Archive for the ‘Technology’ Category

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Suppliers are from Mars, buyers are from Venus

March 9, 2010

A recent IDC survey regarding the state of IT (in Sweden) in 2010 really did it’s best to expose the difference between buying and selling organizations. When asked about how they expect the IT market to develop in 2010 diametric answers were provided making one wonder where the two parties can actually meet.

The only area with a near resemblance of likeminded views was cloud computing:

  • 46 percent of the suppliers believed that cloud computing would grow in 2010…
  • …as opposed to 30 percent of the buyers

But from that point on, the gap grew larger with each asked question.

  • 57 percent of the suppliers expected that sales would grow in 2010…
  • …where-as only 27 percent of the buyers indicated that their IT budgets were growing

And when it came to outsourcing, the gap between seller and buyer expectations had grown to 37 percent as:

  • 53 percent of the suppliers expected the outsourcing market would grow…
  • …as opposed to a meager 16 percent of the buyers

Now there are probably numerous reasons that explain these variations but I dare say that sales and marketing almost by default are opportunistic by nature and set goals that are hard to reach yet in return yield great rewards. Buyers on the other hand are perceived as nay-sayers, and do their best to live up to that reputation.

So what can one learn from a quick exercise in sales to purchasing comparison.

As in real life, understanding the other side will be of great benefit to all parties.

Posted in Business, Sourcing, Strategy, Technology | Leave a Comment »

The future of purchasing technology lies beyond the war of words between Coupa and Ariba

February 26, 2010

Over at Spend Matters (here and here), there’s a heated debate over Coupa’s recent marketing campaign and it’s claims to better Ariba in many areas. Now I’m not going to jump into that fray – I’ve spent too many years as a copy writer and music critic to bother with marketing claims and hyping the flavor of the month.

In my mind, the one thing that stands out in differentiating purchasing software is ease of use. End-users don’t care if they work for a multi-national, multi-billion dollar company or if they work for a local firm with single-digit FTEs. They are users of a system and by default they expect things to work easily, smoothly and efficiently. It’s as simple as that. Just because you work for a multi-national doesn’t mean you should expect that the tools you use should be complicated.

Bizconnect’s recent poll shows just this (albeit that their research might be a bit shifty):

43 percent of the respondents said the most important feature they look for when evaluating new purchasing software is ease of use.

So what exactly is ease of use.

Well, today many purchasing software developers look at what Google is doing in the domain, or the major internet webshops. I would say that strategy is rather reactive. In an increasingly mobile (in all senses of the word) world – anything developed with a laptop or stationary computer in mind is going to be second-tier by the time they’re closing in on their release date. If your not convinced, check out this blog-post at Google Mobile; Smarter Shopping with Google Moblie to see where internet commerce is heading.

With smart phone sales boosting the entire mobile phone market in 2009, up by 23.8 percent year over year according to Gartner it’s a no brainer to see where development budgets should be going in the future.

Smartphone sales to end users continued their strong growth in the fourth quarter of 2009, totalling 53.8 million units, up 41.1 per cent from the same period in 2008. In 2009, smartphone sales reached 172.4 million units, a 23.8 per cent increase from 2008. More at Gartner.

It’s a fair guess that many a smart phone ended up in the pockets of business managers looking for ways to better manage their daily work (whilst keeping a front of success and innovation). Smart phones are ease of use. Mobile, simple, efficient and always online.

No matter where the war of words between Coupa, Ariba and the numerous commentators end up – purchasing software providers that do not support smart phones in the near future will not be seen as front runners or purveyors of ease-of-use. They’ll just be more of the same old that we are struggling to leave behind.

Posted in eprocurement, Marketing, News, procure-to-pay cycle, Software as a Service, Technology, Vendor, Web 2.0 | 5 Comments »

The importance of managing end-user expectations

September 11, 2009

At the IBX Purchasing Executive Summit earlier this week many wise words were spoken, but in retrospect the words that linger I my mind and won’t go away came from Gerold Carl, the Director Strategic ePurchasing at Lufthansa.

When describing the lessons learned from the very impressive Lufthansa e-procurement initiative (more on which can be learned in this Efficient Purchasing interview) he noted that end-users were reluctant to go for e-learning often pushing for the more costly in-person training approach. When asked why he thought this might be he matter-of-factly nailed answer:

“…our end-users were expecting somthing like Amazon.com, we gave them SAP…”

It just goes to show how important user-friendliness is, and how rapid e-procurement providers need to be in adapting B2C-like user experiences. If e-procurement providers can’t deliver up to those expectations, customers are no doubt heading down a path of costly training, change managment, information and expectation management.

Posted in Change Management, Procurement, Technology | Leave a Comment »

Procurement and web 2.0

September 7, 2009

There’s been a lot of chatter regarding the pros and cons of Web 2.0 technologies and their place in business in general and supply chain management in particular. And this has been particularly evident when it comes to developing end-user interfaces for IM&S procurement.

Coupa does a great job of describing some of the communication clutter that abounds in many procurement functions in their wickedly funny Coupa Sam Procurement Hero marketing ploy. But for some more hard on facts of the rise new technologies and their place in business McKinsey Quarterly might be a more secure source of information.

They recently published the results of a global survey targeting “How companies are benefiting from Web 2.0” and there are some interesting bits of information in there. The adoption rates and growth of Web 2.0 technologies is growing and though it is most evident on competence aspects, there are signs of adoption in supply chain matters as well.

  • 51 % of respondents report measurable gains in access to external knowledge (+25)
  • 49 % of respondents report measurable gains in lowered communication costs (+20)
  • 37 % of respondents report measurable gains in supplier satisfaction (+20)
  • 23 % of respondents report measurable gains in reducing supply chain costs (+12)

In times of turbulence and increased risk all of these aspects point to an increased usage of Web 2.0 technologies as communication and transparency are crucial to efficient supply chain management.

Posted in Change Management, Technology, Web 2.0 | Leave a Comment »

IT sourcing revisited

August 12, 2009

Whilst the general consensus is that the economic downturn is near bottom, the service sectors are still feeling the pressure. In the first seven months of 2009, more than 200 IT companies declared bankruptcy in Sweden alone (as reported by IT 24 - in Swedish), an increase of 73 percent from the year before.

Now many of these companies no doubt had troubles beforehand; but during the past year we’ve seen an increased engagement of professional purchasing in IT-sourcing. The great divide separating purchasing and IT has been bridged; and due to this fact IT vendors are exposed to healthier competition, which in turn will lead to a healthier IT market for the future.

Posted in Sourcing, Strategy, Technology | Leave a Comment »

And You Thought Youtube Was Just For Kicks – Think Again – Supply Chain Video

September 3, 2008

One of the great things about user created content and the so called web 2.0 technologies is when these tools and ideas are picked up by professionals and used for non-entertainment purposes.

My favourite pastime at the moment is checking out the supply chain videos compiled Ehsan Ehsani on Supplychainer.com. Most of the content linked from youtube.com and have been published by a wide array of publishers big and small.

If you have been led to believe that web sites such as Youtube is for kids or for after curricular activities; think again. If you don’t believe me, just check out how online publishers such as GasgooTV  use Youtube as the medium to provide indepth analysis of the Chinese automotive industry.

Posted in News, Supply Chain, Supply Chain Management, Technology | Leave a Comment »

Sourcing Innovation Climbs Aboard the Web 2.0 Bandwagon

August 19, 2008

Recently, Sourcing Innovation published their first white paper in a five part series meant to open the eyes of purchasers to the opportunities that arise as web 2.0 makes its way into B2B. Entitled “Introducing B2B 3.0 and Simplicity for All” it provides backgrounds and details the development of e-procurement and e-sourcing from the early rough stages until today, and starts to point out a direction for where these technologies will go in the future.

We’ve touched upon this subject several times in the past few months (On the Way to Enterprise 2.0 and What SRM Can Gain From Social Networking) so hopefully you’re already aware of the power that the so-called web 2.0 technologies unleash (be it web services, intelligent agents, mash-ups, blogs, RSS etc).

Sourcing Innovation promises that this series of white papers will be published on a monthly basis until the end of the year, with “Simplyfying B2B for Suppliers Enables Buyers” being the title of the september edition.

Posted in Software as a Service, Supply Chain Management, Technology | 1 Comment »

Microsoft XP vs. VISTA: Negotiate it!

July 1, 2008

Markets react really strange sometimes: although the new Microsoft operating system Windows Vista is supposed to deliver higher security, better performance and a smarter architecture, people still want to buy the forerunner version Windows XP. As it does not fit, the official Microsoft strategy to sell XP anymore, there are strange reactions going on: the main distributors like Dell or HP officially sell VISTA computers. But: to fulfill the demands of the market, they “pre-downgrade” the VISTA computers to XP computers (click here to read an article about it on heise online).

Of course, that does not really help Microsoft to get the optimum spread for their new operating system. Major marketing campaigns failed to convince people that VISTA really is the better choice. Even big corporations like Daimler or Intel prefer to “downgrade” to XP.

How could you exploit that situation as a purchaser? Every Microsoft salesman has the “deployment rate” in his KPIs, not only for the operating system but also for the other MS office products. When your internal IT wants to switch to VISTA use the given circumstances: get some additional discount or add on licenses, because you are helping to fulfill the deployment of Windows VISTA.

Posted in Negotiation, Technology | Leave a Comment »

On the way to Enterprise 2.0

June 23, 2008

Forrester Research recently published a forecast report on the Global Enterprise Web 2.0 Market. This report deals with the influence of the latest Web 2.0 technologies (social networks, RSS, mashups) on the enterprise market and predicts a spending on related technologies and tools of $4.6 billion by the year 2013. The concept of Social Networking will boost collaboration and productivity for the enterprise worker and this will definitely have any impact on ePurchasing as we know it today – I also tackled this in one of my last posts.

If you don’t want to buy the report you can find an excellent article analyzing  the findings on ReadWriteWeb. The article also highlights trends which will influence the Enterprise 2.0 market and I would like to quote the two which I think are the most important ones.

 

External Spending Will Beat Internal Spending:

External Web 2.0 expenditure will surpass internal expenditure in 2009, and, by 2013, will dwarf internal spending by a billion dollars. Internally, companies will spend money on internal social networking, blogs, wikis, and RSS; externally, the spending patterns will be very similar. Social networking tools that provide customer interaction, allowing customers the ability to create profiles, join discussion boards, and read company blogs, for example, will receive more investment and development over the next five years.

 

Web 2.0 Graduates from “Kids’ Stuff”

Right now, it’s people between the ages of 12 and 17 that are the more avid consumers of social computing technology, with one-third of them acting as content creators. Meanwhile, only 7% of those 51-61 do the same. However, this is another trend that is going to change over the next few years. By 2011, Forrester believes that users of Web 2.0 tools will mirror users of the web at large.

 

Source: Enterprise 2.0 To Become a $4.6 Billion Industry By 2013 – ReadWriteWeb.com

 

So if you want to be an early adaptor – have a chat with your kids!

Posted in Software as a Service, Technology | 1 Comment »

Rather optimize than extend

June 16, 2008

ePurchasing applications have reached a fair level of maturity which has changed the focus of providers from adding more features to their products to actually improving and optimizing existing tools and processes. Of course as an application provider you need to show innovation in your product lines but the feature war seems to have calmed down a lot comparing to a few years back.

This is good for the customer side because usability actually moved form “Nice to have, let’s do it later!” to the top of the requirements agenda. If you compare the different ePurchasing applications on the market you will realize that they will all pretty much match up with your main requirements. Of course there are different bells and whistles but all tools will help you to get your stuff done the one way or the other. The differentiation factor is usability, performance, effectivness and beauty … or before we get to romantic here lets call it “layout of the user interface”.

  • Is the system friendly to use?
  • Is the user interface self explaining?
  • Can a new user get thru the process without any training?
  • Howquick can I get things done?
  • Usability drives adoption – rolling out an ugly system is much harder than introducing a nice, lean and fast user interface. Even if the ugly inteface can do more you will need to push your users much harder to work with it.
  • Or why do you buy your books on amazon? Because amazon has so many features? No, because it makes buying simple.

So when you post your next change request to your application provider I would like you to reflect on this? Will the change blow up complexity or will it make work easier? Not just for you – for everyone!

Posted in Software as a Service, Technology | Leave a Comment »

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