Do I Need a Separate Procurement Intake System for Software?

Ben Pippenger: Hey everyone. Ben Pippenger here with another episode of SaaSMe Anything. In this episode, we're going to talk about procurement intake and work to answer the question, do I need a separate system for software intake? So I don't know about you, but I sort of live in a SaaS bubble and it feels like software intake and intake in general is just sort of everywhere right now. It feels like everyone's talking about it. So much so that there's standalone companies that have started that are focused on software intake or intake in general. There's P2P platforms out there that are all supporting guided buying and intake processes and then there's even other SaaS management platforms that are launching intake capabilities for SaaS.

Ben Pippenger: So I want to spend a few minutes and let's do a couple things. Number one, I want to demystify what intake is. Let's talk about what it actually is and the impact it has in a business, why it is a challenge for organizations to put an intake process in place today, and finally, how you should be thinking about the business process of intake and how it relates to SaaS.

Ben Pippenger: All right. So let's get going here. What is intake? Intake at its core is a pretty simple business process to understand. It's the process for an employee to request to go buy something all the way through the approval processes and looking at everything else in order to get to that final step of approve to go purchase. So it's really all of that data that's coming in and helping get to that final decision.

Ben Pippenger: So why is that a challenge? It seems pretty straightforward at surface level. Well, number one is that that process oftentimes requires multiple cross- functional team members to collaborate across different inputs before getting to a decision. So think about the roles like the actual employee that's requesting to buy whatever it is they're trying to purchase, their chain of command, their management team that needs to provide the proper approvals for that purchase. You think about procurement teams that need to get involved to help do that purchase, legal teams, security teams, and then if it's an IT related thing, your IT team or whatever department's responsible for it in the end. You get a lot of cross- functional team members that need to be a part of that approval process.

Ben Pippenger: The next thing you think about then is well what's all the data that's needed to get to the point of making that decision? And a lot of times that data is siloed across the organization. So data points like what is the business justification for buying whatever it is that needs to be purchased? That's probably going to come from the requester. What's the price that you're going to be paying for that thing? Any sort of compliance data, risk data, those sorts of data points. And then things like looking at well what's the stuff that we already have? Do we already have something out there that could do this for the end user based on what they want to accomplish? Putting together the ROI analysis and really looking at the business value of that investment from the company. So, you look at all those sorts of things and it can get really complex really quickly.

Ben Pippenger: And so as I mentioned at the start, as a result of that, there's really every P2P company is putting together solutions around this. Coupa launched their guided buying platform earlier this year. There's even standalone companies like Zip that are raising a lot of money and doing really, really well that are growing quickly to help organizations solve this problem. So why does this matter for SaaS? Well, I think all of us know that a lot of SaaS is purchased, which means that an intake process is used a lot to buy that SaaS. However, that intake process is used for a lot more than just software as a service. Things like professional services, contingent labor, marketing and IT spend are also frequently purchased across organizations.

Ben Pippenger: In fact, I mentioned Zip earlier, Zip's one of our partners. According to them, about 30 to 40% of the spend that's going through their platform is SaaS. So that means a big chunk of it is, but that also means there's a big chunk that isn't software as a service as well that's going through their intake platform.

Ben Pippenger: So how should we all be looking at this, us that are focused on SaaS all day every day? What are the things that we should be considering? Well number one, organizations really need to be looking at a broad strategy as it relates to purchasing an intake, not just focusing on software and the software intake side of things. Here's a couple points why. Number one, it's a confusing process for your employees. You want employees to adopt this intake tool. You want them to find productivity gains by using it. You don't want them to have to go to one place to buy software, another place to buy services, another place to go to request hardware. That should all be centralized into one request process.

Ben Pippenger: Next, we talked about the data. That data needs to be injected into that workflow engine. You should be able to provide that data at the moment that the right people need it to make the right decisions. So you got to think about a system that's connected into other products or other tools that you're using to run your company on, things like your SaaS management platform, providing insights and data about your SaaS portfolio, your governance platform to make sure you have the right information about risk and compliance information, your contract system, your ITSM tools, and others to really make sure that you're making the right decisions. And lastly, the end result of the intake process needs to be either an approval or rejection and then turning into a buying decision. That needs to be connected into your P2P platform, into your procurement system, to make that process as smooth as possible.

Ben Pippenger: So if I were to boil all this down, intake is definitely a business critical process and one that could help you improve employee productivity and efficiency of really your overall company and your buying processes. It can't live on an island just for software. So make sure you're planning for a broader strategy so that you can make the biggest impact. That's it for today and we will see you next time.