Tag Archives: open networks

The Next Big Idea: Eliminating Supplier Enablement

What’s the next big idea in procurement? Getting rid of the need for supplier enablement and moving to real time supplier activation instead.

Supplier Enablement

It may sound tactical, but really it’s the key to success with all the other big strategic ideas we’ve been talking about for a long time: Increasing supplier innovation, optimising total spend, and getting a seat at the table with top leadership.

Back when EDI , cXML, and other proprietary technologies were the only way for suppliers to electronically transmit data directly into buyers’ back-end systems, supplier enablement was a necessity. These are not the easiest integrations, so buyers had to run enablement campaigns to get suppliers on board.

We all know how that has played out. The only suppliers who participate are those with the resources and the sales volume to justify the effort. As a result, most buyers can only transact electronically with 10-20 per cent of their suppliers.

There was a time when getting the top 20 per cent of your suppliers electronically enabled was a big step forward. Today, twenty percent enablement is a dismal result that’s holding the profession back.

Proprietary supplier networks were supposed to alleviate this problem by providing buyers access to ‘pre-enabled’ suppliers. This too was a step forward at one time. But even the largest proprietary networks today only boast between one and two million suppliers. When you consider that there are close to 200 million suppliers in the world, this too is a dismal result.

Supplier Exclusion

The need for supplier enablement is excluding the vast majority of the world’s suppliers from participating electronically. For buyers, that not only means inefficient processing, it means lost data. And in today’s data driven world, that increasingly means lost opportunity to analyse, optimise and innovate.

We can do better than that now. We have the technology. In our daily lives, we no longer enable anything. We activate and go. We are already pre-enabled to connect and share data through the Internet using our computers and phones. There are 7.4 billion people on the planet. There are 8.6 billion phones. We have never been more connected, and in real time.

Over 100 billion apps have been downloaded from the Apple store since 2008. Uber fulfils a million rides daily. Over two million people have set up shop on Amazon’s marketplace. There are two million Airbnb listings.

These are all networks powered by the meta network—the Internet. The Internet is the enabling thing. If you have a valid driver’s licence, arts and crafts to sell, or property to share, all you need is a data connection, an email address, and a pulse to join and start tapping into the value of any of these networks. Their reach is already enormous, and growth is not limited by enablement hurdles.

A Phone and a Blackberry

In contrast, your typical supplier enablement exercise requires unnatural acts to get to the value. It reminds me of these people I see in the subway in New York City, who have an iPhone and a Blackberry, or two different phones—one for work and one for business.

What if you had to use a separate phone to download an app from the Apple store, hail an Uber or shop on Amazon? These networks would certainly not have achieved such widespread adoption under those circumstances. Yet that is essentially what supplier enablement as we know it asks suppliers to do—step outside of their normal systems and business processes, and do something different and unique in order to transact with the buyer.

These closed networks have been created through years of collective enablement campaigns but the whole world is moving toward open networks that require no enablement and instead leverage the ways in which we are already connected.

B2B commerce is a one trillion dollar market by some estimates. Open networks are its future. They are the key to connecting electronically to the 80 to 90 per cent of your suppliers that make up the long tail.

When you unlock the tail, the odds of finding the innovation and value that procurement is looking for go up exponentially. Those are the hungry suppliers, the scrappy suppliers, the startups, the ones that aren’t getting the same opportunity that big companies are, but who might be moving faster and doing more inventive things. This is where the next big ideas are.

The tail is not a tactical part of spend. It’s actually the strategic part, and no company can afford to write it off. The 80/20 rule of supplier enablement is no longer good enough. We have to get as close to 100 percent participation as we can, by democratising the network using technology. We’ve got to be able to say, “If you can connect to the Internet, we can collaborate.”

Coupa are one of the sponsors of the Big Ideas Summit, to be held in London on April 21st. 

If you’re interested in finding out more, visit www.bigideassummit.com, join our Procurious group, and Tweet your thoughts and Big Ideas to us using #BigIdeas2016.

Don’t miss out on this truly excellent event and the chance to participate in discussions that will shape the future of the procurement profession. Get Involved, register today.

The Early Bird Catches the Procurement News Worm

In a fast-paced world, being first with the procurement news can mean the difference between being in the know and being left behind.

First with procurement news

Read Tania’s first article on the importance of networking and your personal brand here.

Too many procurement professionals spend their careers in closed networks. They stay in the same profession, peer group, company, or industry, associating with people they already know. In these safe, closed networks, it’s easier to get things done because we’ve built up trust, and know all the shorthand terms and unspoken rules. It’s comfortable because the group converges on the same ways of seeing the world that confirm our own.

Life in a closed network is easy.  It’s safe.  It’s comfortable.

But unfortunately these gentle words are not synonymous with career advancement. If you want to keep growing and get ahead in your career, you need to be challenged, and be a challenger, within your ‘tribe’. You need to be first with the procurement news, be able to quickly digest the information, and interpret what it means for your organisation.

Open or Closed Case

When we were designing Procurious, the team had a lot of heated debates over whether we should have an open or closed network. That is, should it be closed exclusively to highly pre-qualified procurement professionals, or open for the whole world (aka. recruiters, consultants, sales professionals) to join.

Luckily my team convinced me to keep our network open, and it’s been an important part of our success story.

When you become part of an open network, you are exposed to multiple groups. Unlike your peers in closed networks, you gain access to unique relationships, experiences, and knowledge. You get to hear from thought leaders and industry experts, and learn about their diverse opinions on the hot topics in procurement.

As a result of being exposed to thinking outside your ‘tribe’, you gain a more accurate view of the world. In fact, some research shows that people with open networks are better forecasters than people with closed networks.

Leverage Your Networks

While Procurious members may not be the first to hear new information, they can be the first to introduce information to their network. As a result, they can leverage the first mover advantage.

For example, as a member of Procurious you may be the first in your company to become aware of a major supply chain disruption. Although the whole Procurious community is aware of this event, you could be the first person in your company to share the procurement news and start planning your response.

What’s more, you could use your network to gain further information on the disruption, and leverage their expertise to help solve the problem. You will be amazed how the community responds with alternate suppliers, solutions, on the ground contacts! In our Discussions section you will see there has already been hundreds of questions asked, and thousands of answers provided by procurement professionals all around the globe.

Let’s face it – procurement issues are now global business issues. The nature and complexity of procurement and supply chain challenges mean that they are too big for one person alone to solve.

To come up with the best ideas we need many, diverse perspectives.  By involving more views, life and career experiences, demographics, and cultures, we can access these perspectives. Through our Procurious network, we increase the pool of talent and therefore ideas that are working to solve problems.  Let’s call it collective problem-solving.

Collective Muscle

If our procurement network on Procurious gets into the habit of collective problem solving by supporting each other by sharing the procurement news, and with information and advice, it will soon become an instant reaction – a community reflex. And if we keep repeating that action, then we will build community muscle.

So when bad things happen, or when we’re looking for solutions to big problems, we turn first towards thinking that we’re going to solve it in a community way, through our network!

Apparently there are more than 3,500,000 procurement professionals in the world. But there are probably less than 500,000 who we can readily identify.

Many procurement professionals are working in isolation, unaware that there is a whole universe of knowledge and professionals available, to help them do their jobs better and learn more effectively.

There are so many problems we can solve together, so much we can do to promote our own careers and the profession – if only we use the power of connection and leverage our network – there is very little that we can’t achieve!

This blog is part of a speech Tania made at the eWorld Procurement and Supply Conference in London on 2 March 2016. Stay tuned for further insights from Tania and the Procurious team from eWorld.