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Software Buyer's Guide: Software keeps an eye on purchasing (company listing)

This year's guide focuses on software for spend analysis and management.

Susan Avery -- Purchasing, 7/17/2003

Agile. Agile Product Cost Management helps integrate and synchronize design-to-sourcing and product cost processes across virtual supply chains. Providing forward visibility of each product's life cycle, the software helps identify multi-tier spend volume opportunities; enables costing across complex bills of materials and products; automates cosourcing processes; drives early supplier visibility into new product design and enables life cycle target cost, margin and risk analysis. A Guaranteed Business Results program ensures that expectations, milestones and measurable results are achieved. Tel: (408) 975-3900; Fax: (408) 271-4886; URL: www.agile.com.

Ariba. Enterprise Spend Management software helps companies automate, integrate and streamline their entire purchasing process from planning to payment, resulting in, according to the company, 'significant process efficiencies and sustainable cost savings that go straight to the bottom line.' Ariba Spend Management consists of strategy, analysis, sourcing, procurement and supplier management applications and encompasses all categories of spend from direct goods to MRO goods and services. Tel: (650) 390-1000; URL: www.ariba.com.

Commerce One. The company's newest 6.0 Conductor platform and supporting set of composite applications (Procure, Source, Auction, UCCnet Conveyor and Messenger) represent 'the next generation of collaborative solutions that enable companies to optimize their current technology investments' and provide new capabilities to existing applications and processes. Tel: (925) 520-6000; Fax: (925) 520-6060; URL: www.commercone.com.

eCLIPSE Advisors. DACODA is a corporate airline program procurement service that allows travel buyers to analyze spending and use that information to execute better airline contracts and improve contract savings and performance. Through a combination of industry expertise and sophisticated decision support services, DACODA offers customized tools that help maximize savings for corporate airline programs. Tel: (215) 977-4176; Fax: (215) 977-4703; URL: www.eclipseadvisors.com.

Emptoris. Emptoris Sourcing Portfolio is a suite of Web-based sourcing solutions that automate every step of the sourcing process. Emptoris's Spend Analysis module guides companies to use historical spending data and future spending expectations to improve their ongoing strategic sourcing strategy and processes. Tel: (781) 993-9212; Fax: (781) 993-9213; URL: www.emptoris.com.

FreeMarkets. An integrated offering that combines analysis software with data collection, cleansing and enhancement services, FreeMarkets Spend Visibility Solution provides companies with, the company says, 'unprecedented' visibility into their global spend, which they can leverage to design, execute and measure the effectiveness of spend management strategies as part of comprehensive global supply management programs. Tel: (888) 434-0500; Fax: (412) 297-8700; URL: www.freemarkets.com.

Frictionless Commerce. Frictionless Sourcing is an end-to-end sourcing platform that deploys behind a company’s firewall and integrates with existing system infrastructure. Multiple users participate in the sourcing process that spans project management, spend analysis, RFx and auctions, ongoing supplier and contract management and reporting. Advanced modules include: Spend Analysis, Workflow, Demand Aggregation, RFQuick, Bill of Materials and Optimization. Tel: (617) 495-0180; Fax: (617) 495-0180; URL: www.frictionless.com

i2. Spend analysis systems from i2 were first deployed in 1997. Deployments range in size from a few sites to 250. Since 1997, i2 has added other functionality for spend management, including contract compliance, measurement, supplier scorecarding, negotiation and procurement execution. i2 also provides content management software and content services. Tel: (877) 926-9286; Fax: (214) 860-6060; URL: www.i2.com.

ICG Commerce. RealSource spend analysis and sourcing tools provide the insight required to categorize spend, identify savings opportunities, create competitive negotiations and 'make the best total-cost decisions quickly and efficiently', according to the company. RealExchange is a purchase-to-pay transaction management tool that enables companies 'to quickly realize' identified savings and manage spend on an ongoing basis. Tel: (877) 935-4242; Fax: 877-424-2339; URL: www. icgcommerce.com.

Ketera Technologies. Ketera Spend Management provides a closed-loop spend management solution deployed as 'on demand' services at a low total cost of ownership. Ketera Spend Management includes applications for spend analysis, sourcing, e-procurement, payment and reconciliation and supplier-enablement helping users to understand, control and reduce spending. Ketera Technologies is an IBM business partner, providing technology for IBM's Leveraged Procurement Service (LPS), an e-Business On Demand offering. Tel: (650) 903-5600; Fax: (650) 903-4196; URL: www.ketera.com.

MindFlow Technologies. MindFlow Sourcing Suite applications automate the end-to-end sourcing process, enabling cost reductions that the company says are 'significant, recurring and quantifiable.' Designed by sourcing pros, the system optimizes the sourcing process, enabling companies to conduct RFx (requests for information, quote, proposal) and reverse auction events, manage the category sourcing lifecycle and perform advanced enterprise analysis. The company helps with deployment, from the development of best practices through training, installation and live projects. Tel: (972) 930-9988; Fax: (972) 930-9919; URL: www.mindflow.com

Oracle. Oracle Purchasing Intelligence allows companies to reduce and control procurement costs with enterprise spend analysis and supplier performance tracking. Purchasing Intelligence is a Web-based analysis and reporting tool for procurement professionals to identify savings opportunities and, the company says, deliver world-class spend performance to their organizations. Tel: (888) ORACLEI; Fax: (800) 469-5820; URL: www.oracle.com.

PeopleSoft. PeopleSoft Supplier Relationship Management (SRM) connects suppliers to an enterprise in real time 'to control all categories of spend and improve overall supplier performance.' PeopleSoft Supply Chain Warehouse provides a complete analysis and reporting platform that extracts data from PeopleSoft and other sources to provide a single integrated view of expenses. PeopleSoft Supplier Rating System provides a complete view of each supplier's performance. Tel: (800) 380-SOFT (7638); URL: www.peoplesoft.com.

SAP. mySAP Supplier Relationship Management is enterprise software that maximizes return on relationship with suppliers. mySAP SRM integrates operations across enterprise boundaries, promoting supplier collaboration by automating processes with all suppliers for all purchases companywide. mySAP SRM addresses the full supply cycle, from all strategic sourcing to operational procurement and supplier enablement. Tel: (888) 727-1993; Fax: (650) 849-4200; URL: www.sap.com.

SAS. Supplier Relationship Management software provides an analytical versus transactional approach to SRM. Through its data access and optimization capabilities, SAS Supplier Relationship Management turns procurement data into strategic information. This, according to the company, delivers the intelligence required to understand total procurement spend, reduce supplier costs, optimize procurement strategies, minimize risk and meet corporate goals at all levels of organizations. Tel: (919) 677-8000; Fax: (919) 677-4444; URL: www.sas.com/solutions/srm/.

Silvon Software. Silvon Stratum allows businesses to collect, analyze and leverage key data related to purchasing performance, supplier performance, buyer performance and pricing. The application is designed to provide, the company says, 'an immediate return on investment' through more than 100 predefined analytics/reporting templates and numerous metrics for measuring procurement-related key performance indicators (KPI). Tel: (800) 874-5866; Fax: (630) 655-3377; URL: www.silvon.com.

Tigris Consulting. Tigris Total Spend Management (TSA) enables companies to gain a detailed, nuanced understanding of enterprise-wide expenditures and uncover considerable savings opportunities through a quick, comprehensive analysis of historical, current and projected spend data. Tigris TSA is a comprehensive approach that does not require users to manage costly and time-consuming software implementations. Item level categorization features and the assignment of UNSPSC (United Nations Standard Products and Services Code) enable TSA users 'to achieve unmatched spend visibility,' says the company. Tel: (646) 792-9200; Fax: (646) 792-9210; URL: www.tigris.com.

Verian Technologies. ProcureIT is Web-based spend management software for mid-to large-sized companies. ProcureIT's components automate purchasing, materials and inventory management, asset tracking, and travel and expense reporting. These components can work together or independently. Customers choose ProcureIT, the company says, 'because it reduces overall spend by decreasing manual effort, optimizing inventory and improving supplier contracts.' Tel: (800) 672-8776; Fax: (704) 547-7304; URL: www.procureit.com.

Verticalnet. Verticalnet Spend Analysis provides insight and analytics to measure ongoing procurement activities, resulting in optimized sourcing decisions. Software enables companies to extract spend data from disparate systems; cleanse and normalize the data to create a single, enterprise-wide view of the spend; and analyze the data to identify savings opportunities and repeatedly monitor spending activities. Tel: (610) 695-2310; Fax: (610) 240-9470. URL: www.verticalnet.com.

Zycus. Zycus's UNSPSC-based automation solutions combines cutting-edge AI (artificial intelligence) technology and domain expertise to discover, enrich and manage enterprise spend and master data for better visibility and greater compliance. Zycus helps increase e-procurement, strategic sourcing, and product lifecycle management (PLM) effectiveness, and complements existing enterprise applications to deliver increased ROI (return on investment). Tel: (201) 896-4001/4002; Fax: (201) 842-7616; URL: www.zycus.com.

 

An alternative to software

For many companies, software is an expensive tool. For some, there is an alternative.

'On demand' is a model for delivering business applications as services to companies. This way, applications are delivered in a manner similar to how gas, water and other utilities are delivered to consumers, based on usage and without the need to implement hardware. It's how Ketera Technologies delivers its spend management solution. On demand, according to the company, consists of these three components:

  • Priced on usage. Companies pay a fee based on how much they use a solution over time. On demand suppliers leverage a multi-company model (again acting like a utility provider) providing economies of scale that are passed on to customers through lower pricing.
  • Applications delivered as services over the Internet. Applications are accessed via an Internet browser without the need to install software at the company site.
  • Supporting services included. On demand solutions include key services such as supplier enablement, IT management and end-user training. These services are also provided by software suppliers but tend to be considered as options and are priced separately.

There are a number of ways in which on demand and software costs differ. A key premise of the on demand model is that the supplier rather than the customer invests in the technology, hardware and supporting services. For this reason, the total cost of ownership (TCO) of on demand solutions is about 5-10 times lower than the cost of software. When breaking down TCO costs, software is usually the least expensive line item. So called hidden costs such as those associated with implementation, supplier enablement, supporting software and training push up TCO.

Another difference in costs is the method used to charge customers. Software providers charge large sums up front and annual maintenance fees to cover customer support and upgrades. This model became popular in the 1990s with the rise in popularity of ERP (enterprise resource planning) systems. On demand solutions, on the other hand, spread the cost over the life of a contract and are based on a company's usage over time. Mitch Plaat, director of contract services at CNF, says, 'We saw the value of spend management a long time ago. However, we could not justify the millions of dollars in up-front license fees.' Ultimately, CNF Services Co. decided on a joint solution: an on demand spend management solution from Ketera integrated with the American Express Corporate Purchasing Card.

Where does on demand fit?

On demand solutions are not for everyone. Because on demand solutions are not implemented behind a company's firewall, companies will need to ensure their corporate culture is accepting of a solution accessed over the Internet. Concerns regarding privacy and security have largely been addressed, but this should be an important question to ask of potential suppliers.

Another key question: Which business processes should be considered a fit for on demand solutions? Many companies hesitate to move strategic applications to an on demand environment. Another consideration is the level of integration required. An example of an application that is both strategic and needs to integrate to multiple systems is a company's automated manufacturing planning system, such as MRP (manufacturing resource planning). Spend management is one solution that can be delivered via the on demand model. Spend management solutions are being used by many companies in spend categories that are nonstrategic to a company's core business yet can yield substantial savings. Integration needs to occur, but batch, rather than real-time, integration will suffice.

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