Guided Sourcing: a simple solution for complex sourcing

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Before I start talking about SAP Ariba Guided Sourcing and all the wonderful things it has to offer, let’s go back a few years before I started my professional procurement career.

Roughly 15 years ago I was working part time at a local computer hardware store, and I remember being introduced to the world of procurement and tendering. The owner was very ambitious and had plans to grow the business but was struggling to find new business opportunities. One common way of looking for potential business was going through the newspaper ads section for any new tender notices that were posted, call up and understand the requirements and then physically driving to the buyer’s office to submit our tender (which we had written up and sealed in an envelope) into their tender box. This was very time consuming and most of the times we never heard back about the results which made it even more frustrating.

Over the next few years, it then slowly evolved into Tenders being advertised online and this made life so much easier. Some organisations still required the bids to be submitted physically to their tender box, but most organisations moved to email communication and even recommended submitting our bid/response via email. This was a dramatic improvement as it made life easier to participate in a tender, but the buyers still did all the work manually.

So how much has changed since then?

You would assume a lot has changed since those days. Well, in the last 15 years, we’ve seen some amazing technical advancements:

  • We now have more computing power in our pockets than the computer aboard Apollo 11 (over 100,000 more powerful to be exact)
  • Machine Learning, Artificial Intelligence and Cloud computing have become key differentiators for companies’ success
  • Subscription based services are now the preferred module for not just corporate software, but for regular consumers as well

We are now even starting to see Blockchain, IoT and the Metaverse slowly incorporated into advanced procurement spaces. So why do we still think it’s fine to physically drive to a buyer’s office and submit tender responses in paper envelopes?

Unfortunately, humans are creatures of habit and without a sound change management system, it becomes increasingly difficult to move people away from their comfort zones. It doesn’t matter how great software is if people don’t use it. This is the challenge! Adapting is not solely about technology; it depends much more on the will and the ‘Want’ to do so, being open-minded and understanding that there are other ways of doing things.

Sourcing was generally managed by a core group of highly experienced professionals that were trained and new exactly what they were doing. Sourcing processes were rigid and set, Sourcing professionals knew their suppliers qualified or not and tenders ranged from complex questionnaires to simple quotes over the phone or via email.

This was fine for a while…Companies needed transparency in all aspects of business, heavy IT investment was made to digitise sourcing and procurement as well as other areas.  Digitisation allowed companies to develop a standardised sourcing approach and thus enabled non-professionals to source successfully within a governed process, whilst leaving the strategic activities to the professionals. For the first-time companies started to reduce costs strategically and increase the bottom line!!

In 2020 the world was a different place, those that had invested in sourcing and procurement solutions were able to continue operations albeit to a limited capacity.  Contract management solutions also played a key role allowing companies to report on liabilities during the pandemic – The world was going through a drastic change. The pandemic had ravaged the world’s supply chain and procurement teams were being asked to tighten the belts.

In 2020 SAP issued a survey and the top 3 top items requested by customers were Improved usability, Faster execution, and an Intuitive user interface. In short, organisations wanted a system that could allow their users to request quotes from their suppliers in a very fast and easy manner with very little intervention from their sourcing teams and within the policies and guidelines they defined – This was the birth of Guided Sourcing.

So, I did promise to talk about Guided Sourcing and some of you might be wondering how it ties into what I’ve been talking about. Firstly, Data has arguably become the world’s most valuable asset, and it only makes sense that Guided Sourcing take full advantage of it! Guided Sourcing has seen its second major upgrade bringing hundreds of features and functionality. I’m not going to go through all of them as you will most likely stop reading out of boredom. But if you love details, feel free to check out the official roadmap and details HERE. I’ve picked out a few features that I think that tie in perfectly with what I’ve been rambling about.  To start off, how do you simplify an UI that has been setup to cater for subset of users to now being adopted across the wider organisation.

Step one, make it easier to use! Logically, the first thing you would need to do is develop a simplified user interface ensuring you don’t need to click threw multiple screens and tabs. It should all be there neatly organised and laid out for you in one page! This sounds easy to do but as Steve Jobs once said: “Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple”

Ok, so you’ve made it look good and easier to use, now what?

Step 2, make it smarter to use!  Why would spend hours figuring out which suppliers you need to invite or having to build out a full RFx with hundreds of lines. Most users would have no clue what to do here and would just pick up the phone and call their support team Do you remember when I said data was the most important asset? Well, you have data, so why not use it. Or better, let Guided Sourcing use it for you. The Intelligent Supplier and Content recommendations features allows Guided Sourcing to learn and adapt to your sourcing processes through machine learning capabilities. It recommends which suppliers to invite as well as recommending what content you should add to your RFx.

If you think it’s too difficult to setup, you’re in for a surprise. We have created a video showing you how easy it is to  setup.

But what if a business user still struggles with all the buttons and options?

Step 3, make it easier for your business users to get answers. Every organisation will go through the effort of trying to train their users but regardless of all the training material and content we provide them, they’ll still ask trivial questions about how to navigate the system and what specific buttons or fields do. That’s where enable now comes in. It guides users through process flows for key tasks within the different screens and it will also provide them with contextual help tiles with information about capabilities based on that particular screen. Our friend Kristina talks about Enable Now in her blog post so don’t be shy to check it out.

We can understand that changes can be difficult and require dedicated experts to leverage new SAP features and functionality.  To simplify this process, SAP has been running Adoption Labs, Value Accelerators and numerous self-service content to ensure that all these new changes are assessable with minimal effort and time.