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.)

What Makes a Good UX? Part III “Mission Control Dashboards”

Last week, after singing Bye, Bye to Monochrome UIs, we posted part II of what is to be a rather lengthy series on what makes a good UI, and more importantly, a good UX in a modern Sourcing or Procurement System. (Lengthy in that, after tackling the basics, we are going to dive into all the major components of your average Source to Pay system, and some of these components will require multiple posts on their own!)

In our first post (on What Makes a Good UI) where we noted that the full series is being published over on Spend Matters Pro [membership required], as it is the result of a deep long-term multi-blogger collaboration (led by the doctor and the prophet) and sponsored by Spend Matters, we outlined some of the fundamental requirements of a UI/UX for any Supply Management application which included, but was not limited to, integrated guidance, context awareness, “touch-less” automation, mobile support, and messaging as a competitive advantage.

Then, in Part II, we began our deep dive into what all of this means, starting with “Smart Systems” that drive integrated guidance leveraging new “AI” techniques -— better termed automated reasoning (AR), as software isn’t truly intelligent —- that adapt and learn over time. These systems mix semantic technology, sentiment analysis, key-phrase driven expert systems and other machine learning techniques with history to determine what the user is doing and what the user wants to do and offer appropriate guidance. But that’s just one aspect (and the full Spend Matters Pro article on “Smart Systems and Messaging, Chat, and Collaboration” also dived into critical MCC aspects among other things.

Yesterday, over on Spend Matters Pro [membership required], the prophet and the doctor released the next part of their UX Series, “Advanced Mobile and “Mission Control” Dashboards” where we dove deep (and I mean deep, Mariana Trench deep) into two more key requirements of modern Sourcing or Procurement application, namely advanced mobile enablement (which is way more than just e-mail, FYI) and what we are terming “mission control dashboards”.

The real key here is “mission control dashboards”, and not just plain old first generation dashboards (which are very dangerous and dysfunctional) which, if present, should result in the application under consideration being banned for life from your organization.

You see, whereas static first generation dashboards give you useless (and I mean useless) reports (which, at best, show a stoplight indictor with no description or backup data that lulls you in to a false sense of complacency or urgency), a modern mission control dashboard replaces those static widgets with modern fully enabled GUI widgets that allow users to drill down, initiate, and execute relevant actions such as data retrieval, workflow kick-off, or collaborative corrective actions. They can embed “apps” and “portlets” and allow a user to get what they need, and where they need, in 3-clicks, without missing anything important. They are the customizeable interactive views that applications have been missing. But, again, this is only the case for truly modern dashboards. First generation dashboards still belong in the dung-heap. For a truly deep dive into what these are, what they can do, and how they are used, check out the Pro piece [membership required].

P.S. Again, if you are a vendor invited to the Sourcing, SRM, CLM, or Spend Analysis Solution Map, this is a series you do NOT want to miss!

No Solution is Completely Foolproof

A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools.
Douglas Adams

Source-to-Pay solutions are getting easier by the day and soon they will be so easy that some vendors will be claiming their solutions are so simple that even a fool can use it error-free. But that’s really not the case. No solution is foolproof. Never will be.

Why? First of all, it’s impossible to predict every action a person could take. So, no matter how many situations you plan and check for, if there is even one you missed, and if the application is complex enough there will be at least one, no matter how unlikely that situation is (or how nonsensical it is), there will be at least one user who finds it and either crashes the application or generates a scenario that is nonsensical.

The alternative is to lock the application down to an enumerable finite set of inputs in each state and limit the allowable actions to those that will allow a smooth, predictable, transition to the next state without fail. But if the vendor chooses this route, the result will be a very limited application with very limited possibilities. And given that the real world is not limited to a small set of situations with always predictable solutions, this is not a very useful solution.

Secondly, never underestimate the application stupidity of a potential user. First of all, the user could be a new transfer from another department with no training and a very shallow understanding of Procurement. What a vendor would assume to be obvious to an average Procurement user would not be obvious to a new transfer. Secondly, not all users are Procurement users. For example, shop floor users might have access to initiate requisitions. And these workers might have limited computer knowledge. And then there’s management. And consultants.

Thirdly, the more a vendor tries to make a solution foolproof, the more they end up throwing in way too much unnecessary code. The more unnecessary code that is put into an application, the more errors that creep in. Errors multiply with code. Always. Doesn’t matter if the code compiles. Doesn’t matter if the code passes the boundary tests. All that matters is that there is more code with more paths and more state transitions to track, to the point where eventually there are too many paths to track and test and something breaks when a user goes down the wrong path.

The moral of the story? Don’t fall for any vendor who says their application is foolproof. And don’t look for a foolproof application, because it’s not about how easy the application is, it’s about how much value the application can generate. The best applications, while easy and logical for most of the functionality, will not be foolproof. Nowhere close. So, value first. Because, at the end of the day, the only user a foolproof solution is for is a fool.

Advanced Sourcing Will Not Disappear If You Figure It Out!

There is a theory which states that if ever anyone discovers exactly what the Universe is for and why it is here, it will instantly disappear and be replaced by something even more bizarre and inexplicable. There is another theory which states that this has already happened.
Douglas Adams

Regardless of this theory is correct or not, advanced sourcing is not the universe … it’s not even the universe of enterprise applications (although it’s becoming a pretty significant part). As a result, your organization should not be scared to acquire, learn, and master it. However, given the continuing rather low uptake of strategic sourcing decision optimization and advanced hybrid spend analysis (that uses machine learning and embeds prescriptive analytics), one would think the average organization is quaking in their boots.

And the answer is not to wait until the application interfaces are simplified enough so that it’s just point-and-click to select a model, accept the default constraints, run the scenario, and accept the result. Just like a top n report in spend analysis will only identify a savings opportunity once, a canned optimization scenario will only identify a significant savings once.

Nor is it the answer to wait until your preferred provider proffers a solution to you. These are solutions you should be seeking on your own, not when your provider brings them to you because every day you wait is a day another opportunity passes you by. And with pressures mounting to generate value, how many opportunities can you afford to miss? None.

So don’t wait. Figure it out. It won’t go away. It won’t change instantaneously when you do. And you won’t have to learn it twice. So just do it.

What is Visibility?

This is a term that has been overused and abused by Supply Management vendors for years who like to claim that their tool will give you unprecedented visibility into your supply chain, but just what does that mean? If you look up the definition, the first (or second) definition you’ll find in many dictionaries is something along the lines of the state or fact of being visible, which isn’t very useful when visible is defined as that [which] can be seen. So what do we have to see?

Well, if you talk to many vendors, you have to see the data is. Specifically, the vendor might tell you that you need to see the data on where your order is in terms of production, shipment, or delivery. And this is good, but it’s not enough. While this will tell you that production on an order is three (3) days behind, it won’t tell you why. Is the plant recovering from a backlog, and about to put your order into overtime production tomorrow? Are they suffering from a worker shortage, or strike, and your order is delayed another week? Or have the components and/or raw materials not yet arrived? And if it’s the latter situation, why? Is it a transportation delay? A production delay? Or a raw material shortage that may take months to correct? So you need visibility into the status of your order and all of your supplier’s orders that impact your orders. But this isn’t always enough.

While it would be great to know as soon as a delay occurs that could potentially impact your supply chain, and give you more time to respond and potentially create and/or implement mitigations and counter-measures (such as finding an alternate source of supply or stepping in to help the supplier solve the problem), this still doesn’t give you any indication of problems that could be brewing.

That’s why other vendors try to sell you risk-focussed data solutions such as financial viability reports (from credit-based data) and activity reports (from import/export data). But these solutions only allow you to judge supplier viability, they don’t allow you to determine if an external event in the supplier’s locale (such as war breaking out or a likely natural disaster) could take the supplier out even if they are financially viable and low-risk from a business perspective.

So other solutions try to sell you country-based risk assessment solutions with data on each of the locales you are doing business with. And this is a type of visibility. As are sustainability tracking solutions which track sustainability data (with regards to environmental, legislative, and other types of compliance data) to try and predict current and future supplier health based upon a sustainability score that goes beyond pure financial data. And this is another type of visibility.

But then not only do you really need to understand your current costs, but your potential costs when doing a Sourcing event, based on current market rates and expected currency fluctuations and transportation costs over the contract term. It’s also important to know not only current tariffs and taxes, but any proposed changes and the rate of change associated with those tariffs and taxes. Some countries (like Brazil) will change import rates across categories almost weekly. Others will only change once a year or when new trade agreements are struck.

And you need to see usage. If you bought a solution for the entire sourcing department, is the entire team using it? How often? And how does that compare to how often they could be using it? If 30 categories should be put out to bid over the course of a year, but only 20 are, why? Is it because a couple of users are still giving contracts to incumbent vendors without proper bids? Is it because the old curmudgeon thinks his 3-bids-and-a-buy spreadsheet approach is superior? Is it because the tool makes it so damn difficult to create an RFX with all the necessary attachments (because your sourcing 100 line item bill of materials where each line needs its own specification attachments and the buyer has to upload them one by one) that the team only has time to do 20 categories? You need to know.

And if you had all these solutions, you could certainly argue that you had supply chain visibility, but the question is, how complete is it? The reality is that you only have data visibility, and while that’s a great start, supply chains don’t run on data alone. They also run on processes … processes used to plan the supply chains, manage the supply chains, and correct them when things go wrong. How much visibility do these solutions give you into your processes?

Think of your average sourcing, procurement, and even BoB Source-to-Pay platforms. How many of them have the ability to even design basic project management templates with workflows, milestones, approval chains, party, and counter-party obligation requirements that give you the ability to plan, track, and maintain visibility through the entire process? There’s the market research, the sourcing, the contract negotiation and lifecycle management, the supplier relationship management and development, the day to day procurement, the inventory management and replenishment, the MRO, and so on that needs to be done, process oriented, day to day. And you need visibility into that too!

And, even if you have all of the data and process visibility described above, is it enough? How much do you need to see to be confident that the chances of an unpredicted event are sufficiently low and/or the chances of you not knowing about an unpredictable event soon enough to implement mitigations are sufficiently low? It’s hard to say. It probably depends upon your operation, your risk exposure, and the strength of your supply chain and supplier relationships. But it is safe to say you need a significant amount of visibility, and that you should starting figuring out what that is today.