supply chain procurement and one that absolutely has to be on the short list of any grocery retailer that needs to get a handle on their perishable supply chain in a manner that will allow them to be fully PACA and FSMA compliant.

Beware of Magical Thinking In Your Procurement!

Back in 2017 (yes, that was 7 years ago, but the subject is still relevant), the doctor penned a post asking if there was magical thinking in your procurement noting that:

the Procurement Department that is getting the worst deal is the one that hallucinates the most — and needs to — in order to keep their worldview intact

And, furthermore, it was these Procurement departments that were most against modernizing their processes or platforms because their worldview requires them to believe that the antiquated processes and (severely) outdated platforms they are (still) using are just fine. (And they don’t recognize that their Procurement departments still run on the island of misfit toys principle — staffed with people who are nearing retirement, related to the boss, or technologically adverse and have been doing it this way for far too long.)

the doctor also noted that the easiest way to identify these organizations was by their telltale arguments of:

  • our processes are just fine, we just need more people
  • our platform is just fine, we just need more people
  • it’s not worth the cost, and it will slow us down

which were soon augmented with the additional telltale arguments of:

  • the problem isn’t with us, it’s with logistics / risk management / compliance / support
  • the problem isn’t with us, it’s the suppliers who aren’t holding up their end of the contract
  • our needs are just too unique and there’s nothing out there that will close the gaps

as supply chains started to crumble under disruptions. Because, if you just gave them more time, money, and people, everything would work out fine with a little pixie dust.

But we know there’s no silver bullet, and the only answer is to implement the best technology, with the best processes, so you can identify the biggest risks, plan mitigations, detect when they have occurred, respond quickly, and, the rest of the time, deal with exceptions and not standard operating procedures that can be entirely automated.

And, in the late 2010s, that was the extent of the magical thinking theorem. But now, thanks to the Gen-AI garbage marketing overload, and the addition of tail end Millenials (who replaced those put out to the Procurement pasture when they called it quits during COVID or when companies tried to force their return to the office), we have a new corollary to the the Magical Thinking Theorem:

the Procurement department getting the worst deal is also the one that thinks they only way to solve their problem and get the best deal is to adopt and implement Gen-AI as fast as possible

because the Millenials, who grew up glued to their smartphones, and always received instant gratification via Google and Apple, believe there is an app-for-everything and that a natural language Gen-AI app combines the best of both worlds and will solve all their problems.

Their thinking is not only as magical as the last generation thinking (that more time, money, and people can solve anything), but more dangerous (because their answer is to just turn their problems over to the artificial idiocy machine and blindly accept whatever comes out of it, no matter how hallucinatory or ridiculous the answer is).

the doctor said it before and he’ll say it again. There’s no room for magical thinking in Procurement. Just like alchemy needed to be replaced with science, magical thinking needs to be replaced with realist thinking, and random unpredictable Gen-AI replaced with proven deterministic procedural (rules-based) solutions that use tried and true mathematical techniques. (Because, the classic analytics, optimization, and machine learning that you have been ignoring for two decades will do just fine.)