E-Sourcing Forum » Low tide at Forrester

Low tide at Forrester

March 31st, 2009 at 02:14am David Bush - Iasta

On Friday, Jason Busch on Spend Matters had excellent coverage of the latest effort from Forrester, the 2009 eSourcing Wave, which is conveniently available from Emptoris. Unfortunately, the blog from Jason is infinitely more interesting than the actual report. If you were wondering, it should be the opposite.

These have historically been done by Andy Bartels. However, this Wave was done by Duncan Jones with help from Christine Ferrusi Ross, Antonin Shanahan, and Philipp Karcher. Much to my disappointment, a new crew has done nothing to enhance the Wave for its value to practitioners. In fact, I waffled on whether to even address this “analysis” but in the end, decided that Iasta must have a public response, since this report will exist on our shared airwaves for the next four years. To not do so would be a disservice to the procurement community. Moreover, it would be a disservice to us and the decade of hard work that has resulted in a very accomplished company and product line.

Before beginning, a quick housekeeping item: it will not be a coincidence when you see my content densely packed with proper names, titles, tags and descriptive terms for eSourcing (like spend analysis, contract management, reverse auctions and optimization). I want to make sure that when any one does a Google search for The Forrester Wave™: eSourcing, Q1 2009 by Duncan Jones, they also have easy access to other sides of this story.

The latest Wave begins with retread benefits of eSourcing – that have existed in Powerpoints going back to FreeMarkets days. Fair enough, I guess some readers are new to this and need the 101 class. It continues on with more basics like deals are getting done in SaaS, suites are expanding across other functional areas, and ERP are becoming players in the market. Spoiler Alert: the rest of this analysis is basically a forty-something ex-model trying to latch on top a sixty-something, moneyed retired divorcée (large vendors pay Forrester into the millions every year for research and “access”). Spoiler Alert II: this is not the portrayal of ERP solutions in the new report coming out by Andy Bartels about the ePurchasing market. I saw an advanced preview and it has got a lot of good impartial information in it and is especially candid about SAP and Oracle in the market.

Aside: Page 4, Figure 1 of the eSourcing 2009 Wave, shows that the total market (using revenue projections for sourcing, contract management, spend analysis, and spm) for eSourcing is $2,043,000,000 and roughly half of the entire ePurchasing market. If this is the case, why would you pick 9 vendors and call it a day? Does not this topic deserve a true “deep dive” with in depth product reviews, surveys, interviews and audits?

The truly troubling part of this effort, was the arbitrary criteria used for inclusion: current offering, annual revenue, strategy, market presence. I am not sure how these were actually graded since we were only asked four questions via email about our revenue and general value proposition and we never did a product demo or serious benchmark. These artificial parameters around the qualification have nothing to do with the product, additional services offered, quality of support, client base or price and do a disservice to practitioners by shot-gunning the research.

As far as what results these parameters developed: a sourcing product that is specifically designed and sold to the retail industry, a company in Europe that I have never heard of and we certainly have never competed against, a product with the acronym PLM right in it, that practically requires you to use the advanced search box to find the one web page about SRM, and an ERP product that actually gets people to laugh out loud at its miserable value. As far as Siemens goes, they probably still have the old eBreviate code jammed into some dark corner but they aren’t competing on any sourcing specific deals with the ATKPS application. And, correct me if I am wrong but Agentrics at least used to use Emptoris – unless they’ve now created their own platform? Would that not a be a violation of Rule #1: (a vendor must have its own e-sourcing product)?

Hmmm, I am losing confidence in the vendor inclusion process…44% of the best vendors have serious issues with their qualifications. Back to Iasta for a moment, which one of these criteria did we not qualify for? We are not $15m in revenue (this is true) but no one ever asked or requested our audited financials.

Moreover, I just do not understand what Forrester is trying to accomplish with this. Is it an intense global review, hence they were impressed by i-faber? If so, where are IBX, Synertrade, Portum and others that have significantly more presence? They even explain that Agentrics and Siemens are vertically targeted tools. So, is there a weighting benefit by only serving one category of client? What does $15m in license revenue have to do with happy customers that renew contracts and quality software that performs incredibly advanced functionality? And, as Jason points out, how is an analyst best qualified to judge a vendor’s strategy and assign 50% of his ranking to it to boot?

At the end of the day, I believe that these reports only do a disservice to the entire community. I got my first inbound query about Iasta not being included at 10:30am Thursday morning following the publication of the Wave. It came from Europe, from a very important prospect, at a very large company, that is strongly considering our tools. (Pay attention class: that’s more than one platform and an international presence, but we are not on the grid). I had to go into Code Red emergency response mode for the rest of the morning, just as I always do when the Wave or Magic Quadrants come out with their predictable results.

I am not mad because these reports are schlock. I am mad because they seriously impact our business and cause irreparable harm to our reputation and growth efforts. Countless companies will now use this report as their short list for evaluating solutions. We will never be contacted. I have no problem with practitioners trying to take the shortest path to the correct decision; everyone is very busy and needs help. However, passing this off as qualified unique research, when it is merely a 4 year refresh to a branded report, is counterproductive to the innovation which is really occurring out here – at Iasta and other vendors who did not meet someone’s arbitrary inclusion criteria.

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Entry Filed under: Analysts/Research, General, e-Sourcing Marketplace

1 Comment Add your own

1. Barb Ardell | March 31st, 2009 at 10:36 am

David, thanks for setting the record straight. I share your concerns about the quality of the research and analysis.

As a sourcing professional, I find analyst reports useful. HOWEVER, I can\’t \”check my brains at the door\”! I need to do my own research to ensure their research isn\’t flawed or biased. Unfortunately, not all of my colleagues have or will take the time to do that.

I\’m grateful for the blogosphere which facilitates the dissemination of additional perspective in these situations. Not everyone has a huge PR budget to get their message out. Thanks to E-Sourcing Forum for providing such an avenue.

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