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ERP Procurement The Outrageous Cost of 'Free’ When to Look Beyond Your ERP For Procurement

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ERP Procurement The Outrageous Cost of 'Free’ When to Look Beyond Your ERP For Procurement

Duncan Jones V.P., Principal Analyst Forrester

Tony Wessels V.P. Marketing Coupa

Christian Bader V.P. IT Adidas Group

Coupa Overview

Today’s Agenda

Q & A

Forrester Insight

Adidas Case Study

Coupa’s Mission

Delivering software innovation that breeds responsible spending while

impacting the company bottom line.

Coupa’s Explosive Growth

180% Bookings

YOY

+95% Renewal Rate

YOY

150% PlaJorm Usage

YOY

One World, One PlaJorm

10 Languages

40 Countries 100,000 Users

Customers Highlights

Retail Finance Mfg. Health Care High Tech

Spend OpPmizaPon

Poll QuesPon

What systems are you using to manage procurement processes?

1.  We use manual, paper-‐based processes

2.  We rely solely on our exisCng ERP system for procurement

3.  We have a third party procurement system in conjuncCon with ERP

Introductions

Adidas Case Study

Agenda

Forrester Insight

Q & A


Brute force alone won’t make people use your eProcurement system


Six keys to successful eProcurement projects

Product selection best practices

Summary recommendations

Agenda


eProcurement can deliver several business benefits

§  Delivering sourcing savings to the bottom line, by directing purchases to approved suppliers and contracts

§  Reducing expenditure via greater visibility and more effective control

§  Lowering administration costs , though process automation and optimization


The business case depends on you achieving four objectives

Project business

case

User adoption

Supplier adoption

Category coverage

Controls’ effectiveness


Success

Executive sponsorship

Application usability

Tailored approvals

Supplier enrolment

and integration

Category-specific

processes

Collaboration with Finance

Which depend on six pre-requisites

Project business

case

User adoption

Supplier adoption

Category coverage

Controls’ effectiveness



Selection and implementation best practices


Agenda


Make the right way easy, and the wrong way hard

• Eliminate non-essential approvals

• Give managers a good mobile UI

• Integrate with suppliers

• Tell user about PO’s progress

• Measure & report compliance • A PO raised after the fact is a fail

• Track maverick buyers and make compliance a performance goal

• Delay payment if there is no PO


Select the product that will best help you achieve the project’s goals

§  Use formal objective decision criteria

§  Consider the pros and cons of going with your ERP incumbent

§  Who can best help you: –  drive high user and supplier adoption?

–  support broad category coverage?

–  enable effective controls?


Your eProcurement solution should be easy to use

Search catalogue

Approve requisition

Confirm price & delivery

Receive goods or services

Submit invoice

Approve invoice

(difference)

Systems of engagement - flexible, intuitive, mobile

Systems of record – robust, internally consistent, static

Purchase Order

ApprovedInvoice


Evaluate your incumbents’ ability to help you achieve the project’s goals

ERP §  Financial resources

§  Productized integration with system of record

§  Well-known brand

§  Job security for IT

§  License may be sunk cost

ePurchasing specialists §  Usability

§  Vision and focus

§  Supplier support services

§  Negotiation leverage

§  SaaS


Is it really SaaS? Apply the duck test

§  Subscription contract –  Investment matches roll-out –  Flex up or down

§  Hosted by the software provider §  Highly configurable §  Frequent product enhancements §  Scalable, on demand §  Multi-tenant infrastructure §  Customer success culture


The real difference is a client-focused culture

They can’t afford to:

§  Release products that aren’t really ready for production use

§  Push bundled deals with lots of modules you’re not yet ready to consume

§  Sell to the CIO without securing broad executive buy-in

§  Let implementation projects go on for ever

§  Allow adoption and usage to wane after the initial enthusiasm

SaaS vendors are focused on your success not merely on their own revenue recognition



Product selection best practices


Agenda



If you’re just starting: §  Build a business case, and

ensure that drives the selection process

§  Use objective evaluation criteria

–  Weight usability over integration

–  Who will best deliver adoption?

§  Start somewhere you can get a quick win

If you’re further along: §  Analyse adoption to identify

obstacles

§  Make the right way easier and the wrong way harder

–  Find juicier carrots and bigger sticks

§  Persuade Finance to repeal their counter-productive edicts

© 2009 Forrester Research, Inc. Reproduction Prohibited

Thank you

Duncan Jones [email protected] http://www.forrester.com/Duncan-Jones

Poll QuesPon

What are the key challenges of using ERP for procurement?

1.  User AdopCon – complexity

2.  Lack of control, dependency on IT

3.  None, we love it!


Introductions

Adidas Case Study

Agenda

Forrester Insight

Q & A

q  The adidas Group strives to be the global leader in the sporting goods industry

q  The Group comprises around 170 subsidiaries with headquarters in Germany

q  Brands include adidas, Reebok, TaylorMade, CCM Hockey and Rockport

q  Revenues of €13,3 billion in 2011

31

•  One of the fastest growing regions

•  Multiple languages and currencies

•  Common ERP Suite

•  Centralized as well as local BI Platform

•  Over 200 Retails

LATIN AMERICA LANDSCAPE

BUSINESS OBJECTIVES

•  Ensure compliance / governance with policies and regulations

•  Create visibility at Regional / country level ( 7 countries, 600-700 users)

•  Create foundation for a centralized buying organization

•  Improve end user experience.

•  Replace in house spaghetti code

•  Give process visibility to customers.

•  One solution everywhere

SELECTION CRITERIA

•  Usability

•  Multi language and currency support

•  Robust functionality

•  Complement ERP

•  Highly configurable - No ERP customization

•  Total cost of ownership

•  Time to Market (implementation time)

•  Low training requirement

RESULTS SO FAR

•  Implemented Coupa in 6 weeks with full procure to pay, budgets, contracts and reporting

functionality

•  550k GL accounts, 7,700 suppliers

•  Multi language & currencies e.g. Spanish

•  Spend categories - marketing, personnel expenses, maintenance & repairs, projects,

technology, legal fees

@coupa

[email protected]

facebook.com/coupasoftware

Thanks!

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