Procurence Meercat: Still Watching Over Your Supply Chain

The last time the doctor covered Procurence was on Spend Matters in 2019 in a two-part series that provided a Vendor Introduction and a SWOT, Selection Checklist, and Market Overview.

In that coverage, we covered the supplier management solution, customized for direct supplier management, that supported the following areas of supplier management:

  • information management
  • performance / KPI management
  • risk assessment
  • quality audits
  • incident and warning management
  • NPI / PPAP / APQP support (with NCR / 8D)
  • administration management

We also noted at the time that some of the positives and unique capabilities of the platform were:

  • extensive task support and tracking
  • deep support for technical assessments and QMRs
  • great self-service administration support
  • extremely deep KPI support
  • flexible report construction

For deeper details, if you have access, we highly recommend checking out the links above (as well as Bertrand’s 2022 follow-up: Part 1: SXM and New Modules and Part 2: SWOT), which also contains the foundations of a SWOT in its 8-page summary.

Today we’ll provide an update and dive into the key capabilities of the platform, which has evolved from a supplier management focussed offering to a source-to-pay collaboration and management platform that addresses so much more than just the supplier lifecycle, with Source-to-Pay capabilities launching this quarter with appropriately enhanced SRM and Compliance capabilities.

Procurence Meercat is a modular platform where an organization can buy only what they need after starting with the core module. The platform contains offerings in six key areas:

  1. Supplier Relationship Management (Core)
  2. Source to Pay
  3. Compliance & Risk
  4. Materials & Quality Management
    (SRM++ for Direct that also encapsulates aspects of part and production management)
  5. ESG
  6. Project & Resource Management

Procurence Meercat is unique in that while they are a smaller niche vendor, the platform was made to support even the largest of enterprise customers, and do so with ease. We’re going to take the six areas one-by-one, focussing primarily on what’s new or unique:

Supplier Relationship Management

Procurence Meercat is a leading Supplier Management Platform with extremely deep supplier profiles that supports custom onboarding workflows, prequalification (in compliance with EU regulations), supplier master data management, documents (inc. contracts and translations), audits, and even supplier development. The SRM module is the core module and provides you with a complete Supplier 360 where you can quickly access any and all information associated with the supplier across the modules you have installed.

Procurence Meercat can handle all of your supplier (related) master data management because it sits between external systems and data providers and internal back-office / ERP platforms (and even existing S2P systems if you prefer to maintain those, especially for indirect/services sourcing and procurement).

Since the platform is highly integrated, onboarding can take advantage of all of the compliance, risk, and ESG data collected as well as all of the part and production data collected and give a buyer complete 360-degree insight into the supplier during the pre-qualification to ensure that no non-compliant (or sanctioned) suppliers get into the system at approval time. Moreover, the onboarding process cna be configured to have as few, or as many, steps as your organization needs to collect all the required information; do all of the external risk, compliance, and ESG validations; verify the contact information; and complete any regulatory KYS (Know Your Supplier) requirements.

One key capability is that it allows you to track all of the relations(hips) associated with a supplier by subsidiary, business unit, location and/or primary commodity type as well as who owns the relationship, what the terms (of the contracts typically) are, and the status of the supplier down to that level. (i.e. You might want to block a supplier only from certain subsidiaries or business units in certain commodities or areas due to poor performance in those commodities or areas but still allow them to do business with you for other commodities in other areas where they are meeting all the regulatory requirements and not causing you any problems.)

Another key capability that comes into effect during onboarding, information management, and procurement is bank account validation. In order to greatly reduce payment fraud, they have introduced multi-step approvals to create or change a bank account profile to ensure only verified information gets into the system.

Another overlooked capability is the ability to define rules that will automatically assign the different individuals required for different aspects of supplier management: overall relationship, assessments, risk, compliance, purchase orders, (payment) approvals, etc. etc. etc. based on role, team or other factors. The platform includes features that support high workforce mobility including temporary delegations and permanent delegations which can be done using rules that reassign tasks in bulk or individually, ensuring that a task always has someone assigned to it. (It also has automatic blocking of user access on a bounced email, helping with ISO 27001 compliance, a certification which they hold.)

Remember, there is no supplier management without human interaction and oversight, and most suppliers go unmanaged because it’s usually impossible for one person to do all the work (and yet that’s how many supplier management systems were set up — one supplier owner). By allowing the work to be broken up and defined on supplier creation, a supplier actually gets managed (and then supervisors get notified when an item is past due and relationship owners notified when key tasks have not bee completed). Match this with the capability to automatically trigger workflows (that can be built up from task suggestions using existing assessments) on any change in any supplier flex status — which can be defined at the level of supplier, commodity, part, tooling, or any combination — and you have powerful, guided, semi-automated supplier (performance) management.

Source-to-Pay

Their new source-to-pay capabilities centers around two new primary modules with core support for sourcing and procurement, namely

Strategic Procurement

  • RFX
  • Contracts (enhanced)
  • Savings Tracker
  • Commodity Profiles
  • Supplier Innovation Sourcing

The core of sourcing is RFX which allows the user to create (multi-round) RFX events that can be used to collect bids and specifications, create award scenarios for evaluation, and walk the user through a templated sourcing cycle (that can be adjusted on implementation and tweaked in the administration control panel). Standard parts of an RFX are settings (type, business unit, category, terms and conditions, currency, timing, etc.), specifications (documents), positions (cost breakdowns), suppliers (suggestion capability based on sourcing history, risk, and location, but the buyer can select who they want), assessments, communications (associated with the RFX), responses (final bids, displayable side-by-side), scenarios (potential awards based on rules such as cheapest supplier or position with location, position, or risk constraints or manual selection), decisions (awards), and, post award, the event can be associated with contracts and orders.

As we noted, contract management has been enhanced as they have implemented multiple AI tools to automatically scan an uploaded document, classify it, auto-extract the suggested metadata (tagged to the appropriate location in the document), and then the user can accept, override, or reject as they see fit. In addition, they’ve also integrated DeepL for automatic document translation, so the user can get a highly accurate (but not legally certified) translation of a contract or document in their native language.

The savings tracking module, which works like most other savings tracking modules you’d be familiar with, kicks in post award and allows you to track historical to projected to actuals over time based on the sourcing event. However, if you use Procurence Meercat for S2P for your direct, it will automatically populate the historicals, projections, and actuals based on each order that flows through the system, making savings tracking easy-peasy for you.

The supplier innovation sourcing is a relatively new module that allows buyers to post challenges where they need innovation to reduce cost, streamline energy requirements, minimize environmental emissions (including carbon), stay ahead of global compliance regulations, or meet an emerging market demand. Like the first generation crowd sourcing innovation platforms (remember those?), it allows suppliers to suggest innovations to meet a buyer’s needs, which, since it’s integrated, can be flipped into RFXs if the proposal sounds promising.

This is because the submission process is partially structured and, when a supplier submits an innovation idea, they can specify the expected business benefits (in terms of sales, sustainability, quality and warranty, production, procurement, process, or logistics factors), the materials that will be used, the associated financials, and the document types that are being submitted. This semi-structured approach allows for quick searching, identification, and RFX/project creation off of a submission.

Moreover, the platform can be opened up for suppliers to provide their own innovations with respect to existing parts or processes if they feel they have a way to improve the end product they are offering to the buyer.

Operational Procurement

  • Purchase Order & ASN Management
  • Invoice Management
  • Capacity Planning

Once an award has been made, and a contract has been cut, purchase orders can be manually, or automatically using appropriate rules definitions, created and sent to the supplier. The platform can also accept ASN (Advanced Shipping Notices) from the supplier and track those as well. When the invoice is submitted, it can be captured, and if it’s an attachment, the platform uses ThinkingMachine-driven AI to automatically parse the invoice into standard metadata and line item data for matching, processing, and payment approval. The approval chains can be defined to be as simple or complex as the organization wants, with single, multi-stage, and even simultaneous approvals supported.

Compliance & Risk

They’ve had compliance and risk management (including a risk decision matrix) since 2012, but it’s been significantly enhanced over the past few years. This includes a number of out-of-the-box integrations including riskmethods, prewave, Z2DATA, Euler Hermes, and D&B. New capabilities revolved around:

  • Sanction Checks
  • Semiconductor Risk
  • AI Risk Review

Procurence integrates with multiple sources to check (potential) suppliers against sanctions list and these checks can be included early in the pre-qualification process (to prevent time being wasted on qualifying a supplier that your organization ultimately can’t do business with. It also integrated with multiple AI technologies in addition to third party risk ratings and can parse available data from documents and the internet to estimate certain risks and help you pre-populate models and then generate an overview of supplier risk from that model. Finally, it integrates with Z2DATA to provide you with deep insight into the semiconductor risk of every part you source that uses semiconductors (as long as you maintain your semiconductor listing in the parts management and associate the semiconductors with the parts they are used in). This isn’t hard to do because you can track the composition (level 1 of the Bill of Materials by default, but the system can track components at multiple levels if required for risk, ESG, etc.) of each part that you purchase (which you need to do for Scope3 CO2 tracking and reporting).

The risk management also includes risk monitoring (which can be continuous on every risk data element update or on a schedule), which can not only support the manual scheduling of automatic (technical) reviews based on identified risk types or scores, but automatic scheduling if a risk factor gets too high.

Materials & Quality

They’ve had part masters, material profiles, PPAP/APQP, NCR/8D, compensation claims, and even NPD for a decade, but all of the capability has been enhanced in recent years as it was spun out of core SRM (which revolved around parts linked to the supplier) into its own product development and quality module which supports highly integrated part development and management centered around a buying organization’s part, and now even supports tooling management.

Their part and material master is quite deep. For each part, in addition to tracking metadata that tracks all of the classification data (id, eClass, HTS, SIC, HS, CN, TARIC, CAS, ECN, SCIP, etc.), it also tracks the default units, criticality, risk, type, tooling, specification documents, related plants, projects, materials, and whether or not it uses semiconductors. It maintains RoHS Data, validations, and current status. Finally, it maintains the lifecycle status, timelines, and cost models required for purchasing; associated RFXs; and, post award, the associated factories, purchase orders, ASNs, and information on received lots.

ESG

They’ve always had the ability to support ESG, as you could extend supplier and part profiles to capture whatever you wanted, but with the recent rise of ESG in the EU (especially around Scope-3 reporting and the German Supply Chain Act [LkSG]), they now have custom capabilities to support both of these requirements, and even have a whistleblower portal. They also have out of the box integrations with ecovadis, and Integrity Next.

As we noted above, you can track the carbon down to the part component level, and this includes the packaging and logistics emissions, where you can track the logistics emissions at the route level, with the emissions tracked for each leg of the route (which might use a different method or carrier). In other words, in Procurence Meercat, your Scope 3 calculations can approach 100% accuracy and, more importantly, you can not only identify real opportunities for Scope 3 improvement (based upon different plant or production efficiencies and production rebalancing) but quick improvements through packaging changes and packaging reduction, better routings, etc. — which is sometimes the only improvements you can really make (if your parts are custom and you can’t easily switch factories, or you’ve already optimized the production and the only way to further reduce carbon is a redesign that takes months or years, etc.).

Project & Resource Management

They’ve had basic project management since last decade, but with a growing customer base in a few key industries (including wind power), they have expanded their capabilities significantly to also support staffing and resourcing profiles (including HSE Compliance), with training requirements, down to the individual employee — like an Avetta but specifically designed for complex industrial supply chains.

Communication

Finally, they have a 7th core module that serves as the communication hub across your organization and its supply base that centralizes asynchronous online communication, mass mailings and notifications, generic platform content in a CMS/Library, and even a generic portal for supplier/third party access to communications. The platform even supports the definition of meeting protocols with topic specific templates to guide staff through supplier meetings.

Procurence Meercat has come a long way since its humble beginnings when it first poked it’s head out of the hole to take it’s first shift in watching over the supply chain landscape, and it’s one Meercat you definitely shouldn’t overlook!

We’ll Rant And We’ll Roar Like True Angry Bloggers!

We’ll rant and we’ll roar like true Angry Bloggers
We’ll rant and we’ll roar when on-line and off
Until we strikes bottom inside the Reddit threads
When straight through the forums to /AskReddit we’ll go

I’m a son of a ‘counter, I’m a geek and a blogger
I can’t dance, I can’t sing, I just sling the web code
I can handle the WordPress and I can write with finesse
Whenever I gets in a chronic’ling mood

We’ll rant and we’ll roar like true Angry Bloggers
We’ll rant and we’ll roar when on-line and off
Until we strikes bottom inside the Reddit threads
When straight through the forums to /AskReddit we’ll go

Farewell and adieu to ye young influencers
You spin a tall tale, which should not be believed
I’m bound to disagree with the bullsh!t that you post
I can’t stay quiet or it’s yokey I’ll be

We’ll rant and we’ll roar like true Angry Bloggers
We’ll rant and we’ll roar when on-line and off
Until we strikes bottom inside the Reddit threads
When straight through the forums to /AskReddit we’ll go

We’ll rant and we’ll roar like true Angry Bloggers
We’ll rant and we’ll roar when on-line and off
Until we strikes bottom inside the Reddit threads
When straight through the forums to /AskReddit we’ll go

Confused? Check out the collected series.

Stop Being Clueless. It’s Time for Revenge of the Nerds!

Last week we tried to further demystify the marketing madness for you by clarifying that spend orchestration is essentially Clueless for the popular kids.

This is really important because there is no difference between a “spend” orchestration and a plain old “regular” orchestration provider, and neither provides any value whatsoever if you don’t have any spend management (i.e. procurement) systems in place to actually process the spend. Otherwise, the best you get is intake to nowhere … which just provides your stakeholders yet another avenue to ask “where’s my stuff” and another reason to say “I thought this new system was supposed to make you more efficient” and get more impatient when their stuff doesn’t arrive any faster.

In other words, unless you have a hodge-podge of best-of-breed systems that cover most, if not all, of the source-to-pay process, that don’t interconnect, and the systems are old and don’t support multiple roles (or charge full license fees for each user, even a 99% read-only role, that access the users), there is no value in an orchestration, as we’ve said many times (including in our post on how Marketplace Madness is Coming.

What you need is not spend orchestration but spend defenestration — you need to throw any and all unnecessary spend out of the window, and that requires spend investigation, need verification, negotiation, observation, and payment verification. That requires spend analysis, demand forecasting and management, fact-based market insight, adherence to contracts and plans, proper procurement platforms, and proper payment validation platforms.

Moreover, it requires proper utilization of these platforms. And that requires Human Intelligence (HI!), skill, and deep (deep) Procurement knowledge. Geek skill and Procurement nerdiness. The nerdiness to use a best-in-class spend analysis and seek out the opportunity that a pre-packaged analytics routine will never find (because you’ve already stared at that report ten times and found nothing after the second time [wonder why?]). The nerdiness to examine the forecasts and use best-in-class forecasting techniques on real (and up-to-date) sales and market demand data. The nerdiness to pour through market cost data for materials, standard overhead costs, energy costs, water costs, differential costs for different production models, and cost models presented to you by third parties and the supplier to pinpoint the right the model, the right data to feed it with, and the true production cost at different volume levels — and then use this in a fact-based market data negotiation. Then, when you cut an agreement, the nerdiness to make sure it is encoded in the right systems and properly executed on as well as the nerdiness to follow the market over time and detect any inflections that would require you to change direction. And, finally, the nerdiness to make sure the platform is configured to properly m-way match every invoice, detect any attempts to fraudulently change the amount, terms, and payee, and only pay for goods and services received on the agreed upon schedule. In other words, if you want to truly succeed at Procurement, forget about the Clueless — It’s time for the Revenge of the Nerds!

We Need More Leaders in Procurement!

And it’s not just because we don’t have enough, as the doctor pointed out in his post on how It Would Be Great If Future CEOs Were Past CPOs (which isn’t happening because we’d need 90% of companies to fail to have enough CPOs for the CEO role), it’s because without them, we are getting lost in a see of sound-bite driven, fact-free marketing, hype, and FOMO relentlessly pushed upon us by vendors, analysts, consultants, and now influencers with next to no one left to cut through the noise and no one to lead you through the land of confusion.

As THE REVELATOR commented on the doctor‘s Top 10 Ways to be a Procurement Influencer on LinkedIn!, in a perfect world,

A “true influencer” would be driven by a single purpose – to get it right versus being right.

A “true influencer” would never look to gain consensus but to stimulate meaningful dialogue, leading to greater individual and collective understanding.

A “true influencer” would build a community of active engagement beyond token gestures of likes and thumbs up.

A “true influencer” would actively look to build a diverse community that challenges them and other members to think differently and see a subject or issue through a wider lens.

A “true influencer” would be insatiably curious and always open to new ways of thinking and doing.

A “true influencer” would be someone who has been around long enough to have witnessed first-hand the events that create the needed context to understand how we are where we are today.

Finally, a “true” influencer would stimulate thoughts and ideas, leading to practical and measurable outcomes.

Of course, today’s influencers don’t measure up to any of that, and as they exist only to build their fame and fortune, they never will.

However, true Procurement Leaders, who believe in education (and not hype-based sound-bite marketing), measure up to all of this. And that’s why we need more Procurement Leaders!

  • True leaders care about getting it right, they don’t care about being right.
  • True leaders understand you will almost never have consensus across the board, but if you let everyone speak, and take all views into account, they’ll respect the decision and change course as necessary for the greater good.
  • True leaders build a team who actively engages with them and each other, not a team who just does what they are told without question (as that team is lazy or scared, and neither indicates a work environment conducive to success).
  • True leaders embrace diversity in their team and their suppliers (to the extent possible, they don’t confuse outcomes with opportunity and force quotas that don’t make sense and just alienate their teams; e.g. if you only have 25% of women in STEM, you can only expect 25% of women in your technical positions; if you locate your office in a 98% caucasian neighbourhood, it’s going to be awfully hard to achieve a 15% African American or a 20% Latino workforce).
  • True leaders want to learn, want you to learn, and want to find practical, measurable solutions that work for everyone.

True Leaders (and a return of True Educators) are what we need to take Procurement forward. Will The Real Slim Shady please stand up?

Tech Won’t Solve Your Procurement Problems!

Probably not something you’d expect from a blog that was initially founded to educate you on best practices and best tech in Procurement and or from the doctor who has publicly reviewed close to 400 companies on Sourcing Innovation (and Spend Matters between ’16 and ’22), but it is something that needs to be said, and yelled loudly, now that everyone (analysts, influencers, marketers, etc.) is telling you this next generation of Gen-AI, Agentric, or AI-driven tech they are building will solve all your problems.

Because it won’t. In fact, it probably won’t solve any!

That’s because Procurement is NOT like other business functions. And while all business units are different, Procurement is different in a unique way. It has to constantly solve problems the business has not experienced yet. Sales just has to sell the next N customers in the target customer base which will be rather similar to the last N. Marketing is messaging this potential base which is not changing their business overnight, or even year to year, isn’t rapidly advancing in their market understanding, and won’t recognize more than a subtle shift in the message. Moreover, you don’t have new mediums popping up everyday. There’s print, radio, TV, skywriting, and web/social media. (We haven’t invented gamma radiation-based dream advertising yet!) Finance isn’t changing the rules of accounting, and even minor changes, like GAAP, only change every couple of decades.

Not so in Procurement. It’s not just acquiring supply at the lowest cost, it’s sustaining supply at a cost that allows the organization to remain profitable, which is not simply repeating the last order to the current supplier when stock gets low. That’s because Procurement not only has to constantly deal with supplier capacities, raw material shortages, carrier capacities, occasional port strikes, occasional carrier and supplier failures, but unexpected natural disasters that wipe out entire yields of renewable raw materials, arbitrary sanctions and border closings making suppliers and routes unavailable, and completely unexpected trade wars sparking tariffs that can completely upset all the cost models you ever developed.

That means that every model you have built and every solution you have customized instantly becomes irrelevant. And you can’t use AI to tell you what to do because AI can only tell you what it has been trained to do, and it can only be trained on existing data which would be based on historical situations.

That means that tech cannot solve your Procurement problems.

That means that the only option you have, as Sourcing Innovation has been saying for months, is Human Intelligence (HI!). That means that only educated, experienced, skilled, and smart people can solve Procurement Problems.

This isn’t to say that you shouldn’t use tech. You most definitely should! Because most of what you do is tactical data processing that is well defined, for which there are configurable solutions that will allow the software to do the majority of it for you, and “AI” solutions that can be trained to learn from the exceptions you manually deal with to handle them automatically the next time.

But when it comes to strategic decisions, there is no Agentric AI that can solve a problem, especially one it, and you, haven’t seen before. You have to do that. If you’re smart, you’ll acquire all of the best knowledge summarization and analytic solutions that you can get your hands on because they’ll automatically acquire, process, summarize, and graphically display all of the information available, which will help you make the right decision efficiently and effectively, so that you can react fast in a crisis with confidence, but it will still be you, the human, who has to make the (right) decision!

As an IBM slide deck stated in 1979:

A computer can never be held accountable, therefore a computer must never make a management decision.

Just because it can do a billion calculations a second and thunk better than you, that doesn’t mean it can think, because it can’t (and when Gen-AI claims to display a “chain of thought” it is lying, it is a “chain of compute”, which is not thinking, just identifying patterns that typically follow other patterns in sequences it was “trained” on). Only you can. (Remember, if machines ever become intelligent, our best case scenario is they need us for bioelectric energy and create the matrix where we believe we are living a life free of machines. Otherwise, we’re probably looking at a SkyNet situation. It’s only logical for many, many reasons.)