As part of our Technology Adoption series which ran this past summer and fall, we thought it would be helpful to capture and share the perspectives from a few industry leaders who face the challenge of technology adoption on a daily basis. Today we are pleased to publish Part two of a contribution from Hubwoo and their Vice President of Market Strategy, Andrew Goldberg. (Part One is here)

The 3 Secrets to Supply Management Technology Adoption (Part 2)

The road map to technology adoption and automation can be a challenging one with obstacles along the way. However, it is has certainly been proven by numerous procurement organizations that procure-to-pay (P2P) technology and process automation such as eProcurement, Supplier Networks, Catalog Management (Procurement Content), etc. can have significant impacts on KPIs such as realized spend reduction, spend under management, contract compliance, and purchasing efficiency. But why have so many companies either not pursued these supply management technology solutions, or implemented and failed to successfully adopt them within their companies?

Based on experiences with many procurement leaders, the answer to this question falls into three categories of challenges:  1) inability to integrate well with existing ERP and procurement systems, 2) challenges in on-boarding a significant number of suppliers, and 3) shortfalls surrounding end-user ease of use and internal policy follow-through for end-users. Without addressing these three categories, the route toward technology adoption to support ongoing cost savings and spend management initiatives may be a long and windy one. The following discussion includes examples of how leading companies have addressed these typical hurdles. (Note: the first two challenges are discussed here).

3. Shortfalls surrounding end-user ease of use, and internal governance

Even after successful ERP integration efforts and supplier connections, unless the P2P application is easy to use by end-users and supports native business processes, companies are likely to experience a mix of non-usage of the application, and usage that is incomplete, inaccurate, and fails to follow system process steps. This quickly leads to increasing dissatisfaction with the end-user community, resulting in non-compliant maverick spend. Why is it that employees can go home at night and buy anything they need on Amazon with three clicks and no training, yet struggle to use procurement systems at work?

As far as P2P systems are concerned, it is critical for professional users that the UI (user interface) be similar to other corporate systems they are interacting with. And, careful consideration needs to be given for the infrequent or “casual user”, so they can order what they are looking for without any training each time they periodically use the system – just like using Amazon. This includes leveraging catalog applications that eliminate or limit the use of punch-out catalogs (which, by their nature, add new UI variety/challenges to the end-user).

So, said another way, if an end-user is in need of purchasing a product/service, and:

• the applications is hard to navigate (or just different), making it difficult to find their preferred vendor and product/service in need, or
• the desired product/service is not in the system or price does not represent the negotiated or best value price, or
• the approval process is too complicated and lengthy,

….chances are that end-user adoption will be minimal. Or if adoption is adequate due to just strict policing by the procurement organization, end-user satisfaction will suffer greatly, and so will the quality of requisitions.

A leading global agricultural biotechnology corporation has linked Hubwoo’s catalog search engine to their internal SAP Plant Maintenance (PM) system, giving their Plant Maintenance teams the ability to purchase from the same catalog suppliers as SRM users, without having to work in two systems. Allowing PM users access to Hubwoo search centralizes the supplier network, simplifies the search activity, and provides an opportunity for issuing the order to a contracted supplier.

Highly adopted P2P applications offer end-users with consumer-like shopping carts and product/service search engines, intuitive approval processes, connection to supplier contracts to ensure negotiated products and pricing are captured, transaction status tracking, etc. – a similar user experience that they have come to expect when ordering products and services in their personal lives. When this occurs, the important activities of enforcing and governing these processes become a less burdensome task. This end-user driven requisition approach also makes it possible to eliminate significant free text orders funneling through the purchasing department.

In summary, can sustainable and cost efficient P2P technology adoption be realized by accomplishing just one or two of these three “secrets”? I argue that it cannot. And are these truly secrets? I believe that they are not. They are widely understood, yet often overlooked in the steps toward sustainable procurement cost savings. Address each of these challenges, and the pace of technology adoption will better support your spend management goals, whatever your organization’s road map may be.

Hubwoo is the world’s leading provider of Cloud Procurement solutions powered by SAP® software.

Tagged in: Adoption, eProcurement, Guest Contributor, Networks, Outside Experts, P2P, Solution Providers, Technology