SciQuest -- Quietly Chugging Along and Building Steam
SciQuest, a Spend Management software provider that is virtually unknown outside of the higher education and life sciences sector, continues to build momentum with new product releases, customer wins and retention rates. Perhaps the greatest irony of SciQuest's success in the eProcurement space is that for the longest time I assumed (and still often do) that buying indirect goods is the same across industries; rendering the notion of a tailored industry solution unnecessary -- at least from a core procure-to-pay standpoint. But given how SciQuest has quietly handed its better known best of breed and ERP competition their shirts in these two vertical industries, there's clearly something to vertical specialization in some markets. Even more remarkable than their new wins is the 100% customer retention rate they claim. As many companies I speak with consider their plan to migrate away from best-of-breed eProcurement systems to standard ERP platform offerings at some point in time -- a good number have already made the move -- this is all the more remarkable. Proof that a razor focus on customer needs can triumph over the best features and technology.
- Jason Busch
- Jason Busch
Actually I am not that surprised that different industries have different requirements for indirect goods as well. I can name multiple different examples both from already mentioned life-sciences and higher-education, but also industries like professional services and consumer products are examples where the companies optimize different things to maximize the value for business.
We have seen companies for example "sub-optimizing" their purchasing by using "standard procurement product" for indirect goods and thus taking a hit in their project and services business with delivery delays of IT etc.
Actually, IMHO, when we see more and more companies targeting value creation instead of (sub)optimization of lowest price points for a category, it creates new requirements not only to procurement suites but also to process flexibility and agility for different business needs.
I think it was Debbie Wilson who said that "one size does not fit all" when talking about procurement tools, and I must agree with that, you must support multiple different sourcing and purchasing strategies even for indirect goods to, if you wish to be best in class in procurement.
cheers,
-jari
I'm familiar with SciQuest's solution. It is indeed impressive and it does have some features important to research-intensive higher ed that not all eProcurement solutions have. But there are other eProcurement solutions that have those same capabilities and other advantages. I think that, when capabilities are equal, the so-called specialization should not make a difference and it certainly shouldn't compensate for other deficiencies.
But SciQuest deserves credit for its solution and its marketing strategy. Quite frankly, it surprises me that others haven't tried to specialize in an industry with the goal of owning that industry.