Linda Chuan has a bone to pick with procurement software. Five bones, to be more precise. Linda is the Head of Strategic Sourcing & Procurement Ops at Box—the California-based Content Cloud company—and has over two decades of senior executive procurement-related experience. Her resume includes many “firsts”: first Head of Sourcing & Procurement at Genstar—GE Capital, first Head of Technology Sourcing & Procurement Gap Inc. corporate, first Head of Technology Sourcing at PeopleSoft, first Head of Value Delivery at Siebel Systems, first Head of Marketing Sourcing (and later included HW/SW categories) at Yahoo!, as Salesforce’s first Senior Director of Global Corporate Services & Strategic Sourcing, and as Vice President of Global Technology Sourcing for Thomson Reuters.
When someone with Linda’s extensive experience in the procurement field has something to say, the companies that design and sell procurement software would do well to take notes. After many years of being “let down,” she’s feeling that these companies continue to fail their users, primarily by not listening to their customers.
“I’m finding that all of these solution providers out there claiming they have the answer to fix the business problem that they’re trying to solve—they’re not really talking to the people who are actually using it, and they’re not really solving it. They’re coming at it from an engineer’s perspective and have not really spoken or taken in feedback from the actual end-users. I was really bullish on technologies and innovations from the procurement side catching up to the sales side a while back. However, over the last five, ten years, I have not seen it. I’m seeing offerings that forget so many fundamental functionalities in the solution they’re building.”
Linda sat down with us to discuss her five biggest points of failure among many of today’s procurement solutions.
1. Data Quality
Giant technological leaps made possible by two things: processing power and data. To be useful, that data has to be cleansed and normalized. Unfortunately, most companies are relying on manual entry of data in their procurement systems. All the processing power in the world can’t compensate for dirty data.
“Data is never clean. I’ve been practicing procurement for a while now and I see it at every company, every industry, and at every phase of the life of any company, whether you’re a startup, or an established company who’s been around years. And even data companies … Everybody still has data quality issues. Why? Because they haven’t eliminated the need for manual entry.”
Even worse, many solutions encourage pushing out that data entry to end-user teams, decentralizing and farming out the work to those who aren’t motivated to ensure data quality. So you end up with multiple teams, each entering data manually, introducing data variations in addition to the usual typos. This is a recipe for bad data, and bad data inevitably means bad results. Garbage in; garbage out; no AI and actionable insights.
2. End-to-End Platforms
The reality of the current procurement software landscape is there is no single “best of breed” solution. Instead, many have specific strengths, and customers end up using multiple products to get the results they want. However, too often, developers decide they want to be an end-to-end platform, locking in users and their data. This strategy appeals to investors, but it doesn’t work for users. Developers need to provide true end-to-end interoperability with each of the modules within the platform—as it was “pitched” to the customers.
Linda has frequently had to work with companies that have dropped the ball on the Open API front, and it is not an experience she relishes:
“They will tell you, ‘it’s not us, it’s you.’ A year and a half, two years later, we can’t connect these modules. It’s not because of our solution; it’s because of how you guys architected your environment.” Years later, the platform solution still isn’t live to realize the efficiency ROIs.
3. Open API
Because the ‘platform’ work, we, the customers, are then having to weave ‘best of breed’ and ‘fit for purposed’ solutions together. In order to do this, we need open APIs to allow for integration with other solutions in the ecosystem.
Then when asked if the solution providers have APIs available, their affirmative responses really only mean: “Yes, we have standard APIs available, which may not work with your requirements.” The customer needs to peel back the onion here and get to what the standard API truly means, because when providers respond yes to this requirement in the RFP, it could mean NO, when it comes time for solution design.
There is no question that procurement solutions must be scalable. When customers grow their business, their procurement solution needs to be able to grow with them. This ensures continuity of data, keeps onboarding costs down, and eliminates the disruption of migrating to a new system. Linda Chuan’s ideal solution? Select a solution that has both small companies and large companies as their customers.
“I can design the solution and process to grow with a company, from small mom and pop shops to enterprise giants, so that I can stick with the one solution. I will then have data from the beginning of history, beginning when that company started.”
Mobile access is a pet peeve, and with today’s lifestyle, should be a built in capability and that includes being able to run an entire procurement sourcing team using a phone. But the current crop of procurement systems can’t always match that degree of mobile functionality. That’s a real shortcoming and especially hard to overlook when so many people are working remotely and wirelessly.
“What happened?” asks Linda. “When mobile, scalable, open, and social solutions were available over 10 years ago, it feels like we’re going backwards…”
And Finally, a Positive Note for the Future
Despite years of new procurement software that repeats the same shortcomings, Linda has hope. She describes herself as “cautiously bullish, or optimistic.” Perhaps it’s being based in the San Francisco area and being exposed to the enthusiasm of the 200+ startups in the area.
“Yes, you can do it. As long as the entrepreneurs are keeping an eye on these foundational requirements, I’m looking forward to seeing a solution that truly meets the end users’ needs.”