{"id":1027,"date":"2015-06-21T17:26:00","date_gmt":"2015-06-21T17:26:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/procurement-as-a-service-blueprint-2015\/"},"modified":"2015-06-21T17:26:00","modified_gmt":"2015-06-21T17:26:00","slug":"procurement-as-a-service-blueprint-2015","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/procurement-as-a-service-blueprint-2015\/","title":{"rendered":"Procurement makes its move to As-a-Service…. so who’s leading the market?"},"content":{"rendered":"

The beauty of procurement is that is was never really geared up for cheap and cheerful labor-arbitrage based BPO. \u00a0In short, most procurement functions have been cut to the bone in most organizations, and many still rely on fax machines, photocopiers and copious filing cabinets of yellowing contracts to get the job done.<\/em><\/p>\n

Shipping this stuff off to far flung offshore destinations for a few FTE savings has rarely proved to work very well. However, creating a capability where clients can plug in to a whole new experience\u00a0of procurement capabilities, category expertise, spend management analytics and gain-share opportunities As-a-Service<\/em><\/a> is now happening\u00a0for many ambitious buyers and service providers.<\/p>\n

The procurement outsourcing market has evolved significantly since 2013 since HfS launched its first Blueprint<\/a>, covering 14 service providers, to this new report<\/a> that covers 18, co-authored by analysts Charles Sutherland<\/a> and Hema Santosh<\/a>. This new report is looking very closely at the evolution of procurement services from its legacy outsourcing roots in lift and shift mega-deals, coupled with strategic sourcing consulting, to the increasingly available As-a-Service solution models offered today.<\/p>\n

The latest HfS Procurement-as-a-Service Blueprint captures the transition of service providers into the As-a-Service Economy:<\/p>\n

\"Click<\/a><\/p>\n

Click to Enlarge<\/p>\n<\/div>\n

What has changed since 2013 in procurement\u00a0outsourcing services?<\/span><\/strong><\/p>\n

If we look at where we are today, or starters, we\u2019re living in a post Procurian world, as its acquisition by Accenture in late 2013 shifted the competitive landscape.\u00a0\u00a0 Both were in our 2013 Winner\u2019s Circle and when combined they created a market leader by share and by innovation. When we first commented on the acquisition<\/a> we expected several more would quickly follow especially for Genpact and Capgemini who needed to replace the partnerships they had been developing with Procurian.\u00a0\u00a0 It turns out that rather than buy at least for now, those service providers who had gaps in capabilities or technologies turned to partnerships instead.<\/p>\n

Indeed, partnerships between service providers born out of the transactional procurement market (e.g. TCS, Genpact, WNS) and those out of the technology (e.g. GEP) or strategic sourcing (e.g. Proxima, AT Kearney) are more prevalent in 2015 than they were back in 2013 as service providers construct end-to-end offerings to better compete with Accenture and IBM in particular.<\/p>\n

But acquisitions didn\u2019t end with Procurian. Xchanging has followed suite with two more that have revitalized their presence in North America and brought them a new proprietary technology base. While Infosys has accelerated the value of the 2011 acquisition of The Portland Group by utilizing their procurement consulting skills<\/p>\n

Internal investments have also mattered over the last several years with service providers increasing their development budgets significantly while also spending on adapting solutions models. In fact over the last two years we have seen previous solution models of end-to-end procurement lift and shift and sourcing consultancy become impacted by the arrival of more modular technology supported service delivery models. While still not the broad norm, this \u201cAs-a-Service\u201d approach is setting roots in many service providers and we expect this to increasingly be the norm in the years to come.<\/p>\n

So in many ways the last several years have been less revolutionary than they have been evolutionary with a slow and steady acceleration for all end-to-end service providers in the breadth of their offerings and only modest movement in their Blueprint positioning as a result. It should be noted though that the specialist service providers have markedly picked p their game in the last few years and now have a much more prominent place in our evaluation than before.<\/p>\n

What matters today in procurement outsourcing<\/strong><\/span><\/p>\n