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Headlines from SAP Ariba Live – “We are listening”

The week of the 4th-6th June saw the biggest European procurement technology event in the calendar as the SAP Ariba roadshow rolled into wonderful, sunny Barcelona. If only it could be there every year!

The event had a different theme to typical software conferences and evidence of further evolution of the business’ message to customers over the past couple of years.  Ariba Live in Prague in 2017 was the age of “making procurement awesome” as they showcased all sorts of innovations. Last year in Amsterdam the message was about “procurement with a purpose” as the business embraced the CSR agenda. That theme continued strongly this year with a lot of coverage of ethical issues in the supply chain and rightly so, although this year’s headline was #3trillionreasons, a reference to the amount transacted on the Ariba Network.

What I did note was a more humble theme than other similar events with the tone set by the President of SAP’s Cloud Business Group Jennifer Morgan at  the opening plenary session. She talked about the business adopting an outside perspective with a greater focus on customer feedback. In plain terms, I thought the underlying message was “we are listening.”

Her three key action points were:

  1. Refocus on quality and support with problem resolution at the top of the agenda.
  2. Faster implementation (as evidenced by big developments in their partner ecosystem).
  3. Continuing to strive for innovation.

Jennifer was the first of six speakers that made up the all-female line-up in that opening session, including high profile guest, the very impressive Amal Clooney.  It sent a strong message about diversity in the business which continued on the second day at the Diversity Luncheon where the keynote speaker was the excellent Michele Mees.  I’d recommend her TED talk. Anyone who was there will remember it for one of the questions that was asked as much as her outstanding content. Let’s just say Michele did a wonderful job of educating us all about what diversity really means, and how it can truly benefit organisations.

The second day saw new President of the SAP Intelligent Spend Group Mike Eberhard continue the theme of working to improve the effectiveness of the solution.   He particularly talked about bringing customers together into the breakout sessions throughout the event to share their experiences and learn from one another.

Sean Thompson (SVP, Business Network and Ecosystem) built on this theme with the emphasis on the importance of using partner organisations as he told us that over 50% of implementations are now partner-led, whilst 75% of all implementations include partners.  I believe this is quite an increase from previous numbers.

The other big theme was the promotion of the power of the unified platform offered by the Intelligent Spend Management group.  Of course, news had reached the industry press that SAP was bringing the Fieldglass and Concur solutions into the stable before the event, but we heard more about the potential for this at various stages.

It struck me that the audience and partners received this news well, as they did indeed the message around members of the leadership team acknowledging that customer feedback and experience would be a central theme of how the business moves forward. It might seem like an obvious thing but it’s not something you hear enough of at these industry events in my opinion.

There were two other highlights from the main stage that I think worth mentioning.

The announcement of the partnership with Barclaycard streamlining payments within the Ariba Network – it was noticeable that the Barclaycard stand was mobbed in the next break and was busy all day as prospects wanted to learn more so that clearly went down well.

From a personal perspective, it was great to see Graham Wright and Mayank Chandla from IBM on the main stage as well, as they shared their vision for the future of procurement, particularly the development of their people enabled by tools like Ariba and Watson.  As regular readers will know this is a course we are particularly passionate about.

There’s so much more to cover from a wealth of breakout sessions and presentations so if you want a more detailed account I suggest you look at the coverage from our friends at Spend Matters here.

Next year the event is in Berlin so unfortunately there’s no beach on my day off and no sunbathing for Mrs Daley, but it’s another great city to visit.  I’m looking forward to it already.

Edbury Daley publishes it’s latest Procurement & Spend Management Insider

Specialist Procurement and Spend Management recruitment firm Edbury Daley has just published it’s latest insider report.

Lead authors Andrew Daley and Peter Brophy delve into several key areas and address key issues including:

All the latest news from the procurement technology sector
Observations on recruitment market trends and legislation updates in the Spend Management Interim Market
A review of Procurement Leadership and senior management roles
The challenges faced by the Management Consultancy sector
A detailed look at what the real impact of Brexit has been on the market including from the viewpoint of the HR practitioner
Advice on the future of your procurement career

You can download the report here: https://edburydaley.com/the-procurement-and-spend-management-insider/

A memo from World Procurement Congress – act now, don’t wait

My colleague Andrew Daley and I attended the World Procurement Congress hosted by Procurement Leaders last Week.

It was an excellent event managing to mix some key themes that procurement needs to address now, such as sustainability and talent and significant long term trends including the impact of technology and how regionalism and nationalism affect the supply chain.

The message to me was ‘act now, don’t wait’, as in such uncertain and unpredictable times sitting and waiting may be the worst option and seriously risks your business getting left behind.

Robert Guest of the Economist gave a very broad ranging ‘state of the nation’ type speech on global trade and made some excellent points on the increasing regionalism of supply chain versus globalism and the impact of nationalism. He asked “what does this mean for Procurement people?” Well it risks the introduction of increasingly populist regulations or challenges on hiring, which means doing business could well become harder. So watch this space as this may be counterbalanced as digitisation and AI may make trading easier.

Sustainability is becoming a critical business driver and one that procurement has a leading role in. This point was made excellently by David Ingram, CPO of Unilever. It’s not good enough to just talk about it as sustainability is visible and measurable and must be checked and certified in the supply chain.

This was followed by an excellent discussion session with Imran Rasul, CPO at BAE Systems. Procurement people in his business have embraced the approach as they feel good about it. So no need for a mandate.

Two excellent but very distinct approaches in different markets.

Talent was another key theme from the conference. Future-proofing procurement’s capabilities featured in many of the keynotes and breakout sessions. Simon Geale of Proxima summed this up concisely as being two key issues of capability and capacity – simple if you think about it but very complex to solve?

Yes, there is a shortfall of people with specialist procurement knowledge, but more critical is finding those with good business and soft skills. Part of this discussion across the two days was also on diversity. We just had to look around the venue at the predominantly white, male audience to see this is a challenge procurement needs to address. Again real action needs to be taken now and words and presentations are not enough.

A number of discussions also touched on another key challenge for procurement, that of digitisation and the use of AI. Daniel Keyworth, CPO at Legal & General shared his vision for a 100% digital workflow by 2021 and I feel other organisations need to challenge themselves in this way too. He proposed five key pillars for procurement linked to digitisation:

  1. Enabling self service.
  2. Team organisational evolution.
  3. Better business partnering.
  4. Driving disruptive innovation.
  5. Easier to work with for our suppliers

Ultimately, the theme ‘procurement needs to be an enabler’ resonated, but with so much to do and with headcount tight it was felt organisations will need a flexible resource model with highly capable, well trained, multi skilled individuals who will adapt to the organisation’s needs.  

This was a red flag for me as whilst I agree, I did not hear how this was to be solved in terms of recruitment or development. If the bar is raised higher and the approach remains the same, we will get the identical end result: a lack of capable people internally and a lack of good people to recruit.

The end of the conference was a call to arms and Anita Sngupata, who is ex-Nasa really showed how we need to challenge our thinking through the example of how transport will change. If she is right our current supply chains will need to be completely re-modelled as there are some genuinely disruptive technologies coming – and soon.

Procurement Leaders event hosts Jet Antonio and Joe Agresta gave us three key takeaways to make happen:

  1. Build talent capability
  2. Drive innovation
  3. Sustainability

The challenge I think for procurement is to lead and educate their businesses about cost savings versus value and long term strategic goals. We see too many functions and organisations who are driven by short term cost or time-based metrics and a ‘penny pinching’ approach to any of these three could be a very short term result indeed.

But overall, do it now. Don’t wait.

Peter Brophy

Associate Director, Edbury Daley

peter@edburydaley.com

Time for action – Talent on the agenda at The World Procurement Congress

It was great to hear that Talent was as high up the agenda as ever at last week’s World Procurement Congress. We hear about supplier innovation and collaboration as the future of procurement and a potential source of competitive advantage in many industries. We ask why isn’t the profession adopting this mentality with their talent attraction?

The Procurement Leaders business always put on a great show and this year was no different with numerous high profile CPOs making presentations or joining group discussions around the central theme of “High Velocity Procurement – The Competitive Advantage”.

These presentations were typically subdivided around concepts like Procurement as an Innovator,  Procurement as a Visionary, Procurement as a Value Driver etc so there was plenty for the procurement professional on a learning expedition to consume.  

My focus is the same at almost every conference we go to, and that is to hear what is being said about people, specifically on the subjects of recruitment, development and retention. I wasn’t disappointed as we heard a lot from industry leaders about the importance of their talent.

In between sessions I took part in some great discussions with other attendees and some of the sponsors where there was a clear theme, and that was the leaders of the profession talk about their great programs offering examples of good hiring practices, career development plans and training to support them. However when you dig a bit deeper into what’s going on outside the big names, the picture is somewhat different.

So best practice in hiring and training remains rare. Many mean well and make the best of the situation but others lack resources (time and financial) whilst others don’t do themselves any favours with their approach to hiring and retention. This is something we see in our day to day work and was backed up by a very interesting panel discussion I attended on day one of the conference.

In this session, Simon Geale of Proxima talked about a severe talent shortage mentioning that many procurement departments are “light on capacity by 10-30%”.  He also commented that “there is not enough talent coming through the system” and talked about the need to equip the next generation with better skills around areas like collaboration and data.  

In response Johanes Giloth (CPO of Nokia) talked about his vision for the future of procurement and working more closely with the business to understand their goals, drivers and challenges which will then enable procurement to better understand its role in future. He actively encourages his best people to move into other departments to develop themselves and their understanding of the business, whilst continuing to hire and develop the best graduate talent he can so they can move up the organisation.

We also heard from Ruth Bromley (VP Operations & Procurement at Heineken) about their development programme for top talent which they call “Procurement Pioneers”. At the heart of their department is the need to understand and talk the language of their stakeholders, so they can ultimately sell their proposition to take responsibility for projects and develop the varied skill sets required to achieve deliver on them.

It was all very encouraging to hear what these two organisations are doing but I found myself nodding my head every time Simon Geale spoke about what he sees in the wider market and the reality is that the likes of Nokia and Heineken lead the way when it comes to developing their people. Unfortunately they are in the minority.

Another organisation that offered some real hope in this area was IBM. I’ve written about their journey to the next generation of procurement in the past and heard more evidence of it on day two when Graham Wright (Vice President – Global Procurement) and Marco Romano (Procurement Data & Analytics Officer) talked about how they are using the Watson tool to help elevate their skills and contribution to the business. The headlines were:

  • AI is enabling new skills not replacing jobs through Watson
  • It’s a valuable tool, not a threat (a common concern about AI)
  • It can help the journey from enabler to consultant for procurement professionals and elevate their skills in the process
  • It is driving a culture change in their organisation
  • At the heart of its success is education and training

IBM was amongst the very first organisations to appoint Marco at what is effectively a Chief Data Officer in procurement, and he provides the bridge between procurement and the data scientists with a key aim being to drive adoption.

Interestingly this concept of a centre of expertise in data analytics able to support procurement was raised in the session I referred to earlier, and it’s a model we expect to see replicated as more organisations finally get around to embracing the opportunities presented by the data.

Some interesting questions were asked by the audience about how it is being used. Graham talked about the importance of speed to value and using the tool when it was going to make a real difference, rather than just for the sake of it.

When asked where to start, both Graham and Marco were on the same page with the suggestion that you should “find something you can execute on and just do it, start small…. don’t go too big or address the most difficult area to begin with… just get started and don’t use lack of data as an excuse not to move forward”.

So having seen evidence from innovators like IBM we know they are using technology as a catalyst to develop their people but to reiterate the point made earlier, they are still in the minority and this practice needs to become mainstream as soon as possible. As my colleague Peter Brophy outlines in his piece on the event, the Procurement Leaders CEO Nandini Basuthakur urged attendees to take action to change and make improvements “NOW” in her closing address and included both technology and talent amongst the key development areas. I couldn’t agree more!

One point I’d like to make as a specialist recruiter in this market is this: we hear about supplier innovation and collaboration as the future of procurement and a potential source of competitive advantage in many industries. So why aren’t procurement leaders adopting this mentality with their talent attraction? In a competitive market for skills with the shortages mentioned by Simon Geale, maybe it’s time to move away from the tactical relationships that dominate the recruitment sector and start thinking a bit differently?

It’s time to back up the big words with some action!

For the record, the awards dinner on the Thursday night was very enjoyable with lots of friendly faces around. The Talent and Development award went to Turkcell, the leading mobile phone operator of Turkey. The judges praised them for their Young Talent Programme aimed at graduates which “provides end to end training programmes that harness technology to deliver the skills that the functions newest entrants require”.  

Congratulations to them. Having recruited in the local market we have seen that procurement talent is in short supply so it’s great to hear how they are developing graduate talent. It is undoubtedly the best long term strategy to address such skills shortages and something that we have been preaching to our clients, particularly in procurement technology and consulting sectors for a while in the UK.

So overall the Word Procurement Congress was a very enjoyable event. It was an intense couple of days of learning and networking where it was great to see a lot of friendly faces and meet some people in our network face to face for the first time.

One other note of interest to me was that it was noticeable that the sponsors that dominated were largely solution providers and partners. Unlike events such as SAP Ariba Live (my next conference in early June) and similar events from their competition, the really big consultancies were not exhibiting although we did see niche players like Proxima alongside the tech firms and payments providers.

I’ll be reporting back from SAP Ariba Live in early June. If you fancy joining me in Barcelona, I can highly recommend the event and the city. More details here: https://events.sap.com/aribalive-2019-barcelona/en/home

Andrew Daley

Director, Procurement Technology at Edbury Daley

andrew@edburydaley.com

What’s happening in the Interim market for procurement technology specialists?

As procurement departments increasingly turn to the latest generation of spend management solutions to drive improvements in efficiency and process, where are they getting the specialist expertise from to drive successful transformation programs?

CPO’s & CFO’s have various options open to them including consultancies and the solution providers themselves, but it seems they are starting to consider alternatives like specialist interim managers.

Andrew Daley of procurement technology recruitment specialists Edbury Daley (LINK) recently posted a two-part series on this very subject.  In it, he addressed how the digital procurement revolution is impacting the interim labour market, the supply/demand equation and what that means for employers.

You can read more here in the first article.

The second of his articles reveals what Edbury Daley are advising their clients to do in order to adapt to the challenging market conditions in order to be successful when hiring for specialist skills in solutions like SAP Ariba, Coupa, Ivalua and Jaggaer.

You can read that article here.

New sponsors, new venue and one big question – my day at eWorld

Having missed the September event both myself and my colleague Peter Brophy were very much looking forward to attending and we weren’t disappointed. The new venue gave the event a fresh feel and was ideally suited to the number of sponsors and delegates at the event.

Proactis was the headline sponsor as has so often been the case, understandably so given their public sector footprint and the traditional make up of the audience.

Amongst the usual suspects among the other sponsors were the likes of SAP Ariba, Tradeshift, Scanmarket, Market Dojo and growing social media presence (and increasing their portfolio of services) Procurious. Other key players from the procurement tech sector included GEP, Wax Digital and Ivalua along with several others we hadn’t seen there before like Tungsten Network, Sievo and Amazon for Business. There’s a full list of sponsors here.

I had planned to attend several presentations as usual, but I spent much of my time networking with the vendors’ sales and marketing people along with a few long-standing procurement contacts, so much so that I only made it to the opening keynote (more on that later).

The question on everyone’s lips was “what’s the market like?” and the answer of course is that the Brexit related uncertainty is certainly impacting on the wider UK professional job market as companies delay key investment and hiring decisions. Frustration with the politicians is clearly not confined to the offices of Edbury Daley but for some, there was a refreshing sense of “it’s still business as usual for us.”

There were the usual brief, cryptic conversations with those who would like to talk further in a more private setting, no doubt about their own personal career objectives, which is always welcome from our perspective of course, and much discussion about the challenges of hiring experienced sales or implementation specialists for the vendors targeting further growth.

So, all in all, a very productive day on the networking front, particularly as I felt there were more senior procurement leaders from the private sector present than has been the case at some previous eWorld events.

In terms of the keynote presentation, Michelle Baker, CPO of Dutch telecoms firm KPN gave an interesting insight into her career, leadership philosophy and of course the impact of technology on procurement.

Amongst the points that resonated with me were the following:

Michelle talked about innovation coming from small businesses that would typically be found in the long tail of spend for most organisations. She cited the example of companies in the pharma sector crowdsourcing from 2-3 person businesses to identify real sources of competitive advantage but flagged the challenges for procurement professionals of identifying the sources of this innovation, and the difficulties of managing those sorts of supplier relationships effectively. I thought that was a fascinating example of the changing demands and skills required for procurement professionals in the future.

She also talked about the need for procurement professionals to take responsibility for their own personal development, how they should focus on deep learning and what she is doing as a leader to help facilitate this. This was of particular interest to me given that my own recent public speaking engagements have focused on the need for self-education for those that have real aspirations to embrace the future of digital procurement.

There’s another eWorld event in the Autumn so keep an eye on their website for more details nearer the time.  I hope to see you there.

What’s happening in the procurement technology market? Acquisitions, moves, careers.

In this article taken from the most recent edition of The Procurement & Spend Management Insider report we cover two key areas following on from the previous report published in April 2018:

  • Industry News and Developments
  • Demand and Supply trends in the sector

The procurement technology market has been a little quieter in terms of senior management moves and merger/acquisition activity than reported in our previous update.

In terms of acquisitions, we’ve seen three significant deals in recent months. Coupa acquired specialist vendor management solution provider DCR Workforce in early September on the back of announcing impressive quarterly financial results, showing revenue growth year on year of some 38%, better than analyst predictions according to Spend Matters.

This resulted in Coupa shares reaching a post IPO high of $80.73 in mid-September although they’d dropped back to just over $60 by mid-October.

More recently Coupa bought Aquirre in mid-October.  Again more details on the deal are available from Spend Matters who explained that the new acquisition “stands out against competing e-procurement and procure-to-pay solutions for its superior front-end shopping user experience and its continued efforts to drive innovation within this segment of the procurement software market.”

Meanwhile Proactis continued their growth with the acquisition of Dutch firm eSize in August.

Rumours continue to circulate the market of at least one more significant business sale before the end of the year with a few underperforming vendors looking vulnerable, but nothing has been confirmed in time for this publication.

Notable senior management changes include both Dean Pathak and Patrick Hyati, Heads of Northern and Southern Europe respectively leaving SAP Ariba towards the end of the summer.  Both had previously reported to EMEA GM Paul Devlin who left earlier this year.

Amabel Grant, formerly of Procserve, Barware and most recently the CCS has joined Bloom Procurement Services as CTO where she teams up with her old OGC colleague David Shields.  This is a significant boost for the public sector focused firm.

Simon Dadswell has left Proactis where he was Marketing Director. Simon was a popular and regular presence at industry events like eWorld and moves into a new role outsider the sector.

In Europe Ivalua have been busy with their expansion. New recruits include Markku Kronqvist formerly of Synertrade who will give increased presence in the Nordics market. They’ve also hired Olga Alvado from BravoSolutions (now Jaggaer of course) in France who lost their Sales Lead Maurice Hamoir to Per Augusta.

SAP Ariba continues to hire extensively across Europe with clear emphasis on increasing their capability in their Customer Value organisation. This includes people with experience of implementing their solutions along with investment in key areas of customer success and value realisation.

Despite Coupa’s impressive results, it appears that hiring hasn’t been as aggressive for them recently, but the consultancies who support their implementations continue to invest in their teams, both in terms of numbers and developing capability.

Hot off the press is the news that Lance Younger will be leaving Deloitte in the next few months.  Lance is the Lead Partner for Deloitte’s UK and EMEA Sourcing & Procurement practice with a focus on procurement transformation, enterprise cost reduction, supplier management and digital procurement.  

He has strong relationships across a number of the key procurement software solutions including Ariba (where he used to lead their EMEA Consulting Team), Coupa, Tradeshift and several niche providers. We expect he’ll be a significant loss to Deloitte’s capability in this area, so it will be interesting to see how they replace him and where he’ll land next.

Notes on our observations from our last report

We predicted limited hiring from newly merged organisations in our last report. The three main deals that we mentioned were Jaggaer’s acquisition of BravoSolution, the Proactis/Perfect Commerce reversed takeover and Advanced Software adding Science Warehouse to their portfolio.

We haven’t seen any evidence to contradict our prediction as each of these organisations have largely been successful in retaining its key people albeit with a couple of exceptions as outlined above.

We did predict more merger and acquisition activity and there maybe more before the year end but with the uncertainty created by Brexit and other political trends geared around trade, it’s quite likely that we’ll see business leaders acting cautiously until these issues settle down.

23/1/19 update – this latest point is an interesting one. There was in fact one more deal in late 2018 as Coupa acquired Risk Management provider Hiperos although that was obviously driven in the US.  Around the same time rumours surfaced of Tradeshift’s bid to buy Basware which is ongoing at the time of publication.  In fact the one deal we heard may happen before Christmas hasn’t done so we’ll bring you news on that as soon as we can.

Andrew Daley

Director

Edbury Daley

 

New research – hiring, salary & bonus trends in procurement technology

Specialist procurement technology recruiters Edbury Daley have undertaken some research into salary and bonus trends in the sector on behalf of some of their clients with some interesting findings.

The fundamental issue is that the procurement technology market is growing at a pace that the existing talent pool can’t support and that is leading to shortages in key areas. The result is challenging hiring conditions and rising salaries.

The headlines from their research include:

  • Salaries for experienced Sales Directors continue to rise due to the shortage of proven leaders with experience in the sector.
  • Furthermore there is an acute scarcity of mid-level sales people with experience of articulating the value technology proposition to procurement and finance stakeholders.  This is forcing vendors to go outside of the sector for such hires.
  • The salaries required to hire experienced pre-sales specialists from the industry are proving to be prohibitively expensive for several vendors. Unfortunately, the situation is not much better when you consider going outside our market into neighbouring sectors.
  • Experienced Implementation consultants are the single biggest skill set in demand. This is driven by both solution providers and consultancies who support the implementation and associated transformation projects.  We have a clear supply/demand inequality that is creating real hiring challenges. We’ve been expecting the interim market to gain a boost from this problem for a while and we may be about to reach that point.
  • Account Management and Customer Success are two areas where the issue isn’t quite as acute as hiring based on transferable skills is more achievable than in some of the areas mentioned above where specific experience is vital. Even so, strong performers can expect to see their skills in demand as the industry continues to grow.

Edbury Daley provide bespoke salary research for the sector and would recommend it to any organisations thinking about end of financial year pay reviews, staff retention and planned recruitment.

This article is taken from their Procurement & Spend Management Insider report which is available to download here.