Angie Counsell (Left), Jon Pole (Centre), Sophia Binns (Right)
What do you do at Market Dojo and how long have you worked there for?
A: I am currently on my University placement year taking on the role of a marketing assistant at Market Dojo
J: Jon Pole – Business Development Manager since December 2017.
S: My name is Sophia Binns and I am the business generation manager for Market Dojo. I joined Market Dojo December 1st, 2017! Christmas came early!
How have you found your time so far at Market Dojo and what have you found interesting?
A: I have enjoyed being able to manage my own projects and have a say in what I think should be done for various marketing activities, including choosing the venue for our last roadshow event at the Birmingham Botanical Gardens.
J: Yeah it’s been really good and the team have been super welcoming, the thing I find most interesting is we have saved customers 1.3 billion yet we are just like a small family run business.
S: In the first week I was blown away by how lovely everyone was. Jon and I were shown the ropes and it’s so cool to see two guys who saw the problems in their industry and have taken the risky steps to change it. And the proof of this working is in the numbers. It’s really interesting to see how some people are scared of change. They’ve been using a system that is either outdated or inefficient but don’t want to take a step forward to change it. It’s going to be fun as my job to help people see why change is not scary but in fact exciting.
What are you hoping to achieve in your first year?
A: Confidence when working within the workplace, professionalism and most importantly my efforts within marketing to be successful. The experience is invaluable.
J: To become a well established sales person within Market Dojo and try to smash my targets, well that’s the dream anyway.
S: My aim is to be bringing in enough leads that both Pete and Jon (the sales guys) will be inundated.
Who in your team is most likely to rule the world?
A: Deffo me
J: Sophia wishes, Angie and her sass stand a chance. But Pete would sly dog everyone.
S: Me obviously.
What one thing would you bring to the office if you could?
A: Probably an endless supply of food, because I am never not hungry.
J: A winning EuroMillions ticket.
S: Multiple Puppies. I am still working on instating an office puppy. Watch this space.
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!Three Compelling Reasons to use a Japanese Auction by Peter Schmidt
Peter Schmidt offered to write a guest blog for Market Dojo on his past experience with eAuctions. Peter has a long track record in, sales, consultancy and procurement. He specialises in Telecoms, Managed Services and Public Cloud.
In procurement, eAuctions can be regarded as a fair way to buy goods or services as all the suppliers have an equal opportunity of being awarded the business.
The model that is commonly used is the reverse auction that gives suppliers during the auction information on their position relative to their contenders. This practice creates a competitive element among the bidders allowing them to establish the market price for the buyer.
At the end of this reverse auction, the contenders ranked two and three may have a fairly good idea of the established market price. This will indicate to them to improve their performance for similar categories organized by the buyer. Despite the fact that the above sounds great and the results are rewarding, there are situations that would call for the Japanese auction.
The Japanese auction
The mechanism of the Japanese eAuction is straightforward. All the participating suppliers start at a predefined price level that is decreased by a fixed percentage during the auction. The final contender who declines the offer wins the auction.
The contenders are unaware of who is bidding and what the others are doing during the auction. In general, the best price that arises from a Japanese auction is less favourable than when a reverse eAuction is conducted. There are situations, however, that could benefit from the Japanese auction model.
Lack of pricing elasticity
The suppliers have submitted their offers at different price levels, where there is a reason to believe that the dynamics of reverse auctions are likely to fail because of a lack of price elasticity between the highest and lowest bidder. The Japanese auction will ensure then, that at all times a better price is established, as the lowest bidder is unaware of the others and is encouraged to give a better price.
Limited amount of contenders
If for whatever reason suppliers are not eager to bid and the number of contenders is reduced to two, you may consider a Japanese auction to eliminate the risk that one of the bidders declines to participate at the last moment, which leaves the buyer with only one supplier. The Japanese auction allows the buyer to continue with the auction and establish a better price.
In a highly regulated market segment where suppliers do not want to know from each other the kind of pricing levels that they can offer. Also here the Japanese auction can be the right fit, as the suppliers are not able to assess the behaviour of their contenders.
Other methods that are beyond the scope of this blog that can be conducive in yielding better results from an eAuction is the introduction of extra variables that relate to the market conditions and/or the supply chain.
It is paramount that whatever way you chose, suppliers must be well informed about the rules of engagement as the buyer’s success depends on their commitment.
For more details on the various types of auctions, please download the Infographic from Market Dojo.
Alternatively, if you’re interested in find out more about the services that Peter Schmidt provides, click here.
Peter Schmidt, Independent Consultant for P.Schmidt Consultancy Services B.V.
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!New Release – November 2017
Our regular system improvements have taken place again, and this month we have looked at Document Sharing.
Ability to attach documents only for a specific supplier
Documents are a really important way for our customers to share information, whether these are terms of business, product specifications or customer references, they often form a critical part of the tender. Until recently, document security meant that a Host could only share documents with Participants based on their status. All participants would see some documents, with others restricted to just the Participants who the Host had given access to the whole event.
Sharing in this way is easy and simple, however, sometimes you may want to share a document with only some suppliers. Examples include co-signed NDAs, Award Letters and Signed Contracts. Previously, the only option was to do this outside Market Dojo, which meant some parts of the audit trail were not available.
Now, we have changed this, so that documents can be shared with certain suppliers, or just with the other Hosts managing the event. This is an extra option when creating or editing documents:
Documents have a new ‘Share with’ option, where you can control who can see the document.
The experience of viewing a document remains the same for Participants (either they can see a document, or they cannot). For Hosts, there is now an extra information badge, which shows who has access to this document.
When the host views a document, they can easily see who it is shared with. 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!New Release – October 2017
Autumn is definitely here, and we have been busy improving Market Dojo. This month we have released two features that our customers have requested. We have also made a whole bunch of improvements which are less conspicuous, but let’s focus on the headlines.
Market Dojo – More than five questionnaires
We have increased the limit on questionnaires in Market Dojo from five to ten! For some of our customers, this is really important so that they can gather more information about the participant’s offers. This additional feature is now live so just add more questionnaires to your event as required.
SIM Dojo – archive and delete participants
When onboarding suppliers, from time-to-time you want to remove someone from the process. This may happen because the wrong person is invited, or you are certain you will not require their services in the future.
Now, you can do this easily in SIM Dojo. When you are viewing the decision tab for a participant, there is a new option to move them to the recycle bin. Once they are in the recycle bin, they will not be counted in reports or sent any emails. If you change your mind, then they can be restored.
We hope you like these two improvements, and we look forward to sharing more exciting news soon.
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![New Release] – August 2017
Over the past few years we’ve discovered that eSourcing has evolved into becoming a team effort. Whether it is the stakeholder who needs to sign off on RFI requirements or the colleague who is best able to answer a suppliers question. In recognition to this, we’ve made a key focus of our latest product update to help with this new challenge.
Market Dojo messaging has always been a great way to manage communication with your suppliers in a centralised, auditable way. However, until now it wasn’t possible to have the same benefits for communication within the buying team. With our latest release that has changed, as now you can message your fellow host as well as participants within the tool.
The new send message page :
Similar to the send to participants page, you can choose which individuals or groups the message should be sent to. You have the ability to easily select everyone with a particular role, or just choose individuals.
We are very excited to help our customers work more efficiently with their internal teams, and look forward to seeing this feature being adopted.
If you have any questions, don’t hesitate to get in touch! Contact us at email@example.com
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!
If you ask most honest companies they will probably tell you that organisations value revenue growth and sales departments more than savings and the procurement/purchasing. Procurement is seen as an administrative function responding to the needs and demands of other areas of the business. But shouldn’t procurement be more prominent?
Why? First, let me go back to the basics of the value of cost reduction
Every Pound or Euro that you save through cost reduction is potentially much more valuable than sales because every sale is reduced by the costs. Those costs might be the materials costs, overheads or even the cost of the sales process (after all someone has to pay the sales guys their big bonuses!).
Remember, what remains after the sale is the net profit. For example, if you’re selling TV’s for £100 each and you have a 10% net profit margin, each television sold will produce £10 net profit for the company.
However, if you reduce the costs of producing the television by £50 per unit, then you will be making a £60 net profit on each television sold (£50 cost reduction + £10 initial profit margin). Meaning that without that cost reduction, in simplistic terms, your sales team will have to sell 6 times as many TV’s to get the same net profit.
The important aspect to consider is that the smaller your net profit margin, the greater the impact of cost reduction becomes.
But how does this relate to ‘The Leaky Bucket of Business’?
Consider your businesses sales process as a bucket. For every cost and expense, a different leak or hole appears within that bucket. The greater the costs, the more holes or leaks that you have in your bucket and therefore the less you will retain after filling up your bucket.
If your company decides to make a huge outlay on marketing, advertising and sales to increase the number of sales (in this case the level to which the bucket is filled to) you will still only be retaining what is left in your bucket.
Traditionally, departments other than sales and marketing have been marked out as ‘cost centers’; areas where cuts and internal savings can first be made, improvements should be limited to bounded capex and any additional pound of ongoing spend is a pound off the bottom line. This approach can work however it typically fails to recognise the value of internal investment. Wise opex focussed on improvements to processes and tools can pay dividends far greater than the investment. That might be in efficiency and speed improvements internally, i.e. ‘getting a bigger bucket’ or, our speciality at Market Dojo, reduction in external costs.
Every department is a profit centre if given the opportunity to be, and procurement is an oft-undervalued way to increase the profit margin without fighting for that next big sale. If your company decides to invest in procurement to reduce their costs and plug some of the leaks in your bucket, your company could be making more with less cost.
The average statistic to measure a procurement department is that it should return 8-12 times in savings to what it costs. If your procurement department isn’t performing to this level, it’s time to look hard, not at cutting their staff, but at improving their processes and tools in order to make the most of your ongoing spend.
Thus why it’s important to invest in your procurement team and their tools, ensuring that you’re not sacrificing sweat, tears and blood for the sake of a very leaky bucket and why (controversially) Procurement has more value than Sales.
For more information on how Market Dojo can help procurement professionals save time and money, get in touch or register for free with our range of on-demand eSourcing tools and find out for yourself!Market Dojo and UNIC ONE partner to strengthen our offering to the German Market
We are delighted to announce our partnership with UNIC ONE in Germany.
UNIC ONE brings a wealth of procurement experience in Europe’s largest economy. Marianne Haack who leads the procurement organisation at UNIC ONE, has previously worked for organisations including Novartis and Sun Microsystems.
This will greatly strengthen the portfolio which Market Dojo offers to customers in Germany.
It means that UNIC ONE can also offer to their customers the Market Dojo solutions. This will compliment the consultancy and training service already provided by UNIC ONE.
Nicholas Martin; Co-Founder of Market Dojo said:
“Market Dojo has seen strong demand from the German market this year. We have been working closely with UNIC ONE and our existing German customers. As a result with have made a number of improvements to our product. We are very excited about the potential to build on this success and having a local partner will be a huge benefit.”
Marianne Haack; UNIC ONE said:
“We chose to partner with Market Dojo as we were attracted by their ease of use and simplicity. We believe the combination of our expertise with Market Dojo product will give a great solution for our customers in Germany’.
If you would like to learn more about UNIC ONE, you can get in touch via their website – www.unic-one-procurement.com
Market Dojo provides accessible eSourcing software. Find out more at www.marketdojo.com
A traditional view on marketing was to simply split it by indirect and direct marketing. Indirect is where you are not going direct to a client and direct is where you are. Both are there to create leads. Sales would be the conversion of those leads to opportunities and hopefully sales.
However, increasingly we will see terms out there such as inbound marketing and search engine optimization.
Are these terms just re-badging of the traditional all encompassing models for specific areas. For example, Inbound marketing is a mixture of picking off parts of indirect marketing (i.e. landing pages) and direct marketing (i.e. email automation). SEO is simply about improving your organic search.
So it might be useful to put together an all encompassing, collectively exhaustive table. It is also helpful to cross reference how the various techniques can help with your strategy.
Indirect marketing tactics can help with your overall game plan in one of four ways. Three of these are related to how people find you: through paid ads, referrals or backlinks, organic search. The fourth one refers to how prospects interact with your website.
Each of the various Indirect tactics can affect your different strategic imperatives. To give you some examples:
Social media and video can obviously help with your referrals from youtube. They can be used embedded in the paid ads or on your website. Also as google analyses their website traffic, this will ultimately help with organic search.
Landing pages are great for specific adverts but can also help with specific content on your website and as above ultimately help with organic search.
Keyword density is really focused on assisting with organic search improvements and again with website conversion through appropriate content.
All in all it takes a hand in each of these tactics to improve your marketing strategies. There is no magic bullet (unless you hit that viral masterpiece – good luck!)
We live in times where search engines are looking for good content that attracts and engages visitors, and keeps them on your site. The strategies you focus on and the tactics you use need to be examined with constant care where quality is more important than quantity.
Last week we bid a fond farewell to our intern Alex who spent 9 glorious weeks at Market Dojo HQ. Whilst here he worked on translation of the website, wrote content for the blog and spent a lot of time creating wonderful graphics for us.He was a great asset to the team and we wish him all the best in the future. Thank you Alex! Here is his parting blog:
I will have long-lasting memories of my experience at Market Dojo. In addition to the relaxed and enjoyable working atmosphere, the team often liked the work I did.
After leaving, a part of me will stay with Marketdojo, and for a while, through my design creations, a part of Market Dojo will also stay with me.
Nicholas, Alun and Nick set up a marketing campaign called “Be the e-Sourcing HERO”. One of my tasks was to put a face into this idea and create various marketing materials. Very soon, you will discover this campaign at the e-World exhibition on 22nd September 2015 where Marketdojo will unveil its new hero.
Here is a small foretaste of the appearance of the hero:
Creating the hero, the banner and the poster was simply a part of my internship. However, my CAD knowledge has been truly tested. Dozens of tests and patterns were needed in order to achieve a result satisfying all Market Dojo members.
This experience enabled me to understand how the validation process of a communication support in the professional world is long and rigorous. Everything can still be improved.
Some of my other missions, such as the translation of the website in French, could appear as less cool. Nevertheless they were just as beneficial as the design stuff. In my opinion, it is one of the best ways to learn English and especially procurement vocabulary. Which has been useful in every day life in Marketdojo. Even if I was not there long enough to become “The e-Sourcing HERO”, I was able to come up with a commandment for procurement: “Buy French.”
My main objective was to write “Fluent in English” on my CV at the end of my stay in the UK. Although, I may have set the bar too high. A future experience will be required to reach this expected level. However, and fortunately the next exam to to join a top Business School should now be achievable.
My internship at this small Start-up has allowed me to interact a lot with people. I had my first opportunity to participate in a professional meeting (party? Congress? I don’t remember the word) where I discovered another interesting side of the English business environment.
I would like to thank every member of Marketdojo for their welcome, for their help and for their happiness.. I know that this experience will have been incredibly beneficial for my career. I definitely recommend this Start-up to any motivated young Business graduate.
Alex – former CED (Chief Executive Designer) of Marketdojo
Market Dojo strive to make procurement professionals’ lives easier by providing innovative cloud-based eSourcing tools. Founded in 2010 by procurement professionals, and having received three grants for innovation, Market Dojo’s main focus is enabling better adoption for both the buyer and the suppliers.
Jadon Silva, Director of UK Procurement, spearheaded the implementation of this software at HomeServe with the first auction taking place in April 2015. Following HomeServe’s first three auctions, savings of £1.9 million have been identified.
HomeServe was formed in 1993. Its mission is to be the UK’s leading home assistance company. The scope of services they provide ranges from plumbing and drainage emergencies, locksmith services and gas boiler repair.
With a growing network of experienced engineers, HomeServe provide a reliable service across the globe, with operations in the UK, US, France, Italy, Spain and further afield.
Jadon Silva and the team at HomeServe have identified a number of reverse auction opportunities by using Market Dojo. Through these, the home assistance experts plan to generate even greater savings, which will hopefully carve the path for a fully adopted eSourcing approach.Two separate categories have so far been auctioned. The first was for the supply of envelopes which took place in a single day and comprised of three ranked auctions to supply the UK, France and Spain. Ranked auctions allow participants to see their position in the auction, relative to other participants. They really encourage competition amongst suppliers and are the most commonly known and widely used e-auctions that take place.
Market Dojo attended HomeServe’s head office in Walsall for the first auctions where a phenomenal value of £500k was saved, working out at 30% of what the company were previously paying.
The second category was for the supply of various subcontracted services, which encompassed four auctions across 20 different regions of the UK. The slightly more aggressive Japanese auction style was used and over 140 suppliers were invited to take part in each auction. Each of the suppliers were able to bid on any of the regions, which were created as separate Lots. Japanese auctions involve the buyer setting various bid levels for each lot, which the suppliers then have to accept within a certain time period. Once this time period passes, a lower price level is designated. This process repeats until the last participant declines a bid level or the time runs out.
Through Jadon’s resilience to push the Japanese e-auction agenda, HomeServe saved a staggering £1.4m. Additionally, negotiation processes which may have taken weeks or months, were completed in a matter of hours.
With success resonating across HomeServe, Market Dojo looks forward to continuing to build a long-standing relationship with the home assistance provider.
Commenting on the savings achieved, Jadon says; “It is great that we can extract this value from smarter procurement initiatives. The subcontractor network may have fallen into the complex category, which often doesn’t favour e-auctions. However, with the correct communication, due diligence and controls, we have proved that the e-auction methodology can still be a success.”
Alun Rafique, co-founder of Market Dojo mentions ”We are delighted to see another company bring eSourcing in-house with such ease and uncover large savings. Jadon has shown how eSourcing can be successfully adopted by his team of buyers and their diverse range of suppliers.”
When asked what HomeServe would do with the savings, Jadon replied; “The savings we make allow HomeServe to invest in what is really important to us as a business. Customer experience is at the heart of what we do. We aim to be at the forefront of new technology, which aligns with providing our customers effortless service.”
This year, I will spend my summer holidays in the British Island. Obviously this is not the most exotic destination but I have to do this because a master in management is waiting for me and my English skills are far to be perfect.
Different missions in this promising start-up as well as the discovery of your country will be my daily life until late July.
Far from being the ultimate summer destination, I was expecting very wet weather.It has not been so bad, until now! Nevertheless, coconuts and lovely beaches are missing.
On disembarking from the ferry, I could almost believe I was in France if you were driving on the correct side of the road and if you were using “kilometres” rather than miles. The first yards driving were slightly stressful.
Fascinated by cars, I think that you, English people, have better taste in this domain. I have already seen more sports and luxury cars here in three days than in one month in France! However, you clearly lack creativity in some areas.
For example, your houses are all identical to each other. Considering the price, is it not frustrating to have the same house as your neighbour? Don’t you prefer something more personal? I find it particularly sad.
Market Dojo seems to be more creative. I was surprised when I discovered that Market Dojo offices are now located in the middle of a farm, in the middle of the countryside and fields. Original for a company that creates software applications and is in full development!
The team, like most English people, are very welcoming. I could also describe it as happy, thirsty (yes, they drink eat least 4 or 5 cup of tea per person and per day), involved in their work & often crazy!
Although they find it odd that I do not like tea and coffee, they do their best to quickly integrate myself within the team. They are very interested in me, which, in addition to creating relationships, helps me improve my English skills.
As soon as I arrived, they didn’t hesitate in accompanying me to Subway and inviting me to come and play a football match on the first evening.
Unfortunately, I did not represent French football well that evening. Awkward in my dribbles and in front of goal, I justify myself by accusing my unsuitable shoes to synthetic fields.
I would add that Nick was a serial scorer this evening.
I also realise that English people seem to be more sporty than us. However fast food and junk food are present approximately everywhere. Perhaps the French and English could take the best from each other ?
Let’s get back to work! My role is to develop their business in France by promoting them and by cold calling people in France. I’m not very exciting by this last one but it should be a beneficial experience in my career.Then, I have to translate some parts of their website into French. Anya, the new marketing and salesperson, may need my help in promoting market dojo. I already have some design tasks to do, which I really like. Nevertheless, my main assignment is to help Alun to maintain his French knowledge. Actually he is not so bad!
I’m going to be a very busy man during these 10 weeks.
Market Dojo, a start up specialising in e- procurement Software – as – a – Service (SaaS), is constantly looking to expand its sphere of influence through short, medium and long term relationships. A viable business needs to be based on all three to have a long term future. Working closely with academic institutions is an ideal vehicle for satisfying all three conditions.
Market Dojo, who work in the eProcurement space have forged a close relationship with the University of Greenwich in their International Procurement and Purchasing course led by Dr Li Zhou. For four years, two of the co-founders of Market Dojo, Alun Rafique and Nick Drewe, have presented and currently help with a key lecture in the MA of Logistics and Supply Chain Management.
The lecture is based on Market Dojo’s initial proposition on which the company was founded four years ago. This focuses on an innovative technology for negotiation called the reverse auction, which Market Dojo have made more accessible through an easy to use, on demand solution that lets procurement professionals more readily negotiate their goods and services.
Embedded in the lecture is a game that Market Dojo has developed which combines the elements of using Software-as-a-Service, negotiation and game theory.
Alun Rafique reveals “This game gives the students a background into a key element of an emerging technology which is at the heart of their course. On top of this it shows how Market Dojo developed its original strategy and shows the benefits and challenges that companies face when adopting new technology.”
Dr. Li Zhou, who is a Reader in Operations Management at the department of Systems Management and Strategy, readily saw the advantages in working with a real life start-up based in the procurement space. She says “Market Dojo has given my students an insider view to how a start-up in this area can create value for businesses whilst also showing them how a small company can grow and challenge much larger competition through innovative on-demand technology”
Market Dojo often works with academics to help provide real life examples to students and there are many reciprocal benefits. The feedback from the students is very insightful and can help shape Market Dojo’s product and even provide answers to their own challenges. Further to this it helps spread awareness and can help with recruitment.
Nick Drewe mentions “It is key for small businesses as well as large multinationals to work with academic institutions to give students a holistic view of all elements of the modern company. We find that students are especially interested in our entrepreneurial view as many want to start a business themselves.”
Market Dojo hopes to expand their relationship with the University of Greenwich and is looking at other research opportunities there. They are also working with more diverse training providers by offering their software to help with general training in the field of eSourcing. It is by working with this area of education where there are obvious benefits for both parties that help Market Dojo forge strong relationships and a real long term strategy.
Market Dojo offers easy to use, professional e-sourcing software as a service. Founded in 2010 and based in Bristol their aim is to provide accessible solutions to procurement professionals enabling them to save time and money on their purchasing activities.
The University of Greenwich is one of London’s largest universities and celebrated its 125th anniversary in 2014. The university has three iconic campuses in London and Kent, and a heritage of education, discovery and technological innovation. An ambitious institution, it takes an innovative and modern approach to teaching, research and enterprise, and is thoroughly committed to making sure that students achieve their potential.
Writing a case study is easy.
Writing a case study that is engaging, compelling and entices the reader to do more is another matter altogether.
Companies structure their case studies in different way in terms of paragraphs, bullet points or a combination of both. Which one of these is correct is hard to say and maybe does not matter. However the actual content of the Case Study does.
I’ve put together some points to consider when you’re writing a case study:
1. Follow a Formatting Framework
Reading big blocks of text can be boring. Make sure to break this up with compelling images and screenshots and informative bullet points. Make your case study easy to read and therefore easy for your reader to get involved in the story.
2. Encourage Empathy
If someone has clicked on a particular case study, that must mean they have drawn some form of connection to it – a bond if you will. This may be because they share something similar, the reader feels they may be able to relate to the particular industry for example. To do this, it is important to retain the reader’s attention. Tell a story and make it personal. Highlight how the needs of the industry your share have been met by this particular product /service.
3. Focus on Facts, Figures and Benefits
People like facts. Fact.
Including specific figures such as ‘achieved savings of 25%’ allows one to see real-life, specific examples of what they could expect to obtain. Giving your readers examples of quantifiable, tangible results alongside a story they can relate to makes for a very powerful case study.
I feel that these are a few of the important points to consider when tasked with creating an interesting case study. There are many more elements to think about, but this should provide a sturdy base to start you off.
What other elements should be taken into consideration?
Have you come across any other key factors that you would like to share which have made your case studies interesting for the reader?
You are an experienced procurement professional. You have been completing tenders via phone and email since 2001.
When you need a quote, you simply pick up the phone, call your suppliers, get a few prices and go with whichever one can deliver first. Sometimes you find yourself asking; is this the most profitable way of operating? Is there a better way of working which could allow me to include more suppliers? If I want to find out what was paid and from whom the last time I bought a specific item, do I have to scroll through hundreds of emails to find out? Your current way is clunky and frustrating at times, but that’s just how it’s done… or is it?
One day, you leap up from your desk and cry ‘ENOUGH IS ENOUGH! There must be another way.’, after plugging ‘eSourcing software’ into Google, you go in search of a more simple, more accountable way of sourcing what you need. Due to the easy to adopt, pay as you host SaaS Model offered, you opt for Market Dojo.
After signing up for free on the site, you log in and head to the Sandpit to create your first eTender. But what is all this jargon? Your comfort blanket of ignorance has been removed and now you have to learn a whole new world of terms and phrases, varying processes, different types of auctions, and strategies to make your event successful. Quite overwhelming really? Nope.
The Market Dojo team are a kind breed and want to make the transition from prehistoric tendering to suave eSourcing as smooth as possible.
Not only have we made our system really easy to adopt for yourselves and your suppliers, all of the fields which may cause confusion are marked with an ‘i’, when you hover over this, you are provided with in-depth details of what it means. If you’re still feeling bamboozled, we have also provided you with a wealth of resources and videos which you can access for free after registering on the site.
Our resources really allow you to get to grips with how the tool works. From demystifying jargon to providing you with templates for uploading lots, the resource page is a great means of finding out what you need to know. And you can access them in your own time, for free.
With over 30 video tutorials, divided into supplier support and participant advice, you can really find out all you need to know without even having to pick up the phone. If your suppliers get confused, you have a host of knowledge at your finger tips ready to pass on.
The video by the students at University of Gloucester sums up this blog post nicely:
Before you know it, you’ve signed up to Market Dojo (Did I mention it’s free?), watched a couple of tutorials, created 3 RFQs, a PPQ and a £10,000,000 auction on stationery, all ready to go live once you purchase your licence. You’ve done it all by yourself, without having to arrange any meetings with the Market Dojo team, no complicated supplier webinars across differing time zones. And if you did need to ask for help, you can always pop us a question on live chat where one of the very knowledgeable team can offer you some light consultancy advice.
Well, what are you waiting for? Head over to our site, check out our resources for yourself and make the easy move to eSourcing.
This Saturday (21st March 2015) is a very important day in the world of rugby. Not only are the final three games of the 6 Nations impending, the ball is literally in anyone’s court as the title of champion could go to one of three contenders- England, Wales or Ireland. After England smashes France in the final game (kick off 5pm), we shall be crowned victor (fingers crossed!), and I shall celebrate with a pint of cider in the pub across the road!
We British are notorious for our love of sport, as pointed out by a French intern at Market Dojo a few years ago, who wrote a blog post for us, singing the praises of the British culture in one paragraph then calling us ‘rosbeefs’ in the next! (Just kidding Camélia. We know you love England really.)
Having spent the past month becoming au fait with all things eSourcing and eAuction (like my use of the French language there?), I can’t help but draw parallels between sport and eAuctions. The thrill of watching your home team scoring a try at the deciding game of the 6 nations and the excitement of viewing a reverse auction in real time as suppliers bid on your product/service of requirement- in both results, you become a winner.
As the final gets underway, Ireland, Wales and England all have a chance at becoming victor- this really is anyone’s game to win. The same also applies to the eAuction process were all of the players (suppliers) enter the event with equal chances of winning the tender, determined by how they perform in the auction.
You can be a hero whether it’s scoring the winning goal at an all-important match, achieving the best result for your company and hosting a successful auction (or even as a supplier, winning a huge tender through an open and transparent auction process).
Hopefully England will be able to pull it out of the bag and give England that win we deserve this weekend. If they don’t, I’ll embrace my Irish heritage and cheer for them next year instead!
Before their unfortunate demise, Phones4U were a wonderful client of our eSourcing and opportunity assessment tools. Their procurement team was lead by the experienced Sandip Modi who had implemented a multitude of eSourcing programmes in his previous roles. We were privileged to have been chosen as the eSourcing provider at Phones4U due to our on-demand, affordable pricing, consumerised ease of use and hands-on support.
Sandip had a very clear vision of how the eSourcing programme could be rolled out across Phones4U. The strategy was to create an eSourcing centre of excellence whereby the individual Category Managers would package up their procurement projects to feed into the eSourcing team to conduct the online negotiation. Once the eSourcing event was complete, the results would be handed back to the Category Manager to implement.
This is a different strategy to how we’ve seen other organisations adopt eSourcing, where many look to give each Category Manager or procurement person the ability to run their own eSourcing events.
There are of course merits and drawbacks to each approach.
Typically we’ve seen that each member of the central procurement team would be given full remit to run their own eSourcing events. The licence holders could be a mix of Category Managers, Procurement Managers, Supplier Relationship Managers, Buyers, Analysts, Marketing Managers, Legal, you name it. As well as running the eSourcing events, they would be heavily involved in all their other procurement duties from category strategy, purchase-to-pay, supplier management, evaluation and implementation, contract management and so on.
The advantage of giving them direct access to the eSourcing tool is that it can empower the individual and raise their profile within the organisation; we’ve seen many a CEO of FTSE 500 organisations take an active interest in procurement’s eSourcing events. The users gain additional expertise that can be called upon when needed, whether in their current role or the next. Plus it’s a low cost way of training staff in best practice, especially if you ask your eSourcing provider to deliver this as part of their licence fee. Lastly it means the individual has full remit across the entire procurement exercise and can use their in-depth knowledge to optimally conduct the eSourcing event without having to transfer their work to another person.
However the drawbacks do become obvious. Since the eSourcing licence holders are so heavily involved in the myriad of other procurement duties, they quickly run out of time and capacity to administer the eSourcing events, even though the approach saves them time in the long run. Fire-fighting becomes the order of play as opposed to strategic planning. Fewer eSourcing opportunities arise, adoption reduces and before long the eSourcing tool is playing second-fiddle to the previous way of working.
Secondly since users dip into the tool on an ad hoc basis, they have little opportunity to become experts on the eSourcing process: be it the software, the guidance notes, the strategy or even support. This can again inhibit the flow of the events and dry up the eSourcing pipeline, as it becomes a barrier instead of an enabler.
Recently we were talking with a FTSE 100 organisation that had purchased 40 user licences of an eSourcing tool (sadly not ours as yet!). A year into that contract, only 1 of the 40 users regularly ran eSourcing events. One! I think that aptly sums up the downside of this approach.
By separating the roles of the eSourcing Managers from the rest of central procurement, it created a clear expectation that the procurement exercise would be conducted via an eSourcing event, unless there were valid exceptions. The eSourcing Managers would proactively knock on the door of the Category Managers to ask for new projects, as this was their deliverable. It greatly helped with adoption of the eSourcing process, and so it was no surprise that within months of our tool being taken up, all of the Category Managers were feeding their projects into it.
The Category Managers could continue to spend 100% of their time on the strategic aspects of the procurement, such as the opportunity assessment, spend analysis, stakeholder engagement, market information, creating robust tender documentation, supplier evaluation and so on.
The eSourcing Managers would spend 100% of their time on becoming experts with the tool, perfecting the eSourcing rules and guidelines, scoping the event strategy, managing the eSourcing events and conducting any reverse auctions.
The eSourcing team would be unencumbered by the internal politics and getting bogged down in the category strategy, project management, supplier award and implementation procedures that typically reduce the flow rate, i.e. adoption, of eSourcing.
By doing this, it was quite realistic that a single eSourcing Manager could handle over a dozen full-scale eSourcing events a month. We’ve heard of several FTSE 100 companies that run fewer events than this across their entire team of 20+ eSourcing users!
Naturally there are some drawbacks. The Category Managers are responsible for the procurement yet can feel peripheral to the more enjoyable aspects of using an eSourcing tool and running reverse auctions. However that can be mitigated by adding the Category Managers as key viewers of the eSourcing events and holding the reverse auction days with everyone present. This would also help promote the communication between the eSourcing team and the Category Managers on important tasks like supplier Q & A.
Furthermore, for an organisation to justify employing people who are solely dedicated to running eSourcing events, you must have confidence in both the eSourcing process and its suitability in the organisation. This is where an experienced procurement professional like Sandip had seen time and again that eSourcing is a vital tool to help procurement deliver optimal results. So instead of spending a fortune on say 40 eSourcing licences, you instead employ an eSourcing expert and a single licence to channel your events through the centre of excellence.
This may well mean we as Market Dojo only sell one or two licences to a FTSE organisation instead of 40, but ultimately we want you to succeed with your eSourcing initiative rather than profit from your struggles – and we promise you won’t find many providers that share that view!
That said, once the centre of excellence was underway at Phones4U, they had Category Managers knocking on their door asking to run the next project themselves, with the eSourcing team in support. That’s the perfect next step for rolling out the process to the wider community.
Now we’ve shared our views, which approach would you take in your organisation and why?
As of Monday 2nd March, I became Market Dojo’s first official employee and the very next day, my knowledge and skills were put to the test as I awoke to my alarm at 4am for my journey to eWorld!
Market Dojo has attended nine eWorlds to date, however this was my very first visit to the exhibition. Coming from a marketing background with little experience of the Procurement industry, I found the day incredibly insightful, extremely beneficial and as I wandered round the stands, chatting to various suppliers/competitors/partners, everyone was really friendly and keen to teach me about the ins and outs of the world of Procurement.
As we made our way from Westminster tube to the conference, I was introduced to Mr Peter Smith from Spend Matters, whom we later got a chance to show our new Lot Matrix to, and we carried on our merry way to the conference. Upon arrival, we were greeted with a free gammon roll (many thanks to the eWorldteam), a cup of coffee and began to load our stand up with our promotional material. We shared our stand with one of our partners, the consultancy firmBaker Wanless, and I met one of the consultants, the lovely Angela Olszewska.
A fantastic stream of people passed by the stand as we were situated next to the entrance. As a result, we were never at a loss for people to speak to, demo to and just generally chat to about our love of e-sourcing and e-auctions!
I attended a talk by Tania Seary of Procurious about the benefits of Social Media to the Procurement world and watched her handle some pretty tough questioning from a few fellow listeners which opened up an interesting debate.
As far as conferences and trade shows go, I have attended a few in my time in various sectors of business and this BY FAR has been one of the most dynamic, welcoming and (most importantly) successful that I have experienced.
CC Image courtesy of Kevin Dooley
The Daily Mail recently published an article about how elderly people had been auctioned off to care homes on the internet.
Of course, the Daily Mail specialise in creating provocative content which people will want to read. This article received 740 comments, which is far better than my average blog post.
Market Dojo does not provide the IT system identified in the article. We did want to provide an alternative viewpoint on the story.
So, lets take the key points in turn…
At least a dozen local authorities are listing vulnerable people’s details
There doesn’t seem to be any suggestion that the local authorities are sharing details with anyone other than those approved to see them. Indeed, the registration process seems to be very thorough. In common with Market Dojo, only approved companies would get access to the details of the event. These details would be required in any kind of tender process to enable to vendors to bid accurately against the requirement.
Ages and care needs including medication sent to up to 100 care firms
Well, yes. It is wise to provide details if you want to find a provider who can care for the person based on their individual needs. I am quite sure that an ethical firm would require this information before they would be able to provide an offer of care for someone. Without knowing their individual needs, how could they be expected to provide proper care for them? Using an electronic approach allows you to spread the net wider, which means finding a better match for the individual’s needs and the auction element of this is simply for the last stage to negotiate the price.
They pick which people to bid for – and cheapest offer nearly always wins
Yes, this isn’t suprising. Generally this only happens after the following steps have taken place:
– The suppliers have been screened to ensure they can offer the level of care which is required.
– The screened suppliers have assessed the persons needs to ensure they can provide the appropriate level of care.
– All suppliers have agreed to meet the required SLA’s (Service Level Agreements)
This makes it unlikely that the cheapest supplier is offering an inferior level of care. In fact, by comparing bids from several suppliers, it is easy to identify anyone who is cutting corners and offering a much lower price than everyone else.
‘eBay-style’ system ‘awful’ and ‘just uncivilised’
The comments seem to refer to the funding crisis for elderly care. This is a cause I completely support and commend Roz Altman for speaking out on this issue. For local authorities who have been tasked with using fewer resources more efficiently, a reverse auction makes a lot of sense. The process can be completed faster, leaving the clients and their families with a shorter period of uncertainty at a very difficult time. By putting strict quality criteria in place (a point mentioned but not emphasied in the article) the local authority get the best possible standard of care, whilst ensuring that private companies are not able to make excessive profits at the taxpayers expense. Again it should be noted that this is no different from any tender process except by the use of an auction the negotiation is more efficient, and not to mention completely transparent.
Health group leader: ‘It’s an absolute disgrace – it’s like a cattle market’
It wasn’t clear to me why the system had been compared to a cattle market. I suspect that this was because an auction was used to match them with care firms. Whilst it’s true that cattle markets use an auction approach, I think that is really where the similarity ends. An auction is an efficient and fair method to identify the best match for a specific set of requirements. Whilst price is a factor, auctions can also consider quality factors as the councils quoted in the article clearly said.
The article did raise some serious issues where vulnerable people had been sent to homes which were zero rated on a councils own quality scale. I’m glad that these problems were highlighted. I would have liked to see more investigation into the reasons why. When used correctly, an auction can help prevent this type of issue. They provide a clear view of the different choices available. I think it’s quite wrong to relate these issues with the use of an auction system for the sake of a good headline. In fact this is far more related to how the SLA was defined and how the contract was awarded and managed.
– Unlike eBay, the details shared on reverse auction systems are only available to companies who are approved to see them and who have agreed to the SLA’s
– Using an online tool simply increases efficiency. It saves time and money allowing those resources to be used in other areas. In reality the process is no different from any paper based tender.
– Auctions are an efficient method to find the best offering for a particular set of needs. They do not need to focus only on price.
– Contract management needs to be carefully reviewed to ensure all SLA’s are adhered to following the tender. Any suppliers deviating from these would not be a result of the method for price submission but rather refers to their attention to detail and rigor during the tender process.
The concept of the reverse auction has been around for close to 20 years and is a well-known approach to negotiating effectively with multiple suppliers.
However, the Morning Star Scholarship Foundation utilised the reverse auction for an entirely new and creative concept that we have not encountered before – to negotiate scholarships towards tuition fees! Read on to learn more about this innovative idea lead by Mike Sertic and his colleagues at the Morning Star Scholarship Foundation.
The Morning Star Company is the world’s leading tomato ingredient processor, supplying approximately 40% of the U.S. industrial tomato paste and diced tomato markets.
They operate the Morning Star Scholarship Foundation, a charitable organisation that provides tuition grants to Morning Star colleagues (parents) to help fund their child’s switch from public to private or home school education, a very noble cause.
The Foundation was looking for a way to increase the number of scholarships they could offer to parents within the $15,000 funding allowance that wasperiodically available.
They decided to contact Market Dojo, an e-Sourcing software provider focusing on user adoption, to try a closed-market auction as a solution to this, by letting parents compete in a reverse auction to determine their willingness to secure a grant.
The concept was that the auction would begin at a maximum grant of $3,000 per child, at which point the total available pot of $15,000 would provide 5 scholarships. However, because there would be more parents bidding thanthere were available grants, parents could use the ranked auction as an opportunity to bid incrementally lower amounts to ensure themselves of a top 5 position and secure a grant. The difference between the $3,000 opening bid and the bid offered by the parent would be paid for by the parent themself.
For example, assuming the cost of the child’s tuition was $3,000, if a parent bid $2,700 to stay within the top 5 places, the parent would be committing to contribute $300 of their own money towards their child’s education, with $2,700 coming directly from the Morning Star Foundation.
The auction would continue until it hit a point where the average grant across the top 6 spots equalled $2,500. For this amount, the $15,000 total fund would now be able to provide 6 scholarships in total, hence any parent ranked in the top 6 spots would be granted a scholarship for their child. Should the auction reach an average of $2,142 across the top 7 spots, there would be 7 scholarships on offer, and so on. Parents were to be notified of the news via the messaging facility in the application.
Since the parents who were bidding in the auction were essentially consumers and not e-Procurement professionals, it was essential that the software was extremely easy to use and consumer-friendly. Mike Sertic, who managed the process for Morning Star in a highly adept manner, conducted a series of trials to ensure everyone was up to speed with the concept:
“Prior to the auction, we utilized the neat “Sandpit” feature within Market Dojo for colleagues to practice and also held an informational webcast about the Foundation and auction process.”
Absorbing all the feedback from the trials, two live auctions were conducted in late March over a 48 hour duration involving 16 competing parents in total. Each auction represented a pot of $15,000, which when combined would be able to provide 10 scholarships. Upon completion of the two auctions, which received over 270 bids, we were delighted to hear from Mike:
“This year we will be awarding $28,789 for a total of 14 scholarships. We hope that in the future, even more colleagues will make the switch to private or home school. The Morning Star Foundation’s effort in implementing this program was made much easier by the folks at Market Dojo.”
Parents were equally supportive of the process, filling in the Market Dojo post-auction survey with very encouraging comments:
“Awesome way to be fair to all colleagues!”, “It is a very generous offer that others could benefit from” and “The process is very user-friendly”.
This was an excellent achievement and only made possible through the team’s vision in taking an existing process and modifying it for new solutions. Mike and his colleagues have used this novel approach to enable an additional 4 children, bringing the total to 14 children, to benefit from the generosity of the Morning Star Scholarship Foundation this year.
As for the reverse auction, it’s great to see innovative ways for it to be used.
We are very proud of our eAuction platform. It was our initial business proposition and still draws in the crowds. We have users from companies ranging from one million in turnover to many billions, running tenders on all types of goods and services from values of thousands to hundreds of millions.
No other platform gives gives you the ability to call in in the morning and run an auction in the afternoon without the need to train the suppliers. We recognise that preparing for an eAuction can be challenging, and the system should help with this challenge, not be an additional hurdle to overcome.
Our platform also has many capabilities from including a Pre Qualification Questionnaire to weighted auctions. See more of our functionality here.
However, in this blog we really wanted to show you the cool parts of our interface. (Click here for the video)
This is an overview of the eAuction screen. Colourful, compact and nearly everything is ‘click-able’ for further information, which can be seen in the following images.
These can be changed live during an auction. You can see the pause button and also the ability to change the heart of the eAuction settings such as the duration, the dynamic close, changing who it applies to and also altering the min and max bid decrements.
We have a great live feed to keep you up to date with the goings on without the need to look at all the lots individually. It is also there for the suppliers so they can see the latest and greatest.
Lot Matrix – ‘The summary’
See an overview of the event from a lot perspective with bespoke total calculations.
Notice the ‘stock market’ type updates highlighting where the bids have been placed.
Lot Matrix – ‘The lines’
See the event overview from a line item perspective with a click of a button.
Lot Matrix – ‘The suppliers’
See the line items by supplier.
Lot Matrix – ‘The detail’
Lastly, with another click, you can see the suppliers, by component, by line item in real time during the eAuction
See who is active, send messages, place proxy bids and you have the ability to delete bids all from within the auction interface
See the graphs
Check out your results graphically displayed in real time. No need to wait for a periodic refresh as we use new technology to display bids as soon as they come in.
If you want to see this for yourself then you can simply sign up for free and try everything out in our sandpit. Welcome to the Dojo!
As we now enter into our fifth year of business, we’d like to share with you some of the more unusual goods and services that we’ve seen tendered via our software!
For example, foodstuff seems to be a recurring category of choice. We’ve witnessed eAuctions on anything from gourmet cheese, whipped deserts, biscuits, cooked chicken, banana purée and even pet food!
eSourcing prevents you making a dog’s dinner of your negotiation
It certainly makes the weekly shop more interesting, as we know the back-story of how that supplier’s products came to be on the shelves.
We’ve encountered eAuctions on goods that we will never fathom, such as ‘Gas Spuds’ or our personal favourite ‘Pig Launcher/Receiver’.
The infamous pig launcher
We truly hoped it might be something to do with Angry birds or perhaps even a fantastic device for aerially transporting swine from A to B in a highly efficient manner. Sadly we have since been told it is something to do with cleaning industrial pipelines.
Speaking of industrial, we’ve witnessed a number of eAuctions for items that seem like your everyday, run-of-the-mill product but quite simply aren’t! Dishwashers that can clean up to 3000 dishes per hour. Ice machines that produce up to 24,500 ice cubes per day! These are quite serious pieces of kit.
Then we move onto quite literally life-saving products that have been reverse auctioned. Vaccines, medicines, drugs, medical sutures. The old adage seems to apply: if you have a liquid supply market and you can define precisely what you need, you can auction it.
Sometimes reverse auctions can be a tough pill to swallow
Something we hear quite a bit on our travels is that only commodities or products can be eAuctioned. Well, looking through some of our past successful events, it would appear that not everyone holds this view. We’ve had auctions on pre-employment checks, canteen services, voice outsourcing services, print management and design agency services amongst many others. Our Lot Matrixcan give you the detail required for those complex tenders with many pricing aspects.
Training and consulting seem popular choices as well, from contract management training to general management consulting. It goes to show that not everything needs a like-with-like spec as you can instead opt for a weighted auction to normalise the proposals.
Anyhow, back to bizarre stuff. There have been quite a few auctions on dangerous chemicals including quite a worrying amount of Sodium Hydroxide. Add to that the Aluminium Chlorohydrate and Potassium Permanganate and it sounds like we have something from Breaking Bad!
Hope you ran a reverse auction for that stuff
Before we go too off-piste, let’s end with a couple of interesting automotive items we’ve seen eAuctioned, such as machined parts for Maserati, BMW brake pedals, golf carts, fork-lift trucks and some shiny new transit vans.
Lastly, we’ve seen a fair few construction and extension tenders, including the house extension and loft conversion for Market Dojo’s very own Nick Drewe.
As for what is next going to be tendered via Market Dojo, I think you can see for yourselves that it is anyone’s guess!
When we started working on Market Dojo, we decided early on that we would use the SaaS model. This was an obvious choice for us, and has helped us and our customers throughout our history. Because we often get asked about this, I wanted to share the reasons for our decision in a bit more detail.
Google Trends – comparing interest in SaaS, Enterprise Software and On-Premises search terms.
Over the last 15 years, enterprise software has undergone a radical shift. In the 1990’s, customers would usually install software on their own servers. Today it is now usually hosted by the application provider, and delivered over the Internet. For a more detailed definition of the two terms – see Wikipedia articles on On-premises Software, and SaaS.
So what are the benefits of SaaS?
Running and support costs are lower, in all except the largest on-premises implementations. This is because all clients share the cost of servers and operations staff. On-premises software would duplicate these costs for each installation.
Time / cost to implement
Implementation for SaaS software is almost always much faster than for on-premises.
Staff must install an on-premises solution at the customers data centre and integrate it with an existing IT infrastructure.
In the case of Market Dojo a new customer can enroll themselves and setting up licences can be done in a few minutes. Here’s an earlier blog post of our’s that shows how you can set up your organisation and be fully operational in 21 minutes.
Support cost and time to resolve issues
Support is simpler, as access to log files and identical system environment is available to the support team. This leads to a cost reduction and also to faster resolution of issues.
Contract length / agility
Because of the reduction in time and cost to install, SaaS vendors can be offer shorter contracts. It also means that they can add or remove users faster. Market Dojo can be purchased on a month by month basis with no minimum contract length.
New versions are immediately available to all users, without the need to be installed on customer systems.
On-premises solutions tend to be bespoke to each customer. This increases the maintenance costs and ability to roll out new features. A SaaS application usually has only one version, which means these issues do not arise.
Due to all the efficiencies that come from true multi-tenanted SaaS applications software companies can supply their SaaS solutions at a much lower cost than on-premises applications.
So why isn’t everything SaaS?
There are some good reasons why not everything is SaaS. SaaS (as it exists today) is a newer concept, so some older software solutions are on-premises for historical reasons.
There are applications which are not so well-suited to a SaaS. Video editing software involves processing huge volumes of data, and is often done more efficiently on a powerful workstation, rather than across a network. This may change as technology improves.
For some classes of applications (e.g. Bank Networks) the risks may outweigh the benefits.
Here are some points that a buyer should consider when evaluating a SaaS product.
Data security is a key issue with SaaS software. It has made the headlines due to events such as revelations about the US Government PRISM programme. These are valid concerns. SaaS companies are taking steps to secure their products from these risks, but a wise buyer would consider this point.
SaaS solutions usually have less downtime than those hosted on-premises, but relying on external vendors is a risk which should be considered.
Dependence on high-speed internet
SaaS applications depend on an internet connection to function. Several factors will affect actual network requirements. These include number of users, type of application, level of interaction.
We believe that most enterprise software is moving to the SaaS model because the benefits of this approach outweigh the disadvantages.
The preferred architecture for computing has swung like a pendulum between a centralised and distributed approach. In the 1970’s a mainframe computer with many dumb terminals was state of the art. In the 1990’s a distributed, client-server model ruled the roost. Long term, we cannot be sure if the pendulum has settled or will swing again. Will current innovations such as MS Office 365, Amazon AWS and Google Chromebook continue? Will the end of Moores law and the Internet of Things give rise to new and better tools and usher in a return to a more distributed model?
Unfortunately, we don’t have a crystal ball*. However, we do believe that, in the short and medium term, at least, SaaS will be the preferred choice for most applications.
*For more information about the Moores Law and accelerating technology, these links are a great place to start:
We had a great write up in the West of England Growth Fund newsletter after receiving a grant to help develop our e-marketplace concept.
Bristol based Market Dojo is poised to launch an enhancement to their e-sourcing and reverse auction platform that is set to revolutionise procurement through dedicated e-marketplaces, thanks to £24,950 of funding from the West of England Growth fund.
The team, led by Alun Rafique, Nick Drewe and Nicholas Martin, have used the cash injection to fund the initial development of an energy e-marketplace that enables businesses to source information and prices from energy suppliers. The platform then facilitates a reverse e-auction which means that suppliers bid online against each other to supply a company’s energy needs.
Alun Rafique, founder and director said: “Our aim has always been to offer simple to use, cost effective e-auction software that was accessible to any business looking to negotiate a more competitive price from suppliers. Rising energy prices are a key issue for businesses so this was an area we were keen to explore further.
“Existing software didn’t provide the level of flexibility needed to take into account varying unit prices or currencies so we needed to start from scratch to develop a platform that would simplify the whole process. As a relatively young business we didn’t have the capital available to invest in that level of development and that’s where the funding from the West of England Growth fund came in.”
The new software is currently being tested with the aim of launching the product to market later this year. The development of the new platform has also opened up a number of new opportunities for the company who plan to market the software to other sectors.
Alun continued: “Although the platform has been developed for use within the energy market it has been created in such a way that it is easily adaptable for use in any industry, for any product or service, offering us huge scope for expansion into new sectors.
“The funding from the West of England Growth fund gave us the freedom to develop our idea into a workable product which, once launched, has the potential to provide a real boost to our business.”
Targets. Based on savings, number of eSourcing events, other contract KPIs? What do you do? In procurement you quite literally have a myriad of different ways you can be assessed. This is an endless debate. Do you base on number of auctions? We have seen this carried out very well but we have also seen this abused where auctions are run with no thought. Sometimes you get what you measure. Target contract KPIs are a great way to move forward but add many layers of complexity to the process. There is no right or wrong way. However, this is not the reason for writing this article.
We have spoken to many organisations where they set targets for eSourcing. Mostly we find these are based on either savings, user adoption or number of eSourcing events. These targets are normally not stand alone and there are other areas where the professionals are measured. However what we have seen over and over is that these targets can be limiting. eSourcing is easy to use. Most people use Amazon and eBay so why not eSourcing. The point is that these targets should not be something to aim for but they should be something to smash. We have seen many organisations that strive for adoption and ask for quotes for many users when year after year they only increase by one or two. We believe with an accessible platform, you should look at everyone using it, 100’s of eSourcing activities instead of just a few on the big ticket items. Why do this? Well, quite simply to ‘Be the Hero!’.
Too cliche? Well think about it. If you smash those targets you may have a higher bonus but more importantly higher recognition. A better CV. Move up or even move on. To make this statement for a sales person would be more challenging given the competition and maturity in the market and the profession. However eSourcing is a perfect arena for this over-achievement. Saving several percent on purchasing spend puts many percent on profit, perhaps as much as a 1:10 ratio. It effectively makes you the salesperson and we know how much recognition they get. The time is right and you should be looking at exponential growth given the timing and the accessibility of the technology. So come on, what’s stopping you?eSourcing returns
We recently met up with a small french consultancy, Effixens at cafe Lala in Hammersmith. On the menu was some fantastic mediterranean food as well as a healthy dose of eSourcing discussion. Over the obligatory espresso, conversation turned to whether the majority of procurement professionals really understand the returns of eSourcing. To put this in perspective, in France eAuctions are not very popular so the primary use of eSourcing is for eRFx’s (such as Request for Information/ Proposals/ Quotations).
(Source iSource report by University of the West of England, 2010)
Earlier that day I had had a discussion with our insurance company who asked to confirm that our software is a back office operation. And as you can probably guess, it isn’t. This is a very pertinent point.
eSourcing is a more complex beast to Contract management for example where the Return on Investment (ROI) is more difficult to judge. The difference being that contract management is more of a back office operation whereas eSourcing is used for collecting prices and information from the suppliers and also negotiation in real time. It is on the front lines, the vangard of the procurement department. The knock on effect is that eSourcing has the potential to deliver a much higher ROI more quickly. Thus the adoption of eSourcing is crucial for any organisation.
Even if eSourcing is only used for eRFx’s, rather than eAuctions there are many benefits over the traditional approaches.
1. Scalability and efficiency
Processes can be standardised. This enables repeatability and especially scalability of any tender activity delivering higher savings without an increased workload.
2. Centralisation of data
All data is held in one place. Should anyone leave or be off sick all the data can be easily picked accessed. Supplier databases can be centrally controlled helping rationalisation.
Secure electronic records of all activities are maintained which can be accessed easily many years after the event.
Thus the adoption of eSourcing is crucial for any organisation. Recently we discussed on Thomas.net how we can beat email, eSourcing’s greatest competitor especially for eRFx’s. The main driver has to be to make a platform that people want to use. It will need to have a gamification element, excellent reporting and has to make life easier. Combined with the obvious benefits, it’s got to be a must for any organisation.A gift from the Market Dojo Easter bunny!
In between the ritual consumption of chocolate eggs over the Easter weekend, we released a set of new enhancements to our software for all to enjoy.
Amongst the highlights include some great usability tweaks for Category Dojo based on some valuable client feedback:
Improved Summary page
You can now scroll through your multiple categories from the top of the page to easily compare and retrieve information. Your answers to each question are neatly aligned and sectioned into the 4 key steps, with quick edit links within each step to help you quickly make amendments to the specific set of questions.
New category hierarchy creator
One of the more challenging developments given the shear variety of web browsers that people use, from Internet Explorer 8 to Safari to smartphones, was the re-jig the category hierarchy mechanism, which was a bit clunky. We now have a dynamic, interactive hierarchy where you can select, create, edit and delete categories and subcategories all within the single user interface for to 5 levels:
It also lets you answer the questions for any previously created category or subcategories in the hierarchy, which greatly helps you to compare the category strategy at the top-level as well as for the subcategories beneath it.
For example, if we purchased IT Hardware on separate contracts for our London office to our Sheffield office, we might assess the two contracts independently via subcategories called ‘IT Hardware – London’ and ‘IT Hardware – Sheffield’. Then we could populate a parent category called ‘IT Hardware’ and analyse the pros/cons of creating a single centrally-managed contract, along with the impact that would have on competition levels, expected savings, timescales and complexity.
Along with the two above enhancements, we continued our bug fixing and general performance improvements to the software to ensure it fulfills our client expectations.
Happy Easter everyone!Market Dojo & eBidding.cz partner to bring accessible eSourcing to Czech Republic & Slovakia
We are delighted to announce our most recent reseller partnership, penned with Ondrej Hajnik of eBidding.cz, to help promote our products throughout the Czech Republic and Slovakia.
Ondrej is a genuine eSourcing expert, having worked as a category manager for Ariba for nearly 4 years, as well as having numerous managerial roles for industrial companies. We have no doubt that there is a lot we can learn from one another. It also enables us to offer Ondrej’s services to any client that might be looking to expand into Eastern Europe, be it for market research, strategic sourcing or project management.
The Czech Republic and Slovakia are very interesting markets to us, given that we were awarded our first Technology Strategy Board grant partly to make eSourcing more accessible to EU accession states, who may not have the budget or resources to invest in the more complex and user-intensive eTendering products that exist today. This is all the more relevant given the 2016 deadline set by the European Commission to make eProcurement mandatory for all public sector buyers.
Furthermore, the private sector is very much in our sights as well. The UK and Czech markets are comparable, whereby large companies tend to have legacy solutions in place, whilst medium-sized companies have dipped in and out of eSourcing over the years, and smaller companies are yet to experience the benefits.
Ondrej feels that there is huge potential here, given the extreme ease of use of our software combined with our affordable on-demand pricing model. Many local competitors tend to have basic eAuction dashboards without the rich bid and vendor management procedures that exist in our software. This will help eAuctions be run more professionally to further embed eSourcing as a daily consideration.
Ondrej is currently helping us to translate the software into Czech ready for the first client investment.
If you would like to know more, please get in touch with us or Ondrej via his website: http://www.ebidding.cz/en/Should suppliers still fear eAuctions?
Following a recent LinkedIn question (“Someone explain to me how a Reverse Auction is fair and equitable to the supplier …”) we had to pause for thought. Admittedly in the past auctions had obtained a less then sparkling reputation. This seems to be in a large part down to the pre-conception that it was a race to the bottom for price and quality.
When eAuctions initially came onto the market (~20 years ago) as a way to negotiate quickly and effectively, they were firmly in the hands of experienced consultants such as FreeMarkets (sold to Ariba 2004). eAuctions were primarily viewed as a way to save money. However it does hide the fact that the consultants would put in a great deal of work. Even five years ago when we were working for a consultancy, auctions would take us between 200 and 300 man-hours.
The next stage in their progression was as a module of the larger ERP (Enterprise Resource Planning) applications and consultancy software offerings. This seems to where the damage to their reputation was done. This was the initial transition of software to the hands of organisations themselves. The fact of the matter is that setting up an auction is more work up front than a traditional RFQ (Request For Quotation). You need to have the Service Level Agreements and specifications tied down as well as have sufficient market liquidity. By this we don’t just mean having suppliers who can bid, but suppliers who will bid and to whom you are willing to award the business. In this initial transition it seems that the benefits from negotiating the price down were understood but the level of work required for a truly successful auction was not. And a truly successful auction needs to be judged on realised savings, quality and delivery, not just identified savings. This is where suppliers were put off by badly run eAuctions.
As the procurement professional has grown up in the last 10 years, becoming far more reputable, so has the eAuction process. Companies understand that for success the eAuctions need to be run in a professional manner and should be viewed as any negotiation where you are looking for a win-win outcome. For example you can weight non-price criteria or mention in the documentation that you will bring in the top three suppliers for discussions post-auction, or even include supplier presentations in the process. The truth is that eAuctions are just another tool in the procurement tool-set for negotiation and they need to be used with care.
The new breed of eSourcing platforms on the market also help make the process easier. For example we strive to embed professional processes in every stage with check points at appropriate milestones. We make it easy for the suppliers, as well as the buyers, to adopt, and we have had many different kinds of suppliers bidding from taxi drivers to one man bands. Here is our guide for helping to onboard suppliers.
Unfortunately that initial bad reputation is still around today. However we less frequently see a powerful incumbent try to kibosh the process. With the increasing professionalism and eConnectivity in supplier markets and the ability for buyers to more readily search globally for suppliers, this is becoming a risky approach for an incumbent.
Not only that but suppliers are actually finding that eAuctions are a good way to negotiate and they have been proven to strengthen relationships. With increased thought up front on documentation, open communication and more transparency, eAuctions are fast becoming a very efficient and fair way to do business. Suppliers are also better prepared in understanding their margins before the event and having a sufficient BATNA (Best Alternative to Negotiated Agreement) in place. This is will help negate the view that suppliers can get caught up in the furore of bidding. Also many consumer applications from eBay to moneysupermarket.com help make the process less daunting. We have many guides and videos to help suppliers through the auction processhere.
In conclusion we would say that suppliers don’t fear the eAuction itself anymore. With a greater understanding they see the advantages. All they do fear is a badly run eAuction, so make sure your’s is not one of them!Can E-Sourcing Break the Bonds of E-mail?
These are the introductory paragraphs of a guest post by Alun Rafique of Market Dojo. The full article features ThomasNet News who is one of the leading supplier discovery and product sourcing platforms on the market today.
Self-service e-auctions are a great technological path for any company, as the advantages derived from more efficient negotiations are easy to relate. The real challenge is on the full e-sourcing software suite. Electronic Request for Quotations (eRFQs) are a great example. The benefits from eRFQs come from the centralization of data, auditability, and the ability to send out to more suppliers without a large increase in overhead.
It has been found that suppliers involved in eRFQs yield better savings. This is attributed to the process making the suppliers simply sharpen their pencils when they send out bids. In research by the University of the West of England, it has been found that e-sourcing strengthens buyer-supplier relationships.
So if the benefits from e-sourcing are there, why is there not more of an uptake in the process?
[Find out more by reading the full article here.]
Supply Management recently posted an article by Nick Drewe of Market Dojo outlining some top 10 tips for running an eSourcing event, based on his experience of using an eSourcing tool to find a builder for his own home extension. Here are the opening few paragraphs, and the rest can be found on Supply Management here.
At the end of 2013 Nick Drewe decided to use his professional expertise to electronically
source a ground floor extension and loft conversion for his
house. Here are 10 things
the process taught him.
When none of the initial RFQs my wife and I received via a traditional email and face-to-face process for a ground-floor extension and loft conversion were within our budget, we decided to change our approach.
Instead of reducing the scope of works, we embarked upon a competitive bidding process, underpinned by e-sourcing software, involving 96 local building firms. The exercise resulted in a £35,000 (33 per cent) saving against the best of the three initial RFQs and, if anything, an increase in the scope of works due to some excellent market-informed suggestions.
Conducting a full-scale strategic sourcing project on something so close to home (sorry) can feel both risky and daunting. And so I’ve listed the top 10 tips from my professional experience that enabled us to achieve this result.
[The top 10 tips can be found on the Supply Management website here.]eWorld March 2014 & our little talk!
We recently returned from another fantastic eWorld event in Westminster. The most noticeable difference for us between this event and previous ones was the absence of Market Dojo co-founder, Alun Rafique. Alun and his wife Justyna are expecting their first child imminently and so a trip into central London was strictly off the cards, as you can imagine!
Having to make do with two of us on the stand, quite simply we were overcome by the sheer quantity of great discussions with passing delegates. For any of you who approached our stand and did not have the chance to talk to us, we apologise profusely!
If it is any consolation, we missed the 2pm cut-off for hot lunches and had to make do with a chicken wrap and fruit salad for nourishment shortly before 3pm! We’ve learnt our lesson and will ensure we have more colleagues on hand next time.
This year was another first for us as we held our own Innovation Briefing seminar entitled, “From identifying opportunities to realised savings” in conjunction with our client and partner, eQuiddity. The 30 minute talk covered two major areas of procurement that are poorly defined, specifically:
The seminar, which was held concurrently with other events, was very well attended with all 80 chairs taken and some attendees even standing at the back! eWorld are excellent at providing detailed feedback from delegates so we look forward to learning from that in due course.
For those of you who couldn’t make it, or if you’d like to own a copy of our presentation, you can download a PDF copy here (please first sign in or sign up to Market Dojo for the link to work).
It’s also great to see that eWorld have taken on board their own feedback and have provided free tea and coffees, which was possibly the most popular event of the day! The queue snaked past our stand, which provided us a captive audience to engage with. I hope we made your waiting time fly by!
Thanks again to all of you who came by and we look forward to a repeat event in September.Strategic procurement and departmental organisation
Thinking of becoming more strategic? How should you adapt your organisational structure? Some time ago one of our client’s was asking the same questions. We sat down and worked through our past experience. We have seen how a large number of companies including Rolls-Royce and PriceWaterhouseCoopers have approached this challenge. We have summed up a simple structure below and we hope you will find it useful.
The introduction of ERP programs, new sourcing methodologies, continuous supplier rationalisation and commodity management, can force companies to adapt the structure of their procurement organisation.
There is a normally an emphasis to reduce the Downstream activities such as:
And to increase the upstream activities such as:
A typical modern approach is to break the standard buying role into these four areas:
Once you have identified the roles and created a job specification, the next step is to produce a person specification. This is a crucial step, often missed, which ensures you know when you have found the right person for the job.
The roles and responsibilities could be broken down as follows:
These procurement professionals would be focused on the daily buying, the functional role.
Within this area you have the two management layers, the commodity managers and the buyers. Depending on the size of the organisation, these could be the same role.
Or the day to day functional buyers could be here (who you rotate from time to time) and the Commodity Managers might be in the strategic group.
The buying in this area should be driven by pre-agreed contracts, frameworks and pricing.
These strategic professionals would be looking at the higher level arrangements, such as:
Essentially these professionals would be developing methodologies that other teams can follow. They could also provide advanced support on procurement exercises or even run complex tenders themselves. These would also form a principal part of your e-Cademy, if you decide have one.
Procurement professionals who focus on project work would be the best people moving forward to take this role.
The internal customer-facing role is about creating a good relationship between the buyers and the project teams.
This allows the buyers to work within commodity groups and the project teams can still get their due care and attention.
This kind of relationship would work well for concurrent engineering and liaising with sales teams around discounts. It would also help reduce renegade purchasing.
The procurement professionals in this role would be primarily focused on the supplier side of the equation. They would need to liaise heavily with the commodity managers.
This would involve:
This is really a flavour of where you can go. The great thing about this methodology is you can implement as much or as little as you like. The main objective is to find a strategy for your procurement team that fits your organisation.
The following article featured as a guest post on the excellent Procurement Insights EU blog. It outlines some of the challenges we have faced whilst working with local government, for which we were invited into Parliament to discuss with MPs – more to come on that later!
Life remains tough for small, innovative companies trying to secure UK public sector business by Alun Rafique
“In order to give Customers using the Framework a balance between choice of suppliers and best value, following completion of the evaluation of tenders a maximum number of five suppliers will be awarded a position on the Framework. It is therefore vital that Tenderers can offer each of the five modules detailed on the following page. As referenced previously in this ITT it is anticipated Customers will elect to procure one or more modules or may choose to purchase a complete solution incorporating all of the five modules. It is therefore essential that Tenderers can offer all of the five modules to meet the requirements of those customers looking for a complete solution. Any Tenderer who cannot offer one or more of the elements listed above in 3.1 will be removed from this procurement process.”
The above is a quote from an invitation to tender by the UK public buying organisation (PBO), Eastern Shires Purchasing Organisation.
The modules, which represent a complete e-procurement solution, are e-tendering, e-evaluation, e-auctions, e-contract management, and e-vendor management. As stipulated, Tenderers have to offer all 5 modules or face being disqualified as a potential supplier. Unfortunately, it is this “all or nothing” approach that represents just one of the many obstacles that Small- Medium Enterprises or SMEs face in the pursuit of public sector business.
More to the point, the stipulation that Tenderers have to deliver all 5 modules, will eliminate or seriously impede the ability for the majority of SMEs to participate regardless of the superior capabilities of the modules they are able to provide. While I believe that this is an unintended consequence of a short-sighted approach, it nonetheless amounts to what could only be viewed as a discriminatory practice that will limit the pool of potential suppliers to the detriment of all involved – including the government itself.
Despite the government’s attempt to introduce reforms that would address the above challenge, the task for SMEs remains a difficult one.
In this context, I would like to take a moment to share with you the experience of my company, Market Dojo.
Market Dojo successfully applied for a grant from the Technology Strategy Board to develop a product to assist public procurement professionals with e-Sourcing activities.
While this support was greatly appreciated, once fulfilled we were for all intents and purposes on our own from that point onward. In essence and despite the government’s recognition that MarketDojo’s negotiating tool for running e-auctions and electronic request for quotations warranted financial support as it addressed “a particular problem area where frameworks have traditionally underperformed,” the method for actually utilizing our solution is hindered by the above mentioned all or nothing edict.
Simply put, and has demonstrated by the government grant, we believe that our product – and the complimentary products of other SMEs – can collectively save organisations a lot of money.
Even though we have made some progress in the public sector, having landed three government contracts, the private sector still represents the company’s best and most reliable opportunity for continued growth and long-term success. This leads one to wonder why SMEs are worthy of government funding but not considered to be worthy partners?
There are of course financial consequences associated with this disconnect.
For example, while both the transport team at Bedford Borough Council and Shropshire County Council have benefited greatly from their relationship with MarketDojo, Worcester County Council’s adoption of a more traditional contracting strategy meant that they ended up paying £2750 per e-auction, instead of the £500 for five that Market Dojo would have provided. This difference amounts to Worcester paying 27 times the price that neighbouring Shropshire County Council is paying per e-auction.
A further complication in terms of government achieving a best value outcome is the tendency on the part of local councils to interpret European Union tendering regulations differently from one another. Some interpretations as I have discovered, can lead to councils paying far too much for a less effective solution as a result of inflexible scoring mechanisms for evaluating tenders. In one instance it was suggested that if we redesigned our system to better mirror the specifications of the tender, we would have a better opportunity of winning the contract. Unfortunately, such an alteration would in reality eliminate the very functionality that led to the significant savings that were realized by both Bedford and Shropshire Councils. This again makes one wonder what it is that the government is attempting to accomplish, as there seems to be a greater emphasis placed upon following arbitrary regulations as opposed to driving greater value from procurement.
Needless to say, the combined outcome of all that I have covered above has led to a common complaint that far too many public sector procurement people hide behind rigid processes and procedures. This in my estimation, prevents public sector bodies from realizing maximum value for money in that they ultimately discriminate against SMEs and the innovative solutions they can provide.
A picture (or in this case UK Tender) is worth a thousand words!Sourcing my extension (Part 3) – Bid Analysis
This is part 3 of Nick Drewe’s foray into a domestic eSourcing exercise for his house extension. Nick has now held all the site visits and chased in the quotes. Time for a spot of bid analysis to prepare for the contract award. You can catch up on part 1 here and part 2 here.
Apologies for the delay in compiling part 3 of this eSourcing project. Amazingly over a month has passed since my last update, and what a hectic month it has been. I had scheduled in site visits with 20 builders over the period. 3 of the builders did not turn up, which presented itself as an easy method of establishing their reliability, or lack thereof, as it happened!
The remaining 17 appointments were conducted smoothly. I gave an extra bonus point to those who came with the drawings and specifications in hand: always good to prepare for a meeting to make best use of the available time. I couldn’t resist the opportunity to ask them about their experience of using the Market Dojo eSourcing tool, which was thankfully overwhelmingly positive, despite a few of the guys needing to ask their siblings/cousin/mate if they could use their computer to access the internet!
Anyhow, the quotes steadily trickled in. Some declined to quote due time constraints or an unrealistic budget (we’ll see about that minute), whilst some provided an entire bill of materials and profit and loss account! The detail was astounding, literally right down to the last screw.
Despite this professionalism, the difficulty I faced with this as a layman was that I was lost in the detail. I couldn’t see the wood for the trees. I almost preferred the quote that said “This quote includes everything in the spec, except we need you to buy the kitchen and sanitaryware.”
I mentioned there were a few objections to the budget, which for the record was circa £70,000 ex. VAT. After a fairly thorough market analysis I believe I have my defense on that, as here is the complete set of quotes I received:
There are a number of great things to witness here.
I could have chosen to proceed with one of the two initial offers on the table from the architect, which I’ve termed the ‘incumbent’ bids. Perhaps I could even have negotiated 10% off through a classic face-to-face discussion. However I would not have been able to afford them in their entirety, so I would have had to make detrimental changes to the spec. by going back to the business and consulting with the key stakeholder, a.k.a. my wife!
However, with a 33% saving against the best ‘incumbent’ bid, on a like-with-like spec, we are now in a great position to secure the build that we want. As 33% equates to some £35,000, I can say without question that this exercise has been worth my time. Furthermore whichever outfit I do go with has such a good knowledge of what I’m looking for now that they can hit the ground running.
Finding market price
There is a clear trend towards the market price, almost like a flattened S-curve from the best bid to the worst. This gives me several affordable options, options I shall gladly exploit in part 4 of this exercise when I make my award of contract.
Engaging market forces
The two bids I received via my architect prior to embarking upon this sourcing project are undeniably the least competitive. I could argue this is because I ran my sourcing project on a professional level, creating an impersonal barrier between me and the market via the eSourcing tool, which in turn gives the builders the impression that I am not doing a half-hearted effort. Consequently this can encourage more competitive offers. Sadly neither of the previous ‘incumbents’ took the opportunity to quote again, so I can’t be certain.
It does illustrate that if you approach just a handful of suppliers in a liquid market, you have no assurances whether you have unintentionally approached the two towards the right of my graph or towards the left. As with any statistical analysis, you need to increase your sample size to increase your certainty. I feel that by approaching 90-odd builders, I have sufficiently achieved this. I could have invited or proactively chased more but I would then be at a greater risk of diminishing returns.
Either way, I don’t think practically that I could have achieved this without using the eSourcing tool. Furthermore it proves that you can achieve excellent ‘savings’ from a robust quotation process without the need to go to an eAuction. In this case an eAuction is not on the cards given that I’ll likely revise the spec to compromise on areas of low importance (the sun-tube seemed like a good idea at the time but a light-bulb would be £700 cheaper!) in order to maximise investment in the focal areas, e.g. the kitchen, now that we have our itemised costings.
Stay tuned for part 4 where I make the all-important assessment of both the price and non-price elements of the bids to reach the award decision.
For those with eagle eyes, you may have noticed a new feature in our eAuctions over the weekend and this is one we are very excited about.
First a bit of background. Almost all eAuction software today is driven by ‘pull’ technology, which basically means that all bid updates etc. are sent to the users when they ask for it, either by manually refreshing the screen or by the software causing an automatic check every 5 to 10 seconds (sometimes longer). Initially this is what we did with our software, as the technology around us when we started in 2010 was still developing. Put into context, the majority of our competitors are based on technology from the late 1990’s.
However, in 2011 standards were brought in for a technology called ‘websockets’. Websockets ‘push’ updates to the users instantaneously. One of the well regarded tools for doing this is Node.js, which is used by GroupOn, Microsoft, LinkedIn, Dow Jones and many others. Well, now they can add Market Dojo to that list!
So, what does this mean to our users?
Truly real-time updates
Our journey with Node.js started a few months ago to make our graphs update live. However, now you will notice that all our eAuction updates are instant, thereby creating more dynamism and encouraging even more active participation. During our testing, we’ve even seen the case that you can send a message to someone during an auction and they receive it before you’ve even see a ‘message sent’ confirmation on your own screen. Now that’s what we call real-time!
We recognise that there are users out there who are perhaps restricted to older browsers or hardware. For this reason, we have built in a fail-over to our old update mechanism in the event that the real-time updates do not work for certain individuals.
Live Auction Feed
More importantly, it has enabled us to develop an even more innovative feature – the Live Auction Feed. It could be compared to the text commentary you see flashing across the screen on CNN to let you catch up on all the headlines whilst witnessing the breaking news.
The Live Auction Feed is updated instantly with new bids, including who placed them, what value and what position the bidder is now in (or whether they are still bidding in the case of a Japanese Auction), as well as both sent and received messages and any changes to the Settings made during the eAuction. You can scroll through this history at any time, which pauses the feed to give you time to read it.
In summary, never again will you be able to say ‘Oh, something’s changed, I missed that’, as you’ll have a permanent script of the complete auction.
We hope you enjoy these new features, which have been brought to you by a collaborative development with a client of ours. Of course if you have your own requests, let us know and we will be delighted to work with you. And congratulations to Salve on being the first to try out the new feature for real!
PS: Here are a couple of videos of the new real-time update and Live Auction Feed features in action:
This is part 2 of Nick Drewe’s foray into a domestic eSourcing exercise for his house extension. Nick’s tender has now gone live! You can catch up on part 1 here.
So last Friday evening I hit the button and made my event live. Invitations were sent out to 83 builders in total, although since then I’ve added a further 9 based on recommendations and referrals. I also forgot to include the builders who provided the original quotes, which wasn’t very fair of me, so I’ve rectified that and included them, should they wish to revise their offer.
I must admit, there were mixed feelings of excitement and apprehension about hitting that button. By the time the screen refreshed, 83 builders around Bristol received the invitation from me (we use an email alias on Market Dojo to make the emails come from the user and not from a generic no-reply@ address to ensure any replies make their way back to me). They would also know where I live! However, this is a genuine opportunity, and I am giving everyone an equal chance of winning the business, so I’ve no concerns. I was more intrigued about what would happen next.
In my previous post I stated that I should start ringing round those who were invited in order to maximise participation. Well, another confession here, we were exhibiting at eWorld on Tuesday and so this week I’ve been absolutely swamped and not made a single outbound phone call to them. Thankfully the builders have been much more proactive than me, and even over the course of that very first evening on the Friday, I received 7 registrations, 2 of which proceeded to download the tender documents. I even had my first site visit on the Sunday, all arranged through the Message facility in the software.
I was also informed that three of the participants I invited to the tender had invalid emails, which meant that the software picked up the delivery fail message and flagged it against the participant in question, be it for a full mailbox, unrecognised email address or some other reason. It gave me the chance to find an alternative address for them or, consequently, discover they were no longer in business.
I made the most of my journey back to Bristol from eWorld by using the software on my smartphone, where I sent out some reminders to various categories of participants, i.e.:
So let me fast forward to where I am as of today, exactly a week after publishing the tender:
I have 92 builders on my list. 84 are still approved to take part, as 5 builders had no capacity until well into 2014, and 3 were no longer in business. Of those 84, 20 are registered and 16 have accepted the invitation. Interestingly 4 of them registered using the Invite Code, which is a unique key that lets people who were not on my original list apply to take part, be it by word of mouth or referral or whatever. I approved their access to my tender having looked through their websites.
14 have downloaded the drawings and I have no fewer than 9 site visits planned over the next few days – there goes my chance of writing thank you letters for our recently received wedding gifts!
I’ve also made an edit to my questionnaire since go-live, as I omitted a rather crucial question of asking whether the builders are VAT-registered. It would be rather hard for me to compare the quotes without this knowledge.
I’ve also had to think about my Lot structure, using market-informed sourcing if you will, in that some builders are experts in loft conversions but not extensions and vice-versa. Therefore I might even be looking to award separately, although again there is feedback that awarding the total job to one outfit has cost advantages. My Lot structure allows for this expression of capability, and so I shall await the market feedback before considering my award position.
Feedback so far has been overwhelmingly positive. This approach has helped the builders to have structure and a central place to refer to. Given that IT is not integral to their day job and that in some cases they don’t even have their own computer, it was always going to be a hurdle, especially as I have no time to hand-hold people through the process and nor do they have time to sit at a computer for long periods. But we did design the software on an entirely self-service model and so far, so good.
Stay tuned for part 3 when my hectic weekend of site visits will be concluded and we might even have some competitive quotes in. Fingers crossed!Sourcing my extension! (part 1)
This is a multi-part article from Market Dojo co-founder, Nick Drewe, who is currently planning a house extension and is embarking on the sourcing phase of the project. We’ll let Nick introduce in more detail below…..
I recently got married and had a fantastic honeymoon in Turkey, co-incidentally the first time I’ve had more than a week off work in well over 3 years! Now I’m back, our next task as a married couple is to build a major house extension.
Up until now we’ve had the plans drawn up by the architect, giving us an indicative budget of £70,000. We’ve had all planning and building regulations approved and we’re in the midst of adhering to the Party Wall Act (not fun – but that’s for another time). Our architect, Ben, is helping us manage the whole project, given his experience and the fact he lives 10 doors up the road from us!
Ben drew up a very comprehensive tender package, including all drawings, national standards, specifications, and a detailed list of the scope of works, and has approached four contractors that he has worked with in the past. Two of those contractors haven’t even bothered quoting for the job. The other two came in with quotes of £93,000 and £98,000, both excluding VAT. The quotes have been paper-based and are barely comparable, with wildly different items included within their cost breakdown. Therefore, not only are they greatly over budget, but I have no confidence that they even fulfill the requirement.
And so I’ve decided to take things into my own hands. I shall distribute the tender package (all 20 megabytes of it) to the Bristol building trade as a whole to find out a) what the real market price is for my extension works and b) to make sure they quote and deliver exactly what we’ve asked for.
I’m in the privileged position of having unlimited access to the professional Market Dojo eSourcing tool, designed for exactly this purpose. Over the years we’ve witnessed our clients, including housing associations who are tendering building services like this, save millions. Some clients run tenders worth just a few hundred pounds. In fact I recall Hamworthy Combustion, our first client, saving £5,000 on a £25,000 contract by using our application. Why on Earth should I not use this approach? Well, exactly.
So this is where I’ve got to so far. I’ve created a test event on Market Dojo so I can interact with it as a test builder and I’ve invited my brother, who is a project manager in the building trade but is unfortunately based the other side of the country, to do likewise. This will help us validate the structure and communication of the tender. I’ve added my ‘Brief’, which gets included in the initial invitation email to the builders, so they will have a heads up on what I’m looking to do and how they can proceed. I’ve added an online questionnaire for the builders to answer my specific questions such as providing references, adherence to standards, confirmation that their price is all-inclusive, etc. I’ve decided to score the questionnaire so I can rank the builders based their answers.
I’ve created a robust Lot structure that pairs up with the breakdown of jobs in the Scope of Works, ensuring all quotes that come in are like-for-like and against our requirements. I’ve uploaded the 20MB of tender documentation so I can track when they download it, but I’ve made sure that the Scope of Works is included with the invitation email to give reassurances to the builders that this is a genuine job. I’ve also added my architect as a collaborator on my tender so he can dip in and out to check how things are going and can help me to answer the questions. I’ve even added my wife as a viewer in case she has the inclination to have a look at what we’re up to!
My final task is to pull together the list of builders, i.e. the sourcing exercise. All I need for Market Dojo is a list of email addresses. Typically if the tender is being run manually and paper-based, I would be inclined to invite only 3 or 4 builders, since the efforts of burning CDs and posting them out, checking they’ve arrived, having dozens of phones calls to handle the questions which are repeated from one builder to the next, collecting all the paperwork and somehow collating it together despite the incomparable nature of the bids, is all very laborious. However, since I’m running this online, there is very little extra effort whether I invite a few builders or a few hundred. Therefore at this point I shall be casting my net far and wide and see how it funnels down.
My first point of call is Google. Searching for ‘builders in bristol’ and other related terms like ‘house extension bristol’, I’m able to find lots of candidates. I’ll be asking for references as part of the questionnaire, so at this stage all I need to know is if they look professional, if they mention jobs that look similar, if they are reasonably local, and if they have an email address. I encountered websites like mybuilder.com a lot, so clearly I am not the first to think of running an online tender process for personal building works, although those sites don’t have the facility to properly manage your tender or to invite builders from outside their system, or even to run a reverse auction to settle the negotiaton if I so please. Additionally builders have to pay fees, which is not a model I believe in as it reduces competition and the fees would end up being passed on to me anyhow.
I will also ask friends and family for referrals, and scour professional associations for any recommendations as well. At this stage, the more the merrier.
So as of today, I have pretty much built my tender and found my list of prospective builders. My action over the weekend is to hit the button and make it live. At that point I really should start ringing round the builders to let them know I’ve been in contact and that I am a genuine prospect. That way I’ll increase my chances of receiving the competitive offers and finding that proverbial ‘needle in a haystack’ builder that precisely meets my objectives.
Stay tuned for part 2 as I manage the tender and hopefully get some competitive offers!Our Innovation Portal receives further innovation!
Only a month has passed since our initial release of the Innovation Portal, our unique tool our clients use to request, collect and compare innovative ideas from their supply chains, outside of any formal sourcing or tendering exercise. Call it a ‘Request for Ideas’ if you will, helping to unite Research & Development and procurement.
We’ve heard frequent complaints over the years that rigid sourcing exercises penalise suppliers who offer novel ways of solving the problem. Indeed we’ve been the victim of this on numerous occasions! Well, this is where our Innovation Portal comes into its own.
As an example a client of ours, a housing association, is looking for new garden designs. They don’t want to run this as a formal tendering exercise that would be to begin with a standard ‘request for information’, or even a ‘request for proposal’, since it is far more conceptual at this early stage. However, the Innovation Portal is perfect, as it allows them to understand what the supply market can offer by way of previously unconsidered ideas. This is helping them gauge their next steps, who to approach and how to approach them. In other words it is an excellent way for them to build a strategy and create interesting opportunities for everyone involved.
It is a highly encouraging start and so we have rapidly followed up our initial product release with some fantastic enhancements. In no particular order, here they are:
Improvements for suppliers raising their own topics
One of the key differentiators between the Innovation Portal and an online questionnaire is that suppliers can create their own ideas as and when they want to, and not just when the procurement team runs an exercise. This gives companies their own portal into which their supply chain can openly collaborate with them. We’ve made improvements to this process to add more robustness and security around it, as well as making the topic creation process for suppliers extremely simple and intuitive.
Quick and easy scoring of ideas
Once the suppliers have submitted their ideas, we have two types of scoring; a simple rating system or a more complex scorecard. In both cases we’ve made the process of scoring the ideas actually quite enjoyable and very straightforward to do by adopting sliders. They even work on mobile devices to ensure all our tools can be used on the go.
Better topic and process management
A clear advantage that the Innovation Portal offers over a simple email-based ‘ideas box’ is that Hosts can manage the whole activity from a central area, including what documents have been sent/received, which suppliers are involved and what they’ve done so far, what messages have been sent/received, what ideas have been generated and how they are ranked, and so on. We’ve made some important improvements to this process, helping to point the Host in the right direction on what they should do next to reach their goals.
General user interface upgrades
The key to any useful software product is to make it easy to use. We’ve made some excellent investments in this area to help our new users make the most of the tool.
Coming soon….Innovation Dojo!
Currently our Innovation Portal is fully integrated within the Market Dojo eSourcing tool. However, as we branch our product range out into unheard of territory within eProcurement, we would like to develop the Innovation Portal further so send us your ideas. Hence keep a lookout for Innovation Dojo !
Market Dojo is 3 years old!
Last Friday we proudly turned 3. If we were talking about a human rather than a company, we might look a little like this guy:
However, we are a business and to reach this milestone is a great accomplishment. According to the Entrepreneur Weekly, 44% of businesses fail by Year 3. Yet here we are, still self-capitalised having turned down investment offers along the way, and still growing at over 100% year-on-year with even steeper growth projections in our pipeline as some of our newest innovations hit the market.
We asked each of the three co-founders of Market Dojo for their highlights of the last 12 months:
In September we released ‘Samurai’. Building Samurai was a much bigger project than our previous enhancements, and we learnt a lot of lessons along the way. Working with new people and making so many improvements to MD was a great experience, particularly when it was all over. It’s also given us the ability to tick many more boxes for our customers and allowed us to work with a much bigger range of organisations.
We have fantastic clients, who are all working on great things with our software from simple RFQ’s to complex weighted auctions. Many of our developments are client led and so we ensure our direction is in line with your needs. The latest client and reseller is ABM Global solutions in the Philippines who we extend a warm welcome to. We could not do this without you all so please accept our greatest appreciation. You can see some case studies on our website. A massive thanks to all!
Nick Drewe: there have been quite a few to consider, such as achieving a 100% renewal rate on our annually paid licences to signing up very recognisable high street brands as customers, or even being nominated for a supply chain award by one of our customers, Arqiva. It’s all pointing towards the fact that our clients like what we do for them. However, for me there is one highlight that does stand out and that is the award of our second grant from the Technology Strategy Board. The first grant enabled us to build and release Samurai, which was immense. However, with this second grant we’ve created a whole new module within eProcurement, one that does not exist at the moment. Fitting in somewhere between Spend Analysis and eSourcing, we hope to announce Category Dojo later this year. Sadly I can’t elaborate too much at the moment, but drop us a visit at eWorld next month where we might be able to let you in on it!Want your own eSourcing portal?
Earlier this year we proudly announced the release of our white labelling enhancements (http://bit.ly/13m6uMB) where you could customise your own unique web address on marketdojo.com, for example http://my-mega-company.marketdojo.com (this is not a working example in case anyone tries that link!).
Well, now we’ve gone a whole load further. In our latest release last night we’ve given our users the ability to create their own web address, branded in their colours yet powered by the Market Dojo eSourcing tool.
Some of you may already have such a feature with other providers, but the difference here is that we haven’t done this by simply setting up a new server and popping a cloned version of our software on it – no, we are still 100% single-instance, multi-tenanted. This gives every one of our customers the added benefit of no upgrade issues nor delays, instant access to new features (such as this one!), no implementation fees and more affordable licences fees, since we have much lower maintenance and support costs.
It’s a really simple process for you to set this up. Simply buy your web domain from someone like LCN or Go Daddy and point it at www.marketdojo.com, then buy an SSL certificate for it so your data remains encrypted over the web. Send us this info so we can pop the certificate on our server and assign your account with the bespoke web address and you’re good to go!
All the other great customisation features still apply, such as:
You might also like to place web links or even your own Log In / Sign Up buttons on your website that take the user to your branded sourcing portal. But we leave all this in your own hands or those of your webmaster.
So, if you’d like to take advantage of all this, give us a call today!Camelia’s final post…for now
‘And here is the last post from our effervescent intern, Camelia…’
Wow. I can’t believe I have already reached the end of my internship. There’s only one week left and the time has passed so quickly. So much happened during my time here.
First, being the world’s biggest fan of the Skins TV show, and realizing that I was working with two of the characters was definitely impressive. (Ok maybe not the characters themselves but their big brothers at least – See picture)
From a more professional point of view, I was in charge of a lot of marketing during my internship. I got to design promotional items to promote the company and I can say that I really enjoyed doing that. I’ve always been quite good with using editing software but it was mostly to retouch Facebook photos – nothing really contributing to the society. So using graphics for an interesting and useful work such as creating promotional items or making a contribution to the website was more gratifying. Now and thanks to this internship, Market Dojo has a whole new 404 page (woop woop!)
The last weeks were also about a pitiless competition between Antoine (the other intern) and I. Alun and Nick encouraged it by using a point system every time we gave the right answer to a question, or beat the other one in any field, or did anything really good.
Thanks to that competition, our previous articles on this very blog have reached +400 views each [at the time of writing], which is quite huge considering that Market Dojo’s previous record was around 250, and this was only because we couldn’t resign ourselves to letting the other one win. No way.
The story does not say who had the most views at the end (me). However, I can tell you for sure that we both took the TOEFL test (Test Of English as a Foreign Language) in Cardiff a few weeks ago. And I won, obviously. Serves you right, Tonio! I knew from the beginning I was the best. You knew it. Nick and Alun knew it. That fly over there knew it. And nothing is going to keep me from enjoying my victory. Nothing.
In brief, if I had to describe the last weeks in a few words, I’d say: genuinely interesting, deeply enriching and full of surprises. I had the opportunity to learn so many things… But the two main ones are that any time is Beer O’clock – literally any time – and the only phrases you need to know here are “hey pal” and “cheers mate”. If you’re aware of this then you can survive in the amazing city that is Bristol.Our first upgrade of 2013, with so much more to come!
Over the weekend we completed our first 2013 upgrade, following on from the second upgrade to Samurai back in December of last year. Such is the elegance of the Software as-a-Service model, each and every one of you can benefit from the upgrade when you next log in.
Quite simply, there are too many improvements to list (70 to be precise), so here are some of the important highlights:
On top of this, we have made a number of upgrades to our infrastructure to keep ahead of the increasing demands of our customers. We are now sending several thousand e-mails a day, practically becoming a MailChimp in our own right, and so we have upgraded our e-mail account to ensure uninterrupted communications between our Hosts and their respective participants.
We have also upgraded our servers (again) to ensure we maintain our 99.9% uptime record. Some events have even had over 500 participants involved, and so we’ve learned a great deal about where potential bottlenecks may lie and catered for them accordingly.
We have a number of exciting new features we are working on that will be released imminently. For example, in collaboration with our customer Arqiva, we are in the final steps of testing and improving our User Hierarchy feature. This will allow our users to invite friends, colleagues and countrymen to view their sourcing activities, or even to have edit rights should they have a licence. You can manage all your internal users from a central place, see all the events across your organisation from your own Dashboard, and even invite external users such as consultants to have their input on your activities.
We are also nearing completing of an enhanced white labelling feature with another collaborative partner in the US as we help them with an exciting new venture. Our users will be able to define their own URL for the sourcing events, such as www.esourcing.marketdojo.com, which will have your logo and menu colours with your own log in, sign up and password reset facilities. In short, it will be your own portal: even the e-mails will come from you.
Here’s to a fantastic February ahead!
PS: If there is anything you’d like us to work on, get in touch and we’d be happy to talk.
Market Dojo – e-sourcing made simple
For the next few weeks, we are lucky enough be working with two interns from France, Camélia Chiguer and Antoine Boton. Here are the observations about the cultural differences they have encountered, through the eyes of Camélia:
Ever since I’ve arrived in the magnificent mother country of Hugh Grant and Coldplay (big fan here), I’ve had lots of opportunities to notice random details that are slightly – or sometimes considerably – different from France to England.
Above all, I can say that everyone here loves Frenchies – everyone that I’ve met so far anyway. Not to mention this (awesome) obsession about what we sound like when we talk: when I try and make an effort to speak proper English, some people even ask for my “real accent”!
In fact, the main difference between us is how friendly and welcoming English people are. It is a huge change compared to France, which is full of people doing nothing but being grumpy and looking unhappy all day. People here are polite and a stranger will always answer with a smile when you ask for your direction in the street. I am not used to it. A stranger smiling at you is something you should almost be afraid of in France, it definitely hides something.
Another area where England is way ahead of France is music. Lennon once said “French rock tastes like English wine“. Need I say more?
Well, enough with putting our English fellows on a pedestal. There are some daily things that got me really confused ever since I’ve been in this country.
First of all, what’s up with the taps here? There are no signs of any mixing valve. The water is either ice frozen or boiling hot, never in the middle. How practical.
I’ve also had the chance to experience the “typical English weather”: I saw some snow when I came out of the plane, then a lot of rain on my way from the airport, quite good weather the next day but then 5 min later a storm, lightning and even hail stones; and all of this happened in less than two days. I can say that at that point I was really missing France.
I’ve also noticed to my great surprise that English people and especially young ones aren’t actually sensitive to this lovely weather, and they don’t seem to like wearing clothes that much: even whilst out at night I could see people wearing nothing but a simple t-shirt, when I, on the other hand, was struggling with keeping my fingers attached to my body, wearing several layers of clothing, a scarf and everything.
Furthermore, I have also been disconcerted by how everything closes at 6pm, if not 4:30pm. I found myself locked in some mall at 6:15pm after having dinner really early (trying to get used to the British way of life, ya know). Similarly, most of pubs close down at 1am on the weekends (whereas in France it wouldn’t be before dawn). On the contrary, nobody’s surprised to find dozens of restaurant open at 3am… no offence guys, but you have got a quite nonexistent sense of time management
Anyway, back in France, as you can imagine, we have a few preconceived ideas about English people. We always imagine you really blonde and really pale (not true (well, not always)). You’re famous for your food across the Channel – not in a good way though – and we have this idea of you eating all the time what we just call “pudding”, which is this jelly-ish Christmas pudding of yours (not quite true again). However, you do drink tons of tea. And you cherish your favorite sport teams in a way I can’t describe. I mean, I’m not sure that entirely disguising yourself is required when supporting your team at the local pub, but then again it’s only my opinion.
Conversely, you have a stereotyped representation of us as well. So sorry to break it to you, but we do not hang around carrying a baguette and wearing a beret. If the cliché of us eating lots of bread isn’t that incorrect, the only time I actually saw someone wearing a beret was here in Bristol on my first night out.
PS: I have learned about you calling us “frogs”. Well, back in France, your nickname is “rosbeefs” so that’s one all I guess.
PS 2: we are so going to beat you up at the VI nation game France vs England! (But then again, I don’t really care if we don’t. I’m just saying this because I’m trying to fit in the British spirit, remember?)The British culture seen by a Frenchy
editors note: this is the second blog entry from our excellent intern Hadrien Geffroy. Sadly Hadrien’s internship has reaached it’s completion and we have to say au revoir, but Hadrien, you are welcome back any time.
Advice: this article could contain French humour which some English people could possibly not understand. I apologise for it, and I ask you not to take it wrong or feel offense. Thanks you for your understanding.
I don’t know if it’s because we are neighbours or if it’s a direct consequence of globalization, but the British culture isn’t so different from the French culture. I mean we are both Occidentalized countries, lead by a democratic government and severely influenced by the American culture. But a few things caught my attention. The first things that shocked me when I arrived in Bristol were the streets and houses, all the British houses look the same and there are no garages to park your cars! Where are your architects? Do you have architects? Do you know what an architect is? Do you want some of ours? Fortunately Banksy is here to beautify your walls!
The second example of great interest to me personally is FOOD. Being French, food is for me a big part of the culture and even if I come from France and the food I eat there is the best in the world, I have to admit there are a few good things in your kitchens. Obviously I’m not talking about this stupid chilli (I’ll get back on it later). By good things I mean crumpets, Shepherd’s Pie, crumbles, bacon… And even if British food isn’t very sophisticated, the meals I ate all along my stay were quite good. Breakfast is on the top of the list of my favourite British food. I tried typical brekky twice and each time it was a really culinary orgasm. I was also fond of Fish & Chips until some made me ill. I love curry as long as there is not too much chilli. You may probably think I make a fixation on chilli but you have to know that for my first lunch with Nick & Alun they put so much chilli on my sandwich that I thought my tongue would fall off. I’d like to talk about beer but I don’t want to shower you with too many praises.
In the UK, and more especially in Bristol, the culture is more visible on the streets than on the plates. The street looks like a perpetual carnival, there are so many styles of people: hippies, Goths, hipsters, coloured haired girls… and what about girls… I don’t want to introduce an endless debate about which of British or French are the most attractive but I heard someone who said that French girls have pretty nice faces and bodies but they are too much introvert whereas British one’s looks sometime “not attractive” but they are sexier… I let you give your point on it on the comments 😉
There is another reason I will never forget this summer: Olympics. One of the questions people asked me the most while my stay in UK was “what do you think about the opening ceremony?” And here is another point in which I have to admit you are very good. I watched the Opening on the big screen in Bristol’s town centre and the atmosphere was awesome.
Being in the UK while the Olympics were on gave me the opportunity to spend a day in London, I couldn’t watch any event but I enjoyed the infatuation of the Olympics. Of course, as a Frenchman, it was very difficult to endure all these gold medals for Team GB or to see how many British people scorned handball. Everybody told me it was a sport for girls…Oh sorry, it’s true, you got the most athletic sports in the world: Darts, Snooker and Cricket…
If there is a point on which France should copy the UK, it’s on the place of sport in society. When you see the place of sport in the daily life you quickly understand how the British athletes managed to reach 26 gold medals at the Olympics. In France sport is most of the time just seen as a way to stay healthy but in the UK it’s much more than that; so one point for you.
editor’s note: this is the first of two blog entries by our intern extraordinnaire, Hadrien Geffroy from École Atlantique de Commerce in France. We were fortunate to have Hadrien join us for 6 weeks this summer and to take us to markets we have never been before.
The 9th of July, on a wet summer’s day, I set my foot on British soil for the first time of my life. Obviously I would have preferred to spend my holidays in my native country, the beautiful and sunny France. But a special mission was waiting for me, here in Bristol, and more precisely two businessmen: Nick & Alun (or Alun & Nick, no jealousy there).
Indeed, as part of my studies, I had to complete a 6 week long internship abroad over the summer. “Why Market Dojo?” You might ask? In fact I had heard about Market Dojo by chance. Fond of the web and new technology I was looking for a trend company as a start-up which related to my business studies. It was only after a few researches that I found Market Dojo. When I applied for my internship, I didn’t imagine how much I was lucky to work for this company.
Today I’m working for Market Dojo as intern and thus for 6 weeks. Because my work is very boring and uninteresting (humour), I have time enough to talk to you about the fantastic professional and life experience I’m currently living in Bristol.
Monday the 9th of July 2012 at 09:00, I knocked at the door and two young (it’s all relative) smiling guys opened the door. I quickly understood they were very cool and relaxed, but also very professional so we didn’t lose time before we set to work, just the time to take a cup of tea (the first of many). But Market Dojo is a kind of modern company, most of the work is home-working and the atmosphere is relaxed, which makes my working conditions very comfortable.
Now let me talk to you about the advantages of working in a little company. Having the opportunity to work for Market Dojo allowed me to see this. Indeed, I wish to every student to work for a little company to live both a professional and a life experience. In little companies the border between working life and private life is very thin; which makes work less boring and gives me ample time to learn about the British culture.
Concerning the work, I quickly realized my responsibilities would outnumber what I was expecting. In my case, my main goal is to make Market Dojo’s website and software accessible for any French native who wants to use Market Dojo’s service; which means translating approximately 15,000 words (so easy!!). But I also have to think about Marketing for French market, software testing, assist a conference, and make cups of tea (wringing the tea bag is much more technical than it seems). Being an intern at Market Dojo also involves eating bacon sandwiches, playing tennis, going to the cinema, watching the London Olympic games, looking at videos on Youtube (http://www.youtube.com/watch?v=YCiY1y3uJ3o), so many things that make you forget you are here for work!!
So many thanks to Alun, Nic and Nick for these 6 weeks!
For immediate release
Market Dojo celebrate their second birthday with a year of amazing growth
Last week marked Market Dojo’s second successful year in business, with a massive ten-fold increase in the previous year’s revenues. Co-founder Nic Martin was delighted with this important milestone, “the last 12 months have been a fantastic period of growth for our young company and has really proven that our business has the key ingredients to succeed, from a great product, excellent customers and a brilliant team”.
The rapidly expanding software technology company, based in the South West, offers an online application that helps businesses negotiate more easily and efficiently with suppliers via the internet. Businesses can also run reverse auctions where suppliers compete to win contracts to supply goods and services.
Market Dojo now has in excess of 25 customers who use the application up to 5 times a day to receive quotes from suppliers for goods and services as varied as electrical cables, paper bags, van and car hire, brake pedals, machined parts and office furniture.
“What makes us unique is that we have taken a concept that was previously restricted to large businesses, due to the complexity and cost of existing software, and made it accessible even to small-to-medium sized businesses”, explains fellow co-founder Alun Rafique.
Their ambitions now lie in building the customer base, both home and abroad, as well as releasing a whole new product upgrade which is just around the corner.
Today, we are really pleased to announce some great new features for Market Dojo. We believe these reflect our four core beliefs: being collaborative, transparent, agile and to have fun doing it.
Here are the highlights…
Translated Market Dojo into German and Russian
We added these specific languages in direct response to customer needs. We are well aware that our users are based all over the world, and for many of them, English is not their first language. This release also lays the groundwork for more languages in the future. We are already planning improvements to the public areas of the website in these first two languages with a new web design planned for July.
Bigger file uploads
Several customers told us they needed to include bigger files with their RFQ and Auctions Events. We have increased the maximum file size to 10Mb, to allow even more detailed documentation to be included.
Improved Edit Mode
Changes happen. When they do, it is important that they are correctly communicated to all affected parties. We have learned that when you are dealing with dozens of people in several different timezones, more focus and detail in the information you provide up front will save time later. Previously Market Dojo automatically notified everyone of changes to an Event, now this is done at the Hosts discretion, so only those who are affected will be informed. Hosts are able to include a detailed message explaining exactly what has changed.
More upload/download formats
Previously, data imported and exported from Market Dojo was only in CSV (comma separated values) text format. Now, we also support Excel (XLSX) format files. This format will address problems for users in countries where the comma is not used in CSV files and also give us more flexibility in the format of reporting we provide. Currently this is a ‘beta’ feature, and we are really keen to get any feedback on how this works in the field.
Improvements and bug fixes
We have made more than 20 improvements and fixes to give our users a better a experience. These range from changes to which information is shown first at various stages of an Event, to clearer messaging and integration to our customer database.
We have had a lot of fun putting this release together, but we are really looking forward to is hearing how it helps our customers. Do let us know what you think!
We have created accessible e-sourcing software, attracted customers both large and small, proved its value and now we want to share our success.
“Market Dojo is looking for resellers”
SaaS solutions are being adopted by many companies in the market and offer advantages over the traditional software applications. We have taken this and applied it very successfully to the e-Procurement space as a best of breed e-Sourcing solution. Our solutions currently extend to electronic quotations and auctions, however, we have many more developments coming soon.
We have demonstrated that our software is as competent as many solutions out on the market, yet is available for a fraction of the cost:
To help bring our solution quickly to the global market, we are looking for resellers. We are happy to work with consultancies and also pure software resellers where our solution will be a great addition to your offerings.
To see some of the benefits and more detail, please go to our Webpage or send an email to firstname.lastname@example.orgWhat is a Japanese Auction?
We have just implemented Japanese Auction capability in our software at the recent request of a customer of ours. Despite our procurement consultancy past, this is an auction format of which we have very little prior experience. In fact, how much knowledge and experience is there in the general purchasing community of this approach to negotiation?
For those who are not familiar, here is an excerpt from our website of the Japanese Auction process:
“The Host states an opening price and participants have to accept that price level or withdraw from the auction. Acceptance indicates that the participant is prepared to supply at the stated price. When all participants reply to a certain price, the software lowers the price level by a pre-determined amount and again asks participants to accept or decline at the new price level.”
The process continues in this manner until all participants have ‘opted out’ of the auction.
As you can see, the approach can be very effective at establishing the final price for each participant in turn, regardless of the market competition. Consequently the approach can be adopted in situations where market liquidity is very low or markets which are dominated by a handful of major players, such as dairy or utilities. The Japanese Auction can even be used for a single-source negotiation, which was the major reason our customer favoured the Japanese Auction, ever since they used it to negotiate a significant cost reduction with just a few keen participants involved.
Other situations where the Japanese Auction can be used effectively are when there are large cost differences between bidders, despite both quoting for the same specifications. With your typical Ranked Auction, the participant in first place will unlikely be challenged, even though they may have built in some margin to play with. However, utilise the Japanese Auction and even that participant will be asked to improve their offer.
So far we have outlined a reverse Japanese Auction, i.e. where the bidding comes down in value upon each round. However, we have encountered situations where a Japanese Auction can be used in an upward price direction, such as the negotiation of rebates amongst your supply base. Since it is fairly meaningless to give suppliers market feedback on their rebates, as each supplier could be contracted for different goods and services and different spend levels, the Japanese Auction presents itself as a superb way to negotiate with each supplier individually, yet concurrently in a single auction. For example, in Round 1 the suppliers are asked whether they agree to a rebate of 0.5% of full year spend, with an answer of “Yes / No”. For those who reply favourably, they are then asked in Round 2 whether they agree to a rebate of 1.0% and so on. There is a huge efficiency saving compared to the traditional way rebates are negotiated, as well as the potential for far greater results.
There are of course challenges to Japanese Auctions. Firstly, they are not widely known about, which means that participants will require a greater degree of hand-holding and reassurance. Secondly, they offer little to the participants in the way of market feedback. Nevertheless, post-auction you can certainly provide feedback at your own discretion and to whatever extent you wish. Thirdly they operate in a rigid manner, with participants only able to accept or decline each price level rather than to come in at their own price level. It may mean that some participants have to wait a little longer to submit their final offer but the goal of establishing the market price is still achieved.
If anyone would like to know more, please feel free to contact us and we would be happy to take you through a web demo to show you how it works.
We were recently asked to contribute our on-the-ground thoughts of the e-Sourcing market, as we witnessed it. The original posting can be found here, although for ease we have included it below:
As a new entrant into the already crowded space of e-sourcing during a major economic downturn, it certainly makes for interesting times. After persevering though our first year, we can see many factors actually in our favour (and of course many against, but let’s focus on the positives).
First, procurement continues to gain visibility within organisations, as we know that an efficient procurement strategy can mean the difference between profitability and receivership. Having been both an engineer and a buyer, it is pleasing to see these professions gaining more traction at a board room level, although still maybe not as much as we’d have liked.
Secondly, there is a strong focus on reducing costs. Perhaps that is stating the obvious; however with sales ever tougher under increasing global competition, procurement is the area where you can really recover that lost profit. To quote a figure commonly bandied about during my time at Rolls-Royce, “a one percent saving could increase profits by as much as ten percent.”
Lastly, we perceive a paradigm shift in the e-sourcing market, which is why we chose to develop a SaaS (Software as a Service) application. As an aside, in our opinion, SaaS is just a re-branding of the type of companies formed during dotcom boom, except this time the internet infrastructure can cope with the delivery of their benefits.
The last fifteen years have definitely seen procurement technology come on leaps and bounds. It has evolved from pipe dreams to disparate applications to fully integrated ERP systems. These have been traditionally maintained by the local IT team and supported by a host of consultants with each required change to the interface or operating system costing the better part of an arm and a leg.
The shift that we thought we were predicting was the shift of this technology to online hosting, coupled with the rapid application of these e-Sourcing solutions to the SME and mid-tier market. In many ways we believed we were looking at the commoditisation (or “consumerization” as we learned to call it in the US) of the technology, embedded with more intelligence yet easy to use, professional and openly priced. We had thought that the larger companies were sewn up with the ERP behemoths who, even as we speak, are slowly moving to online hosting by development and acquisition. Parallels could also be drawn to the dotcom boom here, where large multi-nationals swept up the few successful e-providers who survived the bust bubble to give them that dynamic edge.
However, we seem to have got it wrong. We were too early — although we have found that being ahead of the curve is not such a bad thing. What we have hit upon is a lot of interest from large tier one companies desiring a simple, online, and accessible solution which can be used in parallel with or sitting on top of their existing ERP solutions, even if those systems already contain e-Sourcing modules. This is most certainly due to the slower reaction speed and migration period to true SaaS solutions exhibited by the larger providers.
What is the reason for this? Our view would be the need for accessibility and easy adoption. Niche SaaS providers offer uncomplicated, pay-as-you-go products that are easily accessible and have been designed with the end user in mind to deliver very focused solutions. In our case, it is to provide in-house sourcing professional tools for e-RFQs and e-Auctions which can be switched on and off with no implementation costs and very little training. Obviously the large providers are adapting, trying to catch up with different pricing models to counter the competition from the smaller, more nimble SaaS providers. Ariba has demonstrated this most recently with their “free” license option. However, the change in the way software is being delivered, combined with the customers desire for an uncomplicated product, at least lets us put our foot firmly in the door and, in the end, we still have the small and medium tier to approach. All in all, interesting times.
Reverse auctions and even e-sourcing software has become a commodity product. There are numerous players in this market offering broadly the same functionality. Sure, some have a few more bells and whistles and others can integrate nicely with other e-procurement solutions, but on the whole there is little to distinguish between them aside from cost and aesthetics.
So, if I had responsibility as a buyer for a large company to implement an e-sourcing solution, why would I not consider conducting a reverse auction to settle the negotiation and how would I go about such a thing?
Well, if you look at the key ingredients for a successful e-auction, purely and simply it comes down to being able to accurately and robustly define what you need and to ensure you have enough capable and interested participants who can meet those needs.
In terms of e-sourcing software, I would draft up the core features and functionality that I would look for in any capable vendor. Now, I could do this the complex way and draft up a weighted RFI followed by a weighted auction to allow bidders who have “special” features to score more highly, but then why make this difficult. Simply knock up the list of “must-haves” and make each participant verify that they can satisfy the requirements. I would request a 2 hour web-demo with each participant to help me decide whether or not to include them in the bidding process. Since the whole process will be run on “Buyer’s Choice”, I will decide post-negotiation which participant to award the business to, taking into account the price of their solution as well as the other features and service levels that they can be distinguished by.
Having done this, I have my list of capable and interested participants. To complete my requirements, I would also compile my commercial and contractual terms, such as length of contract, number of users, approximate number of sourcing events, suggested payment terms, my training requirements and so on. This would allow my participants to submit accurate and sustainable quotations.
The next step is to conduct the negotiation and for this we could choose the reverse auction. The interesting step here is to pick a platform on which to conduct the auction, as it would most likely be inappropriate to use the software of one of the competing vendors, even though I could probably source a free event from them! Perhaps one of my earlier unsuccessful candidates would supply this, which would at least be something of a consolation for them.
With the auction and hence price negotiation complete I would be in the position to award the business, using my buyer’s choice to take into account all the other differentials.
So, would we as a company participate in such a process?
The short answer is most certainly yes! Whilst some organisations refuse to take part reverse auctions on the basis that they are too price-focused and that they drive you to prices that are unsustainable, we would actually be very keen to take part in any such opportunity as we know this is not true.
Firstly, the sales process is much shorter. A buyer would be approaching us with a genuine interest to buy and has been given the green-light from above. We would not have to spend much time at all writing proposals, reviewing proposals, re-writing proposals and so on! Instead, the buyer has taken the time to lay all of this out for us in advance. All we have to do is examine whether it is within our core capability and interest to supply it and at what price. Since we know from experience that the entire reverse auction process and award decision takes approximately 8 weeks, this method is far quicker than the 6 months it can take in a traditional process.
Secondly we have huge belief in our business model and offering to the extent that we think we would perform very well under competitive pressures. Should we not be successful, at least we have live and dynamic market feedback on how we compare to our genuine competitors. If we continued to be unsuccessful against the competition then it would provoke us to carefully review our business, thereby mitigating the risk of longer term failure that would inevitably have occurred should we not have pitted ourselves against the competition.
As for the potential objections, sure the auction itself is focused on price however the award process is not. During the process, as a participant I would be in regular dialogue with the buyer, building up the relationship, advising where the specifications are not quite right, being supportive, proactive and punctual. Let’s not forget that the negotiation is still part of the sales process and so by demonstrating a high degree of professionalism and that you are a company that can be trusted, you are greatly influencing the buyer’s decision once the auction is over. This can make the difference between success and failure, despite your ranking in the auction.
The only ground for objection here is that the auction is simply too effective as a negotiation tool. With my buyer’s hat on, sometimes I do wish that suppliers I am negotiating with stopped offering me all these extra services and features that I don’t want and simply reduced their price for those that I am actually asking for! This is where the auction is so powerful.
As for auctions leading to unsustainable contract pricing, this is where you need to do your groundwork and stick to it during the auction itself. Sure, it can be tempting during an auction to submit that “one last offer” only to later realise you cannot commit to it, but it is in no one’s interest for this to happen. The buyer is looking for a capable partner at the most competitive price level and we as a participant are looking for a new customer at a price level that allows us to grow. There is certainly middle ground here where both parties can win. Again, if you keep losing out whilst bidding on auctions, it is time to take a look at where you are leaking costs or to re-think which markets you should be competing in. Perhaps all those additional service levels and quality accreditations are simply not important to your customers, or on the other hand, perhaps your run-of-the-mill offering is not specialised or distinct enough to convince your customers to partner with you. An auction plus award decision offers genuine market feedback combined with specific personal feedback. You can really use this to your advantage to improve your sales performance in future activities. In fact, should you be successful in an e-auction, why not shout it from the roof-tops. You have just positioned your company as one of the best in the market. What a fantastic statement to make when you are next in a sales dialogue.
One final note is that we as an e-sourcing and e-auction software vendor, who encourages organisations across the globe to tender their business via this approach, really should be able to put our money where our mouth is and wholly support any buyer who would like to auction us.
Well, it would be our pleasure!
About: Market Dojo provides business-to-business e-auction and e-sourcing software. Find out more at www.marketdojo.comWhy we are so grateful for the ‘cloud’
Last month we surpassed the milestone of our first year in business. Understandably we were delighted, as we read previously that up to four-fifths of start-ups fail in their first 12 months. Yet we feel we are truly on our way to becoming an established player in this market, with a client list that is expanding rapidly. However, when we look back at how we started Market Dojo, there is one aspect that stands out when assessing what helped us reach this goal, and that is the use of cloud technology.
For those who are not familiar with cloud technology, and to admit such a thing is akin to never having watched a Star Wars film or never to have heard a Beatles song, our take on it is the use of software or an application over the web on a ‘pay per use’ or monthly basis which you can use straight away with clear benefits. Think Facebook, LinkedIn, Twitter or YouTube. No installation, no set-up costs, and in many cases no fee. If you like just think of it as the dotcom boom version 2.0, only this time it is here to stay!
When you consider any business, you will find it will most likely have office infrastructure to some extent. Such infrastructure might include a phone system, an e-mail system, a fax system, an accountancy system, a CRM system, a calendar sharing system, a data storage system, a web-hosting system, or even a customer support system. Clearly there can be a lot of systems and many of these are non-core to your business, meaning time and money spent in these areas would be detrimental to other areas of your business.
I can only imagine how much it might have cost us 15 years ago to cater for all these systems. We would probably require a receptionist for the phones, a PA to manage the CRM, an on-site accountant, a very large printed calendar, an even larger filing cabinet and a staffed front-desk for our customer support. We would then need a rather large room to host all this.
This takes me to why we are so grateful for the cloud. At Market Dojo we have embraced the best of today’s technology to turn us into a professional company, as ultimately that is what we wish to extend to our clients.
Our phone system is Skype, where you rent a phone number by the month and only pay for your usage, most of which is free. This includes video conferencing, file sharing and instant messaging for everyone in our company and gives us a global presence by allowing us to rent or cease renting international phone numbers when we like. Whilst Skype is not strictly cloud, as you do install software, you can log in across the world from any computer that has it or that you can download it to, so in many respects it is very similar.
Our CRM is Zoho. We only pay per user per month. It integrates with our other applications, including Skype, which means no repetition. Within our own software development we have the approach of “Don’t Repeat Yourself” (DRY) which any business would be wise to apply to administrative tasks as well. Zoho also caters for the customer support system on the same basis.
Data storage and sharing, calendar sharing and e-mail is all with Google Apps, which is completely free and is as robust as the google.com website, even though everything is still in beta!
Our accountancy software is Clearbooks. Again, pay per month per user. We can even add our accountant to it so that they never even need to set foot in the office, as we can upload all our receipts and invoices to Google Docs.
We don’t have any need for a fax system, but if we did there are plenty of cloud systems out there that charge per use.
And finally our web-hosting is all with an external hosting provider, secure and backed-up daily, paid monthly of course and with zero set-up costs.
The advantages that cloud technology has brought to us are simply enormous. The most obvious one is cost. If I were a sole trader, I would be able to set up and manage all of this for less than £600 a year. I would need no training and no upfront capital expenditure. To ‘house’ all of this technology, all I would require is a computer, in fact no, a smartphone. It would take me all of about 3 hours to set up and I would be happily catered for until I was running a global empire, at which point some apps might start to creak at the edges.
The main risk that companies quote for not examining the cloud as a serious solution can be easily mitigated. Data security is a major and very understandable concern. However, with such a broad choice of hosting providers on the market, you can always source a provider that offers the necessary level of data protection, whether for personal use or for the Ministry of Defence. You can also find cloud-based data back-up providers!
Another major objection is reliability. Today though, the internet is probably less likely to fail than your internal LAN and with an increasing number of companies providing networks that are dual-hosted, these risks are diminishing. In fact, you can actually end up with a more reliable solution than your own internal network. For your servers, do you have back-up generators, CCTV, a fire suppression system, 24/7 security patrols, CESG accreditation, dual-hosting and multiple internet providers? This is certainly what we look for in our hosting provider.
When you compare the old approach to starting a business and the new with all the technology that is now available to us, the two are worlds apart. You don’t need capital expenditure for office infrastructure, nor the staff to manage it, nor the space to house it. You don’t need a hardware refresh, nor have costly upgrades as you grow or as old technology becomes redundant. There is a valid question over whether you need an office at all. And best of all, you only pay for what you use.
Just like you do with us!Our Press Release (A bit late!!)
Market Dojo celebrates their 1 year birthday!
Market Dojo, an innovative Bristol-based software company, recently celebrated their first year in business. The company, incorporated on the 2nd August 2010, is looking to soon become global with potential clients in Greece, Peru, US and Germany.
Co-founder Alun Rafique reflected, “It has been a fantastic year in which we have learned a lot and come a long way. We’ve been very surprised by the level of interest that we have seen, not just from the small-to-medium sized companies but also from the larger enterprises.”
Market Dojo offers easy to use, professional e-sourcing software to help businesses save time and money on their purchases. The key benefits of their software include increased efficiency, centralisation of information, repeatability, transparency and auditability of the sourcing process.
To date Market Dojo has helped their clients average savings of approximately 30% from e-auctions alone, as well as bringing major efficiency improvements for all involved. The more standard Request for Quotation activities have seen similar results, which is all the more significant given each client averages 15 new sourcing activities a month.
Even more impressively, their clients have generated an average return on investment with Market Dojo of little over 2 weeks!
Alun Rafique looks forward to the next year with huge enthusiasm, “We have laid a great foundation for the future. We have established the business and proven the benefits of our product, so it is now a case of expanding the sales and marketing activities to bring the benefits to many more companies.”
About Market Dojo:
We offer Business to Business e-Sourcing software [RFQ’s and Auctions] to help companies save time and money when negotiating for their goods and services.
Our guiding philosophy has been to develop cloud-based software-as-a-service (SaaS) suited for the in-house professional.
It is designed around three core ideas:
Our software costs just £1,000 per sourcing event or £5,000 for a single-user annual licence to run as many sourcing events as you wish.
For more information please refer to www.marketdojo.com
Key contact: Co-founder Alun Rafique, 0117 230 9200, email@example.com.
We were having a meeting the other day with a vastly experienced ex-CPO of many FTSE 250 organisations, whose counsel to us was that we should look at developing a fully integrated eProcurement toolset if we were to have a chance of working with FTSE companies. Given our current direction, it did get us thinking about the whole best of breed versus enterprise solution debate.
The main advantage of best of breed is that is allows customers to select the ‘best’ product for each requirement, rather than going for one tool that can satisfy every requirement in perhaps a sub-standard way. Time and again we have seen certain modules of these enterprise solutions gathering dust within an organisation simply because they are not a best fit yet organisations are paying the software companies for supporting these unused features. In worse cases, best of breed applications are still brought in to do the very same task, only better, leading to the company paying for the same requirement twice over.
It is frequently cited that enterprise solutions have less integration costs. However in many cases it can be far more costly to implement an ERP solution onto the current IT infrastructure and then to bespoke it to fit the specific requirements. Perhaps if there were any true SaaS ERP applications out there at the moment then maybe the implementation costs would be much less. However adopting a best of breed route opens up the choice in the market considerably, which in turn increases your negotiation potential, in the same way that a buyer might devise ‘Lots’ for a tender process. This becomes particularly prevalent when it may come to switching your provider, as the fully integrated solutions will be extremely challenging to dislodge, whereas you can phase out individual best of breed applications gradually.
Furthermore integration costs can be cut drastically, in terms of price, time and complexity, through the use of clever cloud-based integration tools that remotely link SaaS applications. Boomi, Pervasive and Cast Iron are some example solutions for this. Suddenly the potential to integrate best of breed solutions becomes even simpler, and all possible via the web, thereby greatly increasing the flexibility of this approach.
From our side, the first major hurdle we would have to overcome to become an enterprise solution is that we would need to develop the other modules, such as spend analytics, contract management, P2P, SRM, SIM, project management and so on. This would create huge development costs on our side, costs which would of course be transferred over to our clients. It would also mean our maintenance and upgrade schedules would be vastly more complex as our team has to keep an eye on tens of thousands more lines of software code, much of which cannot be refined in isolation but must be looked at as part of the bigger picture. Naturally, as soon as this happens, cracks appear in previously excellent products, functionality starts to suffer and the user experience is greatly diminished due to the increasing number of options that the user is presented with. It is no surprise that best of breed applications are more streamlined than the larger ERP solutions, as they only have to handle 99% of the capability. As soon as attempts are made to plug the final 1%, which can move them further into the ERP domain, the application becomes unwieldy.
Instead we could partner with best of breed vendors in each of the key areas, using cloud integration tools to integrate our respective solutions, and then our team can focus on our key strengths and plans, and our partners can focus on theirs. We could even have multiple partners within the same product type, for example contract management, so that we could present our clients with several possible solutions from the all-singing, all-dancing right down to the very basic.
The partnership between applications can create huge value. Just a casual glance through the Google Apps Marketplace and you can find thousands of best of breed applications, designed specifically for simple integration with Google Apps. Google could have kept all their software behind closed doors and prevented third parties from branching out. However Google recognises the innovation and perfection of solutions that is created by promoting such an open network of best of breed applications. We certainly use a number of these applications, such as Zoho and Oggchat, and thanks to the way that these applications can feed off the functionality of Google, the costs are extremely low and integration was a doddle.
So, the next time you are looking for a suite of solutions to cater for your procurement needs, please do bear in mind the best of breed approach and use it to create your own solution to perfectly fit your needs whilst keeping your options open for the future.Market Dojo Interview with Buyers Meeting Point, November 2010
To get us started, give us a little background on Market Dojo and the team.
Two of the founding Directors, Alun Rafique and I, worked as cost reduction consultants for a nearly a decade combined. We helped companies like BP, Asda, Tarmac, Meggitt, Rolls-Royce and others to reduce cost and risk in their supply chains through strategic sourcing, tactical negotiations, supplier workshops and managed e-auctions. During this time we noticed a gradual shift whereby companies wanted to carry out the activities in-house. This gave us the seedling that became Market Dojo, the business-to-business e-auction software provider.
Our third Director, who used to work as an IT database specialist, but now currently designs complex data analysis software, has created solutions for companies like Tesco, Argos and Best Buy. Therefore between us we feel we have all the necessary skills to create and manage an e-auction software company. Our goal is to enable small and medium-sized businesses to run their own e-auctions successfully.
There are already so many players in the market – why enter the scene now?
We think that the timing is ideal. We’ve noticed procurement organisations are facing new challenges as many of their clients who have enjoyed their services now wish to self-manage e-auctions to reduce costs. Businesses have also learnt from the consultancies and there are an ever-increasing number of educational e-auction courses available. Thus we have focused our company to supply the procurement professional with a commoditised solution. We are not aware of any other e-auction providers that offer a product which is openly and reasonably priced (with no hidden prices or price escalations), yet easy to use and adopts professional processes to ensure success for third party use. Furthermore the “cloud”, which is big news at the moment, allows us to provide the software-as-a-service solution to a very broad market with no set-up costs.
Our offering, which aims to provide businesses between $5m and $500m annual turnover with the tools required to run their own e-auctions, is very neatly spaced in its own market niche. A number of our competitors would struggle to keep their skilled consultant workforce if they approached this market with our philosophy. We believe this is exemplified by Ariba divesting their consultancy arm of the business to Accenture. Both experienced professionals as well as complete novices are able to use our software. We embed best practice into the software, which means our support costs will be greatly reduced.
One of the distinct things about Market Dojo is your credit based pricing system. Why did you choose to take this approach rather than just charging straight GBP for a license?
The credits model is to give us and our clients flexibility. What we offer is a solution that caters for 90% of the e-auction market as standard, but with modular functionality to satisfy the remaining 10% of users, for example having bespoke categorised participant databases or using advanced reporting. Our clients can expend credits to add such functionality to their account, if they so choose, and can make this choice once their experience and requirements develop, i.e. once they feel comfortable.
Credits also allow clients to consolidate their purchasing and invoicing transactions and allow them to continue to use their account uninterrupted. This works in the same way as something like ICIS LOR, the plastics and chemicals market price database. Credits can be purchased in bulk by our clients to be used how they want, when they want.
For us the credit system is an advantage because the consolidated invoicing also aids our cash flow. Furthermore the credits allow us to carry out some great marketing initiatives. For example, exclusively for Buyers Meeting Point, sign up with Market Dojo before the end of 2010 and drop us a line quoting “Buyers Meeting Point” and we shall give you 25 free credits towards your first event, plus a further 25 credits in return for a case study.
One of the challenges of running a successful auction is being absolutely prepared. How you plan to be sure that users of the Market Dojo solution have positive results – not just because the software is useable but because they have the knowledge in house to follow a good process in advance?
We completely agree that the so called “plug and play” e-auctions can require just as much work as the consultancy-led managed auction process to be successful. We have worked hard to inform our clients of the work and thorough process required, which is encapsulated in our free guides, yet by streamlining the process within the software we have managed to reduce the workload.
Whilst working as a consultant I recall assisting a client who wished to run their own e-auction. After initially agreeing to proof-read their RFP, I ended up re-writing it for them, as well as adjusting the spend data and Lot structure. However, despite our warnings, we just could not convince them to bolster the number of participants. In the end they received a mere 3 qualification bids and during the e-auction itself just one further bid was placed. It just demonstrated that the traditional “three bids and a buy” embedded itself in their process so firmly that even the e-auction became a part of it. However, there is also an element that because the company sought to run an e-auction themselves via software from a consultancy, there was a blur in the roles and responsibilities, which ultimately caused it to fail. At Market Dojo we counter this by clearly outlining the process in our guides and by taking on the clear role of a software provider.
Our past experience gave us a great learning platform to incorporate into Market Dojo. We have developed a number of features to make our clients, in their own capacity, run successful e-auctions. Firstly, we offer only self-managed e-auctions, therefore the clients know what to expect. To assist them we have created nearly 20 guides packed full of our consultancy knowledge and experience, which are free for all our users. We have established our own community site, called Community Dojo, which encourages the free exchange of knowledge and learnings from running e-auctions and using Market Dojo. We have created professional, step-by-step software that has information help icons for every title, button and action that not just state information but provide advice and tips as well. We also have professional support on stand-by in the form of e-mail, phone and Live Chat.
All of these features combined mean that we have used our past learnings to fuel the future success of our clients. Nevertheless, although we do focus on the software, we are a new company and we would be happy to go the extra mile in return for a testimonial or referral to make sure that our clients exceed their targets.What is ‘market price’ and how do I know I’ve found it?
I realised recently that this is a term we brandish about quite frequently at various meetings and conversations we have. Occasionally we get nods of appreciation for the term, but more commonly we receive a look of faint recognition, as if it were a friend last seen in school days wearing braces and ill-fitting clothes. So, perhaps it might be worth giving our take on the term, just to help freshen up the concept, plus a little advice on how you might seek it.
The Merriam-Webster dictionary provides the following: “a price actually given in current market dealings”.
There are several key words in this definition. Let’s take the word ‘actually’ for example, for the above sentence can make perfect sense without it, yet the insertion is deliberate. It adds gravitas to the word ‘price’. It is not a suggested price or an implied price or even a piece of estimation, but an actual price.
What we would interpret this to mean in the procurement world is that this price is genuinely valid and acceptable. It has been submitted based on all the specified requirements of quality, technical, commercial, logistical, operational, administrative, health and safety and so forth. In other words, it is real and it is based on a product or service that meets your needs.
Another key word is ‘current’. A market price cannot be so if it is founded upon old or even future information. It has to be based current facts and information. If I purchased my property for £200,000 two years ago, I would be misinformed to say it is now worth the same. And nor could I actually tell now you the market price for it in 6 months time. If I want to know an accurate figure for my property today, I would consult the market today. It’s the only way to be certain.
The same applies in procurement. Where certain prices rely heavily on raw material costs, such as fuel or steel, don’t leave it to the supplier to hedge their bets on raw material price movements as part of their offer to you. It won’t be a market price if this happens. Instead, ask them to give you a price based on today’s raw material costs and to provide a raw material index mechanism for future price reviews. This way no one needs to take a gamble and lose out. Such a mechanism is fair, open and transparent. Currency reviews should operate in the same way.
However, what this definition does leave open is that you could receive a number of so-called ‘market prices’. Which one is the right one?
This is where we would go a step further. We would classify a market price as, “the best actual price in current market dealings that is sustainable for the required term”. It is in no one’s interest for the price to be so competitive that it causes a supplier to go out of business or conversely so uncompetitive that it causes the buying company to go bust. So, put into plain English, we see the market price as being the best price for a product or service, based on current market conditions, that meets your needs and is sustainable for the duration you want.
So, if that is what the market price is, how do we go about finding it?
First you specify your requirements. Second, you engage the market. It’s as simple as that. Think about something like Money Supermarket or Compare the Market. By filling in your car insurance requirements, you are provided with up to 30 quotes. The top two or three are usually around the market price level, i.e. the best price, based on current market conditions, that meets your needs and is sustainable for the period you require it. Beware of spurious prices, the ones that look too good to be true, because usually they are! A bit of due diligence is required just to double-check that the quotes are based on what you require. You don’t want to later find out your excess, for example, is ten times more than the next best quote.
For procurement, it is a case of designing a robust RFQ or set of requirements, leaving as little scope for interpretation as possible. Secondly, you distribute it to your own private market, whereby you should have a plentiful number of capable and interested suppliers. Finally, pick the top two or three bids and carry out that bit of due diligence to make sure everything has been understood and that the quotes are accurate.
The knack is in creating your market. If you were to approach two suppliers down the road and get prices, would you say that you have approached the market? No. If however you approach 10,000 suppliers around the globe, would you say that you need a few more before you know the market? Also no, you would say you have covered a sufficient number of bases. Clearly something lies in between.
Thankfully this is where online sourcing technology can greatly help you by keeping everything together in an auditable and controlled manner, allowing you to involve huge numbers of suppliers. My personal record was a sourcing exercise that involved 1,500 suppliers, of which 140 or so provided prices. Having completed this, I was particularly confident I had found the market price.
However this is a one-off example. The practical way to create and involve the market is to:
1) Outline your supplier criteria, such as geography, turnover, accreditations, capabilities etc.
2) Source suppliers using your contacts, your experience, trade shows, associations, sourcing agencies and databases such as Kompass, Hotfrog, Kellysearch, Applegate, Alibaba, TradeIndia and so on,
3) Qualify the suppliers against your criteria, using questionnaires and submitted responses if time permits.
Once done, send out the RFQ or grant the qualified suppliers access to it and simply manage any questions that come back. Once all the prices are in, carry out the competitive negotiation, be it an e-auction or otherwise, and the market price will be revealed before your very eyes!