By Alun Rafique, CEO, Market Dojo
In my last article, I promised to “delve deeper into how a true SaaS model will transform and scale your procurement practice.”
However, before we get into the potential for your procurement SaaS platform to transform your practice, there is one important obstacle to overcome – user adoption.
While great technology is “fundamentally crucial,” technology alone will not elevate your practice in key areas such as cost-down initiatives, supply chain resilience, ESG, and risk analysis. The list is much longer, but these are the core focus points for organisations implementing a SaaS solution.
Unfortunately, based on our recent research (July 2022), the median rate of user adoption of SaaS-based solutions is 17%. Even though it is significantly higher – 65% in the 90th percentile group, I was surprised by these findings. After all, isn’t today’s digital technology implemented in weeks and days versus months and years intuitively user-friendly? It is not unreasonable to expect that the median would be much higher than a low 17%. As a side note, I will share Market Dojo’s adoption rates in my next post.
You Have Two Choices
According to a July 2020 article, the benefit of a bespoke “customised” SaaS solution is that you “don’t have to worry about compatibility between different platforms.” In theory, this seems to make sense – emphasis on the words “in theory” given the 17% adoption rate.
Now, if you read my last article in which I talk about the “convenience of access, user adoption, and ultimately SaaS scalability for procurement being the way to go,” it may sound like I am talking about a bespoke architecture. That is not the case because bespoke customised solutions are actually like a multi-instance cloud platform, e.g., a single tenant living in a single apartment building. You are, in essence, limited to one solution versus having the flexibility to try out multiple solutions, e.g., a single instance “multi-tenancy” model.
Think of it in terms of having (or not having) the ability to move throughout the building to different apartments. Regarding your needs and preferences, there may be significant differences between one unit and the next. For example, one may have a different and better view than another.
Additionally, it is not to say you are not able to furnish the apartments as you like. A true SaaS solution allows for personalisation within the single environment but has the benefit that it is only the one environment making the solution more dynamic and agile in its adoption. My point is that, like a building with many different apartments, different procurement solutions will have different features and functionalities. Do you really want to be limited to one? The ability to try out new solutions without the requirement for a bespoke installation is why the single instance, multi-tenancy model is the best way to optimise both scalability and performance.
The example from the previous post referencing Invoice Cloud as a single instance, multi-tenant platform example, is a good place to start.
Realising the SaaS Mosaic
What are the benefits of a true SaaS model?
Right off the top:
If you think about it, the multi-tenancy SaaS procurement model is like a mosaic of best-of-breed individual solutions, individually effective and collectively powerful.
I cannot think of a more effective way to transform and scale your procurement practice. As more people adopt this model, we will likely see SaaS adoption rates increase – time will tell.