The Ardent Partners team recently took a briefing from SpendHQ, the Atlanta-based provider of spend analysis SaaS solutions for procurement. On the call from SpendHQ were David Bush, chief revenue officer, Corrina Owens, marketing and demand generation manager, and Matt Keifer, product manager. The SpendHQ team (“SpendHQ”) briefed us on their year in review, on the roll out of their new spend analysis engine and dashboard, and previewed some developments to come in the later part of 2020.
About SpendHQ and Insight Sourcing Group
As a refresher, SpendHQ is an outgrowth from Insight Sourcing Group (“ISG”), a strategic sourcing service provider founded in 2002 by current CEO, Tom Beaty (click here and here to read our procurement influencer series featuring Tom). To date, ISG has conducted more than 6,000 strategic sourcing projects and delivered between 4x and 10x average 1-year ROI on sourcing programs. In 2019, they delivered more than $1 billion in contracted savings to their more than 1,500 managed service clients.
ISG spun off SpendHQ in 2013 to offer clients their proprietary, in-house spend analysis solution that they had developed to conduct spend analysis for ISG’s sourcing projects. Since then, SpendHQ has grown into a formidable provider of SaaS-based spend analysis solutions. To date, the company has analyzed more than $4 trillion in customer spend, has categorized more than 20 million total unique vendor records, and boasts a 97% spend categorization guarantee. According to the SpendHQ team, the company achieved a three-year compound annual growth rate (CAGR) of 31%; they are endeavoring to achieve a sustained 30%-40% growth rate for 2020. Additionally, the client names that they added were impressive and a great cross section of company sizes, industries and geographies.
A New Spend Analysis Tool for a New Decade
In late 2019, SpendHQ refreshed its SaaS-based spend analysis engine and dashboard, and we were given a demonstration of the updated tool. The solution presents with a clean user interface and a shiny new dashboard built with entirely new visualization and analytics tools. Users have the ability to customize the standard dashboard with a variety of widgets/reports/etc. that they can access within their analytics environment so that the most important spend information and metrics are most easily accessed.
One of the nicer enhancements is the new filtering capabilities that allow users to view spend by category, supplier, period of time, and other dimensions. This enables users to drill down on spend categories and sub-categories to gain greater insight on suppliers. Users can also follow the bread crumbs back home or simply clear all filters on the dashboard and revert to the original report. Users now have the ability to toggle between chart types, too — for example, between bar charts and line charts — depending on what they’re trying to visualize.
According to SpendHQ, the new user interface “surfaces” new suppliers acquired within a date range; users can also filter out some suppliers based on spend levels. They can identify the suppliers with which they have transacted more (or less) over a given time frame in order to see how relationships and buying behaviors are evolving. Other parameters, like payment method, can be adjusted depending on what users would like to see (e.g., suppliers that accept p-cards).
What’s more: SpendHQ believes that no system actions should take longer than a few seconds to complete and set about to ensure that their system performs accordingly during the development process where any actions that took longer than their internal targets were were whittled down or set aside. The impetus for faster interactions is that an answer isn’t valuable to users if it takes so long that they’ve lost interest and moved onto something else (in fairness, attention spans have gotten shorter and no one has time to stare faithfully at “the blue wheel of death” as it spins indefinitely).
The team also provided an overview of its new spend compliance management capabilities, which enables users to get a fast and multidimensional view into internal and external spend compliance metrics and trends. Users can take a corporate view of spend and then drill down into category level, impactable level, subcategory level, and vendor levels to see: compliance rates, impact rates, lost savings from non-compliance, and savings potential from unmanaged spend — all valuable insight and intelligence. The goal is to present values for total spend, addressable spend, impactable spend and compliant spend and have teams look at the overall progression along this chain and understand why the values are different. The concept is strong but some refinement is still needed, including a better way to define compliant spend.
The Year Ahead
Moving forward, SpendHQ sees opportunities to further differentiate themselves in the market. For example, they are looking at ways for procurement teams to assess their own performance by objectively looking at KPIs and then reporting their findings to external teams. SpendHQ is also partnering with ScoutRFP to integrate its spend analysis tool with Scout’s strategic sourcing solutions.
All in all, SpendHQ has made some impressive strides forward with the new release and, at this writing, have become a highly competitive spend analysis solution worthy of consideration by companies seeking a spend analysis solution. However, we must remember that product innovation is a journey, not a destination; and there is plenty of potential for SpendHQ to further innovate and serve the procurement market — in 2020 and beyond. Today, it is one of the few independent spend analysis companies which has benefits, but also presents challenges. The fact that its Insight Sourcing Group parent continues to grow and touches so many different procurement operations leaves SpendHQ well-positioned for another strong year of growth (recession notwithstanding).
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