E-Sourcing Forum » Optimization and Reverse Auctions are Not Mutually Exclusive

Optimization and Reverse Auctions are Not Mutually Exclusive

February 4th, 2006 at 05:11pm Jason Busch

I recently did quite a bit of research on the state of eSourcing optimization technology, and came away impressed with how far the vendor community has come in the past few years. But while a good number of providers now offer optimization capabilities (including Iasta), I have a feeling that from an adoption standpoint, users are significantly lagging behind the optimization tools that they now have available to them. In fact, I’d wager that less than 20% of procurement organizations understand the power that optimization can bring to their negotiation arsenal, and far fewer know when to apply the right technique, and under what condition. In the next few months, I hope to change this by blogging quite a bit about how optimization, reverse auctions, and other negotiation techniques can work together (sometimes even in the same category, or even the same event). But for now, it’s critical to remember that this is not an either / or situation. I strongly believe that optimization and reverse auctions are not mutually exclusive techniques. If anyone tries to tell you that optimization is a replacement for direct, competitive negotiations (either face-to-face or via reverse auctions), I believe they’re speaking out of self interest. There’s a role for both.

- Jason Busch

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