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Saturday, August 30, 2014

Ivalua Making Spend Management Software Imprint in U.S.

Credit: twobee at FreeDigitalPhotos.net

Credit: twobee at FreeDigitalPhotos.net

Ivalua, a developer of an integrated spend management software suite whose roots lie in Europe, is beginning to make itself noticed in North America after nearly four years of uptake. That’s because after joining the fray that is the U.S. market of procurement software suppliers in 2010, Ivalua’s CEO, Dan Amzallag, says there is a golden window of opportunity for dedicated providers of fully integrated end-to-end software created by the wake of SAP’s acquisition of Ariba as well as IBM’s purchase of Emptoris.

Amzallag’s confidence that Ivalua can challenge leaders like Ariba, as well as Zycus and Bravosolution, comes from his belief that the company’s Ivalua Buyer software is a true integrated suite with customization at the code level compared with other full spend management suite offerings in a quickly consolidating vendor market. A presentation of Ivalua Buyer at the recent International Supply Management Conference (ISM 2014) makes the point that other solution providers are assembling together software suites out of different technologies they have acquired.

In the presentation, Ivalua also highlights itself as a “Challenger” that is on the cusp of joining the “Leaders” group in Gartner’s 2013 Magic Quadrant for Strategic Sourcing Application Suites. Comparably, in the 2010 version of Gartner’s Magic Quadrant, Ivalua was rated as being a niche player. Moreover, in Forrester Research’s recently released eProcurement, Q2 2014 examination of procure-to-pay platforms, Ivalua was graded a “strong performer.”

The “single, connected suite” play and a high level of configuration flexibilty for a software-as-a-service (SaaS) product have helped Ivalua gain a market foothold, Amzallag says. There are 25 modules covering five primary but interdependent areas: spend analysis, e-sourcing and e-procurement, contract and catalog management, procure-to-pay functions, and supplier relationship management tools. Among its features, Ivalua’s software allows on-the-fly, drag-and-drop workflow configuration and changes in business rules that can be done by users. The full suite residing within one code base allows this to happen.

“We can help (procurement organizations) with redesigning key practices and workflows,” said Amzallag. “SaaS solutions are usually restrictive with these changes.”

Although Ivalua offers on-premise and private-hosting options, that flexibility and integration with the cloud model are attracting users, according to Amzallag. Organizations can mix and match the modules, upgrade to the latest version of Buyer in the cloud when they want to while carrying over specific user configurations, and pay via monthly-SaaS or ongoing-license models. Major version updates come about every two years.

Dan Amzallag

Dan Amzallag

The fact that Ivalua’s technology has been developed in-house and “organically” (rather than through acquisitions) has been advantageous to both customers and itself, Amzallag remarks. “We’ve built and fine-tuned the platform for over 12 years. There are lots of players in the U.S., but few have true-integrated and comprehensive suites, except for Ariba maybe,” he noted. “Our business has been to replace systems that don’t integrate well, with massive data migrations. [Clients’] first pain point is integration and syncing data.”

For multinational organizations that operate in global sourcing and purchasing environments, this connectedness eases the handshake between different internal systems around the world. Thales Group, a French multinational supplier of electrical systems to the aerospace, defense, transportation, and security markets, is using several Ivalua Buyer modules in its Group Purchasing Division for its network of 1,350 worldwide buyers. Tire maker Michelin Group replaced fragmented contract management tools with Ivalua for an enterprise-level shared tool to oversee 5,000 supplier contracts and 5 million invoices across 55 countries.

Amzallag says Ivalua is betting on at least half of its new SaaS customers being large-deployment deals. While the CEO did not disclose figures, he said the company wants to continue its current 50 percent revenue growth rate for the next three years, with a majority of the growth coming from North American new users. “We had huge sales growth from 2012-13, growing 390 percent,” he claimed, with most of it coming in the U.S.

Recent new clients in the United States and Canada include consumer goods titans Whirlpool and Jarden Corp., along with defense IT company CACI International and Shared Services Canada, which is responsible for the IT services management for the entire Canadian government. “We’ve grown from three to 45 people in the U.S. in the last three years,” Amzallag noted. Ivalua has based itself in Redwood City, Calif., and just outside Montreal.

In Europe, the software firm counts a large industrial-user base, with prominent names including Honeywell, Saint-Gobain, and Rexam. With European offices in France, Germany, and Italy, the company says it has over 100 organizational customers in more than 70 countries.  It was founded in 2000.

 

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