I recently published a TEC article about my attendance of Emptoris’ Empower 2011 user conference this past fall. What follows now is my deep-dive interview with Terrence Curley, Senior Vice President (SVP) of Product Strategy and Development at Emptoris, with the idea of developing some of the main messages from the conference.
For years (if not decades) now, but especially during tough economic times, companies have been trying to better analyze their enterprise spend over their comprehensive pools of sourcing categories (and individual items and commodities within these categories) and suppliers.
The idea here is to find room for improvement and savings by pinpointing strategic centralized (consolidated) procurement opportunities for a better negotiating power, discovering better (and worse) performing contracts and their individual terms and clauses, by eliminating costly maverick spending, and by dealing only with the best and most reliable suppliers. For more information, see my previous blog series entitled “Are Spend Management (or SRM) apps Suited for the Mid-market?” and TEC’s article entitled “Thou Shalt Manage (and Cherish) Thy (Best) Suppliers.”
While many companies have experienced significant benefits and improvements by deploying spend analysis solutions from specialists such as Ariba, BravoSolution, Emptoris, Oracle, Proactis, SAP, SAS, and Zycus, those benefits do not come by easily or cheaply. Namely, every comprehensive spend analysis implementation is, in fact, an implementation of a sophisticated business intelligence (BI) solution.
Part 1 of this blog series talked about my impressions following an upbeat and constructive business update meeting at Emptoris’ headquarters. Under its new investors’ wing, with a new customer-focused CEO, and with the former Click Commerce’s contract and service management (CSM) business as a new major capability, Emptoris has charted a new course recently.
Good news is scarce these days across the board, and I am always keen on reporting on rare bullish enterprise applications businesses, especially if the company is in my neck of woods. Recently, I had an upbeat and constructive business update meeting in person at Emptoris’ headquarters.
The Burlington, Massachusetts, US-based company was founded in 1999 as a strategic sourcing software company, pioneering the use of optimization in strategic sourcing of both direct and indirect materials.
Part 1 of this blog series introduced common supply chain challenges and resulting spend management opportunities for companies of all sizes. The article then went into the philosophical and functional differences (if any) between the “spend management” and “supplier relationship management (SRM)” monikers. Further discussion was about what exact functional parts of this software category small and medium enterprises (SMEs) might need.
The real question should always be, “Do we manage spending and, if so, what solutions do we use to do it?” To my mind, sourcing, procurement, and spend analysis capabilities cover most of the spend control needs for midsized enterprises. Read the rest of this entry »
My previous blog entry about procurement commandments in a down economy also made me think about whether there are different priorities for the chief procurement officer (CPO) during prosperous economic times. Or, how different are (or should be) the CPO’s strategies in good versus bad times?
Well, the CPO’s fundamental objectives do not change: procure the physical goods and services needed by the company at the best possible mix of price and performance (non-price features). The focus can shift at times from operational streamlining to new product introduction (NPI) to supplier rationalization.
In lean times, however, there will be pressure to do even more with less, postpone large expenditures, and get additional concessions from suppliers (e.g., better shipping rates, rebates, discounts, or better payment terms, etc.). Amid all of this, the CPOs must provide high-quality service guidelines to their employees to encourage the proper use of systems and policies, and to reduce maverick purchasing practices. Read the rest of this entry »