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New Names, Same Slogans at ISM
Thursday, May 15, 2008

I recently attended (and worked multiple booths) at the ISM conference in St. Louis. My general impression is that the conference went over fairly well. Although far less attendees than last year, the individuals that were at the conference seemed to be more focused on learning the marketplace and what was out there that could help their businesses, as compared to Vegas last year, where it was obvious that a large percentage of the procurement professionals were there for free gift bags and a vacation. Of course we still had our fair share of people that came for our "giveaways" without any interest in the products or services, including a guy that attempted took a whole stack of Source One T-shirts, and the many many people that were taking visors or golf balls "for a friend".

Anyhow, the biggest surprise to me was the vast amount of new companies that were hosting booths at the show. In many cases, I am sure that it was just the first show that was attended by well established companies, but in many other cases it seems that many of the companies popped-up overnight in order to make a quick buck in a hot marketplace. It seemed that there were dozens of new software vendors (both hosted and behind-the-firewall solutions) that were all pitching the same basic esourcing tools and functionality. After speaking with a few, it also became obvious their lack of expertise in any given area, more the software developer types than actual strategic sourcing practitioners. I also noticed the lack of attendance of several major players in the market.

The one thing that was overwhelmingly consistent through most of the software vendors was their slogans. We saw about 25 variations of the same (not so great) message:

  • "Click to Save"
  • "Boost Profits With Just a Few Clicks"
  • "Why Hire Consultants?"
  • "Implement Strategic Sourcing With a Proven System"

I understand that most companies use a slogan as a simple hook to drive traffic to their booth, and then will explain their solutions in more in-depth, however it seemed that many of the software vendors there actually thought their software would do what their slogan said. I wonder if their are any procurement professionals that believe software solutions alone will boost their profits and allow them to click a few buttons to save money.

Really, can you just click a few buttons to boost your profits and save tons of money? Maybe if you have really poor or non-existent processes your organization will see some benefit, but mainly because you are standardizing on any process, not that the software itself will deliver you savings. And, "Why Hire Consultants", that one is outright laughable. To think that software alone can replace good resources (internally or outsourced) shows a complete lack of understanding of Strategic Sourcing. Strategic Sourcing is not the process of developing three RFXs or a Reverse Auctions and clicking a few buttons to solicit some responses. Sure, your organization might save a couple of bucks, but what is the overall impact to your supply chain, and how much did you really leave on the table? I challenge and esourcing application to answer those questions for you.

As I mentioned before, many of the slogans were simply to drive people to booths to have more in-depth conversations. But in a few of the solutions I went to investigate, the salespeople actually believed that their software alone (without supporting services) would implement a full strategic sourcing solution that runs itself. It definitely leads me to believe that market is becoming flooded with software developers looking to make a quick buck, that do not even have the basic understanding of true strategic sourcing.

I was also surprised this year about the amount of attendees that had already implemented esourcing tools compared to last year. However, we heard a lot of the same story, "Our company spent $xx,xxxx and the xxxxx solution still is not implemented properly." , or the more common "I don't know why we bought all of these modules, we are only using one piece of it". Hearing these comments reinforced our position with our free toolset www.WhyAbe.com, and now Puchasing Tools by ThomasNet (which we announced our partnership at ISM). Many companies do not require an expensive full suite of tools. Instead, they need pieces of the tools in a low-cost on-demand model that will help assist their internal processes, not replace them.

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posted by William Dorn @ 9:19 AM  
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