The UIX One Should Expect from Best-In-Class Auctions, Part II

Last week we dove deep into the basic general requirements for any e-Negotiation platform, namely e-RFX and e-Auction, and called out the need for easy template creation and easy starting bid population and validation as two necessary key requirements (among a set of requirements). (See: Best-in-Class e-Sourcing Part I and Best-in-Class e-Sourcing Part II.)

However, as we explained in our last post, the requirements for auctions go quite deeper than the requirements for RFX. In our latest article over on Spend Matters Pro [membership required] on “What To Expect from Best-in-Class Reverse Auction Technology and User Design (Part 2)”, the doctor and the prophet dive deep into specific capabilities required of modern e-Auction platforms in order for a user to have a great experience.

In our article, we define three absolutely requirements, as well as two requirements that will soon be absolute, for every e-Auction platform that wants to be a modern platform, including real-time connectivity monitoring.

As we state in our article, internet and software connectivity should never be taken for granted. This is a lesson one of the authors originally learned over 15 years ago (first hand) when helping run early online sourcing events at FreeMarkets. However, even today, many platforms still take this for granted, assuming that everyone has the reliable, redundant internet infrastructure of a modern first world data center. This is still simply not the case. Your supplier representatives are probably located at their factories in the middle of Nowheresville in the Lost State of Third World Country and might still be on a 1.54 Mbps T1 connection, which is only up on good days. Their data centers might be located in the nearest city, which barely has enough electricity to meet demand on a good day (when the AC or Heat is cranked up in every home and building), and subject to occasional rolling brown-outs. And so on.

The fact of the matter is the software should assume that suppliers can, and at least one supplier representative will, lose connection during an event. And if this happens, the supplier still needs to be able to bid. A modern platform allows for each supplier representative to designate one or more proxy bidders, in priority order, and if the main rep is unable to establish, or maintain a connection, the software will detect that and automatically switch the bidding designation to a proxy (who will be view only until he or she needs to take over bidding). In addition, the loss of connectivity and change of delegate will be noted and the buying organization notified.

In addition, it will detect if multiple supplier representatives lose connectivity, assume there is a major issue, automatically suspend the event, and notify the supplier representatives through other means (e.g. backup emails, fax, and/or even SMS) that the event has been suspended and will pick up either the designated back-up time or at a time to be communicated by the buying organization as soon as the issue has been identified and resolved.

This is necessary not just to maintain good supplier relations, but to prevent costly legal challenges, especially in the public sector, if an organization lost because it couldn’t bid through no fault of its own (and could prove that it was willing to make the lowest bid which, in many jurisdictions, requires the award to be given to that organization). But yet, a [large] number of auction providers (of the 50+ that the authors collectively know about) do not provide this capability.

Curious to know what the other four requirements are? Then check out our full piece over on Spend Matters Pro [membership required] on What To Expect from Best-in-Class Reverse Auction Technology and User Design (Part 2).

The UIX One Should Expect from Best-In-Class Auctions, Part I

In our last two posts we dove deep into requirements for e-Negotiation platforms, namely e-RFX and e-Auction, in general, highlighting the need for easy template creation and easy starting bid population and validation as key requirements. (See: Best-in-Class e-Sourcing Part I and Best-in-Class e-Sourcing Part II.)

However, the requirements for auctions go quite deeper than the requirements for RFX. In our latest post over on Spend Matters Pro [membership required], “What To Expect from Best-in-Class Reverse Auction Technology and User Design (Part 1)”, the doctor and the prophet, dive deep into specific capabilities required of modern e-Auction platforms in order for a user to have a good experience.

In our article we discuss three key requirements that every platform must meet, one of which is extensive format selection and parameterization.

As we lay bare, there’s a reason there are more than half-a-dozen different auction types. One of the co-authors of this report first wrote about the application of advanced auctions models (e.g., Vickrey) to strategic sourcing back in 1999 and the other co-author has been developing, consulting on, and/or writing about auctions since 2001. Auction types include Yankee, Dutch, Japanese, English, Vickrey and Brazilian. One format doesn’t suit all category, supplier, supply market or procurement organizational needs. In fact, the ideal format(s) may change over time, even for a similar event.

Furthermore, as we point out the application of different auction models is not just a question of categories or supply market conditions. It also needs to be a cultural consideration within the buying organization itself. In different parts of the world, different formats are more accepted and just work better (even within the same company). As a result, if these auction formats are not supported out of the box, the configuration capabilities should be sufficient to more or less to mimic the core of most of these formats.

And all of these need to support extensive configuration. Because, not only is it not one-format-fits-all, it’s not one-kind-of-format-fits-all. For more details, check out our deep dive over on What To Expect from Best-in-Class Reverse Auction Technology and User Design (Part 1).

Competition When it Comes to Incontinence: Retailer Sourcing Considerations

Today’s guest post is from Elizabeth Skipor, a Consultant at Source One Management Services, specializing in Marketing Procurement from the mid-market to the Fortune 500 companies. Before joining Source One, she was a category manager/specialist for a major US retailer.

Whether or not you’re familiar with or are an avid shopper for incontinence products such as adult diapers and incontinence pads, merchants like Walgreens, CVS and WalMart, are expanding their product mix to not only enhance comfort and fit, but performance in this highly competitive market.

This means product development and sourcing divisions at these fine retailers are busy trying to stay ahead of the curve. According to Nonwovens Industry, it’s in developed markets that adult incontinence is outpacing growth in more established segments like baby diapers and feminine hygiene. In my experience (as a former procurement professional of one of these organizations), this is true and mainly due to the 74.9 million baby-boomers (or Demographic, for purposes of this article) who are not only remaining active but are living longer. The number of people age 65 and older has increased tenfold in the last century and in better health than ever before (Source: ABC News).

As a former major retail buyer and category specialist for the adult incontinence category and previously procured fabrics for major clothing brands, I had to ask myself this question: What were the requirements that were rated high on the list by the demographic and what did I do in preparation for sourcing the best of the best for such a sensitive category?

Based on market research, there are three majorly important factors to consider:

  • Product Performance;
  • Comfort & Fit;
  • Discreetness

These three areas are imperative to the demographic due to the demographic remaining active longer; “People are living longer and living more of their life in better health than before” said Richard Suzman, an expert at the National Institute on Aging, the lead agency in assembling the report. Quality of life and the ability to maintain an active lifestyle remains vastly important.

When it comes to performance, if the product fails in functionality and doesn’t perform perfectly as promised, it can not only cause an uproar of poor review with your demographic and more importantly your brand in totality can take a major hit on its’ reliability, directly causing a decline in sales.

So, what’s important here?

  1. Absorption!
    Therefore, utilizing the right product for you whether it’s bladder control pads, protective underwear & briefs. In to put it gently, these products range in absorbency protection from very light to ultimate absorption; they’re also available in different lengths and thicknesses, and some offer side protection barriers for added leakage protection. These products are designed to draw moisture away from the body, eliminate odour, encompasses side shields for added projection, and offers a thicker level of protection where it’s needed the most (Source: National Incontinence).
  2. Research & development, innovation and technology
    are the forefront of any product development initiative due to consumers wanting items faster and better at competitive prices, and in this case more comfortable and discreet to wear; retailers are investing heavily on technological innovation of adult incontinence to ensure the functionality of the items create strong brand loyalty as well as sourcing from. Some recent innovations include the application elastic nettings allowing for flexible, smooth and seamless fusions for grander comfort and feel for the consumer. Taking this innovation this a step further in application in relation to hygiene and skin protection, the web configuration of the net offers a unique level of breathability and air permeability that directly affects end users’ level of comfort. As these are only a few examples, the innovation behind incontinence is rapidly increasing and fast paced, while maintaining a cost competitive advantage with not only major brands but private owned brands as well.

Whether it’s private label or name branded product, sourcing a supplier who stays ahead of the demographics’ requirements is essential to the shelf life of the product. Aside from this, extensive tests are performed to ensure the promises on the labels are accurate.

Some key performance indicators for incontinence testing include the following:

  • Rewet
  • Breathability
  • Retention Capacity
  • Elasticity
  • Total Absorbent Capacity

Thanks Liz for the deep insights into the daily life of a Sourcing Professional. Sourcing isn’t always glamourous, but, to find savings, and value, the work has to be done.

Stay tuned to SI as we will, through collaboration with Source One, continue to bring you down-and-dirty details on categories everyone has to source, but no one wants to talk about. Sometimes you have to dive into the weeds to succeed (which is something every incontinent golfer knows).

The UX One Should Expect from Best-in-Class e-Sourcing, Part II

Yesterday, as we continued our series on what makes a good UIX (which followed our posts on Smart Systems and Mission Control Dashboards), we went from generic Source-to-Pay system wide requirements to specific e-Negotiation, specifically e-RFX and e-Auction, requirements.

Specifically, in yesterday’s post, we noted that creating an RFX or Auction from scratch is a lot of work. From defining the need through selecting the suppliers through evaluating the responses to making an award, an average event typically consists of at least a dozen (or more) steps, each of which are arduous and time-consuming. That’s why the first core requirement we focussed on in yesterday’s post was easy template creation as a great template can jump start event creation, initiation, and execution over and over again (especially if it is work-flow enabled and driven by an underlying smart system).

But that’s just one core requirement. Another, as we dove deep into our follow up piece on “What You Should Expect from Best-in-Class E-Sourcing User Experience and Functionality (Part 2)” over on Spend Matters Pro [membership required], is easy starting bid population and validation. If there are a lot of products that need to be bid on, or a lot of bid fields that need to be filled out, and the data, or most of it, is already available in the system, or a connected system, it should be pre-populated for the supplier so that all the supplier has to do is make updates. This will not only decrease turn-around time, but potentially increase participation. If the event is run every six months, the buyer could pre-populate with the supplier’s previous bids or allow the supplier to pre-populate with their previous bids plus or minus a mark-up/mark-down and if an auction was preceded with a qualifying RFX, the starting bids can be automatically loaded. Either way, not pre-populating (or given the supplier the option to pre-populate) from existing data just doesn’t make sense.

And neither does not validating to the extent of data available. Bids can be compared to market rates and tolerances and suppliers or buyers alerted if the bids are outside of expected ranges and bids can be compared against each other and alerts given if a bid is detected to be an outlier which is off more than one deviation from the average, even if market data is available and it is within a normal tolerance. The bid might be right, and that’s okay, but buyers and suppliers still need to be alerted because erroneous bids lead to wrong awards (especially in optimization-backed events) and a lot of bad feelings in negotiations, especially if one side expects the other to live up to the bid.

These aren’t the only requirements for a great user experience, but they are additional core requirements that no modern platform should be without. For a deeper dive into this requirement as well as other core requirements, see the doctor and the prophet‘s piece on What You Should Expect from Best-in-Class E-Sourcing User Experience and Functionality (Part 2) over on Spend Matters Pro [membership required]. When combined with the rest of our series, it’s the best definition of what a modern e-Negotiation platform should contain that you’re going to find.

The UX One Should Expect from Best-in-Class e-Sourcing, Part I

As we continue our series on what makes a good UIX (to follow our posts on Smart Systems and Mission Control Dashboards), we go from generic Source-to-Pay system wide requirements to specific e-Negotiation, specifically e-RFX and e-Auction, requirements.

As the co-authors of this series, the doctor and the prophet, laid bare in our next deep dive on “What You Should Expect from Best-in-Class E-Sourcing User Experience and Functionality” over on Spend Matters Pro [membership required], creating an RFX or Auction from scratch is a lot of work. A lot of work. At a minimum:

  • Define the basic need that consists of products, services or bill of materials
  • Define the requirements for those products
  • Define the requirements for doing business with the organization
  • Define the information needed from the suppliers
  • Select (or define) the suppliers
  • Select (or define) the contacts
  • Set up the timeline (and milestones)
  • Send out the RFX invitations or launch the Auction
  • Receive responses back
  • Verify completeness and correctness
  • Evaluate, collaborate with teammates
  • Make an award

If all of this has to be done, from scratch, for every RFX or Auction, very few will get done. Considering that real benefits from these platforms only materialize if a lot get done, obviously this has to be as quick and easy to do as possible — and the platform will, thus, only have a good U(I)X if it is as quick and easy to do as possible.

So, what are the core requirements? Many, but in this post, we’re only going to focus on one of the core requirements — easy template creation. Given that the basic needs for a category don’t change much from event to event, the supply base doesn’t change much from event to event, the business and insurance requirements don’t change much from event to event, and so on. Thus, the ability to quickly and easily define templates that can be used over and over again is key. What should this template creation look like? Check out the doctor and the prophet‘s latest piece on What You Should Expect from Best-in-Class E-Sourcing User Experience and Functionality over on Spend Matters Pro [membership required]. (Vendors, this is the best description you’re ever going to get.)