Dive Brief:
- U.S.-based indirect spend solutions provider Jaggaer and Europe-based direct procurement solutions company Pool4Tool announced a merger, on Monday.
- The merger creates the only e-procurement company including end-to-end management of both direct and indirect spend and access to global markets, according to the press release. However, Spend Matters reports the two companies do not have "immediate plans" to integrate the two suites of solutions.
- Spend Matters notes the merger could open the door for Jaggaer's entry into Europe, but most importantly brings a direct procurement solution into a North American market that has so far lagged in adoption. The two companies currently have 900 clients, but intend to reach 1,000 by the end of the year.
Dive Insight:
A crowded e-procurement landscape just became a bit more complex with the merger of Jaggaer and Pool4Tool. These two companies, and their competitors, provide a broad range of e-procurement products and services that profess to help manage the complexities of the end-to-end supply chain. In theory, and yes in practice, these products do make a positive difference in many companies.
Yet, the automation of a process does not make it more effective if the fundamental attributes are absent. A blinking cursor on a blank page of a word processing document doesn’t make one an author, nor does clicking the icon of a project management application make one a project manager. Those using e-procurement packages without the proper experience or training are not supply chain professionals.
But that caution does not minimize the impact of the bevy of e-procurement tool on the market, either as stand alone products or ERP modules. The key to their success is rooted in the supply chain organization. Create the supply chain strategy, actively manage the supply base, provide training on the tools, and monitor the entire process. Focus on the fundamentals and maintain control of the product, and process.
