In last week’s article, we kicked off our discussion on suites vs. specialist providers by discussing the primary considerations in setting an overall procurement technology strategy. Generally, it is not a matter of either/or, but rather, it’s finding the balance of what approach to take and in what situations. Before deciding on an approach, we need to discuss their strengths and weaknesses.
In this week’s article, we will dive into various suite options and some of the suite providers.
So, what are the key arguments for utilizing a full solution suite?
Home Suite Home: Why the Suite Approach is Best
Here are the primary arguments (in no particular order) for taking the suite approach.
All the Data in One Place (Common Data Model)
When all your sourcing events, contracts, suppliers, purchase orders, and invoices and the underlying data are located and accessible in one place, it reduces or completely removes the need to manually move data or migrate it between different solutions. For example, having a common supplier master or profile reduces the need to re-enter the same information and can be used across multiple sourcing events to create contracts for invoice validation and so on.
If the supplier profile is also extensible and dynamic, it can make the supplier’s life easier because the information was already submitted (in the onboarding process or a previous sourcing event). Another great opportunity is to leverage contract and risk data in the transactional processes. Suppliers with higher risk, poor performance, or contractual disputes can be flagged, enabling more informed decisions for the order placer.
In short, there is a lot of useful procurement and supplier data captured or created in different modules. Other modules can leverage that readily available data.
Less Need for Integration(s)
As discussed above, using a suite removes the need to integrate corresponding solutions. But it also reduces the number of integrations to other systems that might have critical data used across the source-to-pay (S2P) suite (like ERPs or third-party data sources). By having a single suite, you only need to create and maintain one integration instead of one for each system using the data.
Common UI
Having the same UI and UX across all the modules makes it much easier for users who use multiple modules to work across them. In fact, it should not feel like working in different modules, but rather in a single solution that provides access to the right data and is supported by the right workflows and controls. Processes that cross the boundaries of what we’ve historically considered different modules will be easier to execute in a single suite. A single solution suite is inherently more usable than a collection of different point solutions that cover the same processes.
Fewer Vendors to Manage
Supplier rationalization has been a popular exercise for many procurement organizations over the last couple of decades or so. And of course, it’s less work to manage a single suite provider than five to 10 separate specialist providers. If a business problem requires multiple solutions to work together, it can be complicated to manage accountability and responsibility when data and workflows cross from one solution to another. With a single suite provider, the responsibility lies with one party. Not only does this prevent the blame from being passed around, but it also leads to fewer contracts and invoices to manage and process. Lastly, you can negotiate better pricing when dealing with a single solution provider. Suite providers are often willing to discount some modules to sell their entire suite.
Unfortunately, It’s Not That Straightforward
Almost all the benefits described above are based on the solution being a “true” suite and not a collection of acquired solutions that haven’t been re-platformed or properly integrated. This was a bigger problem in the past when rapid consolidation of the market occurred as part of the race towards full S2P. Since then, most S2P suites built up through acquisition have been integrated or re-platformed. With that said, never assume anything about integrations and unified data models when it comes to S2P suites.
Perhaps the even bigger issue is the unevenness of capabilities. No single suite provider is best at everything, and each provider has strengths and weaknesses, often correlating to when the provider first entered the market. Thus, it’s vital to review each capability critical to the business and not make any assumptions. After all, if a solution doesn’t solve your business problem(s), its ease of use and attractive design are irrelevant.
That said, as the suites have matured, functional parity has increased. However, much of the differentiating innovation is still happening at specialist providers that are more focused on solving specific issues — a point I’ll discuss in next week’s article.
Evaluating a full S2P suite is a very complex undertaking that requires both deep technical and functional expertise, with deployment occurring over years. (I would argue that you are never done implementing procurement solutions, but that’s a topic for another day). If you are considering a suite, take the time to evaluate all your critical needs properly and exhaustively. I would strongly recommend using external, independent experts because it is you who will have to live with the decision for years to come.
Plenty of Choice in the Suite Market
Over the last 10 to 15 years, many of the most prominent and well-known vendors in the procurement solution market have expanded into full S2P suites. Some through acquisitions, and some through native growth and development.
Today, there are more than 20 S2P suites in the market (fewer if you’re strict with your definitions) ranging from offerings from the biggest ERP players in the world to small startups targeting the SMB markets and everything in between. Some of the more established options include the following.
Coupa
Coupa is the biggest procurement technology provider outside the ERP players. The company started out in the late 2000s as an e-procurement specialist, before acquiring several market-leading solutions and building one of the most prominent S2P (or Business Spend Management, BSM, as they call it) suites in the market today.
GEP
While GEP is a long-term veteran in the procurement technology space, it launched its new natively developed S2P suite GEP SMART in 2014. More recently, in 2020, it released GEP NEXXE and ventured into supply chain management. GEP has differentiated its offerings with a separate business arm focused on managed services for procurement and supply chain.
Ivalua
A veteran in the S2P space, Ivalua has a natively developed S2P suite with an architecture that is very flexible and highly configurable. With its acquisition of DirectWorks in 2017, the company was able to build much deeper direct materials capabilities into the core solution.
As you can see, there are some very compelling arguments for selecting a broader suite. However — and this is critical — it depends on the suite being properly integrated and having the functionality you need.
Check back next week when we look at the arguments for taking a specialist approach!
