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Written by Tony Wessels | 

October 17th, 2012

3 Essential Time Saving Tools for a Chief Procurement Officer

Time is of an essence when you are holding the strings to your company's procurement purse.

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Written by Kelly Deacon - Intesource | 

October 11th, 2012

When Suppliers Compete, You Win

By Kelly Deacon – Intesource

Not every company has the purchasing power of a Fortune 1000 company.  Many act like they do, though, when they continuously pressure suppliers for lower costs and more favorable terms.

The problem: It’s bad business.

Harsh, margin-busting negotiations can create volatile and animosity-filled supplier relationships. Since suppliers play an integral role in a company’s reputation today - from product quality and sustainability to labor practices – these practices put a company at risk.   And at the end of the day, buying organizations can still only guess whether they’re getting the best possible value.

Fortunately, there’s a better approach to negotiation; Lending Tree’s slogan says it best: “When banks compete, you win.”  The same is true in the supply chain – when suppliers compete, you win.

That’s the beauty of e-Sourcing.  Instead of back and forth negotiations with suppliers, sourcing teams can tell a collection of qualified suppliers exactly what they need and let the suppliers compete against each other.  There’s no need to haggle; if a supplier wants your business, they will put their best offer forward. 

By removing yourself from the negotiation and putting the supplier in control, supplier relationships are strengthened.  The process is much easier, on the buying organization, and is almost guaranteed to save a huge amount of time and money.

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Written by Mark Verbeck, Coupa CFO | 

September 26th, 2012

Spend Approval Silos Driving Maverick Spend

Last week I participated in a web conference on spend management hosted by CFO magazine. A survey question during the webinar asked the CFO-centric attendees what they thought were their greatest challenges in spend management. Procurement people might be surprised by the limited amount of concern the audience had about off contract (“maverick”) spending. They ranked it 4th - well behind lack of visibility, complicated approval processes, and lack of user adoption. This is in stark contrast to what we at Coupa typically hear from CPOs.

Full disclosure - I used to be unconcerned by maverick spend, so I was not surprised by the result. My CFO counterparts and I typically believe that the finance organization has control of spend whether it is coming through procurement, invoicing, or expense reports. Unfortunately the amount of control, the ability to realize savings and the processing cost vary greatly between these approaches.

When I implemented a spend approval process that required a similar amount of scrutiny for invoices that are not backed by purchase orders as I would demand for the PO process itself, I realized how much these differences in approaches are often driving maverick spending -- taking away savings opportunities from the organization.

The CPO cringes when they hear someone say “just expense it” because they know there is likely to be a missed savings opportunity. Why is this phrase something that most people recognize? It’s because the alternative way to spend money is often cumbersome, hard to use, difficult to access and limited in scope.

We have seen some organizations try to address the challenges of the silos by fiat – “no invoices without a PO” and “No purchases of goods will be reimbursed on an expense report.” While these approaches might lead to better spend results and eliminate maverick spending, they also come at a significant productivity and processing cost.

Coupa has a better way. Manage all of your silos of spend as a cohesive unit, optimizing processing and efficiency, while capturing the maximum amount of savings.

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Written by Bhaskar Deka | 

September 10th, 2012

Coupa 8: The next chapter in innovation for the buyer - part II (Smarter Contracts)

Continuing on the series on Coupa 8, in this post, I will talk about Coupa Smarter Contracts - one of the new modules in Coupa 8.

Purchasing contracts are one of your most important tools for cost-effectively conducting business with your suppliers. You negotiate the terms carefully - now make sure you’re getting the most out of them! For most organizations, however, finding the contract when you need it is a key challenge. Purchasing contracts tend to be all over the place. Some could be in Theresa's thumb drive, some in Lee's laptop, some in Dale's desktop, and still others neatly tucked away in Mohan's Manila folders. If you are not able to find the contracts, how do you ensure that the contract terms are properly enforced at the point of purchase?

Meet Coupa Smarter Contracts.

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Written by Henry Ijams, Managing Director, PayStream Advisors | 

August 30th, 2012

Money Might Not Grow on Trees but it does Fly in the Clouds

How much can your company save by utilizing cloud based procurement solutions?

I recently presented a Coupa webinar focusing on calculating the total cost of ownership (TCO) for cloud-based applications.  While cloud computing has been around for a while, there seems to be some confusion surrounding exactly what cloud computing is and how companies can benefit from applying it. 

Most of the challenge stems from evaluating different cost elements of cloud solutions and comparing costs to traditional software deployment.  Until the internet age, technology was always delivered using on-premise licensed solutions. What differentiates the cloud from traditional deployment is who manages and delivers the solution. In today’s Cloud, a third party vendor manages not only the application, but the deployment and the hardware. 

If your procurement applications are on-premise, your company manages everything from the application to the hardware, software and upgrades.  As you know, this can be a big investment in IT time along with commitment of capital.  On the opposite end of the spectrum with cloud-based solutions, the vendor manages everything, allowing your company to focus on the core business of making the software deliver business value.  Somewhere in between traditional in-house and cloud based solutions lie hosted services where your company and your vendor share responsibilities.

Graphic: The Transition of Enterprise Software to the Cloud

The benefits of cloud computing are widely promoted and include the ability to have access to the most current services, improved configurability, reduced costs and access to new services and applications that are constantly updated.  The Cloud provider is willing to offer a much lower upfront cost with confidence that they will continue to win your business by continually improving the application.

In order to see the true cost and payoff of on-premise versus cloud-based solutions, buyers must carefully evaluate the immediate and long term costs of acquiring and maintaining the technology.  This includes identifying the cost drivers for procurement automation – both the on-premise costs and the cloud costs.  These costs include:

• Software
• Hardware and Infrastructure
• Management of the supplier network
• Configuration and Implementation
• Data Migration
• User Training
• Annual Maintenance

Easy to Use TCO Tool

In an effort to simplify the process of evaluating on-premise versus cloud based solution costs, PayStream Advisors analysts developed an easy to use self-evaluation tool.  The PayStream TCO calculation tool creates a Cumulative Cost Table that will automatically populate your cost data and graph on-premise vs. cloud development costs.

The TCO Calculation Tool makes it easy to determine which solution – cloud versus on-premise is more cost effective for your company.  The tool is designed to help you understand your costs and gain the executive buy in you need.

Formula for Success

The attractiveness of Cloud-based solutions is undeniable; however, without a detailed comparison of the costs, projects can’t get started. Once you have the figures, the next step is to develop a plan of attack to obtaining executive sponsorship.  PayStream has worked with innovative companies from around the world to develop successful project launches.  In our 12 years of advising clients we’ve identified five key success factors worth sharing:

1. Develop a compelling vision
2. Utilize the TCO Calculation Tool to realistically calculate your costs
3. Build a bullet-proof business case
4. Build a realistic roadmap
5. Have a risk mitigation plan

If you missed the PayStream Total Cost of Ownership for Spend Optimization webinar, you can still tune in to learn more about how to calculate your TCO for cloud-based applications.  It will be posted soon. 

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Written by Bhaskar Deka | 

August 28th, 2012

Coupa 8: The Next Chapter in Innovation for the Buyer

From the very formative days, Coupa has always been about innovation for the buyer. Continuing on that tradition, today, we are announcing Coupa 8 - the most innovative platform in the spend optimization world that takes "user-centricity" to a level never seen before!

When we first burst into the scene six years ago, the e-procurement space was badly in need of innovation. Some vendors were trying to put so called "self service apps" in front of complex back-end processes. Some were (unfortunately still are) trying to re-purpose '90s UI technology to claim victory on usability. Still others were embarking on a journey to "cloudify" on-premise software through clever marketing. 

Coupa disrupted the market by focussing on users first as a means to bringing spend under management. 

Buyers took notice. 

Being chosen by Coca-Cola, the #1 brand in the world, is just one of the testaments to the unique appeal of a potent combination of unmatched usability, superior spend visibility, and rapid time-to-value of the Coupa cloud platform. Over the years, we have heard customers talk about us being the "gold standard" for user adoption of enterprise application. After all, we consistently see customers talk about more than 90% user adoption.

We are both humbled and hugely motivated to do more by such monikers.

When we set out to do Coupa 8 and listened to our customers, we realized that we have been fortunate to help our customers manage indirect spend in the procurement and expenses space by an order of magnitude. At the same time, we also heard about many areas that were ripe for innovation. With that in mind, we are announcing two new modules in Coupa 8 - Coupa Invoicing and Coupa Smarter Contracts. Coupa 8 makes it even easier to manage your spend - for folks in Accounts Payable (using our new Invoicing module); Contract managers (Smarter Contracts brings contracts to life!), road warriors (an iPhone app for expense reports), and well, just about everyone (over 30 major enhancements to the Coupa Procure to Order platform).

Some of our fellow travelers in the spend management space have taken the easy route of acquiring another company to extend their offering. May Lord have mercy on the poor souls in engineering who will try to "integrate" those solutions (aka apples and oranges and duct-tapes - e.g., trying to make an '90s application written in java to talk nicely to an another '90s application written in .net). 

Here at Coupa, we continue to be innovators! Coupa 8 is based on the same unified and organically built platform trusted by customers around the globe who pump billions of dollars of spend through us.

Stay tuned for more on the new modules in the coming days.

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Written by Constantine Limberakis | 

August 16th, 2012

Attaining the “State of Spend Optimization”

This week's guest post is courtesy of Constantine Limberakis, Senior Research Analyst, Aberdeen Group.

During the course of my career I recall often using the term “spend management” throughout the nineties. The concept of spend management  is one that evolved from a technology perspective when it was realized that purchasing as an organization required a separate yet unique set of tools that could set it apart for improving efficiency and gaining deeper insight into spend – hence the birth of “eProcurement”.

But just like anything idea or concept there is a necessary evolution or reinterpretation where the concept needs to be reconsidered in a new light.

Just think about architectural developments like the classical to neo-classical, gothic and neo-gothic, etc. Perhaps better still would be the analogy of how impressionism violated the rules of academic painting. I experienced this sense of an “aha” moment as a result of a recent piece that I put together. The goal of the paper was to understand what defines spend optimization – in other words is there a trend emerging in procurement that is pushing toward a new idea beyond just managing spend?

I also shared this concept further yesterday on a webinar with Tony Wessels, VP of Marketing at Coupa entitled – In Search of Spend Optimization. Based on the respective experiences with their client base and the conversations I’ve had with end-users and vendors respectively, it is interesting to see how this concept evolves.

While this concept may still be a work in progress, I found several key features that can helped me construct what organizations must do to reach that higher point of “spend nirvana”. From this Analyst Insight “Creating a Culture of Spend Optimization“, I think it is apparent that to get noticed as an agent of change in their own rite, CPOs must find a way to transform an organization’s DNA and cultural mindset on a number of different levels. At some level I came to the following conclusions on how CPOs can attain spend optimization, I shared the following tactics that CPOs or other procurement leaders should pursue for attaining a level of spend optimization   -

• Be profit-center minded. Procurement organizations needs to promote the notion that procurement is a value-add to the organization and profit center oriented. For instance, procurement leadership should develop a “what if” scenarios report that can demonstrate procurement’s impact on net income and illustrate how it would have been lower without procurement’s involvement.
• Be always on the mind of the executive. Executives need to buy into procurement’s vision of success. This provides two functions; 1. It allows these executives to communicate procurement’s value to their teams and 2. Procurement’s vision of spend optimization is more visible at the executive level.
• Be talent oriented and focused. Procurement must do a better job at recruiting and marketing the best talent. While traditionally procurement may have been seen as a stepping stone to another function in the past, today procurement is increasingly becoming a desired function by its impact on the commercial viability of an organization.
• Be organized through a center-led approach. Structural deficits in the way procurement has traditionally been organized has often impeded and effort that could create a common culture for understanding its value. Focus should be made on establishing a center-led model based on the ability to promote consistent policy while instilling flexibility of some self-determination at the local level.
• Be innovative through technology. While organizations too often rely on technology as the panacea to solve organizational issues, technology is the necessary glue that can help centralize procurement processes and close the loop for gaining visibility, increasing spend efficiency and amplifying spend power within the organization through new technologies like mobility.

To better understand it, I would also encourage you take the CPO Agenda survey.  The data collected from the survey will be in the report that will be released October 1^st entitled – The Chief Procurement Officer: Enterprise Champions during Economic Uncertainty.

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Written by Tony Wessels | 

August 9th, 2012

One CFO's Journey To Selecting The Right Procurement Vendor

David Rosenbaum of CFO Magazine, recently interviewed Coupa's CFO Mark Verbeck in an article: "How to Spend Too Much for Stuff You Don’t Need"

One of the statistics that stood out from the article:  "a 2009 Aberdeen Group study estimated that “improving the percentage of all non-payroll, tax, tariff, and fee-related spend” – that is, indirect, non-strategic expenses – brought under the management of a dedicated group can help enterprises “achieve a 5% to 20% cost savings for each dollar brought under spend management."

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Written by Bhaskar Deka | 

July 12th, 2012

Satisfaction is so '70s... let's talk Customer Success

Happy 50th birthday, Rolling Stones! It was 50 years ago on July 12th that the Stones had their first gig in a club named The Marquee in Oxford Street in London.

A question, Mick Jagger, the front man of the Rolling Stones gets asked a lot is - "Mick, are you satisfied now?" He says it poses an interesting dilemma - If he says no, few people will believe him given the wild success the Rolling Stones has enjoyed over the years. If he says yes, he can't sing the popular song "can't get no satisfaction" any more! 

When it comes to customers, there should be no dilemma. Customer satisfaction is so '70s, let's talk about customer success!

Earlier in the week during the company all hands, it was great to hear another rockstar, Rob Bernshteyn, CEO of Coupa, talk about how "ensuring customer succcess" has been one of the three core values of Coupa right from the early days. 

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Written by Bhaskar Deka | 

June 26th, 2012

Usability in Enterprise Applications .. Part IV ("Of APIs and Administrators")

Is usability only relevant for the "business end users"? In continuation of the series on usability, in this post, I will talk about the often forgotten classes of users - e.g., administrators or the developers doing the integration work. Or, taking an example from the procurement space -  usability needs of the suppliers. 

It’s easy for enterprise application vendors to forget the usability needs of users beyond the “business end users”. Most enterprises, however, have unique business needs. A base application needs to be configured to accommodate the unique business needs of an enterprise.

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