Business Commerce Innovation [New York City]

1
Buy, Pay, Manage: The Future of Business Commerce
Andrew Bartolini, Chief Research Officer
Christopher J. Dwyer, Research Director
Ardent Partners
October 7, 2014

2
CO-PRESENTERS
Copyright © 2014 - Ardent Partners Ltd.
Andrew Bartolini
Chief Research Officer
Ardent Partners
Christopher J. Dwyer
Research Director
Ardent Partners

3
AGENDA
Introduction
Buy, Pay, Manage: The Future of Business Commerce
Convergence on the Network

4
Ardent Partners is a research and advisory firm focused on defining and advancing the supply management strategies, processes, and technologies that drive business value and accelerate organizational transformation within the enterprise.
ARDENT PARTNERS

5
CPO Rising: The site for CPOs and other supply management executives
www.cporising.com
ARDENT’S NETWORK OF SITES
Payables Place: Global source for ePayables news, research, & analysis
www.payablesplace.com

6
ARDENT’S’ RESEARCH COVERAGE: SUPPLY MANAGEMENT
Commercial Cards
Supply Risk & Supplier Information/Performance Management
Contingent Workforce Management
Other Complex Categories (T&E , Meetings and Events, Print, etc.)
Spend Analysis
eSourcing
Contract
Management
eProcurement
ePayables
Procurement Outsourcing

7
BUY, PAY, MANAGE: THE FUTURE OF BUSINESS COMMERCE

8
WHAT IS BUSINESS COMMERCE?
BUY
PAY
MANAGE

9
BUSINESS COMMERCE INNOVATION
BUY
PAY
MANAGE
22%
4%
2006
2011
Motorola Market Share:
Mobile Phones
Key Takeaways:
 Joy’s Law: “Innovation will happen, and it will happen elsewhere.”
 Innovation extends to all supply markets
 A ‘static “supply base is now a red flag
 No company can risk going it alone
 Increasing reliance on suppliers
 Suppliers are partners assets

10
CPO’S AGENDA: THEN AND NOW
CPO View 2009
"There has been a change in context, speed, and risk. It's time for procurement to be the hero.“
Christina DeLuca
CPO - BP
CPO View 2014
"The minute you get complacent, people will begin to offer other opinions. You must stay sharp.“
Chris Shanahan
CPO - BD

11
TOP CPO PRIORITIES (NEXT THREE YEARS)
Innovation
©Ardent Partners - 2014

12
TOP STRATEGIES FOR SOURCING TEAMS IN 2014
55%
47%
42%
32%
31%
31%
Improve
collaboration
with business
Improve
collaboration
with suppliers
Improve use of
technology (buy
new systems /
improve current
ones)
Implement
stronger
policies and
processes
Improve
collaboration
with the CFO
and other
executives
Optimize current
systems and
processes
© Ardent Partners - 2014
Collaboration

13
THE CPO ROLE IN 2014
Purchasing
Sourcing
Cash
Risk
Innovation
Sales
M&A
New Products
New Markets
Joint Ventures
Travel
Outsourcing
Contingent Workers
Trusted Advisor / Influencer / Special Projects
Accounts Payable
Convergence

14
BUY
PAY
MANAGE
Key Takeaways:
 No company wants to “slow the line”
 ePayments are easier
 ePayments are cheaper
 ePayments are more accurate
 ePayments are more secure

15
AP’S TOP PRIORITIES IN 2014
23%
25%
27%
31%
37%
63%
Generate discounts on spend
Better link P2P processes and systems
Improve collaboration/communication with
procurement
Improve visibility into invoice and payment
data
Improve reporting and analytics around AP
Reduce processing costs

16
THAT PERSISTENT PAPER PROBLEM
Copyright © 2014- Ardent Partners Ltd.
70%
30%
Manual
Electronic
Invoice Formats
Payment Formats
44%
56%
Manual
Electronic

17
THE BENEFITS OF ELECTRONIC PAYMENTS
24% of all AP groups report increased accuracy and control of payment delivery
24%
45%
51%
17
45% of AP groups say that electronic payments enable more efficient and streamlined processing (e.g., review, approval, execution).
51% of enterprises rate cost savings as the top benefit seen from electronic payments

18
18
Greater involvement in working capital optimization
Skill set required within AP will change
Stronger AP & Procurement partnership
AP process will be largely automated
AP TRENDS & PREDICTIONS (“LIKELY” IN NEXT 2-3 YEARS)
83%
69%
66%
57%

19
BUY
PAY
MANAGE
Job Stats
 4.4 years = Average job tenure in US (US Dept. of Labor - 2014)
 91% of Millenials expected to stay at current job less than 3 years
Key Takeaways:
 The “rules of employment” have changed
 Work will continue to migrate to where it can best be done
 Geography will not be a talent constraint
Job hopping is now a trend
 Outside talent can offer great value and agility
 There is a talent war
 New strategies and approaches are needed

20
CURRENT CONTINGENT WORKFORCE CHALLENGES

21
THE EVOLVING CONTINGENT WORKFORCE
Ardent Partners predicts that the average contingent workforce will rise by 30% over the next three years
92% of enterprises cite non-traditional talent as a moderate-to-vital aspect of their overall corporate strategy
The “war for talent” now outweighs “cost savings” as the top driver of contingent workforce management

22
Traditional
Complex
Independent Contractors
Comprised of SOW- based projects and services
Purpose: Unique talents and expertise
Freelancers, consultants and contractors Purpose: High-level talent and specialized skillsets
“Temps” sourced via staffing suppliers and agencies
Purpose: Low-to- mid-level talent
ARDENT PARTNERS CWM FRAMEWORK

23
THE FUTURE OF CONTINGENT WORKFORCE MANAGEMENT

24
CONVERGENCE ON THE NETWORK

25
THE EVOLUTION OF TALENT SOURCES

26
BUSINESS NETWORKS’ IMPACT ON TRANSACTIONS

27
BUSINESS NETWORKS’ IMPACT ON SUPPLIER COMMUNICATION / COLLABORATION

28
THE NEW “COMMERCE” DYNAMIC
Speed and complexity continue to accelerate
Compliance, control, efficiency are table stakes
This is the “Age of Innovation and Collaboration“
Winners will be the agile organizations that can tap into expertise and find value wherever it exists in the market
Selecting the right partners and platforms has never been more important

29
For more information please visit:
www.ardentpartners.com
THANK YOU!
Andrew Bartolini
Managing Partner &
617.752.1620 abartolini@ardentpartners.com @andrewbartolini
Contact Info:
Ardent’s Media Sites:
Copyright© 2014 - Ardent Partners Ltd.
Research Director &
VP, Operations
617.752.1624
cdwyer@ardentpartners.com
@cjd_ardent

30
Buy, Pay, Manage: The Future of Business Commerce
Andrew Bartolini, Chief Research Officer
Christopher J. Dwyer, Research Director
Ardent Partners
October 7, 2014

31
CO-PRESENTERS
Andrew Bartolini
Ardent Partners
Christopher J. Dwyer Research Director Ardent Partners

32
AGENDA
Introduction
Buy, Pay, Manage: The Future of Business Commerce
Convergence on the Network

33
Ardent Partners is a research and advisory firm focused on defining and advancing the supply management strategies, processes, and technologies that drive business value and accelerate organizational transformation within the enterprise.
ARDENT PARTNERS

34
CPO Rising: The site for CPOs and other supply management executives www.cporising.com
ARDENT’S NETWORK OF SITES
Payables Place: Global source for ePayables news, research, & analysis
www.payablesplace.com

35
ARDENT’S’ RESEARCH COVERAGE: SUPPLY MANAGEMENT
Commercial Cards
Supply Risk & Supplier Information/Performance Management
Contingent Workforce Management
Other Complex Categories (T&E , Meetings and Events, Print, etc.)
Spend Analysis
eSourcing
Contract
Management
eProcurement
ePayables
Procurement Outsourcing

36
BUY, PAY, MANAGE: THE FUTURE OF BUSINESS COMMERCE

37
WHAT IS BUSINESS COMMERCE?
BUY
PAY
MANAGE

38
BUY
PAY
MANAGE
22%
4%
2006
2011
Motorola Market Share:
Mobile Phones
Key Takeaways:
 Joy’s Law: “Innovation will happen, and it will happen elsewhere.”
 Innovation extends to all supply markets
 A ‘static “supply base is now a red flag
 No company can risk going it alone
 Increasing reliance on suppliers
 Suppliers are partners assets

39
CPO’S AGENDA: THEN AND NOW
CPO View 2009
"There has been a change in context, speed, and risk. It's time for procurement to be the hero.“
Christina DeLuca
CPO - BP
CPO View 2014
"The minute you get complacent, people will begin to offer other opinions. You must stay sharp.“
Chris Shanahan
CPO - BD

40
TOP CPO PRIORITIES (NEXT THREE YEARS)
Innovation
©Ardent Partners - 2014

41
TOP STRATEGIES FOR SOURCING TEAMS IN 2014
55%
47%
42%
32%
31%
31%
Improve
collaboration
with business
Improve
collaboration
with suppliers
Improve use of
technology (buy
new systems /
improve current
ones)
Implement
stronger
policies and
processes
Improve
collaboration
with the CFO
and other
executives
Optimize current
systems and
processes
Collaboration

42
THE CPO ROLE IN 2014
Purchasing
Sourcing
Cash
Risk
Innovation
Sales
M&A
New Products
New Markets
Joint Ventures
Travel
Outsourcing
Contingent Workers
Trusted Advisor / Influencer / Special Projects
Accounts Payable
Convergence

43
BUY
PAY
MANAGE
Key Takeaways:
 No company wants to “slow the line”
 ePayments are easier
 ePayments are cheaper
 ePayments are more accurate
 ePayments are more secure

44
AP’S TOP PRIORITIES IN 2014
23%
25%
27%
31%
37%
63%
Generate discounts on spend
Better link P2P processes and systems
Improve collaboration/communication with
procurement
Improve visibility into invoice and payment
data
Improve reporting and analytics around AP
Reduce processing costs

45
THAT PERSISTENT PAPER PROBLEM
70%
30%
Manual
Electronic
Invoice Formats
Payment Formats
44%
56%
Manual
Electronic

46
THE BENEFITS OF ELECTRONIC PAYMENTS
24% of all AP groups report increased accuracy and control of payment delivery
24%
45%
51%
46
45% of AP groups say that electronic payments enable more efficient and streamlined processing (e.g., review, approval, execution).
51% of enterprises rate cost savings as the top benefit seen from electronic payments

47
47
Greater involvement in working capital optimization
Skill set required within AP will change
Stronger AP & Procurement partnership
AP process will be largely automated
AP TRENDS & PREDICTIONS (“LIKELY” IN NEXT 2-3 YEARS)
83%
69%
66%
57%

48
BUY
PAY
MANAGE
Job Stats
 4.4 years = Average job tenure in US (US Dept. of Labor - 2014)
 91% of Millenials expected to stay at current job less than 3 years
Key Takeaways:
 The “rules of employment” have changed
 Work will continue to migrate to where it can best be done
 Geography will not be a talent constraint
Job hopping is now a trend
 Outside talent can offer great value and agility
 There is a talent war
 New strategies and approaches are needed

49
CURRENT CONTINGENT WORKFORCE CHALLENGES

50
THE EVOLVING CONTINGENT WORKFORCE
Ardent Partners predicts that the average contingent workforce will rise by 30% over the next three years
92% of enterprises cite non-traditional talent as a moderate-to-vital aspect of their overall corporate strategy
The “war for talent” now outweighs “cost savings” as the top driver of contingent workforce management

51
Traditional
Complex
Independent Contractors
Comprised of SOW- based projects and services
Purpose: Unique talents and expertise
Freelancers, consultants and contractors Purpose: High-level talent and specialized skillsets
“Temps” sourced via staffing suppliers and agencies
Purpose: Low-to- mid-level talent
ARDENT PARTNERS CWM FRAMEWORK

52
THE FUTURE OF CONTINGENT WORKFORCE MANAGEMENT

53
CONVERGENCE ON THE NETWORK

54
THE EVOLUTION OF TALENT SOURCES

55
BUSINESS NETWORKS’ IMPACT ON TRANSACTIONS

56
BUSINESS NETWORKS’ IMPACT ON SUPPLIER COMMUNICATION / COLLABORATION

57
THE NEW “COMMERCE” DYNAMIC
Speed and complexity continue to accelerate
Compliance, control, efficiency are table stakes
This is the “Age of Innovation and Collaboration“
Winners will be the agile organizations that can tap into expertise and find value wherever it exists in the market
Selecting the right partners and platforms has never been more important

58
For more information please visit:
www.ardentpartners.com
THANK YOU!
Andrew Bartolini
Managing Partner &
617.752.1620 abartolini@ardentpartners.com @andrewbartolini
Contact Info:
Ardent’s Media Sites:
Copyright© 2014 - Ardent Partners Ltd.
Research Director &
VP, Operations
617.752.1624
cdwyer@ardentpartners.com
@cjd_ardent

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