Driven by enterprise demand for spending visibility, a host of BI (business intelligence) vendors are manoeuvring to leverage existing platforms with strategic sourcing-analytics packages.
Traditional BI vendors such as Informatica Corp., SAS Institute Inc., and MicroStrategy Inc. are attempting to leverage their strength in collecting and analysing data from disparate sources to develop strategic sourcing offerings.
Unlike software application categories such as e-sourcing and e-procurement, Boston-based AMR Research Inc. defines strategic sourcing as a cross-enterprise process that tracks the life-cycle performance of inbound goods and services and offers an accurate view of a company’s total spending.
Informatica is one player touting the strategic sourcing mantra with the release this week of Informatica Strategic Sourcing Analytics, an analytic software package designed to allow companies to analyse and streamline spending for indirect and direct materials and services.
The package offers an integrated analytics solution that combines a data integration platform for sourcing disparate data, best-practice metrics, and an analytical data model that features supplier scorecards and analytic workflows – all designed to help reduce corporate spending, said Sanjay Poonen, vice-president and general manager of Informatica applications in Redwood City, Calif.
“While most companies recognize the need to reduce costs, they lack the visibility into global spending,” Poonen said. “Savings are small from automating indirect product requisitions. Companies need a complete view of all supplier-related costs.”
Poonen said Informatica provides visibility via packaged business adapters to source data from a variety of disparate sources, including Oracle Corp., PeopleSoft Inc., SAP AG, Ariba Inc., and proprietary sourcing systems.
MicroStrategy is also on the strategic-sourcing trail this week with the launch of 7i, an update to its BI platform. The product features a zero-footprint Web client that is designed to allow the client to be deployed through all firewalls, said Sanju Bansul, vice chairman and COO of MicroStrategy in Washington. “A real barrier for a lot of supply-chain applications…has been that most products have either Java or Active X downloads,” he said.
Meanwhile, Cary, N.C.-based SAS Institute has exploited its data warehousing strengths for supplier intelligence with the release last week of Supplier Relationship Management Version 2.3.
The product is designed to analyse procurement data drawn from sources such as multiple ERP systems. By analysing this warehoused data via its optimization engine with SAS analytics, a company can add or drop suppliers or make other changes to meet business constraints, according to company officials.
The moves reflect a desire among C-level executives for more information to help with quick, deliberate decision-making, said Bob Moran, an analyst at Aberdeen Group Inc. in Boston. “It’s all designed to exert analysis, when screwing up on margins is nothing short of perilous,” he said.
One example is Tempe, Ariz.-based Motorola Inc., which combines Informatica’s sourcing analytics with Ariba’s Buyer procurement solution to analyse its global spending on indirect materials and to monitor internal systems such as accounts payable. “[The solution] allows us to slice and dice this information quite extensively,” said Mike De Runtz, director of global nonproduction procurement at Motorola.
Strategic Sourcing to Grow