What eSourcing can learn from social media

Over the last decade, social media has become ever more streamlined. From the creation of Facebook over 12 years ago, allowing individuals to represent themselves on a single page. The evolution of Twitter, limiting the number of characters that can be used in a single ‘tweet’ to 140. To the eventual creation ofTinder that matches couples based on their physical attraction to each other. Social media has revolutionised the way we socialise on a daily basis.

We have broken down social media into 6 main aspects that we believe are integral to the success of social media and what eSourcing can learn:

1. Engagement
2. Expanding networks
3. Ability to express opinions
4. Dissemble information
5. Sharing content
6. Create events

Aspects of Social Media

1. Engagement
Central to the success of any social media platform is its ability to engage users. Engagement in social media is measured by how much and how often others interact with each other and their content. This is influenced by content, usability of the system and its reach.
Successful SaaS sSourcing providers are typically easy to use and have the ability for suppliers as well as hosts to use the application anywhere in the world. Ideally an eSourcing platform would allow users to create content, potentially increasing the use of the software for enjoyment. In the future there is potential for further gamification as an avenue to explore to encourage user engagement.

2. Expanding networks
Social media platforms such as Linkedin and Facebook have the ability to bring together contacts from around the world. In recent years you can expand your network and connect with individuals who you don’t know but share a common interest such as sports teams, universities and previous job history.

Most eSourcing platforms are similarly moving down this route to connect hosts with more suppliers and also hosts with other hosts. Ideally an eSourcing system would have the ability for hosts to expand their networks of suppliers. An example of how you could do this would be a database of suppliers that would allow new hosts to invite other suppliers to their network. Thereby using the SaaS application to expand networks and find new contacts.

3. Ability to express opinions
Integral to any modern social media platform is the ability for a user to express their opinion over a particular topic. This can be done in the now popular method of ‘liking’ content.
In this case eSourcing platforms typically don’t have an option of expressing opinions due to the limited content that is shared between hosts and suppliers. However, could platforms integrate this ability as an alternative way to gain additional feedback on tenders.

4. Dissemble information – Twitter via 140 characters
Twitter has created an incredible ability to disassemble content into 140 characters or less. By limiting the number of characters in a ‘tweet’ it allows users to easily process information in small chunks.

eSourcing as with other industries are still looking for ways to further condense information into smaller forms, however the development of visuals over the last few years has gone further to dissembling information into easy to read content. Twitter has been used by past clients to advertise their tenders to a wider audience and then is certainly more scope for this.

5. Sharing Content
Social media platforms have advanced in recent years to make the process of sharing content both straightforward and effective. By using already existent content and distributing it to other users, it both lessens the need for new content and encourages or develops the relationships between users.

A form of sharing content is already being used in eSourcing through templates, guides, forums, and just in the process of general tenders. We foresee this to increase as eSourcing becomes even more integral to businesses, especially with respect to the community as a whole sharing ideas and experience.

6. Create events
Events are being used by social media applications to interact and develop relationships between users. Whether it’s scheduling your social calendar with ‘Events’ on Facebook or reacting to real-time events with ‘trends’ on Twitter.

eSourcing systems such as Market Dojo already use events such as Reverse eAuctions as a method of interaction between users. However the ability to show events taking place by other users and what is going on for other suppliers to join might be beneficial to create interaction and ultimately success.. Obviously there are issues with confidentiality and security that need to be upheld.

Overview
Social media has many aspects that are being used in eSourcing, while there are some aspects such as the dissembling of information into a very limited number of characters that have yet to be adapted. Here is a breakdown of different features that we believe eSourcing can adapt from social media.

What can eSourcing learn from social media?

Market Dojo helps procurement professionals negotiate better with our on-demand eSourcing tools. If you’d like to find out more, get in touch or register for free and play around with our software for yourself! https://www.marketdojo.com/reverse-auctions

Which reverse auction type should I use?


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Great! You have decided that you are going to save time and money by running a reverse auction to negotiate. One of the decisions you will need to make is which format of reverse auction will work best for you.

There are several different types to choose from, each one has strengths and weaknesses which you should consider.  I am going to focus on the three types which Market Dojo supports – Ranked, Open and Japanese. Both Ranked and Open auctions can also be referred to as ‘Reverse English Auctions’.

Ranked Auction
In a Ranked Auction participants see their position for each Lot relative to the other participants.  Generally it is the most popular auction type as it works for the majority of situations.  This is the default option in Market Dojo.


What a participant sees in a Market Dojo Ranked Auction

A Ranked Auction promotes a very close auction when you have a number of participants on a similar price level.

Pros

Cons

Open Auction
In an Open Auction participants see the Lead Bid per Lot and can only submit a bid that beats it.


What a participant sees in a Market Dojo Open auction

Pros

Cons

Japanese Auction
For each Lot, a Bid Level, which begins at a level you choose, is shown to all the participants. Each participant must either Accept or Decline the Bid Level within a set time period, e.g. two minutes. Once accepted and the time expires, the price drops by a specified amount and the participants must repeat the process. It continues in this fashion until the participant declines the Bid Level or is timed out.


What a Participant sees in a Market Dojo Japanese Auction

Pros

Cons

I hope this overview of different reverse auction types is informative, let me know what you think in the comments below.

Gamification – An evolution in software design or just continuing the trend?

Recently there has been an article in Supply Management (issue 6th Jan 2011) and also on the UK Spend Matters blog by Peter Smith (3rd February 2011) touching on the subject of Gamification.

For those unfamiliar with the term, here is the Wikipedia definition:

“Gamification is the use of game play mechanics for non-game, particularly consumer-oriented web and mobile sites, in order to encourage people to adopt the applications. Read More 

The gaming industries revenue is measured in tens of billions and it is growing at an almost exponential rate. They are obviously doing something right. 

Should the business software world take note and learn from this industry? Is it just a fad? Or is ‘Gamification’ just renaming of existing practices that companies are already engaged with whilst ignoring other elements of the gaming industry such as story telling which are central to games but not so relevant for business applications? 

There is quite an academic debate around this issue. This article is not about resolving this but to give a pragmatic viewpoint.

What you can say is that irrespective of the naming convention, it is obvious that the business world has a great deal to learn from the gaming industry. Software in the business world is becoming more useable, functional and can be easily customised, but misses the point if it is trying to learn from the gaming industry. 

The primary strength of the gaming industry is around the user experience. There are many other words that could be included here but it is the user experience which seems core to the uptake of their technology. There are many facets which make up the user experience: ease of use, attractive GUI, inbuilt intelligent tutorials, dynamic interfaces, fun to use, reward mechanisms, online communities, challenges, stories, scoring and so on… The list is endless and different applications will focus on different points.

The key is that the user engages with a very complex system easily and effortlessly to become proficient and then is self motivated to continue and progress and share information. It is the user experience which drives this however it is made up. You can’t say this about many (any?) business applications. Although you can certainly see that many modern websites and applications are starting to take on a different look and feel which seems to draw on important aspects of the gaming industry. They have taken on a more fun approach and well as a clearer and easier to use interface. Some nice examples here are Survey Monkey and Value my Stuff whose websites and functionality are laid out in very clear and simple steps.

Obviously business applications are always striving to become more user friendly, and this has been an industry trend for many years. However it seems that they always put functionality first above the user experience. They can continually make the user interface easier but it is by examining other industries such as the gaming sector that will result in an application which people want to use. If more business application started design by looking at the user experience and ultimately engagement first then there would be less multi million pound software implementations where much of the workforce don’t use to their full capability. We have spoken to companies who have Oracle and SAP implementations where they need to bring external consultants in to show them how to use the systems and increase uptake. Forcing users to uptake new technologies by changing processes is one way but wouldn’t it be great if users really wanted to use a new technology? 

Gamification, for want of a better word, seems to embody an incremental step change in the way business software applications are designed through the priority given to user experience.
You could just say it is a next level of design, but the word itself embodies a very specific element in the way design strategy is changing and there are other benefits to just user uptake. Games tend to be fun. This is because they are easy to use and encourage engagement. They tend to avoid repetitive tasks and focus on getting back into the thick of it. Thus the advantages of enhancing the user experience through design from the gaming industry in business applications will not just be around the faster uptake of the technology but also other areas such as reduced administration and efficiency.

One just has to look at Apple. It is very impressive how they have put the user experience first and have thus created a loyalty in their user base which continually grows. The IPhone has many little nuances which impress and you can see how it also makes the experience easier and richer. It seems they looked at the market and put the user first before putting in the functionality. (OK, still a good question around flash!)

At Market Dojo we believe the skill is not just around a nice looking GUI, or inbuilt tutorials but much more fundamental. Our philosophy is built around making a software product which people want to use rather than one that they simply can use. It seems this is now the goal of many other upcoming SasS vendors who are new to the market and it is a very interesting time for business applications and their evolution in design.

About:  Market Dojo provides business-to-business e-auction and e-sourcing software.  Find out more atwww.marketdojo.com.  

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