Per Angusta: End-to-End Cross-Platform Purchasing & Procurement Project Management

When we last discussed Per Angusta last year in our post on Purchasing CRM, they were a relatively new SaaS company focussing on the workflow that ties the entire Supply Management process together.

They were building a SaaS platform to manage sourcing pipelines, track savings for organizational validation, and make Procurement’s impact visible to the organization. And, more importantly, they were building a tool designed to manage the sourcing workflow by integrating (through APIs) with Sourcing, Procurement, and Supplier platforms … out-of-the-box. At the time, they were integrated, or building integrations with, Rosslyn Analytics, HICX, Market Dojo. Today, they are also integrated with Coupa, Dhatim, D&B, and Ecovadis and other integrations are in the way.

Back then, they were mainly workflow, budget management, and great project management. Since then, they’ve added (better) ERP integration; improved alerts with rule definitions that will, in the next release, also support approval management and “toll gates” for better project management capability; added better contract management and tracking support (with forthcoming DocuSign integration); added supplier (information) management capability (that can import data from existing systems); added opportunity identification and management (with some innovative capability for those that also use Dhatim); and added an overall progress management capability … with the ability to take reporting snapshots from any point in time (in the past). In this post we are going to focus on three key advancements: opportunity management, supplier management and the progress management capability.

Opportunity Management was designed as a “scratch-pad” based application that allows a sourcing and procurement team to track potential opportunities as they are identified. To start identifying an opportunity, all that is needed is a name, an opportunity type, and a category. A short description, stakeholder, scope, implementation difficulty, and expected start date can also be defined. Once an opportunity is accepted, a potential budget impact can be defined, and once the opportunity is implemented, the expected savings can be defined and then the actual savings tracked. And all of this is summarized on the dashboard that summarizes opportunities by status, type of impact, ease of implementation, and project duration. But the great thing is that if a customer also has Dhatim, they can use Dhatim’s AI to identify the likely best opportunities that can be attacked and then feed them right into the Per Angusta platform.

Supplier Management, which can take data from the ERP, organizational Sourcing / ERP / Supply Management systems, and third party systems (D&B, Ecovadis, etc.), can be use to provide a basic Supplier snapshot independent of any given Sourcing system that can merge all the relevant data and provide consistent information to all Supply Management personnel. If they integrate a supplier discovery platform, it will be quick and easy to identify the best current and new suppliers to invite to your next Sourcing or Procurement project.

The Progress Management capability is essentially a pair of operational and financial dashboards that summarize target, forecast, and actual results for the year on top of the opportunity management and tracking capability. It’s trivially simple, but when data from all the platforms is integrated, extremely powerful and useful to the Procurement and Finance organizations.

Per Angusta has come a long way in a short time and SI looks forward to see what they do next year, especially as they are now working on “finding ways to use AI to make sourcing and procurement professionals much more productive and effective”.

M&A: And the Mania Continues …

Our last post on the subject was on how The M&A Mania Ain’t Over Yet. In it, we had two words of advice. Don’t Panic! Those two words are more important now than ever now that Jaggaer has bought BravoSolution. Big has bought big to become bigger and fatten the bottom line, most likely dancing to the tune of the private equity firm looking to get a return on its investment by either growing the company big enough to take public (again) or by making a global offering attractive enough to a bigger private equity firm.

And while this could be very good for the private equity firm, is it good for the customers? Let’s think about this. There are three things that make an M&A attractive:

  • More Customers
    Check, and check. The first check for the sizeable customer base that BravoSolution has. The second check for the fact that most of this customer base is in Europe, where Jaggaer is not well established (with the exception of Jaggaer Direct as a result of its Pool4Tool acquisition).
  • Synergy
    Either in customer base (for cross-selling) or in application (for broader platform). Check, but no check. There is a theoretical synergy in customer base (as both organizations sell to Procurement organizations), but there is not only a geographic divide, but a bit of a cultural divide as well (as most customers tend to buy from organizations with similar cultures, and BravoSolution and Jaggaer have, at least historically, considerably different cultures with regards to solution development and delivery.
  • Cost Reduction
    If there is an overlap in personnel, systems, locations, or other cost centers that can be reduced, then there is a great opportunity for cost reduction. Check, Check, and Check! First of all, while Jaggaer needs to be on all continents, and needs multiple offices on big continents (like the USA, EU, etc.), but only so many. There can be office reduction. This would be a big savings. They now have 2 of just about every Purchasing system — one set can be retired (in time). This would be a big savings. And as for personnel — while customer support personnel cannot be reduced (without losing customers, which negates reason one for M&A), tech support and sales and back office personnel can — especially when one set of systems is retired.

Now, we can’t be sure any of the changes hypothesized above will materialize, but unless some do, how will Jaggaer realize the potential benefits of the merger? It’s not time for panic, but it is time for thought. And the formation of a plan, or at least a back-up plan, if you are a current, or potential, Jaggaer or BravoSolution customer and someday it is announced that your solution, local support office, or team is being retired.

Ninety Years Ago Today …

The Ford Motor Company taught us how long a product line built to last should last when it unveiled its Ford Model A as its new automobile NINETEEN (19) years into production of the Ford Model T. Can you believe it! What else lasts nineteen years (besides versions of Unix and Linux, but even then support is sometimes only guaranteed for a decade) in today’s economy?

When you look at fast moving industries like fashion, sometimes you are looking at product lifespans of 19 days! And most companies roll out a brand new mobile phone model every twelve to eighteen months and an upgraded model every six to nine months. You cannot get a laptop or computer warranty for more than three years. And you’re supposed to trade up to a new car as soon as the current model is paid off.

But products can, and should, be built to last. Will we ever remember what the Ford Motor Company taught us?

30 Days Left to Get Your Supply Management Solution Budget In Order …

… unless, of course, you are a government / defense contractor and on the government fiscal year. But we’ll assume you’re not, and move forward.

There isn’t an organization in existence that has a complete Supply Management Solution platform, not even an organization in the Gartner Top 25 or the Hackett Group top 8% even though they are much, much closer than the average organization. Most (average) organizations only have part of the Source-to-Pay spectrum covered, and almost half don’t even have a modern solution at all.

And, as we have indicated previously, this cannot continue. But you can’t afford everything, and big bang implementations usually go up in a big bang. So you need to start by figuring out what you need first, what the average price point is for the solutions most likely to meet your need, and get that in the budget.

And that will require a good ROI argument, which needs to be a believable one. Which means you have to understand the full impact of the acquisition, implementation, and usage cost of a new purchase, as well as the time it will take to reach the ROI the solution will achieve. For example, while an optimization-backed sourcing platform will identify 10%+ savings on the top 30% of spend, delivering at least 3% to the bottom line, if the contracts are three years, it will take 3 years to realize the savings, and not all will materialize without a proper Procurement platform that insures the contract is properly executed.

Plus, when it comes to Sourcing platforms, even if you pay a monthly SaaS subscription, there will still be the integration costs with the current platforms (including ERP), the training costs for the intended users, any customization costs that result, and delayed ROI costs as it will take a few months to get all users on the platform, which means that it will take a few months before significant savings are identified, and a few more months before savings start to materialize.

The savings will materialize, and the ROI over the long term will be considerable, but the best way to get the necessary budget for a Sourcing, Procurement, SRM, or Analytics platform is to be honest about the cost and the time to significant ROI, which will typically be 6 months to 12 months, minimum, not the first 3 to 6 months like some vendors will promise. But there was a time company’s would take the long, 5 to 10 year, view, and if you take the long view, you will save Millions, maybe Billions (if you are a Fortune 100).

And that can be true of any best of breed (conglomerate) Sourcing, Procurement, SRM, or Analytics platform. So, get your well researched, well thought out, arguments.

Fujitsu is Launching a Blockchain Money Transfer Service

Which is a step in the right direction, but it’s not enough.

As per a recent article, Fujitsu Eyes Cryptocurrency Trading with Cross-Blockchain Payments Tech. The goal of the platform is to allow two different cryptocurrency networks to interoperate.

Interoperable networks are the future of supply chain, as per a recent article on we need blockchain, but not for the reasons you think, as, implemented properly, it could allow supply chain partners on different platforms to securely, but openly, trade information that multiple partners need access to in an unalterable way.

But that, of course, is easier said than done. Company X might post that it has a 10 Million Renminbi receivable in China that it wants to trade for a 1.5 Million USD receivable in the USA, but even if that is the exact exchange rate, are the two debts equal? Only if both parties can, and will, pay the same amount at the same time. If one debt is due now and one is due in 30 days, there is a cost of capital if one organization has to borrow in the interim to meet cashflow requirements. Also, if both debts are due in 30 days, something could happen within 30 days that would result in one organization being unable to pay its debt for 60 days, and this again could result in a cashflow issue for one party that traded a debt.

As a result, unless both parties pay into a network and the funds can be immediately transferred, then you need a network where parties are trading at negotiated discount rates (subject to credit ratings or other agreed upon factors), and that could get tricky.

We could be left with a situation where each IOU is auctioned off to the highest bidder in one of the counter-party currencies of choice (1.4M USD, 1.0M British Pounds, etc) or the situation where each block is put up with a (set of) offer requirement(s) and the first offer takes it. In the first situation, which requires a fixed time auction over block chain, you have a lot of overhead (and blockchain’s primary application — bitcoin — already takes too much energy), and the second case this could leave trade possibilities on the table.

Unless a truly global currency facilitation fund where a number of entities establish a global bank, each funding in their own currency, and agree to pay out debts in the local currency in an established timeline for each IOU placed on the network, the dream could stay that, a dream. But with a global organization, the global organization would do its own risk checks, insure the risk is acceptable, and then take a cut just like supplier networks and payment networks take a cut. It would be like a bank or an invoice factoring network, but could offer lower costs as it wouldn’t need to exchange currency all the time, could weather currency storms, minimize global transfer (and global transfer costs), and generally improve global trade efficiencies. Just like the Knight’s Templar did when they effectively established one of the first global banks.

What we’re asking is not an easy network to design, but one we need to be thinking about.