Feature: Trust in the cloud - the future of procurement
Ivalua delivers cloud-based end-to-end spend management software solutions on a unified platform, empowering organisations to unlock the maximum value of procurement. CMO Alex Saric reveals how Ivalua is investing in R&D to keep ahead of the supply chain curve and planning for expansion across North America.
“Ivalua provides a comprehensive Source-to-Pay platform allowing companies to do more than just better manage spend, but also identify opportunities, negotiate and manage their contracts as well as pay for, order and manage their suppliers,” says CMO, Alex Saric.
“Technology addresses the full source of the pay platform and we deal with both the direct and indirect material, and even allow them to manage the master data integrated into the back-end system. It’s a very comprehensive solution for procurement and supply professionals.” It’s a solution which has seen Ivalua evolve rapidly since entering the North American market in 2011 where half of its global revenue is now generated.
“A big milestone for us was when we entered Gartner’s Magic Quadrant in 2015 and have maintained our position in the top right quadrant since. Earlier this year we received $70m in growth equity funding from KKR (a top global investor helping fund the likes of Lyft and DarkTrace), validating the business model and allowing us to invest more in R&D and sales and marketing to accelerate our development and growth.”
That focus on growth will hone in on the Canadian market where Ivalua is now working with eight major clients including the British Columbia Lottery Corporation (BCLC), Scotiabank and Transalta. “BCLC was a focused project looking at contract and supplier relationship management,” explains Saric. “The challenge with BCLC was that they were resource constrained so it was important to work on prioritising their objectives and focus on what they’re really trying to achieve. Identifying the unique needs of customers in terms of expectations, making sure all the stakeholders are aligned and navigating any bumps in the road, are typical for us.”
The latest win for Ivalua is the Calgary-based energy provider Transalta who were seeking help to deliver an intensive supply chain optimisation project. “We selected Ivalua for its comprehensive source-to-pay platform, flexible architecture and overall ability to give us a competitive advantage,” affirms Transalta CAO Dawn De Lima.
Globally, large companies like KPMG partner with Ivalua and it’s the proven fruit of these alliances Saric believes drives the best retention rate in the business while building trust in new markets. “It’s 98% historically and we actually haven’t lost a customer since 2015,” he says. “That’s a testament to us being able to work through challenges in projects thanks to the continuous integration we offer throughout the process.”
It’s a process that has Ivalua’s innovative technology difference at its heart. Founder and CEO David Khuat-Duy stresses the importance of its single cloud-based platform and a user-friendly interface which he states is “at the best level on the market”, making it a powerful tool for flexibility and configurability of everything from supplier management to strategy and analytics. “Nothing is impossible with our workflow engine,” maintains Khuat-Duy. Large corporations like EDF and BNP Paribas take advantage of integrated services between the Ivalua Platform and Ivalua Cloud, helping them improve working capital management and drive innovation.
A unique feature and advantage of Ivalua’s suite is that its entire platform was natively developed with a completely unified data model, perfect for procurement. “Integration for us is something we’ve maintained from day one, it’s seamless,” maintains Saric. “That means if a customer makes a change on one part of the platform, someone else can see that immediately in real time.”
It’s taken over a decade of development for Ivalua to reach this stage with an offering that clients like Gap, Whirlpool and Michelin could not practically emulate in-house, he stresses. “To develop suites that meet the complex requirements of big organisations… there’s so much work behind it so if you’re asking why Ivalua versus someone else? Ultimately, it comes down to our empowering approach,” emphasises Saric.
“We give customers the benefits of SAS (spend analytics software) without any of the trade-offs. We have the most flexible platform on the market with a unique infrastructure giving customers the highest level of configurability so they can meet unique or evolving requirements. If there’s some capability that’s not out of the box available, they can configure it without any coding due to the flexibility of the architecture. Most of our competitors offer limited configurability with a generic best-in-class solution. Our customers don’t have to compromise between the integrated suite and best of breed capabilities – we offer options to cover the whole source of the pay process. BCLC started with just part of our suite – contract management and SRM – but as their needs evolve if they need to move to source-to-pay they can stick with the same company and add specific modules.”
So how can customers leverage the power of the Ivalua Open Network for their business? “We don’t constrain our customers or their stakeholders,” explains Saric. “Our network is truly open – we don’t charge fees to suppliers and we don’t place limits on a customer’s volume where many of our competitors enforce caps or coverage charges.”
Saric maintains it’s about more than merely digitising documents now more than 1mn suppliers connect with a world of commerce through Ivalua. “It’s a true collaboration platform where businesses can define workflow and enable processes and include suppliers and other third parties in their approaches to add value, improve performance and take cost out of the overall supply chain. Our customers can evaluate suppliers with score cards to gather information, ultimately inspiring high adoption and collaboration and avoiding a conflicting relationship between buyers and suppliers.
“Ivalua is mining for value at the data coalface”
To achieve this level of adoption, Ivalua is investing over 10% of its R&D budget in AI to enhance digital enablement of cloud-based spend management through its Add-On Store. “Machine learning is a big focus for a range of applications with our services for stakeholders including consumerised purchasing, valued buying and chat bot support for suppliers,” says Saric. “We’re focused on providing actionable insight and presenting it to the users at the right point of the process. There’s so much information captured through these platforms, but actually mining real insight to find where there’s a missed opportunity or some overlooked efficiency represents a huge opportunity because, if you can action information at the right point, it becomes really valuable.”
Ivalua’s Add-On Store enables the packaging of insight, integrations and even an entire suite configuration into a bundled Add-On that can be downloaded just like an app. “It means we can offer bespoke configurations in industries like public sector manufacturing where they have unique needs a generic solution can’t solve,” suggests Saric.
Collaboration is key for Ivalua in delivering its services to clients. “Our goal is to make things easy for our users and provide them with more information. This can help our customers who are focused on CSR and many of them work with Ecovadis, a partner of ours, and one of the leaders in the sustainability space,” explains Saric.
“Rather than have a generic reporting tool with a bunch of reports that aren’t populated, because certain customers don’t do that, we focus reporting on what our customers do have. If they have a CSR initiative and want to work with Ecovadis, we have an add-on which automatically integrates third party data from a company, configuring all the reports and CSR reporting and matching it to suppliers to enhance their capabilities.”
Ivalua also partners with Amazon’s business division so customers can leverage the benefits of its catalogues and spend categories, and has deep ties with Comsys and Shelby Group with their Middle East business. “We realise we can’t have all of the best information and expertise in everything, so we make sure we’re open to work smoothly with partners that can provide that for our customers,” says Saric.
Looking ahead, an excited Saric reveals Ivalua is hiring more sales staff in Canada in a bid to maintain its lead, ramp up the noise and help drive commercial growth in global sales by 70% next year. “We’re planning aggressive international expansion and investment in North America to maximise brand awareness and carry on empowering our customers.”
EU and US agree end to Airbus-Boeing supply chain tariffs
The EU and US have agreed to resolve a 17-year dispute over aircraft subsidies, suspending tariffs on billions of dollars' worth of goods that have plagued procurement leaders on both sides of the Atlantic.
Under an agreement reached by European Commission Executive Vice-President Valdis Dombrovskis and US Trade Representative Katherine Tai on Tuesday, the tariffs will be halted for a period of at least five years.
It will bring an end to punitive and disruptive levies on supply chains that have little to do with the argument, which became embroiled in the trade battle. Businesses on both sides of the dispute have been hit with more than $3.3bn in duties since they were first imposed by the US in October 2019, according the EC.
The US imposed charges on goods upto $7.5bn in response to a World Trade Organisation ruling that judged the EU’s support of Airbus, its biggest aircraft manufacturer, unlawful. A year later in November 2020, the EU hit back. The WTO found the US had violated trade rules in its favourable treatment of Boeing, and was hit with EU duties worth $4bn.
In all the tariffs affected $11.5bn worth of goods, including French cheese, Scotch whisky, aircraft and machinery in Europe, and sugarcane products, handbags and tobacco in America. Procurement leaders on both sides of the fence were forced to wrestle with tariffs of 15% on aircraft and components, and 25% on non-aircraft related products.
Boeing-Airbus dispute by the numbers
- The dispute began in 2004
- Tariffs suspended for 5 years
- $11.5bn worth of goods affected by tariffs
- $3.3bn in duties paid by businesses to date
- 15% levy on aircraft and 25% on non-aircraft goods suspended
Both sides welcome end to tariffs
European Commission President Ursula von der Leyen branded the truce a “major step” in ending what is the longest running dispute in WTO history. It began in 2004.
“I am happy to see that after intensive work between the European Commission and the US administration, our transatlantic partnership is on its way to reaching cruising speed. This shows the new spirit of cooperation between the EU and the US and that we can solve the other issues to our mutual benefit,” she added.
Both aircraft manufacturers have welcomed the news. Airbus said in a statement that it will hopefully bring to an end the “lose-lose tariffs” that are affecting industries already facing “many challenges”. Boeing added that it will “fully support the U.S. Government’s efforts to ensure that the principles in this understanding are respected”.
The US aerospace firm added: "The understanding reached today commits the EU to addressing launch aid, and leaves in place the necessary rules to ensure that the EU and United States live up to that commitment, without requiring further WTO action."
This week’s decision expands upon a short-term tariff truce announced in March this year. The EC says it will work closely with the US to try and further resolve the dispute, establishing a Working Group on Large Civil Aircraft led by each side’s trade minister.
Airbus last month signalled to suppliers that post-pandemic recovery was on the horizon, telling them to scale up to meet a return to pre-COVID manufacturing levels. “The aviation sector is beginning to recover from the COVID-19 crisis,” said Airbus chief executive Guillaume Faury, adding that suppliers should prepare for a period of intensive production “when market conditions call for it.”