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March 18, 2010

 

Is Business Intelligence the Answer to Supplier and Supply Chain Management?

Over on Supply Chain Management Review, an article by two Wipro consultants suggests that business intelligence (BI) software, such as the kind acquired by SAP and Oracle in recent years, is key to building supply chain visibility. The two argue that "BI capability allows monitoring of supply chain performance and helps in capturing new insights into all aspects of the businesses, fostering innovation." Moreover, "BI allows driving performance improvement in individual functions, business processes that span across multiple functions and in the extended supply chain through collaboration with customers, vendors and other trading partners delivering significant benefits in terms of cost reduction, customer service improvements and lower inventory levels." While this is a great vision, perhaps it's better for those in the implementation and advisory ecosystem than for the actual customer that's got to pay to make it all work.

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Spend Radar's Beacon Expands (Part 2)

( For Part 1, click here.)

One of the questions asked by some of Spend Radar's channel partners (and customers ) when first hearing of the tool is simple: does the world really need another spend-classification and -analysis product? Aren't there enough already? The answer to this is not as simple as it might seem. Yes, there are far too many products on the market; even the ERP providers have gotten around to finally releasing decent stand-alone offerings that include both the cleansing/classification and analytics bit. But few, if any, new providers tackle classification at the core of their offerings first, delivering a solution focused on simplicity of execution (making the hard stuff look easy), transparency, and flexibility. That is, of course, until Spend Radar launched out of the starting gates at a speed steadily ramping up to a breakneck pace only a few quarters past its incorporation date. But what caused Spend Radar to gain traction so quickly, especially considering that solid, albeit more complicated, solutions (e.g., transactional procurement providers like Coupa) had such a challenge with revenue growth early on?

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Rosslyn Analytics' New Twist on Spend Visibility (Part 1)

While I plan, over the holiday break, to find as many ways as possible to ignore numbers, charts, graphics, and useful and creative quantitative displays of visual information in general, there was a time earlier in the month when, although overloaded with ideas and information and most in need of a refresh, I still could say "wow" when I saw something exciting. That moment happened during a demonstration of Rosslyn Analytics’ enterprise spend analysis product. Now, I know what you're thinking: How could yet another spend analysis product cause such excitement, both in the heart and in the head? Haven't we already done analytics three ways to Sunday, and didn't Spend Radar and others already come up with a better mousetrap around classification? The answer, of course, is yes. But what makes Rossyln different is not just some of the capabilities of the application ( which are certainly more broad than deep, relative to some other offerings); it's the fundamental assumption behind what the role of spend visibility should be, and who, within an organization, should benefit from it. ( Hint: it's not just procurement anymore.)

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Spend Radar's Beacon Expands (Part 1)

A few weeks back, over the best Korean fried chicken in Chicago, if not the world, I had the chance to catch up with Brian Daniels and Rod True of Spend Radar. In full disclosure, Spend Radar is not only a sponsor of Spend Matters, but Brian is a personal friend. Still, if I did not think that his organization was doing the right things, I would owe him nothing less than to say so in person, not to mention right here. But fortunately, that's not the case. Spend Radar, in less than a year since its launch, is on spend-classification fire. Without any outside investment -- and initially with offices that consisted of temporary conference space in a hotel -- Spend Radar has had over 40 projects (many of them global) this year and signed up over 10 channel partners. These include many household names in the management-consulting industry, not to mention a number of well-regarded boutiques. Moreover, Spend Radar has comfortably exceeded its first-year revenue plan, which was "in the low 7 figures." This might not sound like much, but for an SaaS vendor just getting off the ground with no outside funding, it's impressive, and represents significantly faster growth than many other providers in the sector.

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One Vote in Favor of Group Purchasing Organizations for Simple Categories

In the debate over group purchasing organizations (GPOs), I'm still not entirely convinced that they represent a good investment outside of a handful of select spend areas -- at least for most companies. After all, the payoff for doing sourcing right versus wrong is so much larger for companies who invest in the right teams and processes (not to mention technologies). Moreover, the incremental benefit from a non-leveraged category environment versus one where a party (e.g., a GPO) skims off the top can still be large. This is because in most cases GPOs are nearly always compensated based on a portion of the transaction, so it makes no sense for them to get a price that is any lower than "good enough" from suppliers, since they'll make less as the offer becomes more competitive. But perhaps I’m in the minority in this type of thinking, especially if you consider the arguments that Mark Usher makes in favor of leveraged buying approaches for non-strategic categories.

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Shameless Plug: MetalMiner Turns Two

MetalMiner, Spend Matters' sister publication focused on metals sourcing, turned two today. Three years younger than Spend Matters, the site is nonetheless following in the virtual steps of this digital rag, quickly catching up with and overtaking established publications and media sites in its sector. Looked at from a traffic perspective compared with other procurement and sourcing blogs, MetalMiner is now the second most trafficked new media site besides Spend Matters in the sector. But our sister-publication is not gunning to capture a generic slice of the procurement and supply chain market. No, they’re going after an underserved but huge niche -- meeting the market intelligence and content needs of metals buyers, specifically.

These folks crave such things as detailed price forecasts and expert commodity analysis rather than "I told you so" alerts about price movements in one direction or another. They’re looking for edge, insight and opinion. And they're also looking for proprietary (yet free) content such as the daily global metals pricing available by registering for MetalMiner IndX. MetalMiner provides both insight and industry color in spades from a "voice of the buyer" perspective that is lacking in traditional publications and subscription services, many of which have served as mouthpieces for producers and distributors for decades. Just as Spend Matters is written by a collection of folks with an edge, opinion and knowledge of sourcing and supply chain, MetalMiner is authored in a similar voice by metals sourcing and trading experts.

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Aravo's $27 Million Funding Round: A Few Thoughts on Its Market Implications

Earlier this morning, Aravo announced a $27 million funding round led by Cisco. While you can read the details of the funding round in the above-linked Spend Matters column -- along with some thoughts from the transaction's lead engineer, Aravo's CEO Tim Albinson -- I thought I'd take a few minutes in this post to share my analysis of what the funding round means for this sector. Perhaps most interesting on a superficial level is how with this round, Aravo appears to be migrating away from their supplier information management (SIM) positioning to what they describe as a broader approach to supplier collaboration that encompasses basic vendor management and vendor information management. Of course they summarize this in a three letter acronym -- it must always be three letters, mustn't it -- as enterprise supplier collaboration. Or ESC for short. While this may have a certain branding ring to it, I'm not so sure that moving away from the concept of managing supplier information and leading with the notion of collaboration is the right approach in selling what Aravo does for procurement organizations.

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Beyond Spend Visibility -- Zycus Takes a Broader Solution Path (Part 2)

In the first post in this series yesterday, I examined some of the factors driving Zycus' impressive growth numbers, drilling specifically into their recent traction with both legacy (e.g., spend classification) and new (e.g., spend analysis, sourcing and contract management) solutions. Today, we'll continue this analysis, examining how professional services and a mini-me offshore version of their competitors' onshore sourcing factory delivery capabilities are fueling an important part of Zycus' overall market ascent. But before getting into professional services, specifically, it's worth pointing out that Zycus has focused as much on global opportunities as those within North America as it has looked for markets and customers to contribute to their growth equation. In fact, Zycus' presence in Europe and Asia is in strong disproportion to the typical focus and size of vendors going after these markets. But this has always been the case with Zycus, which has truly sold a world-product since the early days of its spend classification tool.

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Beyond Spend Visibility -- Zycus Takes a Broader Solution Path (Part 1)

Earlier this fall, I had the chance to get a regular business and solutions update from Zycus. Then, a few weeks later, I caught up with the Zycus team along with one of their customers in Chicago. Zycus' reference customer, from a well-known medical device company, was using their solution to drive a hybrid procurement/lean transformation within their organization, a story I'll look forward to sharing in December. For some, all this interaction might feel like oversaturation. After all, how much is there really to come up to speed on with a single provider in the sector -- especially one without end-to-end analyze-to-pay capability? The answer, in Zycus' case, is quite a bit. In fact Zycus, like Iasta, has successfully transformed itself from a one-trick Spend Management pony into a provider with ambitions to serve all areas of the Spend Management market. And they're leveraging strong customer relationships, a tenacious sales and marketing approach and a constantly expanding product and services footprint to get there.

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Fieldglass Doubles Down on BI and Contingent Spend (Part 2)

In my first column tackling the latest from Chicago-based VMS provider Fieldglass last week, I provided an overview of a number of the gaps they recently filled from a reporting, analytics, visualization and benchmarking perspective in their solution. But I was not alone in having an opinion on the subject -- I also appreciated the reader comment that provided some additional color around how other providers stack up in this regard as well. Today, I'll continue this analysis, providing some concrete examples of how companies can leverage the enhanced analytics capabilities of providers like Fieldglass to make better contingent staffing decisions that save money and time while driving to better levels of supplier performance. Let's begin.

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