Supply Integration Solutions & How They Add Dramatic Value

By Scott Walls

Supply Integration Solutions refer to best of breed, niche, third party tools, applications and services (think content management, esettlement, etc.).  These solutions provide dramatic value enhancements for procuring organizations (and often their supplying organizations) when integrated with traditional SRM applications (SAP, PeopleSoft, and Oracle).  SI solutions have been created to address some of the natural limitations with traditional SRM applications and/or the application provider’s business model. 

This BLOG post provides brief explanations of both the SRM limitations and the related SI solutions.

SI tools are mini-apps (pages and/or process) deployed within the traditional SRM application toolset or using SOA technology.  One size fits all SRM applications can make simple processes appear complex for smaller volume clients.  These “mini-apps” reduce that complexity.  For example, the different cataloging methods within the traditional SRM applications’ requisition process (internal item master, external hosted catalogs, external punch-out catalogs, etc.) confuses the non-procurement savvy requester.  Multiple third-party tool providers have created mini-apps that present one, simplified requester interface, allowing the requester to locate product based on description, without even understanding what an item catalog is.  Because these mini-apps reduce the cataloging complexity, they increase the number of cataloging options available to procurement, increase the amount of content being displayed, and increase the request adoption of the traditional SRM application.

SI applications are external applications that integrate with the traditional SRM application; usually via XML or another standard protocol.  The best of these applications tend to be micro-focused (think external marketplace/item repositories).  They often provide additional, more mature functionality then their traditional SRM counterparts.  In some cases, they also allow multiple SRM applications to access the same functionality/data simultaneously.  For example, content repositories (AKA organizational marketplaces) allow procurement the ability to source purchasable content and make that content available to one or more organizations/SRM applications simultaneously (see Organizational Marketplaces – Shared Vs. Dedicated).  In addition, the content management tools within these third-party applications far exceed their traditional SRM counterparts.  These applications and tools not only allow for better content and easier content management, they pave the way for outsourcing the content management process all together (see the services section below).

SI services, also referred to as “managed services”, are external services that integrate with the traditional SRM both technically and functionally.  These managed services allow procuring orgs to leverage assets they could not create organically (i.e. the Visa settlement infrastructure) or share the management of costly setup/transaction value maintenance (content management/invoice entry).  For example, traditional SRM applications require procurement organizations to setup, test, and maintain all internal item catalogs, external item catalog URL connections, and forms.  Multiple third-party service providers offer external organizational marketplaces procuring organizations can connect to once and the third-party will not only create and manage their content (the “you source, we enable” model), they will work with all potential suppliers from B2B concept initiation through content sunset.  This allows the procuring organization to completely outsource the creation and management of purchasable content at a fraction of the cost of employing the resources.

NOTE: For more information related to Supply Integration, see BLOG posts Supply Integration and Supply Integration Touch-Points.

About SRM Plus

SRM+ is a boutique procurement business consulting firm.  We provide procuring organizations with the strategic and tactical consulting services required to dramatically reduce operational expenses, create revenue streams (1 million per every 200 million in spend), and decrease their Cost Of Goods Purchased (COGP).  Whether defining a strategy, creating measurable objectives, designing / deploying solutions, or creating a continual improvement framework, SRM+ wants to turn your cost centers into cash centers.  Visit us at www.srm-plus.com.