Posts filed under 'Enterprise Software'

Gartner Magic Quadrant for Sourcing Application Suites – A Reaction

See this link on Spend Matters for the story on Gartner’s 2008 Magic Quadrant for Sourcing Software http://www.spendmatters.com/index.cfm/2008/7/15/A-Free-Look-at-a-Gartners-Sourcing-Magic-Quadrant. My comment was a bit too lengthy for a comment on Jason’s post. So here it is, below:

First a disclosure: I lead the product development for TradingPartners. TradingPartners provides eAuction services. Very similar to what FreeMarkets pioneered all those years ago with their “Full Source” offering. We don’t sell software licenses, let alone software suites, so wouldn’t fall into Gartner’s analysis but we are considered competitors with a number of the companies mentioned in the Gartner Sourcing Magic Quadrant report. You can make up your own mind to what degree the comments below are self-serving or not.

I’m not keen on the name of the report. Despite all disclaimers the report is titled “Magic Quadrant” which implies that there is one “magic quadrant” that buyers should look at, i.e. the top right. And when I look at the vendors in the graphic the relative ranking seems fairly arbitrary. Certainly it’s not clear from the report why Quadrem should be better able to execute than BravoSolution.

The best part was the overall 10,000ft view of what is happening in the market. In particular:

  1. The distinction between strategic sourcing and tactical sourcing. “Organizations should expect to eventually deploy two separate sourcing solutions or two configurations of a single solution: one for tactical sourcing (for example, querying a contract fuel vendor for this week’s price per liter) and one for strategic sourcing (such as simultaneously negotiating rental car contracts across multiple vendors for service for the next three years and in 10 countries”.
  2. The summary of the consolidation in the sourcing software space (gone are Freemarkets, B2eMarkets, Frictionless, Mindflow, Procuri, Verticalnet).
  3. The recognition that wrap-around sevices are of paramount importance in strategic sourcing initiatives. “[E]ffectively leveraging different auction/event types for the best results requires a knowledge that can be gained only be using strategic sourcing applications. Furthermore, enabling suppliers to register online and providing customer service to troubleshoot their issues requires a significant effort that a procurement group will not be able to support without advanced planning and incremental staffing”.
  4. The recognition that strategic sourcing tools don’t require ERP integration. “They function nicely as standalone tools, because the trigger to commence a strategic sourcing event is the initiation of a project, and prospective vendors do not need to be in the vendor master unless they win the bid. The output of an event tends to be a contract. The unstructured nature of strategic sourcing lends itself to solutions that are architected as project management and document repository tools”. Here Gartner calls strategic sourcing unstructured. I would prefer to call it BRP (in contrast to ERP).
  5. The recognition that, in reality, buyers are still sticking to Excel rather than fully automating the sourcing process. “Requirements should be specified in the sourcing tool at the line-item level to fully evaluate and document the resulting bids using the application; however, in practice, many companies simply attach the specifications and record the resulting proposals at the header level, and analyze the results offline.”

Some parts of the report I would take with a pinch of salt:

  1. Including forward auctions in the debate. They are a red herring. Sure from a technology point of view they are similar to reverse auctions but in practical business terms they are of little relevance to most buyers.
  2. Cautioning that some suppliers are buggy. Without any meaty supporting arguments I’d assume all software is equally equal in this regard
  3. Come to think of it, a lot of the “strengths/weaknesses” seem cursory. E.g. Ariba is praised because it “offers varying scales of its sourcing product so customers can consume functionality as gradually as desired”. And Ariba is criticised because its “customers tend to use sourcing to solicit bids from local vendors”. 

Add comment July 18, 2008

Enrich, Simplify

The Gaping Void cartoons are often really spot on, and here’s one of my favourites.

Enrich, Simplify (c) Hugh MacLeod

It neatly sums up something I’ve struggled with in my life developing software products over the past 10+ years. Programmers will prefer to continue building software (development) rather than slowing down and seeing how people use that software in the real world (support). So you often see a tendency to continue adding new features one on top of the other. Something that used to be good once gradually becomes more complex and brittle over time.

Where I am now I try to develop products along the lines in the Hugh cartoon. Deliver software in small chunks. Speed up and slow down delivery so that you have time to see how people use your latest code before you race off down the next avenue. Focus on the pieces that people are interested in. Spend time stripping stuff out as much as piling new stuff on. Depending on what the user base really uses. Something that is only really practical in the On Demand/SaaS/ASP/whatever world rather than the behind-the-firewall expensive-customised-software world.

Not a million miles away from the approach Mitch Free talks about in this interview with Jason Busch today (and what prompted this post).

 

 

Add comment July 10, 2008

Blame the users, or the technology?

Hardly a news story but this week’s Supply Management has a news story headline “Councils: most buying goals met“.

One of the goals listed in the article that was not met was the use of e-marketplaces.

Each council was also meant to be using an e-marketplace by 2006, but latest figures show only 22 per cent have met this target.

The traditional response to such a dismal failure to adopt a new technology is: “more change management, please, doctor”. As if the technology users are always to blame for being to blinkered.

But are people always and everywhere scared of new technology? I don’t think so. People are not afraid of adopting new technologies if those technologies are good. Excel. Mobile phones. SMS. Email. Social Networks. Online airline check-in. Google. Online banking. Etc etc. (yes, I am old enough to remember offices before Excel. I spent some time working as an accountant doing 4 column trial balances on paper. That was horrible).

Oh yes iPods. Good technology. Vista. Not as good technology.

You can make your own lists.

To come back to the SM article: if an e-marketplace helps buyers buy stuff better then of course they will use it. But if it is just a pain in the a** to use then they will stick to email and Excel. And don’t talk about nebulous downstream process improvements, puh-lease. People want process improvements now, not some unidentified time in the future.

When a fly keeps banging its head against a pane of glass trying to get out of your house, it’s obvious what the fly needs is a different approach: an open window. The same is true in enterprise software. Software developers: stop bashing your heads on the change management window. Do something to your software so the users don’t need change management to want to use it.

The exciting news is that there are some people who are daring to do the undoable. Thingamy for example has the audacity to be challenging not only the rigid process-driven ERP mindset prevalent in the industry, but also how we do something as basic as accounting. Will they succeed? Who knows. But the more people who take Sig’s lead and try to re-invent enterprise software, the more chance we’ll have of getting those buyers all happily using their e-marketplaces.

 

Add comment May 30, 2008

What’s good for Ariba is good for eProcurement (and eSourcing)

http://money.cnn.com/news/newsfeeds/articles/marketwire/0396537.htm has a list of the Top 100 Most Influential Technology Vendors for 2008 (via Deal Architect).

Ariba is at at a respectable 38.

Interestingly Netsuite is only at 85 (Salesforce is at 8). Shows that despite all the attention heaped on the CRM guys, that there are plenty of other players out there adding value, quietly. For example – check this graph from Compete.com which bizarrely enough shows (relatively) masses of hits for Netsuite, a smaller number for Salesforce.com and a “hey, who the heck are you anyway?” line in blue at the bottom for Ariba.

Vinnie Marchandi raises his eyebrows  at the results , well … it is an Aberdeen report so what do you expect :) ?

Nevertheless any publicity that gives a little more recognition to Ariba, and by extension eProcurement, is a good thing as far as I’m concerned. Perhaps as an industry we aren’t as sexy as a Salesforce or a Netsuite in terms of hits, but we can hold our own in terms of value.

Add comment May 15, 2008

Another reason why enterprise software is generally so bad

One of the main reasons is that the individual buying the software is rarely the person using the software. The individual buying the software is doing so on behalf of one party (probably a CFO or similar) but then imposing it on some others (probably some junior staff). Two issues here: Number 1 – there are plenty of opportunities for misunderstanding what is genuinely needed and what really makes sense to use; Number 2 – this approach smacks of a planned economy in which a “ministry of enterprise software” decides what software works best for us, the users. We all know that planned economies tend to underperform market economies.

Another reason is because of the divergence between what Thingamy are calling “ERP” vs “BRP”, (also described well here) or “Easily Repeatable Processes” vs “Barely Repeatable Processes”.   The argument here being that enterprise software may be quite good at automating drudge tasks like accounts payable, but that it struggles with something more fluid like strategic sourcing.

But on reflection, postulating a fundamental difference between ERP and BRP is something of an assumption.

Take brewing a cup of tea. Is this an “easily repeatable process” or an “barely repeatable process”? You’d hope that it is easily repeatable. You’d be surprised. I certainly was. I was once using an auditorium that was also being used by some students to learn process mapping. They had put up posters of their process maps for making a cup of tea on the walls. Each process was completely different. And the lecturer told me that as part of the course the students then have to try to make a cup of tea in front of the whole class by following their process map. Needless to say, they usually fail.

If it’s so hard to even define the process for making a cup of tea clearly, it should come as little surprise that the extensive process definition exercises associated with major enterprise software implementations end up delivering something that the users find themselves struggling with.

5 comments March 14, 2008

Consumerisation of Business eAuction Technologies

For those struggling with lacklustre take-up of eAuction software in their organisations, take note.

One answer is to use a trusted third party to manage your eAuctions in an open and transparent way. But then I would say that, I work for TradingPartners, a firm which does precisely this.

But for those of you flogging the self-service software horse. I bet you that if you could make your eAuction software more fun and compelling you would get better results. Make the software be something that your users would actually want to use. Take some cues from the consumer space rather than looking just rehashing the same old tired “enterprise” or “B2B” bullshit. Have a look at this site for instance which is probably the most fun of all the eAuction software I have seen out there. I bet you it will only take 10 mins for you to work out how the auctions work.

The auction technology that Jellyfish uses is nothing new. It’s just a Forward Dutch auction. (Forward Dutch auctions work well when you are trying to sell something. Reverse Dutch auctions on the internet are a mess. Please remember the difference). But the implementation is very entertaining. As are the frills they’ve built around the auction mechanism. For example: calling a set of auctions “a show”, having people guess where the price will end, etc.

If you do have an interest in eAuction technology do give Jellyfish 10 minutes of your time. It’s very entertaining and quite compelling. And probably a little instructive.

Till next time

a

Add comment March 10, 2008

ERP, BRP and e-sourcing

Brilliant post I picked up from Gaping Void. It discusses a company called Thingamy and how Thingamy’s founder contrasts ERP (which in his book equates to “Easily Repeatable Process”) with what Thingamy call BRP (“Barely Repeatable Process”).

When I think back to my old SAP and Ariba days: those are really all about Easily Repeatable Processes. Posting an invoice, posting a purchase order, issuing a sales order. Etc etc. All pretty standard stuff that happens the same way day in and day out.

But when it comes to sourcing, things are rarely as clear cut as posting a purchase order. Sourcing is much more BRP than ERP which is probably why so many of the traditional ERP companies struggle to produce quality e-sourcing software. And why so many companies who have bought e-auction and e-sourcing licenses end up under-using them and/or considering them a poor tool (e.g. see the comments about e-auctions on Supply Excellence and SpendMatter’s third wish for Santa for some examples). And probably why Email and Excel are still de rigeur in most purchasing departments.

Unless Santa does come up with the MacGyver gadget, a new approach will be needed that better addresses the BRP nature of sourcing. And despite the underwhelming response so far to Enterprise 2.0, I’m sure that most, if not all, of the principles that Jeff Nolan lists here are going to play a major part.

1 comment December 21, 2007

Wikis, User-Generated Content and Procurement Communities

I started experimenting with wikis at TradingPartners a little over a year ago. A wiki could help us, we figured, with sharing  up to date category information across a team that is spread all over the globe. (How to best make sure when Joe in the USA ran a sourcing project for castings that he would know that Jane had recently been working on something similar in China, and would be able to benefit from her experience?)

A wiki seemed like a good fit as:

  1. it would be editable by anyone in the business 
  2. it would be accessible to everyone in the business over the web
  3. it would be fun for people to use
  4. the necessary investment would be negligible

So we tried out various wikis and settled on mediawiki. Launched it to the business early 2007 in workshops at which staff excitedly brainstormed ideas of what kinds of information they’d like to see on there…

Then we left it to see how it evolved. Fast forward 9 months and this is what we had:

  • Lots of marketing material – case studies, brochures etc.
  • Some customised user pages with pictures of people, their backgrounds and interests.
  • Standard templates, training materials etc.
  • Some category information. But, interestingly, this had not been put on by auction managers themselves, but by self-appointed editors who were collecting the information and uploading it.

In reality, despite the initial enthusiasm for a site that “anyone could edit” was replaced with the more realistic understanding that in order for it to be of any value, “someone” would have to do the actual editing!

It brings home the fact that in wiki- or forum- style communities, the number of people who contribute information is a fraction of those who consume information. The templates and marketing information all went on because they only relied on a small number of interested editors to make the wiki site definitive. Some people – either those who find this sort of thing interesting, or those whose managers find this stuff interesting, were prepared to update their own user pages. But changing the process of running a sourcing event so that all the relevant information is entered into the wiki repository after the event for the benefit of others in the business? Now that’s a whole different proposition. And it begs a number of questions like: how do you make sure all the relevant information is loaded onto the wiki (and you don’t miss out a crucial piece of information which is blindingly obvious to you but which might not be obvious for other people)? How do you ensure that people who are consuming the information are looking at the right page (paper bought for resale might not be the same as paper bought as an indirect, for example)? Etc, etc.

Extrapolating from this experience has taught me something important about any attempts to build a procurement community online: The procurement world is sufficiently small that you can’t expect a critical mass of people simply to contribute useful information to any one central repository. Iasta’s e-sourcing wiki is an example: 7,500 odd hits so far but check the recent changes page and only a small number of names appear as contributors. Perhaps there’s a generational element, with newer buyers more open and older buyers more reticent. That would be the thrust of articles like this one at Tech Crunch, but I suspect the generational piece will turn out to be just a small element in the overall equation, especially when applied to business information. Seems to me that the best way to share useful information in the procurement space is by inferring it from what people are actually doing, rather than treating it as an activity in its own right. Of course, exactly how to infer auction best practice (for example) from successful auctions people have run rather than via a self-contained documentation exercise is another question in its own right which, I guess, nods towards the Semantic Web – if that ever gets off the ground. More questions than answers, in other words.

A coda: what did we do with our wiki in the end?

Well, we kept it for two things:

  1. Community building by people building their own pages and telling a bit about where they come from and what their experiences are. This is becoming part of the process for all new starters and is quite a neat way to quickly get a feel for who you should be talking to about what.
  2. An intranet-style piece holding standard templates and marketing materials.

Regarding category information: We could have gone down the traditional Enterprise Software Change Management route. This would have gone something like “come on, the eAuction managers aren’t updating their category information. We need to mandate it as part of the process and keep beating them over the head until they accept it”.  Or we could have gone down the Enterprise Software Budget Busting route. This would have been something like “the central repository won’t work without an editor. So let’s hire someone to maintain the wiki and have that person interview, or otherwise, extract information from the eAuction managers as they go about their daily jobs”.

We took a different approach, which I call the Going Back To The Objective approach. We asked “what are we trying to achieve here?”. The answer was: “help eAuction managers keep up to speed with what their colleagues are doing”. Next question: “Is there an easier way to do this that doesn’t make them do extra typing?”. Answer: “How about just letting everyone have query access over our history of sourcing events with some pre-defined reports so people can easily look up who has the most experience in category X and which eAuction managers have auctioned category Y most recently. That way they can just pick up the phone and easily get hold of all the relevant information, plus all that intangible, invaluable stuff you only get through talking to people”. The tool then becomes something to encourage, and facilitate, people to talk to each other. Not an end in itself. Boom. Sometimes the simplest solutions are the best.

4 comments December 20, 2007

Consumerisation of businesses technology: careful which sites you emulate

I’ve been blogging for a long time about how enterprise software has a lot to learn from consumer web sites.

This is not to say that consumer sites are inherently clear, intuitive and a joy to use. Many are far from it:

Take this disclaimer from lindam, who sells baby stair gates: Lindam would from time to time also like to send you promotional information regarding our products and promotions. If you would prefer not to receive such information please do not tick the above box.

Or the fact that I couldn’t order flowers from Next Flowers at 11pm on Monday because their online shop was closed until 6am the next morning (and this fact was hidden at the bottom of the page - I only stumbled upon it after much scrolling and dragging around trying to figure out where to click). 

Or SNH, a site which doesn’t let you add more items to an existing order, and whose “contact us” email form seems to send messages into a black hole (*)

But worse than all these is the grand daddy of consumer web sites: Amazon. How these guys came to embody good website design is beyond me (**). Their screen is full of clutter and the processes don’t follow as logically as they could. Take wish lists for example.

When you choose something from someone’s wish list you land on the “people who bought X also bought Y” page. But this is irrelevant information if you are buying a specific present for someone else. You should, if anything, be sent back to the person’s wish list so you can buy more stuff for them! I recall a Christmas a few years ago: my parents wanted to buy 2 books for my wife from her wish list. They ended up ordering one off the wish list and one similar item, accidentally, from “people who bought X also bought Y”. It took some time to disentangle the order mishap.

They haven’t used Amazon since.
The consumer web sites that enterprise software should be emulating are sites like Zopa – which successfully personalises an otherwise very de-personalised space (lending and borrowing money). Or, GLTC has a neat feature for zooming into images, which would be a cool way of showing suppliers images of parts that you are buying (for example).

(*) Yes, you can see the sort of stuff I’ve been buying over the last few days.

(**) Ironically Ariba ditched the bright, fun golds of their early user interface for a pastel Amazon look in version 7 of Ariba Buyer. Add a few autocomplete text boxes to the old look and feel, and you’d have something a lot more up to date than what they have now.

Add comment December 13, 2007

The consumerisation of enterprise (e-sourcing) software

Hand on heart, what would you say are the most popular e-sourcing technologies amongst buyers? How about:

  • Outlook
  • Google
  • Excel

Sorry Ariba, sorry Emptoris, sorry Procuri, sorry Iasta.

This pattern extends far further than just the world of procurement.

Once I, like many others, used to assume that dragging users by their ears until they saw the light of a new enterprise system was just part of the normal process of deploying a new enterprise software system. They used to call it change management.

But again, like many others, I have been blown away by how fast adoption can kick in for software that is genuinely good and flexible enough that people want to use it.

Imagine enterprise software that didn’t need change management. Imagine users demanding software. Like they do with MS Office, email, Google Maps, etc. Imagine software that doesn’t add new features for the sake of it release after release, but just builds one or two pieces that work well and which people can understand fast.

Now look at Huddle, or Coupa, or 37Signals. These guys are onto something.

2 comments November 2, 2007

Previous Posts


What

Alan Buxton on e-Sourcing in general and e-Auctions in particular

RSS Subscribe

CTO

Read my technology blog, Golden Pebbles

Technorati

Add to Technorati Favorites

Category Cloud

auction CIO e-auction e-sourcing software Enterprise Software procurement Ramblings reverse auction Software development sourcing

Archives