the forrester wave™: eprocurement, · ability to combat the growing adoption threat from...

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The Forrester Wave™: eProcurement, Q2 2014by Duncan Jones, May 23, 2014

For: Sourcing & Vendor Management Professionals

Key TaKeaways

The eProcurement Market Is Growing as sourcing Pros seek Visibility and ControlMore and more chief procurement officers (CPOs) are seeking global solutions for their procure-to-pay (P2P) processes so they can cut costs while saving employees’ time. ERP vendors have all improved their search-and-compare shopping front ends, but face strong competition from a new group of SaaS platforms and some established ePurchasing suites.

Usability, Flexibility, and Vision are The Key DifferentiatorsLow adoption of legacy procurement software is the main obstacle to getting this visibility and control. CPOs should therefore favor products with enticing shopping experiences and simple configurable approval workflows. They also need vendors with the vision and ability to combat the growing adoption threat from sell-side eCommerce sites.

Coupa, Basware, and ariba Lead The PackForrester’s evaluation of 11 leading eProcurement products’ current offerings and strategies found that Coupa, Basware, and Ariba are the market leaders. Capgemini IBX, Ivalua, Oracle (E-Business Suite, Fusion, and PeopleSoft), SAP, SciQuest, and Verian all offer competitive options that will merit inclusion on many clients’ shortlists.

access The Forrester wave Model For Deeper InsightUse the detailed Forrester Wave model to view every piece of data used to score participating vendors and create a custom vendor shortlist. Access the report online and download the Excel tool using the link in the right-hand column under “Tools & Templates.” Alter Forrester’s weightings to tailor the Forrester Wave model to your specifications.

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© 2014, Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester®, Technographics®, Forrester Wave, RoleView, TechRadar, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. To purchase reprints of this document, please email [email protected]. For additional information, go to www.forrester.com.

For Sourcing & Vendor ManageMent ProFeSSionalS

why ReaD ThIs RePoRT

In Forrester’s 69-criteria evaluation of eProcurement providers, we identified the 11 most significant software platforms — Basware, Capgemini IBX, Coupa, Ivalua, Oracle (E-Business Suite [EBS], Fusion, and PeopleSoft), SAP (Ariba and SRM), SciQuest, and Verian — in the category and researched, analyzed, and scored them. This report details our findings about how well each vendor fulfills our criteria and where they stand in relation to each other to help sourcing and vendor management professionals select the right partner for their procure-to-pay (P2P) projects.

table of contents

eProcurement Improves Visibility and Control of Indirect Costs

B2B ecommerce continues to Be the usability Fight at the not-oK corral

three types of Products try to overcome the adoption Barrier

our evaluation asks “who will Best help you Maximize adoption?”

this Means overcoming current and Future adoption challenges

evaluated Vendors Have good Functionality and Broad Market reach

Usability, Customer Centricity, and Vision are The Key Differentiators

use the Forrester Wave tool to tailor Your decision to Your Firm’s Specific Priorities

Vendor Profiles

leaders

Strong Performers

supplemental Material

notes & resources

Forrester conducted 11 product evaluations between november, 2013 and January, 2014, and interviewed eight vendor and 33 user companies, including Basware, capgemini iBX, coupa, ivalua, oracle, SaP, SciQuest, and Verian.

related research documents

Best Practices: Selecting and implementing ePurchasing ProductsMay 22, 2013

2013 Predictions: the ePurchasing Software Market Will grow 5%May 10, 2013

the Forrester Wave™: eProcurement Solutions, Q1 2011March 7, 2011

The Forrester wave™: eProcurement, Q2 2014the 11 largest Procure-to-Pay (P2P) Platforms, graded By their ability to deliver Visibility and control through High user adoptionby duncan Joneswith chris andrews, andrew Bartels, andy Hoar, and Ben Jennings

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MaY 23, 2014

www.forrester.com

http://www.forrester.com/go?objectid=RES95141






http://www.forrester.com/go?objectid=BIO1246





the Forrester Wave™: eProcurement, Q2 2014 2

© 2014, Forrester Research, Inc. Reproduction Prohibited May 23, 2014

ePRoCUReMenT IMPRoVes VIsIBILITy anD ConTRoL oF InDIReCT CosTs

eProcurement software is a system of engagement for the complete purchasing process for indirect goods and simple services. Solutions cover the process from the time when an employee decides he needs some goods or services through selection of a product from a catalog or other source, approval of the proposed purchase, placement of the purchase order with the supplier, receipt of goods, and validation of the invoice for payment to the supplier (see Figure 1). This process is also known as procure-to-pay or requisition-to-pay (R2P). The potential business benefits of eProcurement come from:

■ Saving employees’ valuable time when they need to buy goods and services. For example, an eProcurement tool would enable a retail store manager to order an urgent repair to vital equipment such as a refrigerator, and would also help the field service engineer buy any parts that he needed in order to complete the job. As a VP of accounting at a retail company told Forrester, “We use eProcurement to buy everything the stores need in order to provide a good customer experience, apart from merchandise. We want our associates in the store serving customers, not stuck in the office in front of a screen.”

■ Reducing cost by channeling purchases to approved suppliers and prenegotiated contracts. eProcurement tools can ensure employees take advantage of the better prices that sourcing has obtained by aggregating volume with a few suppliers. One procurement manager told Forrester,

“We saved tens of thousands of dollars on bottled water, simply by making everyone buy from one supplier. The savings soon add up when you do that for many categories.”

■ Improving visibility by capturing liabilities in one shared system. With effective use of eProcurement, finance groups can match up to 80% of incoming invoices as soon as the suppliers issue them, with POs, contracts, receipts, work tickets, or other supporting vouchers. They can monitor spend and liabilities closer to real time instead of having to wait weeks for invoices to get through manual approval processes. An engineering company finance VP told Forrester how he could now spot projects that were going over budget in time to take corrective action, whereas previously it was too late to fix a problem by the time it showed up in the accounts.




Figure 1 eProcurement Supports The Requisition To Invoice Process

Source: Forrester Research, Inc.113422

Employee

Searchcatalog

Manager

Approverequisition

Supplier

Con�rm priceand delivery

Employee

Receivegoods

or services

Supplier

Submitinvoice

Manager

Approveinvoice

(difference)

eProcurement system of engagement —�exible, intuitive, mobile

Purchaseorder

Approvedinvoice

ERP/�nance system of record —robust, internally consistent, static

B2B eCommerce Continues To Be The Usability Fight at The not-oK Corral

For years, chief procurement officers have struggled to get these promised compliance, control, and visibility benefits because of low adoption of their eProcurement platforms. Busy employees want to be able to buy the goods and services they need as quickly and easily as possible so that they can get back to their real jobs — serving customers. They resent delays and inconveniences like requisition forms and approval chains. They are like the townspeople of Tombstone in the famous Western, caught between:1

■ “Outlaw” suppliers, enticing employees to turn into “rogue” buyers. Unapproved suppliers are the Clantons, tempting shoppers to ignore the CPO’s policies and become what he calls

“maverick” or “rogue” spenders. Some provide better service than the official sources by responding to email and telephone orders. Others use sell-side websites that provide the usability employees expect, along with risky features that CPOs hate, such as upselling (see Figure 2).

■ The forces of law and order, in the shape of the CPO “marshal” and the ERP brothers. For years, many CPOs have tried to marshal all transactions to central contracts and approved suppliers by insisting that employees use the procurement modules of their ERP suites, or




specialist applications such as Ariba and Commerce One that looked like the ERPs. Earlier versions of these products supported the command and control mentality but deterred employees from using them with complex data entry screens and rigid, over-long approval chains.

Figure 2 Sell-Side Sites Include Features That Employees Expect, And Some That CPOs Hate


Source: www.staples.com

Buyers’ needs

Easy, �lterablesearch

Comparisontools

Tailored process

Peer reviews

Business users expect B2C features




Figure 2 Sell-Side Sites Include Features That Employees Expect, And Some That CPOs Hate (Cont.)


Sellers’ goals

Upsell

Cross-sell

Drive impulsebuying

Extensive catalog

Source: www.staples.com

But buyers’ goals conflict with sellers’

Three Types of Products Try To overcome The adoption Barrier

In the usability fight, unlike the movie, the outlaws have been winning — many clients complain to Forrester about low adoption of their current eProcurement platform. Customers to whom we have spoken who claim compliance levels over 50% only achieve this by creating PO’s after they have received the invoice, which is worse than pointless. This is not because the so-called rogue buyers are bad people, it is because CPOs and their deputies have failed to provide them with an easy way to get what they need in a compliant way.

But now there is new hope for both CPOs and end users. The eProcurement market is seeing renewed growth as many visionary CPOs replace legacy products and homegrown approval applications with modern eProcurement platforms. All promise to end the feud and bring employees back inside the law via “Amazon-like” shopping experiences and streamlined, configurable approval processes. CPOs who want to follow Forrester’s mantra for ePurchasing success — “make the right way easy and the wrong way hard” — can now choose between:2

■ New versions of the ERP products, all with improved requisitioning front ends. Oracle (with EBS, Fusion, and PeopleSoft) and SAP (with SRM) have mature products with deep functionality, to which they have added better shopping applications. They still have usability problems in some areas, but are now tenable products that warrant serious consideration, especially if you already use other modules from their portfolios.




■ Established ePurchasing specialists with broad suites and extensive supplier networks. This Forrester Wave evaluated Ariba (an SAP company), Basware, Capgemini IBX, and SciQuest. Other products in this category include GEP, Hubwoo, and Perfect Commerce. These all have strong products and good focus on CPOs and their needs, with solid revenue streams to fund ongoing development.

■ Up-and-coming SaaS providers offering agility and customer centricity. The new generation of SaaS platforms includes Coupa, Ivalua, and Verian, along with others such as b-pack, Birchstreet Systems, Nipendo, Proactis, and Puridiom that did not quite qualify to be in this Forrester Wave. Most of these are smaller than the other two types but are often more focused on their customer’s success, and nimbler when it comes to addressing new market needs.

oUR eVaLUaTIon asKs “who wILL BesT heLP yoU MaxIMIze aDoPTIon?”

To assess the state of the eProcurement market and see how the vendors stack up against each other, Forrester evaluated the strengths and weaknesses of 11 top eProcurement products from eight vendors. Because low adoption — by user and suppliers — is the biggest obstacle to realizing value from eProcurement, we have targeted our evaluation criteria at capabilities that will reduce users’ resistance to your initiative, including:

■ Usability — for busy employees needing to quickly and easily buy goods and services. Most employees will use eProcurement infrequently, so they need intuitive applications that they can use without training. Our usability benchmarks therefore come from sell-side eCommerce, not from enterprise applications, because employees will get consumer-grade features such as personalization and mobility from the outlaws’ next generation sell-side websites unless your eProcurement tool provides them.3

■ Flexibility — to support procurement of various difficult categories. Everyone can handle office supplies; the challenge for eProcurement comes from complex items and different types of service.4 We therefore looked at platforms’ configurability, to support various ways of defining the item or service the user needs, getting managers’ approval for the purchase, and recording fulfillment of it.

■ Automation —to minimize delays to employees getting what they need. The main benefit of streamlining processes, more important than reducing administrative costs, is in accelerating delivery. The outlaws are quick on the draw, so the eProcurement platform must help the preferred suppliers be quicker, and by minimizing manual steps to approve the requisition, convert it into a PO and get it into the supplier’s system. They must police compliance by unobtrusive analytics, not by a posse of approvers.




This Means overcoming Current and Future adoption Challenges

After examining past research, user need assessments, and vendor and expert interviews, we developed a comprehensive set of 69 evaluation criteria, which we grouped into three high-level buckets:

■ Current offering. We tested the products’ support for the six important process steps shown in the earlier figure, looking particularly for capabilities that will help employees buy what they need with minimum effort and delay. In addition to usability, flexibility, and automation, we also looked at the products’ integration with other systems and their support for global organizations.

■ Strategy. We reviewed each vendor’s strategy to assess how effective they will be at delivering ongoing benefits to customers. We emphasized customer centricity, because it is vital to have an eProcurement vendor that is committed to delivering and maintaining high adoption. We also placed importance on vendors’ ability to meet customers’ future needs. We believe rapid development in sell-side capability in areas such as mobility and analytics will transform B2B eCommerce over the next two or three years, raising users’ expectations well beyond what the current platforms provide.5 We therefore examined whether vendors have the vision to keep pace with this transformation and also the financial resources and management focus needed to deliver against that vision.

■ Market presence. To determine each vendor’s relative importance to the current market, we looked at their share of new deals in 2013. We also measured overall size in terms of ongoing revenue streams and employee numbers.

evaluated Vendors have Good Functionality and Broad Market Reach

Forrester refined an initial list of over 20 products down to the 11 that deserve inclusion in selection short lists for the largest number of clients: Basware, Capgemini IBX, Coupa, Ivalua, Oracle (E-Business Suite, Fusion, and PeopleSoft product lines), SAP (Ariba and SRM product lines), SciQuest, and Verian. Each of these vendors has (see Figure 3):

■ Fully productized eProcurement platforms. All the included vendors have packaged offerings, with strong product management teams and substantial ongoing development activity. We excluded BPO-type solutions as offered by Accenture (which acquired Procurian, formerly ICG Commerce), Infosys, Tata Consultancy Systems (TCS), and others that are not managed and sold as separate products.

■ Broad applicability across verticals and regions. We filtered out niche vendors that would not be relevant to enough Forrester clients. Companies such as Adaco and Birchstreet (hotel industry), b-pack (France), e-Plus (midsize companies), Esize (the Netherlands), Pool4Tool (Germany and Austria), and Wax Digital (UK) merit consideration by companies in their target markets but will not figure on as many short lists as the vendors in this Forrester Wave. We excluded the eProcurement modules of Epicor Software, Lawson (now part of Infor), and Microsoft Dynamics for the same reason.




■ Willingness and ability to support our research process. The Forrester Wave involves a lot of work for the vendor and for us, and some candidates, including Hubwoo, Perfect Commerce, and Proactis, chose not to participate in this evaluation. We have respected that decision, and left those companies out of the scoring rather than attempt to evaluate their products without their support.

Figure 3 Evaluated Vendors: Product Information And Selection Criteria

Source: Forrester Research, Inc.

Vendor

Ariba

Basware

Capgemini IBX

Coupa

Ivalua

Oracle EBS

Oracle Fusion

Oracle PeopleSoft

SAP

SciQuest

Verian

Product

Ariba Procurement On Demand

Basware Purchase-to-Pay

IBX Purchase-to-Pay

Coupa Spend Optimization Platform

Ivalua Buyer 8

Oracle E-Business Suite Advanced Procurement

PeopleSoft eProcurement

SAP SRM

Spend Director Enterprise

Verian Purchase Manager

Version

12s

A2.1

R3 2013

r10

8.11

12.2

9.2

7.0 EHP 3

13.3

12.1

Release date

June 2013

November 2013

October 2013

January 2014

January 10, 2014

Fall 2013

March 2013

August 2013

November 2013

October 25, 2013

Selection criteria

Current annual P2P automation product revenues (excluding implementation and consulting services) of at least USD$10 million.

Steady growth and upward market trajectory.

Client interest and relevancy to our target audience.




UsaBILITy, CUsToMeR CenTRICITy, anD VIsIon aRe The Key DIFFeRenTIaToRs

All the vendors have solid products, with some exceptional capabilities that will win them some specific deals and weaknesses that will rule them out on other occasions. All have reasonable shopping experiences, albeit with room for improvement. The largest gaps between products appeared in usability of other parts of the system beyond the search and selection front end, in customer centricity to maximize the chance of successful projects, and in vision for the future of B2B eCommerce. Overall, our evaluation found that (see Figure 4):

■ Coupa, Basware, and Ariba lead the pack. All have good products across all criteria, with some unique strengths and few weaknesses. Coupa’s customer centricity, Basware’s invoice automation vision, and Ariba’s functional breadth elevate them into the top sector. Although none of the evaluated vendors have yet delivered a really good mobile app, Forrester believes that these three are the most likely candidates to deliver the smart, mobile solutions that CPOs need if they are to combat the threat to eProcurement adoption from sell-side eCommerce sites.

■ The remaining products are all Strong Performers. Each will merit a place in many clients’ shortlists, beating the leaders in some criteria while placing just behind them overall. The giants offer OEM integration to their ERP suites but give us some concerns about ongoing vision and focus for what they may now view as legacy products. The specialists combine eProcurement with wider ePurchasing requirements, but rate just behind the leaders in terms of product road map and/or ability to deliver it.




Figure 4 Forrester Wave™: eProcurement, Q2 ‘14


RiskyBets Contenders Leaders

StrongPerformers

StrategyWeak Strong

Currentoffering

Weak

Strong

Go to Forrester.com to

download the Forrester

Wave tool for more

detailed product

evaluations, feature

comparisons, and

customizable rankings.

Coupa

Basware

AribaVerianSciQuest

Ivalua

Oracle PeopleSoft

Oracle FusionOracle EBS

Capgemini IBX

SAP

Market presence




Figure 4 Forrester Wave™: eProcurement, Q2 ‘14 (Cont.)


CURRENT OFFERING Requisition-to-purchase process Receiving and invoicing Reporting Supplier connectivity and enablement Technology Globalization Cost STRATEGY Product strategy Corporate strategy Financial resources to pursue strategy MARKET PRESENCE Installed base Market share of new deals Employees

Bas

war

e

3.653.20

4.353.503.75

4.124.70

3.974.303.903.00

4.704.005.00

5.00

Arib

a

3.753.45

4.254.003.90

3.684.40

3.653.004.005.00

4.704.005.00

5.00

Forr

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r’sW

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ting

50%50%

15%8%

10%

10%7%0%

50%50%35%15%

0%30%40%

30%

Cap

gem

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BX

3.293.13

3.152.504.55

3.523.50

2.942.602.804.40

1.902.001.00

3.00

Cou

pa

4.134.23

3.574.504.00

4.603.80

4.284.304.803.00

3.102.004.00

3.00

Ival

ua

3.313.23

3.203.503.13

3.903.40

3.522.904.802.60

1.401.002.00

1.00

Ora

cle

EB

S

3.683.65

3.285.002.90

3.724.30

2.763.001.704.40

4.004.004.00

4.00

Ora

cle

Fusi

on

3.583.48

3.484.503.08

3.843.80

2.882.303.303.80

1.301.001.00

2.00

Ora

cle

Peo

ple

Sof

t

3.503.43

3.764.002.90

3.423.90

3.283.003.204.40

3.703.004.00

4.00

SA

P

3.823.45

3.794.504.13

4.005.00

2.372.002.204.00

5.005.005.00

5.00S

ciQ

uest

3.623.68

3.104.003.78

4.003.10

3.323.303.303.40

3.102.004.00

3.00

Veria

n

3.633.70

4.263.003.35

4.022.40

3.303.303.602.60

1.701.002.00

2.00

All scores are based on a scale of 0 (weak) to 5 (strong).

Use The Forrester wave Tool To Tailor your Decision To your Firm’s specific Priorities

Forrester intends this report to be the starting point for your decision. We encourage clients to tailor the downloadable Forrester Wave Excel-based vendor comparison tool to reflect your particular needs and priorities.6 For instance, you may decide to:

■ Favor existing vendors, if you are happy to expand their footprint. You can adjust the incumbent ERP provider’s score upwards to reflect the benefit of consistency and integration, or downwards if you want to reduce your dependence on it.

■ Add specific vertical industry requirements. For instance, public sector organizations need support for their budget constraints and approval rules.




■ De-emphasize criteria that are less important to you. For example, companies that only operate in North America may ignore vendors’ global capabilities. Similarly, companies that are happy with their approval workflow and/or invoice processing could exclude those sections and focus instead on requisitioning and supplier enablement.

■ Expand your decision’s scope to include other ePurchasing segments. Our evaluation focuses on eProcurement because most clients choose solutions for transactional P2P separately from their strategic sourcing needs. However, buyers seeking one global, integrated supplier management platform will need to expand this tool to include criteria related to supplier risk and performance management, sourcing, and contracts.

VenDoR PRoFILes

Leaders

■ Coupa is the most customer-centric organization with the most flexible product. It is smaller than the other leaders but growing faster, fuelled by a strong commitment to its customers’ success and providing the product and organization to deliver on this commitment. Reference customers praised its usability and configurability — system administrators can make changes to smart forms or approval workflows in minutes that would take days or weeks in most of the other products.

■ Basware excels in invoice automation. Its Alusta eProcurement platform is solid, and its capabilities for capturing, validating, and processing all types of invoices propel it into the leader sector. Other strengths include a large active supplier community — both directly on its Basware Commerce Network and via interoperability with over 170 other networks — and innovative analytics. Basware is the largest independent eProcurement vendor. Eighty-five percent of its revenue comes from Europe, so it has less North American presence than most of its rivals, although that is where it is growing fastest.

■ Ariba has the broadest ePurchasing capability and the largest supplier network. Ariba offers a mature and time-tested product — it has been an eProcurement leader in the two previous Forrester Wave evaluations, in 2007 and 2011.7 Strengths include advanced functionality in most areas, integration with the rest of the Ariba suite (including contracts and supplier management), and a large supplier network. Relative weaknesses include the effort required to customize smart forms and workflows. Ariba now has access to increased development investment, better technology, and broader sales activity as a result of its acquisition by SAP, and there is no indication as yet that SAP’s merging of Ariba’s organization into a new “cloud and line-of-business” division may impair its ePurchasing vision and focus.




strong Performers

■ SciQuest’s excellent shopping front end is fuelling renewed growth. It has long been the leader for life sciences and higher education organizations buying laboratory equipment and supplies due to its superior search and comparison functionality, and it is now winning deals in the wider eProcurement market across all industries, particularly commercial. SciQuest is a mature product with broad capability in procurement, but it has room to grow when it comes to invoice validation. The company has an aggressive acquisition-fuelled growth strategy which has the potential to divert management focus to areas beyond eProcurement while it integrates acquired solutions into its portfolio.

■ Ivalua offers an integrated ePurchasing suite and customer-centric development. It has grown steadily over recent years by winning enterprise customers in its home market in France, and has now made a successful expansion into North America, winning some major deals such as Whirlpool and Honeywell. Its main strengths are the completeness of the ePurchasing suite, and its ability to quickly deliver new customer requirements and incorporate them into the platform. Weaker areas are in item comparison and mobility.

■ Verian delivers rapid adoption with high usability. It merits consideration by North American enterprises as a cost-effective option with simplicity and usability throughout the product. It has had particular sales and delivery success among customers with multiple remote sites — including many in oil and gas, financial services, retail, and hospitality — in which local managers need to be able to buy stuff without head office looking over their virtual shoulders. Another strength is its mobile app for requisition and invoice approval. Weaker areas include a relatively small supplier community and gaps in its support for global organizations.

■ Oracle E-Business Suite has the best shopping experience, but some gaps elsewhere. Integration between Oracle iProcurement and the rest of the suite gets most praise from customers and it excels in its own right in some criteria, particularly the new search and comparison front end, which is based on Oracle’s Endeca technology and is the best we saw. Other strengths include reporting and analytics and support for global organizations. Areas to check are configurability, usability outside the catalog search screen, and mobility. The supplier integration issue described below for PeopleSoft also applies to EBS.

■ Oracle PeopleSoft continues to deliver a strong eProcurement solution. PeopleSoft remains an important product line for Oracle, and its procurement product compares well against its ERP competitors. It is consistently strong in all areas and has some exceptional support for PeopleSoft’s top vertical markets, including public sector and services industries. The latest shopping front end is much better than earlier versions but not yet where it needs to be, and elsewhere the user interface needs improving. Integration with suppliers is another issue that customers should consider, because Oracle does not have a large supplier network of its own.8




■ Oracle Fusion merits consideration by Oracle shops wanting a SaaS solution. Oracle’s substantial investment in Fusion procurement is evident from its broad functionality and modern user interface. Its combination of task frames with embedded work lists, analytics, and social-style activity streams is a particular strength. Another advantage of Fusion is that its high profile and “100% referenceability” target ensure that customers will get maximum support from Oracle, with swift action on their enhancement requests. The flip side of that is that the high visibility is due to disappointing performance, so there is a risk that Oracle may make a radical strategy change if Fusion adoption does not improve rapidly.9

■ Capgemini IBX excels in usability and supplier enablement. Capgemini IBX provides great functionality and services to help clients connect with their suppliers, but that’s not all it does. It also delivers its own requisitioning front end, either standalone or integrated with its hosted version of SAP SRM. Capgemini IBX is an independent division within Capgemini, working closely with its BPO and consulting groups but with its own sales and product management resources. A possible concern for clients considering Capgemini IBX is whether it will get adequate funds to further enhance usability and mobility as rapidly as the leaders are doing.

■ SAP SRM is a robust, much-improved option for SAP customers who don’t want SaaS. SRM has always had robust capabilities for global organizations with SAP back ends, and now it also offers a good shopping front end. Customers can choose between having their own self-service supplier portal and using Ariba’s Commerce Cloud to connect with suppliers. The main concern for prospective buyers is whether SAP will continue to invest in SRM now that cloud is its overwhelming priority, or will it instead focus on Ariba as the better bet for revenue growth going forward.10

sUPPLeMenTaL MaTeRIaL

online Resource

The online version of Figure 4 is an Excel-based vendor comparison tool that provides detailed product evaluations and customizable rankings.

Data sources Used In This Forrester wave

Forrester used a combination of four data sources to assess the strengths and weaknesses of each solution:

■ Vendor surveys. Forrester surveyed vendors on their capabilities as they relate to the evaluation criteria. Once we analyzed the completed vendor surveys, we conducted vendor calls where necessary to gather details of vendor qualifications.




■ Product demos. We asked vendors to conduct demonstrations of their product’s functionality. We used findings from these product demos to validate details of each vendor’s product capabilities.

■ Hands-on lab evaluations. Forrester performed a hands-on evaluation of the product using a scenario-based testing methodology. We evaluated each product using the same scenario(s), creating a level playing field by evaluating every product on the same criteria.

■ Customer reference calls. To validate product and vendor qualifications, Forrester also conducted reference calls with 33 of the vendors’ current customers.

The Forrester wave Methodology

We conduct primary research to develop a list of vendors that meet our criteria to be evaluated in this market. From that initial pool of vendors, we then narrow our final list. We choose these vendors based on: 1) product fit; 2) customer success; and 3) Forrester client demand. We eliminate vendors that have limited customer references and products that don’t fit the scope of our evaluation.

After examining past research, user need assessments, and vendor and expert interviews, we develop the initial evaluation criteria. To evaluate the vendors and their products against our set of criteria, we gather details of product qualifications through a combination of lab evaluations, questionnaires, demos, and/or discussions with client references. We send evaluations to the vendors for their review, and we adjust the evaluations to provide the most accurate view of vendor offerings and strategies.

We set default weightings to reflect our analysis of the needs of large user companies — and/or other scenarios as outlined in the Forrester Wave document — and then score the vendors based on a clearly defined scale. These default weightings are intended only as a starting point, and we encourage readers to adapt the weightings to fit their individual needs through the Excel-based tool. The final scores generate the graphical depiction of the market based on current offering, strategy, and market presence. Forrester intends to update vendor evaluations regularly as product capabilities and vendor strategies evolve. For more information on the methodology that every Forrester Wave follows, go to http://www.forrester.com/marketing/policies/forrester-wave-methodology.html.

Integrity Policy

All of Forrester’s research, including Forrester Waves, is conducted according to our Integrity Policy. For more information, go to http://www.forrester.com/marketing/policies/integrity-policy.html.




enDnoTes1 Gunfight at the O.K. Corral (1957) is a film directed by John Sturges starring Burt Lancaster as Wyatt Earp,

and Kirk Douglas as Doc Holliday, with DeForest Kelly as Morgan Earp, one of Wyatt’s three brothers. It is the story of how Wyatt Earp, marshal of Dodge city, and his brothers rid tough cattle towns of gun-slingers. Source: British Film Institute http://explore.bfi.org.uk/4ce2b6aba4fb4

2 Many ePurchasing projects fail due to low adoption. Employees resent interference and delay, suppliers suspect every initiative will cost them, and buyers fear that technology will replace them. ePurchasing products from the previous decade suffered from inside-out design, a focus on central control rather than usability, and buyers’ selfish attitude toward suppliers. Encourage adoption by making the right way easy and the wrong way hard. Pick tools that are easy to use and which have the right functionality for the users’ ePurchasing maturity level. Streamline approval processes by eliminating all nonessential manual approval steps, such as automating alerts and exception reports that focus executives on the issues that really merit their attention. See the May 22, 2013, “Best Practices: Selecting And Implementing ePurchasing Products” report.

3 Amazon-like B2C standards will define the customer experience threshold for B2B. Customers will simply not accept substandard B2B customer experiences. B2C sites like Amazon, Nordstrom, and Sephora have set the standard by which all commerce sites, B2C and B2B, will be judged. See the February 10, 2014, “The New And Emerging World Of B2B Commerce” report.

4 Forrester recommends that companies base application decisions on critical business scenarios rather than long feature wish lists. Every ePurchasing product can deal with office supplies. Your implementation challenges, and hence the product choice differentiators, will be the more complex purchase categories. Find out which types of transaction currently cause the most problems in terms of unmanaged spend and inefficient processes. Put these at your project’s core. See the May 22, 2013, “Best Practices: Selecting And Implementing ePurchasing Products” report.

5 B2B eCommerce is finally beginning to fulfill its long-heralded promise. After 10 years and a full generation of business-to-consumer (B2C) development, B2B eCommerce is no longer the mirage that many experts once saw off in the distance. Real opportunities for B2B buyers and sellers and the broader B2B eCommerce ecosystem now exist because customer-facing B2B eCommerce has crossed a critical sales threshold, B2B buyers increasingly expect a B2C-like shopping experience, and B2B buyers are buying online via self-serve eCommerce portals. See the January 7, 2013, “Building A World-Class B2B eCommerce Business” report.

6 The attached Forrester Wave™ tool includes a summary chart and score table and individual sheets for each product. The latter includes the vendors’ responses to our RFI against each base criterion, and Forrester’s opinion for each section summary row.

7 See the March 7, 2011, “The Forrester Wave™: eProcurement Solutions, Q1 2011” report and see the April 20, 2007, “The Forrester Wave™: eProcurement Solutions, Q2 2007” report.

8 The Oracle Supplier Network is a free service that Oracle makes available to its customers. It supports basic transaction exchange with suppliers but lacks the scale and functionality of the bigger communities. Oracle partners with Transcepta for direct connection with suppliers’ systems. PeopleSoft customers also use industry marketplaces, such as Vinimaya and Podigo, and/or their own PeopleSoft self-service portal.












9 It’s make-or-break time for Oracle’s applications business. Oracle’s main challenge in applications is retaining profitable recurring revenues while increasing revenue growth from new licenses and subscriptions. For new customers, Oracle is in danger of appearing more of a me-too apps player than an innovator, given the time it’s taken to deliver complete versions of Fusion Applications and lay out its particular approach to cloud computing. Oracle Fusion Applications represents Oracle’s main strategy to grow its applications revenue and counter a variety of fast-growing SaaS competitors. Fusion Applications alone, however, may not provide the growth engine Oracle needs to protect its market position in applications. Look for Oracle to accelerate its growth strategy with more SaaS acquisitions, similar to Taleo and RightNow. See the March 1, 2013,

“Oracle Customers Are Hesitant To Embrace Fusion Applications” report.

10 Many SAP customers already own SRM, so SAP cannot sell it to them a second time, nor can it gain extra revenue by persuading them to deploy it. In contrast, it can get incremental revenue by persuading SRM customers to switch to Ariba. SAP’s new cloud and line of business group will allocate its development resources where they generate the largest return, and that could well be Ariba rather than SRM, or even outside ePurchasing altogether.


Forrester Research (Nasdaq: FORR) is a global research and advisory firm serving professionals in 13 key roles across three distinct client segments. Our clients face progressively complex business and technology decisions every day. To help them understand, strategize, and act upon opportunities brought by change, Forrester provides proprietary research, consumer and business data, custom consulting, events and online communities, and peer-to-peer executive programs. We guide leaders in business technology, marketing and strategy, and the technology industry through independent fact-based insight, ensuring their business success today and tomorrow. 113422

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