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Top Takeaways from Coupa Inspire

By April 24, 2023Uncategorized

Raja Hammoud, EVP of Products at Coupa, speaking on the main stage at Coupa Inspire

Coupa recently completed its Inspire conference. It ran from April 11th through the 13th at the Aria Resort in Las Vegas. Roughly 3,000 customers, prospects, and partners attended.

Coupa offers a Business Spend Management (BSM) platform based on a public cloud. The platform connects hundreds of organizations representing the Americas, EMEA, and APAC, with millions of suppliers globally. This technology allows businesses to unify their procurement, expense management, invoicing, payments, contract management, and spend analysis processes and reporting. The public cloud gives Coupa visibility to $4 trillion in spend that passes through their public cloud. The visibility to spend allows them to provide excellent benchmarking in several areas. The cloud also allows access to Big Data, which greatly improves the platform’s ability to do machine learning.

Coupa also offers a robust, market share leading, supply chain design solution.  Hearing how Coupa was improving the design solution, and hearing how customers were using it, was my main reason for attending Inspire.

Here are my top take-aways from Coupa Inspire.

The Thoma Bravo Acquisition is Not Leading to Major Changes at Coupa

This February, the investment firm Thoma Bravo acquired Coupa in an all-cash transaction valued at approximately $8.0 billion. Coupa, formerly public, became a private company. Coupa has been a very fast-growing company. The new mantra is profitable growth.

The top Coupa executives, and the supply chain executives I have interacted with, are still working at Coupa. I see no evidence that less money is being invested in product development. The supply chain design solution, for example, continues to grow in depth and usability. And a new solution, that applies machine learning to making better ongoing transportation routing and mode decisions, is particularly interesting.

Coupa Introduces a Supply Chain Collaboration Network Solution

Coupa has claimed that their platform unifies processes across procurement, finance, and supply chain functions. I saw this claim as being more a statement of intention than of fact. I saw how their platform unified finance and procurement activities, but not supply chain. In fact, when Coupa acquired LLamasoft – the leading supply chain design software vendor – back in 2020, the product synergies were not at all clear to me. I assumed the main thing that Coupa was getting was access to great talent that would accelerate Coupa’s artificial intelligence/machine learning journey.

That has recently changed. Coupa just released a supply chain collaboration network (SCCN) solution that runs on their BSM platform. Initially, this product will focus on the purchase order (PO) acceptance process. An example of this electronically automated process flow would be a buyer asking a supplier if they can provide 1,000 widgets on January 10th, the seller replies “we can do 950 on July 11th, is that OK?” The buyer says, “yes.” These exchanges are done using codes, rather than human language. Then the delivery of those widgets to the buyer is tracked along with whether the order promise was met. When this visibility is focused on strategic materials, a buyer’s supply chain becomes more agile and reliable.

A SCCN solution needs to be built on a public cloud to be effective. Just as with BSM, the bigger the SCCN network, the more effective the solution. With the trillions that flow thought the BSM platform, a strong public cloud architecture, and some very large global multinationals that have signed up as Beta customers, Coupa is off to a good start.

Still, based on the new mantra of profitable growth, I was a little surprised Coupa brought this new SCCN solution to market. Afterall, there are some very large, well-established competitors in this segment. Coupa’s lead product development executive explained that the solution was codeveloped with their beta customers. These customers, she said, were unhappy with the usability of the current solutions in the market.

Coupa’s Take on Platform Fatigue

The top executives at Coupa had a private briefing for industry analysts. There was an interesting discussion of whether the word “platform” has any relevance anymore. Virtually every enterprise application vendor claims to offer a platform. What seems to be meant by many vendors is that their solution is a platform because they offer development tools that allow their customers or partners can use to build extensions to their solutions. Often these solutions can then be sold in a vendor’s application marketplace. Coupa meets this definition.

But from a customer’s point of view, moving to platforms should help a company rationalize their IT environment. If the customer moves from having 50 applications to 50 platforms, no IT consolidation has occurred. Coupa executives argued that for a solution set to truly be a platform, it should permit IT rationalization by unifying a broad set of processes. The following figure shows how Coupa views this.

Supply Chain Design Solutions are Flexible!

The use cases for how supply chain design solutions can be used keep expanding. Supply chain design solutions offer the broadest set of use cases of any supply chain solution. They are used for helping to design supply chain networks, to optimize transportation flow, for supply chain risk analysis, for jointly optimize transportation and carbon emissions, to design key supply chain policies, as part of a mergers & acquisition analysis, and in several other areas.

The use cases just keep expanding. At this conference, I heard of a couple of companies using supply chain design in their planning processes in new ways. The terminology surrounding what sales & operations planning is, versus what integrated business planning is, is somewhat variable. One set of practitioners defines sales & operations execution (S&OE) as the short-term planning horizon, sales & operations planning (S&OP) as the mid-term horizon, and integrated business planning (IBP) for the long-term strategic horizon. In its ideal form, these planning processes should help leaders align strategy, financial considerations, and supply chain strategy. This should be done in a manner that balances customer service with profits, cash flows, and assets.

Supply chain design has long been used for long-term planning. As companies look at long term estimates of demand, they need to make capacity decisions. Building a new factory or warehouse takes time and is capital intensive. Using supply chain design to help time the investment and select the optimal location is a perfect use case. Now, some leading companies are also using supply chain design solutions in long term planning to help determine the timing and scope of their investments related to lowering their carbon footprint.

For medium-term and short-term planning, supply planning solutions have traditionally been used. At this conference, I heard managers from two companies talking about using supply chain design for medium-term planning. The reasons for this included: a) they already owned supply chain design and they would not have to buy a license for supply planning; and b) the existing supply planning solution did not do optimization as robustly as the supply chain design solution.

Coupa solutions are also being used for S&OE. In the case of one Coupa customer, their production planning process did not look like any other production planning process I’ve been exposed to. They created a model for this unique process, and used Coupa tools to wrap a user interface around the model so that planning could be done on an ongoing basis by planners rather than requiring the use of more skilled industrial engineers that are often the main users of design tools.

A supply chain design modeling solution is more like a toolbox full of many different tools. In this analogy, supply planning would be more like a hammer. There are a lot of companies with unique businesses. These companies often have nonstandard planning processes. For such companies, supply planning is not a good fit. There are a lot more of these companies than you would think.

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