1. Part I: You’re Asking For the Wrong Information
2. Part II: You’re Not Asking For the Right Information
3. Part III: You’re Missing the Most Important Point
4. Part IV: Open the Doors For a Truly Successful RFX
5. Part V: Stuck With an ERP or Outdated ERP Suite? You Do Have Options!

This is a repost and reprise of a series that last ran (for the second time) in 2015. It’s as relevant, and important, today as it was then, if not more so, thanks to the I2O Hype and AI BS!

Despite claims to the contrary, you are not stuck being a sap or following prophecies from an ethylene-gas inhaling delphi. You do have options. Acquisitions might have some analysts in a tizzy, but you only need to remember one thing. Don’t Panic.

It’s been over a decade since the acquisitions of Ariba & Emptoris, which kicked the M&A mania in our space into super high gear for the first time.
They were not the only best-of-breed suite game in town then, and they certainly aren’t the only best-of-breed game in town now, especially since the latter was retired by IBM a mere five years after acquisition. In fact, for many companies that have been acquired in our space over the years, SI would argue that they are not even in the best-of-breed category as the lengthy integration cycles required to integrate them into their acquirer’s platforms slowed down development and now there are only a few module or functions left that, in SI’s opinion, are still best-of-breed. However, there are lots of other options, and these options exist on both sides of what the Brits call the pond. (For you Americans, that’s the Atlantic Ocean.)

Best of Breed vendors eat, sleep, and drink sourcing, procurement, and supply management
Unlike do-it-all suites or ERP vendors, best-of-breed supply management vendors are focused entirely on a critical supply management process and, as a result, they tend to be much better at it than do-it-all or ERP vendors, especially supplier enablement, which we all know fuels the e-procurement benefits engine. (And whatever you do, don’t confuse supplier enablement with supplier experience or confuse vendor marketing with actual supplier experience — some vendors who market supplier experience actually excel at the working with the supplier experience which means the platform makes buyers happy, but suppliers [much] less so.)

Best of Breed on an ERP backbone can offer significant advantages

• Best of Breed providers often know the strengths and weaknesses of ERP systems they are replacing (or augmenting) better than the consulting implementation partners, who care more about if they can weasel their way into long-term strategy consulting than a successful implementation. (For example, there are now a number of vendors with over 100 customer SAP implementations who know the system way better than a Big 5 consultant on his second implementation project ever will.)
• Best of Breed providers have enabled hundreds of thousand of suppliers, maybe more, over the years … in all regions of the world … your 13,470 suppliers aren’t going to make them flinch (and they will be faster and cost less, because once again, they, or their carefully selected and trained integration partners, have been there, done that … a few hundred or thousand times.)
• Best of Breed provider’s customers are all former ERP e-procurement / consulting implementation customers … that’s right, most of whom have already failed using the ERP/consultant approach, spent the millions, got 7 punch-outs and 11 catalogs implemented … now they spend hundreds of thousands and get … well, you already know … actual results and benefits. And the Best of Breed learns from those customers!
• Best of Breed providers have to be better than the ERP or broad portfolio providers, because they can’t fall back on their CRM sales or app server license revenue if they don’t deliver.
• And because of all of this, Best of Breed providers have way more references than the ERP providers. Those big ERP guys based in Germany have a handful of significant e-procurement references at best … because they’ve already lost most to specialist providers with better systems.
• Best of Breed providers’ SaaS-type offerings and supplier networks minimize or eliminate the need for your IT department or external consultants to be involved, so they implement faster and less expensively
• The most successful Best of Breed providers have service organizations or carefully selected service partners around the globe to assist with implementations and provide stability.
• Best of Breed providers fill in the gaps where ERP falls short. ERP may try, but it is not all-in-one and they are usually years or more (and sometimes a decade) behind the Best-of-Breeds functionality-wise.
• Best of Breed works and they have the client stories to prove it. Follow SI’s advice, verify their offerings, check their references, and find the right one for you.
• Best of Breed will help your SUM (Spend Under Management) soar.

Consider your options carefully. A Best of Breed solution on your ERP backbone might be the best decision you can make.

This is a repost and reprise of a series that last ran (for the second time) in 2015. It’s as relevant, and important, today as it was then, if not more so, thanks to the I2O Hype and AI BS!

In the first three parts of this series we discussed the proper RFX process to follow when attempting to select a technology(-based) solution provider (for e-Procurement, e-Sourcing, and Supply Management solutions in particular) as a true multi-national. We noted that while most companies more-or-less understand the high level process, most get the implementation wrong, focussing too heavy on feature-function checklists (that are usually put together by vendors, even if they are obtained from third parties), technology buzzwords (like AI, Intake, and Orchestration) and too little on the core processes that need to be effectively supported and a vendor’s global implementation and support capabilities.

If your organization follows the advice presented, starts with the customer references, and only spends time and energy conducting a detailed review of those vendors with a track record that suggests that the vendor has a solution that will support your core processes and could meet your global implementation and support needs, then your organization is off to a great start. But this isn’t the only best practice that your organization should be following in the selection of a vendor for your global technology needs. In this post we’ll cover five more.

The Core Solution Litmus Test
Once the vendor has passed the core process and customer litmus test, the next litmus test is the core solution requirement litmus test. After dividing all of the stakeholder problems into must solves, should solves, and nice-to-solves, re-validate that the vendor has solutions (technology, services, or a combination thereof) that address each of the must-solve problems and most of the should-be-solved problems. The vendor is not right for you unless it is a global, cultural fit that brings the right solutions. (Remember, there’s no checking feature/function boxes at this step!)

Third-Party Claim Verification
Most vendors will make big claims in terms of their platform capabilities. Just like a vendor’s ability to serve your organization globally should be challenged and verified with customer references, so should its ability to fill your technology gaps. Not only should you talk to their partners, but talk to analysts, bloggers, and other third-parties they have interacted with and whom have seen (part of) their solution.

Open Book Negotiations
In addition to third-party claim verification, don’t be afraid to force a vendor to prove every claim, statement, and assumption. This should not stop at current, successful, customer references. The vendor should let you speak to analysts it has relationships with, consultants who have implemented their solutions, auditors to verify their financial stability, and even ex-customers if asked.

End-To-End Total Cost of Ownership Elucidation
What is the true cost of the solution to your organization AND your supply chain? This goes beyond the end-to-end platform cost, as discussed in this classic post on Cost Model Calculations in SI’s “Enterprise Software Buying Guide” series, but also includes any costs that will be borne by your supply base. It’s often the case with e-Sourcing/e-Procurement/Supply Management solutions with Supplier Information Management, Supplier Portal, or Supplier Network functionality that a vendor will charge your suppliers an access fee, which can sometimes be hefty. An access fee that is just going to hit your organization with interest in a year when your suppliers raise their prices to cover the fees you caused them to incur. In Procurement, a penny saved today at your supplier’s expense often translates into a dime spent tomorrow. (And if you don’t believe me, then you need to work on understanding the cost of capital throughout your supply chain. Remember that sound, conventional financial management is NOT good for supply chains.)

Open Finals^*
Typically, the final negotiations in this space are more secret than what goes on beyond closed doors at Area 51, scientology headquarters, and the back room of the club where Wall Street mega deals really happen. This is dumb. Really, really dumb! Blind auctions may be okay when buying commodities, but it’s the last thing an organization should do when buying a critical piece of functionality where a failed implementation will cost (tens of) millions of dollars or more in overspend and opportunity costs. Not only should each vendor be aware of whom it is up against, but vendors should be asked to promote their strengths and counter their opponents weaknesses. They should be instructed to tell the truth, even when asked tough questions (about customer retention and defection to a competitor), and (severely) penalized for false answers (and if they try to bypass you by going straight to the CFO or CEO, they should immediately be disqualified from the competition).

Remember, good vendors are honest, especially about the occasional (big) mistake that they made in the past, learned from, and put measures in place to prevent ever repeating it. And the best vendors will get up and walk away as soon as they realize they are not the solution for you (because they thought you needed primarily e-Sourcing functionality and they are mainly e-Procurement for example) and that it would take too long or cost to much to tailor it to your needs. (And these are the first vendors you should go back to as soon as you have needs that they can fulfill. As we said in a prior post, there is no perfect solution, or even anything close, but a vendor who is completely honest about what they do and willing to work with you to solve your problems is the best vendor for you, not the vendor with the most extensive system today [who may have stopped new development entirely and is just selling what they have].)

If your organization implements the best practices covered in this series, then chances are that it will have no choice but to prepare for success!

^* Nothing to do with tennis, folks!

This is a repost and reprise of a series that last ran (for the second time) in 2015. It’s as relevant, and important, today as it was then, if not more so, thanks to the I2O Hype and AI BS!

In this post we continue our series on best-practice vendor selection for your enterprise e-Procurement, e-Sourcing and Supply Management solution. As per our first post, this series specifically relates to the selection of technology(-based) vendors for your enterprise software needs, and e-Procurement, e-Sourcing, and Supply Management solutions in particular.

What is the ultimate goal of your organization’s technology acquisition project? To get a Spend Analysis/e-Procurement/e-Sourcing/S2C/P2P(/I2P/AP)/S2S/S2P/SXM/TPM/CLM/I2O system? No. To increase efficiency / save money / get more spend under management? No. To get satisfaction? No. (If you believe you will ever be satisfied, then I suggest you break out your record player, pull out “Out of Our Heads” by The Rolling Stones (US Edition), flip it to the B-Side, and repeat track one over and over, screaming with Mick Jaggar at the top of your lungs that [I Can’t Get No] Satisfaction until you believe it!)

The ultimate goal is your organization’s success. That’s the only metric you care about when initiating the technology acquisition project (TAP) dance. If your organization is a global multi-national, then your organization’s success depends on the vendor’s ability to deliver globally. (And if it’s just regional, on its ability to serve mid-size organizations effectively at a cost point that is affordable so that you can buy the system and grow.) Not how many boxes the vendor can check on some random feature / function check list. As we discussed in our last post, where large-scale roll-outs are concerned, there are only a few standalone best-of-breed sourcing and procurement technology vendors that will make the shortlist for a given organization.

Moreover, and you’ve probably been wondering about this, this success metric has NOTHING to do with AI, and neither does your RFX. Depending on what you need, the best solution might be AI, it might be rules-based RPA, it might be guided workflows, it might be a simple data processing and reporting app, or it might be an alert to dust off the handset, pick up the phone, and call the supplier rep to hash out a problem. The reality is that it is usually the case that you don’t need AI and Agents, you need solutions that solve your problems. The best solution is an Augmented Intelligence solution (which is the best type of “AI” solution that actually exists, because, as we’ve repeatedly told you, there is no real Artificial Intelligence, AI Employees Aren’t Real, and if you truly want a good RFP response, the #1 phrase you should ban in your RFP response is AI!)

Great results come from applying the best tech for the problem at hand, not from forcing experimental AI where it doesn’t belong. If a traditional technique can automate 95% of the tactical and data processing workload with 100% accuracy, that’s what you want. (Your CEO and CFO might want a dystopian society where they replace all the workers with artificial agents to maximize profits and minimize the need to actually comply with laws and regulations, but that’s not a reality that is within reach — so they will have to settle for a reality where the white collar workforce is optimized as every worker is 2, 3, 5, or 10 times as productive with the right Augmented Intelligence application supporting them, and every worker they bring on contributes to company growth and success.)

Furthermore, this success metric has NOTHING to do with Intake to Orchestrate either! (We’ve said it before, and we’ll say it again. Spend Orchestration is Clueless for the Popular Kids when what you really need is Revenge of the Nerds!) Intake is NOT NEW. Coupa had full intake on Procurement Independence Day in 2006! (But everyone forgets because as soon as Robbie took over the Coupa factory, they switched from an organizational-size pricing model to a per-seat pricing model and that resulted in many organizations limiting non-Procurement seats.) Moreover, on its own, intake is totally useless. What’s the use of centralizing requests you can’t do anything with? For that matter, neither is (web-based) Orchestration. The World Wide Web was invented by Tim Berners-Lee at CERN in 1989, and CORBA (the first web middleware) was released in 1991 — almost 35 years ago! (And that’s all Orchestration is, Middleware 3.0!)

All you care about is that the platform you are buying can connect to the other platforms it needs to connect to in order to pull data in and push data out as part of an enterprise process, with the ability to be launched by, or launch, other programs in the process workflow. As long as the platform you are buying has a (secure) fully open API for data injection and extraction, process initialization, and connection to your other platforms (either by modules offered by one of the vendors, a third party vendor, or customer integration), that’s all you need.

Your organization needs to remember that this is not 2005, or even 2015, but now 2025 and not only are Spend Analysis, e-Sourcing, e-Procurement, SXM, 3PM, CLM, and I2O functionality becoming more-or-less commoditized among the established vendors, but any decent-sized vendor will be able to check-the-box against any publicly available check-list. (And it’s not “AI” that is enabling this rapid progress, but huge open source libraries and ready-made stacks that encapsulate rules-based workflow and automation and easy plug-in of traditional ML/AI technologies that have been proven to work.) Sure, some vendor platforms will have features G, H, and I while other vendor platforms have features J, K, and L, but all of the vendor platforms will have critical features A through F. As for features G through L, if they are valuable, the other vendors will catch-up, and the time it will take them is usually less than three to six months nowadays, and if a core feature or function is made a contingency of a deal, the catch-up time is probably shorter still!

Another thing your organization needs to be aware of is that starting with a short-list of vendors that it is fairly certain can meet its needs will not only significantly reduce the length of the evaluation process (as it is no longer a question of “can the vendor meet my needs” but a question of “is this the best vendor to meet my needs”), but also significantly reduce the organization’s risk. If the organization needs to operate in forty countries and twenty languages, and doesn’t do it’s homework, it could end up wasting six months evaluating three vendors who don’t have a reference outside of the US and UK and who don’t support customers in a language other than English. If it has a deadline of nine months, what does it do? Either it takes the last vendor in the pipeline, if any are left, or rushes out to find another one, with no time to consider how appropriate the vendor it is for its needs or its organizational culture.

Which is another point that is often missed in the traditional implementation of an RFX cycle. Cultural considerations are typically ignored in technology selection, ignoring the fact that people have to use these systems — people who work, think, act, and like to conduct business in a certain way (and like to interact in a certain way with technology and technology / service providers). As a result, good technology selection is not just a matter of check-the-box when a strong vendor interaction is required. If two or more vendors are more-or-less equal from a functional/process selection, the tie-breaker should be cultural alignment. Does the vendor have the same goals? Work to the same metrics? Conduct itself in a similar manner? Give your customers and suppliers the same respect? Have a system with a workflow that can be tuned to organizational processes (and not force the organization to shoe-horn into processes and workflows that don’t support it’s efficient, best-practice, workflows)? These are important, but often overlooked, questions. Don’t forget them. (And much more important than how many “AI” boxes a vendor checks.)

In our next post we will dive into more best-practices to truly take your technology acquisition project to the next level now that your RFX process is back on the rails.