We made it!! Shortlisted to the Top 10

We're excited to announce that we've made it to the Top 10 of DPW's DEMO 2022 start-up competition!

This means in June we'll get to pitch virtually to hundreds of tech buyers and the panel of judges during the Semi-Final round.

Success at that point will see us heading to Amsterdam in September and the opportunity as one of top 5 start-ups to pitch in the Final, to thousands of onsite and online viewers live on Centre stage at DPW Conference 2022.

Alistair Cane (Co-Founder) said "the DPW DEMO competition is established as one of the Start-up competitions of the year. We've invested heavily in creating the world's first Procurement-Intelligence© marketplace, using AI to connect Buyers, Suppliers and Procurement and it's exciting to hear one of our key clients describe this 'as one of the most exciting ProcureTech solutions I’ve seen and it will fundamentally change our approach to procurement and category value. So we're really looking forward to pitching it during this year's competition."


Axiom included in DPW's DEMO 2022 start-up competition

DPW's DEMO is the largest start-up pitch competition in procurement and has become a real benchmark for Innovation in this rapidly expanding ProcureTech arena.

As such, we're delighted to have been selected for this year's 'Early-stage track' competition, which covers the most innovative start-ups from MVP to Scale-up.

The next stage at the end of May will see the top 10 selected to pitch virtually to hundreds of tech buyers and our judges during the Semi-Final round.

Success at that point will see us heading to Amsterdam in September and the opportunity as one of top 5 start-ups to pitch in the Final, to thousands of onsite and online viewers live on Centre stage at DPW Conference 2022.

Alistair Cane (Co-Founder) said "the DPW DEMO competition is established as one of the Start-up competitions of the year. Last year we entered a DPW Start-up scouting challenge and were selected from over 80 applications by a global pharmaceutical organisation to develop an intelligent market-place solution for their indirect categories. This has recently been described as 'one of the most innovative and exciting capabilities in this space' and we are really looking forward to pitching it during this year's competition."

 


A time for change in Marketing Materials Sourcing?

Prior to establishing Axiom, our Co-Founders spent over two decades in the Marketing Materials Outsourcing sector - shaping, leading and managing not only some first, but also the largest regional & global deals.

Two years ago, Axiom was founded - primarily to address some key challenge that the industry was struggling to get to grips with. Particularly around the wider use of data to drive procurement decisions and the measurement of ESG - two areas in particular where it could be argued that the industry has been ‘asleep at the wheel’ for too long.

In this series of articles, we’ll examine this outsourced marketing materials procurement model more broadly and ask, “is it still fit for purpose today, or it is time for a new approach?”

For a sector that controls over $1Tr of client spend, we’ll argue that the model, that was established in the 90’s, has changed very little in the last three decades and is increasingly becoming “off the pace” as we enter the 4th Industrial revolution (4IR).

But is the model completely broken?

It’s easy to suggest not, particularly when you consider that it’s an industry that’s created some very successful $bn service providers, and also when there seems to be no end in sight to the number of client organisations turning to this outsourcing approach, as they try to drive change in their own procurement organisations.

But do these clients deserve better than what’s currently on offer?

We believe very firmly “Yes”! And throughout this series we’ll explain Why and How these world-leading global organisations should be, and could be, better served.

Challenges

Our perspectives are borne out of deep sector experience, augmented by the startlingly clear insights derived from Axiom’s research, data modelling and analysis since 2020.

This work is highlighting what many people in the industry suspected - the model is outdated and is no longer fit-for-purpose, particularly given the ever-increasing commercial and ESG transparency demands being placed on buying organisations.

Our work has shown that the standard industry contractual, commercial and operating models are one-dimensional, in most instances ‘broken’ and often misaligned with the current and future needs of large buying organisations. The technology deployed by the primary service providers is too simplistic and simply reinforces a traditionally flawed approach to buying.

Over the course of the next few instalments, we’ll add some colour and substance to each of the following areas, as well as some key challenges the sector faces:

  • High levels of budget waste, resulting from the dominant blind ‘spot-buy’ and ‘three-bid’ buying methodologies which are fundamentally flawed
  • Industry standard commercial terms that are designed to drive the wrong behaviours both in the client and service provider organisations
  • Poor quality and/or incomplete data capture that means transparency and objective decision-making and contract management is impossible
  • Data poverty that naturally leads to low levels of automation and high levels of human intervention in repetitive activities, resulting in a high ‘cost to serve’, compromised ‘speed to market’ and increased supply chain risks
  • Heavy reliance on simplistic savings methodologies that do not deliver P&L savings
  • No ability to deliver instant predictive pricing or automated procurement scenarios
  • No ability to accurately measure and manage ESG factors pre-emptively
  • No ability to manage demand pre-emptively, resulting in unnecessary cost and environmental impact
  • No means of objectively measuring the ROI and the effectiveness of the investment in marketing materials

Don’t get us wrong, there are some very good global and regional services providers, but procurement’s historical primary focus on cost reduction and the industry’s infatuation with driving scale and geographic coverage has almost certainly been an inhibitor to real progress and investment in marketing materials procurement innovation. Faced with the need for volume to sustain business models, commodity level service pricing expectations from large buying organisations and competitive tensions that have reduced contracted margins to single digits, most of these service providers have looked up- and down-stream to drive improved margins.

The future

The wider world of Procurement is changing at a faster pace than ever before. A wave of Digital Procurement is washing across the industry, driving a new era of Transformational Sourcing. Recent advancements in Automated Insights and Spend Analytics is now yesterday’s news, being rapidly overtaken by 4IR technologies using the power of Big Data, Blockchain and AI to drive Predictive Procurement.

In the often one-dimensional Marketing Materials world, this talk probably seems like a foreign language, as the industry continues to plow on in the same old furrow.

But this is not some distant future, Industry 4.0 is already here and driving change across numerous sectors and disciplines, where the use of data and AI is delivering significant advances in efficiency, effectiveness and delivering ESG commitments.

The marketing materials sector is unfortunately lagging far behind and needs a wake-up call. It needs to change…..and quickly. BUT is it up for the challenge? Can it lead or will it wait to be forced into a new way of working by its increasingly digitally-savvy clients?

As Albert Einstein famously said, “Insanity is doing the same thing over and over and expecting different results.”

Coming next……

In the next instalment, we’ll look at the current state of the industry in more detail and consider what the outsourcing proposition promises to deliver. In part 3, we’ll get under the skin of the issues that face the industry, from outdated commercial and savings models, to the inadequate technology offerings that are being deployed across global organisations and the enormous gap in accurate ESG measurement and management.

In the final part, we’ll describe what Marketing Materials Procurement 2.0 should look like in today’s data-empowered world, and how it can start to add some real, measurable value both to Procurement and Marketing.

______________________________________

AXIOM

Axiom is a next-generation Procurement-Intelligence© platform, using AI to enable Procurement to make more effective, more sustainable, more efficient and more inclusive decisions, every time, in real time.

Axiom launched in 2020 in the world of marketing materials. We’ve come a long way since then!! Today, we’re a dynamic ProcureTech start-up, working with clients across a variety of procurement categories, assisting them to drive Transformational Sourcing strategies, as part of their wider digital ecosystem.

Completely independent, we work with clients directly, with management consultants, technology providers and with intermediaries to drive meaningful, AI-powered change.

Why not drop us a line at info@axiomdata.io to see how Procurement-Intelligence© could help to deliver your digital procurement journey in 2022 and beyond.


Everybody loves a '2022 Procurement Trends' List!

As usual, throughout December and into January, the Procurement industry peers into its proverbial Crystal Ball, to proclaim the top Trends and Predictions for the year ahead.

We’ve summarised our humble thoughts on the topic at the end of this piece, but first of all let’s look at what the industry is suggesting that we should be focussing on in the next 12 months:

SUPPLY MANAGEMENT – rounds up its key procurement and supply chain predictions for 2022:

    1. Prioritising risk management
    2. Investing in IT solutions
    3. Maximising talent
    4. Visibility in supply chains
    5. Procurement taking centre stage

Have a look at: What are the key procurement trends for 2022? - Supply Management (cips.org)

 

SOURCE TODAY – 5 procurement predictions for 2022:

    1. Companies Want Less Paper and More Automation
    2. Procurement’s Role in ESG grows
    3. The Spotlight is on Supplier Diversity
    4. Forward-Looking Data Analytics Come Into View
    5. Artificial Intelligence and Machine Learning Come of Age

Have a look at: 5 Procurement Predictions for 2022 | Source Today (from a Basware article)

 

PROCUREMENT MAGAZINE – summarises the thoughts of 10 Procurement industry leaders’ insights and predictions for 2022:

    1. Are businesses ready for Circular Sourcing
    2. Risk Management should be a first priority for organisations
    3. It’s time to think big
    4. Accelerating digital transformation in Procurement
    5. Social procurement
    6. Customer data will focus much more on quality over quantity
    7. Source to Pay
    8. Contract lifecycle management
    9. AI-powered contract review
    10. Don’t doubt the Metaverse

Top 10 procurement predictions and trends in 2022 (procurementmag.com)

 

PROCURETECH – predictions for 2022:

    1. Digitalisation
    2. Intelligence
    3. People, Planet and Prosperity
    4. Organisation

Have a look at: ProcureTech100 Predictions for 2022: Digitalisation Part 1 – Procuretech

 

As always, there’s much to admire in these lists, and the articles wrapped around them. From our tiny corner of the ProcureTech start-up world, we humbly put forward 6 key areas that the conversations we’re having with our clients are suggesting are going to be critical to them in 2022:

 

  1. Acceleration of Digital Procurement Transformation
    If you follow the theory of the Diffusion of Innovation, it could be said that we’re at the start of the “Early Majority” segment when it comes to the Digital Procurement Transformation that forms part of the Fourth Industrial Revolution (4IR). The 2.5% of “Innovators” are way out in front. The 13.5% of organisations that constitute the “Early Adopters” made great strides throughout 2021. Now the next 34% of organisations have got Digital Procurement in their sights – the question remains “how long will it be before the ‘Late Majority’ (34%) and then finally the ‘Laggards’ (16%) wake up and join the party?”
  2. Data, Data, Data
    Much has been written about data and its importance to successful digital procurement (including our piece here: Why we hate data - Axiom Data). We think 2022 is the year when Procurement finally starts getting to grips with data and stops hiding behind the fact that their historical data is poor. Now is the moment for Procurement to make a stand, draw a line in the sand and ensure that suppliers understand their responsibility in presenting you with complete and accurate data for every single transaction moving forwards (if necessary, as part of supplier contracts). Leave us to worry about your dirty and unstructured historical data as we build a powerful data foundation for you.
  3. Beyond Spend Analytics and the Rise of Procurement-Intelligence©
    There was a time when data driven Spend Analytics was all the rage, the new kid on the block, the answer to Procurement’s woes. The reality is of course that this is only one piece (albeit an important piece) of the jigsaw or step on journey to the more efficient, automated procurement world that is coming down the track. Understanding what you’ve bought previously still means you’re looking in the rear-view mirror. Procurement needs to be focussed on the road ahead and needs to ensure every single future procurement decision is predicted, with this prediction Powered by Data, Informed by Insight, Driven by Intelligence and Guided by Science. Welcome to the world of Procurement-Intelligence©.
  4. Creating a Digital Backbone and best-in-class ecosystem
    One of the biggest changes this last year has been the wholesale realisation that one system doesn’t fit all. As Dr Elouise Epstein, Thought Leader and Partner at Kearney states: “the technology landscape of the future will be an ecosystem of flexible tools. Companies need to take a future-proof approach, which means sourcing intelligent individual technologies that can be updated as they evolve.” And Dan Bartel, CPO of Schneider Electric reinforces this view when he says “75% of the innovations that we embed are coming from start-ups and 25% are coming from our strategic suppliers – 5 years ago that ration was reversed.” The start-up landscape is ever changing and there are two good places to start – Lance Younger’s ProcureTech (Procuretech – The definitive 100 pioneering digital procurement …) and Matthias Gutzmann’s DPW (DPW | The global ecosystem for technology and innovation in procurement.)
  5. Digital Procurement as a Competitive Differentiator
    We’ve been reading about the Great Resignation, and as things stand a quick search on LinkedIn reveals that there are 362,895 current procurement jobs listed on the platform. The War for Talent is enormous at the moment, but the great news is that there’s a wave of new talent, with new ideas and a new energy entering the sector. Once seen as a bit of a corporate backwater, Procurement is now at the centre of every progressive organisation with a seat (and a loud voice) at the top table. As Dr Elouise Epstein says “the greatest time to be in Procurement is NOW!”. It’s easy to see how this talent is going to levitate to companies seen as “Innovators” and “Early Adopters” in our digital world. This is without considering the commercial advantages that such organisations can achieve through streamlined and intelligent procurement that focuses as much on managing global risk as it does on maximising value. If you’re working for a “Laggard” boss or company, and your mindset is towards innovation then if you haven’t dusted off your digital CV yet then we suspect it’s pretty high up your list of New Year’s Resolutions!
  6. ESG comes of age
    And Procurement can make all the difference. The world is not interested in green washing any longer, consumers are not interested in bland corporate PR statements about carbon off-setting. They want action and they want it now! Or they’ll be off to one of your competitors who’s got it right in this area. It’s easy for organisations to get to grip with their Scope 1 and 2 emissions but it’s the Scope 3 emissions that exist in the supply chain that are the hardest to quantify and control. But all your Scope 3 emissions are a Scope 1 or 2 for someone – your supplier!! If we’re honest, Suppliers have had a pretty easy one-dimensional ride for the last 20 years – compete on quality, price and service levels and you’re going to be okay. Not anymore, Buyers need to work with their Supply chain to get them to step up to the ESG table, big time. They need to know that moving forwards your decisions are going to be based on data relating to Sustainable objectives and Diversity metrics and if they want to remain a ‘strategic’ supplier then they need to provide you with accurate data to guide your decision making.

What do you think? If you want to continue the discussion then please feel free to get in touch, we’d be delighted to expand on how Procurement-Intelligence© is helping global organisations on their Digital Transformation journeys…….

 

In the meantime, we’re very much looking forward to tuning into PROCURETECH’s virtual event on Thursday 13th January to listen to: “2022 Predictions & Purpose” where Patrick Foelck (Roche), Jason Kurtz (Accel-KKR), Adam Brown (BT Sourced), Dr Elouise Epstein (Kearney) & Lance Younger (ProcureTech) will be sharing their thoughts and revealing the way ahead for digital procurement.


Procurement’s irrepressible march to a Digital revolution!

In today’s commerce-focused world, it would be impossible for most businesses to function without procurement. Put simply ‘procurement’ describes the act of acquiring goods and services, products and materials (including negotiating terms) required to run an efficient business. A quick trawl through LinkedIn shows there are around 19.6m people with ‘Procurement’, ‘Sourcing’, ‘Purchasing’ or ‘Buying’ in their job title (about 2.4% of all people on LinkedIn); there are over 220,000 companies offering procurement-related services, products or solutions across this landscape and there are approximately 25,000 current sourcing-related roles advertised across the platform. Today, Procurement is recognised as strategically important both as an ‘activity’ and as a ‘department’, and it’s riding the crest of a Digital revolution that will change the industry forever. 

But where did it all begin and how has this journey evolved over time? 

Humble beginnings

‘Procurement’ can claim to trace its roots back to the early civilisations - when Scribes used papyrus to record the materials & labour used in the building of the pyramids, and the Romans introduced contracts to record the transaction of goods. The Middle Ages saw various schemes to record land, property and livestock for the purposes of taxation on the holding and exchange of items. The derivation of the word ‘Procurement’ comes from the 14th  Century and to the Medieval Latin word ‘procuramentum’, meaning “the process of bringing something about (by the action of another)”. 

The ‘Materials Man’ in the “Supplying Department”

To understand when ‘buying’ really started to emerge in the business world in a recognisable way, we probably need to fast forward to the First Industrial Revolution, which began around 1760 in the textile industry in the UK, with the invention of steam powered machinery. This resulted in the migration from hand production to the building of factories and the need for supplies to keep them running. Hot on its heals, in the early 1800s came the invention of the steam locomotive and the building of the railways. These projects were hungry for raw materials and the role of ‘Materials Men’ emerged. By the end of the Century this buying function was being formalised into the first “Supplying Departments”. 

The Professionalisation of Purchasing

The introduction of electric power heralded the Second Industrial Revolution in the 20th Century, and with it the concept of mass production. By the early 1900s local purchasing associations had formed in at least 10 major cities in the US and these came together in 1915 to form “The National Association of Purchasing Agents (NAPA)” (which would ultimately become the Institute for Supply Management). In 1916 it held its first convention and launched a magazine, The Purchasing Agent - a forerunner to Inside Supply Management magazine. 

During the 1930s, in an effort to continue to professionalise this “purchasing” function, NAPA focused on improving education and developing standards across its expanding network. In support of this, Harvard Business School published two purchasing textbooks and developed case studies about purchasing issues, all under the auspices of NAPA. 

Meanwhile, in the UK, a gathering of Purchasing Managers came together in 1932 to form the Purchasing Officers' Association (POA). 

This wider buying capability across the Western world, started to come into its own in handling the shortage of supplies that occurred during wartime. Then, with the return to a peacetime free market, purchasing executives faced new complexities of higher costs and increased demand, which required a different and more structured approach to the role. 

By the 1950’s and ‘60s, organisations began to realise that purchasing was spending, on average, half the corporate sales income! This resulted in Leadership teams putting pressure on these buyers to begin to make a positive contribution to the strategic goals of the company. This elevated the role from undertaking simple clerical tasks - no longer was Purchasing acting as a mere agent but it had been transformed into a vital management function. 

To reflect this fundamental shift in Purchasing's role, in 1967, the Purchasing Officers' Association in the UK became known as the “Institute of Purchasing & Supply”, and was fast becoming the central reference for industry best practice. A year later, in 1968, NAPA followed suite and changed its name to the “National Association of Purchasing Management, Inc. (NAPM)”. 

Recognising that professionalising an industry required the ability to ensure practitioners had the requisite skills set and had achieved certain measurable standards, in 1974, NAPM introduced the Certified Purchasing Manager (CPM) qualification - the first professional certification in the field. 

People, Process and Technology

The next significant shift for Purchasing came during the Third Industrial Revolution, which began in the ’70s in the 20th century and has picked up pace ever since! The key influence at the start of this period was the commercial development of the computer. Often referred to as the period of “Automation”, the computer allowed basic or standard repetitive procurement tasks to be processed automatically. With the computer came the natural emergence of Software companies (e.g. SAP was founded in 1972 in Germany, Microsoft in 1975, Oracle in 1977 in California) and the creation of solutions to manage a range of tasks from business operations, customer relations to financial management and ultimately the birth of ERP systems. 

Alongside the software companies, came a new world of Services companies, to support organisations through a significant era of change. The general business consulting companies of the first half of the Century became global Management Consulting firms, with bespoke divisions focused specifically on the procurement function; a new wave of specialist Procurement Companies emerged along with the new kid on the block, ‘Outsourcing’.  

Outsourcing allowed organisations to engage with specialist 3rd-party service providers to manage non-core functions and activities – initially at a category level, but ultimately sometimes as a wider function. These services providers not only provided the people (or in some instances, transferred them from the client with the function) to provide the service, but also sought to implement standard best practice procedures to drive operational improvement. It wasn’t long before these organisations introduced technology platforms to drive more effective project management and buying portals to simplify the ordering of standard items and elements. 

From the client’s perspective, this required a seismic shift within the Purchasing organisation, as it evolved from a simple ‘buying function’ to a ‘Category or Supplier management’ function, leading to the development of a whole new skill-set associated with managing the performance of 3rd-party strategic partners. 

As the field grew in complexity, and became more global, purchasing professionals were becoming increasingly responsible for the supply of goods and services. To more accurately reflect the scope that the profession encompassed, NAPM members voted to change the organisation's name to the “Institute for Supply Management (ISM)”, which became effective in January 2002. In a similar vein, in the UK, the "Chartered Institute of Purchasing and Supply“ (as it was known by then, having received a Royal Charter in 1992) changed its name in October 2014 to the “Chartered Institute of Procurement & Supply”.

If the ‘80s/’90s were all about this strategic management, the 00’s saw a focus on using e-procurement tools to simplify the procurement process - from eRFX platforms to e-Auctions - and to drive competitive tension in the supply chain. This approach, effective though it was in a one-dimensional way, helped to compound an increasing global view that Procurement was becoming fixated with ‘Cost’, often at the detriment of ‘Value’ (this is a mantle that the industry is still trying to rid itself of today).

Plotting the evolution of the procurement function over time, you can see it perfectly reflected in the associated job titles. From ‘Buyers’ in the 1950’s, to ‘Purchasing Managers’ in the 1980s, to ‘Procurement Directors’ in the ‘00s to the “Chief Procurement Officers” of today, the escalation in importance that the wider world of Procurement plays in the Corporate environment is self-evident.

All this suggests that Procurement has come all long way in a relatively short period of time. But, it’s not done yet, not by a long stretch!! In many ways, it’s beginning to feel that we’re only just getting started! 

The Digital Procurement Transformation

There’s a revolution that’s happening all around us in our everyday lives from a technology perspective – what is increasingly referred to as ‘The Fourth Industrial Revolution’ (4IR).

As Klaus Schwab (Founder and Executive Chairman, World Economic Forum) says “We stand on the brink of a technological revolution that will fundamentally alter the way we live, work, and relate to one another. In its scale, scope, and complexity, the transformation will be unlike anything humankind has experienced before. We do not yet know just how it will unfold, but one thing is clear: the response to it must be integrated and comprehensive, involving all stakeholders of the global polity, from the public and private sectors to academia and civil society. The First Industrial Revolution used water and steam power to mechanize production. The Second used electric power to create mass production. The Third used electronics and information technology to automate production. Now a Fourth Industrial Revolution is building on the Third, the digital revolution that has been occurring since the middle of the last century. It is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.

There are three reasons why today’s transformations represent not merely a prolongation of the Third Industrial Revolution but rather the arrival of a Fourth and distinct one: velocity, scope, and systems impact. The speed of current breakthroughs has no historical precedent. When compared with previous industrial revolutions, the Fourth is evolving at an exponential rather than a linear pace. Moreover, it is disrupting almost every industry in every country. And the breadth and depth of these changes herald the transformation of entire systems of production, management, and governance.

Whether consumers or businesses, customers are increasingly at the epicenter of the economy, which is all about improving how customers are served. Physical products and services, moreover, can now be enhanced with digital capabilities that increase their value. New technologies make assets more durable and resilient, while data and analytics are transforming how they are maintained. A world of customer experiences, data-based services, and asset performance through analytics, meanwhile, requires new forms of collaboration, particularly given the speed at which innovation and disruption are taking place.”

This is driving change in the Procurement function, faster than the previous 100 years combined.

We’ve now entered a new world of Digital Procurement, where disruptive 4IR technology is shifting Procurement from a one-dimensional supply management / cost control function, to a proactive and disruptive force of change throughout the organisation. 

Global organisations have rarely had to deal with change on the scale they face today. Pressures from this wave of Digital Transformation, combined with challenges brought on by the global pandemic and increasing pressures to do the right thing as far as the planet is concerned, are forcing these organisations to act, and at a pace they’ve not historically been known for, or been geared to manage without support from external expertise. 

Enter the ProcureTech start-up community - bringing a level of innovation, digital problem solving and agility that today’s CPO is looking for in seeking to address the multi-faceted challenges that Procurement, and the organisation as a whole, is now faced with.

As Digital Procurement World (DPW) puts it, “digital procurement isn’t just about using new platforms and technologies - it also requires new ways of working and a determination from the top to drive through meaningful change. In recent years, a revolution has taken place in procurement - a transformation that has brought sweeping changes to how functions operate and what they can achieve. Central to these changes is the shift from the old idea of procurement technology that focused on a single, closed-loop, end-to-end system. This has been replaced with the far more flexible ideal of a digital backbone tying together a myriad of bespoke solutions from different providers - the best of breed ecosystem.”

Global organisations are reaching out to this dynamic start-up community (of over 4,000 solutions according to the ProcureTech platform) to deliver this agility. As Dan Bartel, CPO of Schneider Electric, explains “75% of the innovations that we embed are coming from start-ups now and 25% are coming from our strategic suppliers - 5 years ago that ratio was reversed.”

Ultimately, though it depends on how far Procurement is willing to go to utilise the new technologies at its disposal. As Jacob Larsen, ex-Director of Digital Procurement at Maersk and Founder of boutique Digital Procurement Consultancy firm Moneyball CPH, says: “the term Digital Darwinism can be used regarding procurement - the solutions are there, but the question is whether Procurement as a function is ready to adapt to the new digital opportunities.”

Dr. Elouise Epstein, Thought Leader and Partner at Kearney adds “the technology landscape of the future will be an ecosystem of flexible tools. Companies need to take a future-proof approach, which means sourcing intelligent, individual technologies that can be updated as they evolve.”

Adrian Friederich, Maersk Growth, summarises the opportunity perfectly when he says “if we can get procurement digitalisation right, the potential is huge, in the best-case scenario, procurement could become a competitive differentiator, anchoring the supply chain and driving collaboration with a wider ecosystem of partners.”

The most forward-thinking organisations in this space are waking up to the fact that data, analytics, insight, AI, blockchain technology, etc. are the currency of progress. A new era of intelligent procurement has dawned. As Lance Younger CEO & Founder, ProcureTech, says "Procurement leaders are looking further ahead. They are creating ecosystems of solutions, anticipating the adoption of new technologies, driving digital-first delivery across the supply chain and embedding agility in preparation for future changes“.

The era of functional technology as a way of simply automating manual processes is over. Today’s CPO is looking for solutions that have real impact on the actual procurement decision being made. They are looking for solutions that deliver real-time intelligence at the point of purchase; that offer instant decision-making and the ability to optimise every purchase using the power of AI; solutions that allow their teams to make decisions that consider the impact on the environment and the effectiveness of the product or service – not just the efficiency of the purchasing transaction and cost; solutions that enable decisions to be based on what’s happening in the marketplace and take into consideration the impact of global events.  

At Axiom, this is where we’re focused, and we call this Procurement-Intelligence. 

As part of the wider ProcureTech landscape, we’re unlocking the value trapped in organisation’s procurement data.  Applying AI to completely revolutionise the procurement landscape, taking complete control of all relevant data and creating a data foundation, that allows for AI-generated price prediction, ESG prediction, demand prediction, effectiveness prediction and risk & compliance management capabilities, to ultimately enable organisations to make more effective, more efficient, more sustainable and more inclusive buying decisions, in real-time. 

As Dr Elouise Epstein says, “the greatest time to be in Procurement is NOW!”  It’s certainly a different landscape to those Scribes and their papyrus!


Read about the birth of Procurement-Intelligence©

Steve and Alistair have worked in the Global Marketing Solutions sector for the last 25 years, designing outsourced solutions for some of the world's largest spenders in the Marketing Services and Marketing Material space (such as Unilever, Coca-Cola, Pfizer, etc.) for the likes of Williams Lea (now Tag), Adare International, Charterhouse (now Indicia), and more recently ASL. In their day these solutions helped to shape this $bn sector and to this day form the basis of the outsourcing model that is adopted extensively across the globe. Looking back, these solutions (some local, some regional, some global) are actually a fairly basic procurement model, combining People, Process, Technology (buying platforms) and a pre-qualified Supply Chain to deliver a buying function.

For many years, like the wider Procurement world, the Marketing Services sector has used the information that's generated around every buying transaction to provide simple, one dimensional MANAGEMENT INFORMATION - a report that provides nothing more than an historical record of what's been bought, when, by who and for which division or Brand or Country, etc.

As innovators, Steve and Alistair have always questioned the outsourcing model and approach, looking to keep the wheels of evolution turning. In 2020 having helped to grow a new outsourcing business from a standing start to a $200m run rate business in under 18 months, they decided to investigate an area that had been a genuine frustration from many years. This DATA that sat around every transaction.

They were convinced that the one-dimensional buying models utilised by almost every singly marketing services organisation across the global market place was leading client organisations to waste a significant amount of the budget they were spending to promote their brands, products and services. They were convinced that if they could get under the skin of every buying activity and the associated behaviours then they would be able to see a different picture. Working with a print management company in Australia, they asked Aaron (then a data scientist for a Financial Institution) to analyse the data from over 30 organisations. In his spare time Aaron created specific algorithms for each category, focussed on identifying price variance at a specification level. The results were staggering - revealing that these major global organisations were indeed wasting between 16% and 53% (with the worst example wasting 71%) of their overall budget. Extensive testing showed that the algorithms had an accuracy of over 99.95%.

Aaron left his role in the City to join Steve and Alistair.........and Axiom was born!

From an initial focus on this area of BUDGET WASTAGE, the team quickly realised that the same Machine Learning approach could be applied to the measurement of key ESG criteria. Enabling for the first time ever, ESG to be driven by real data, rather than hugely inaccurate "industry standards". This is a game changer for an industry that has been struggling to meet clients' expectations in this increasingly important area. Axiom now gives these organisations the opportunity to adopt a science-based approach to measuring and reporting ESG.

Towards the end of 2020, the focused shifted to the development of the Axiom platform. The detailed, forensic analysis of data attributes evolved into the creation of a PROCUREMENT-INTELLIGENCE engine to not only deliver automated insights across historical spend data, BUT to power all future transactions, using AI to guide the buyer according to specific business rules within the platform.

For the first time ever, this allowed the buyer to see in real-time the market-price of the product that there are about to buy as well as a detailed breakdown of its impact on the environment. Buyers can make changes to the specification or the location of production and see the cost and ESG impact, instantly.

Axiom may have started in the world of Marketing Materials, but our clients have seen the broader potential and have taken us into other categories in both Indirect and Direct Procurement, including Packaging, Electronic Components, Lab Supplies, MRO, Market Research and IT Consumables. As a Tech and AI company, we’re channel agnostic, working directly with Brands, with third-party procurement experts, management consultants, buying & sourcing platforms and outsourcing companies.

Our Vision sees a future where every procurement decision is informed by data and powered by AI - what we call PROCUREMENT-INTELLIGENCE. A future where waste and guess-work are a thing of the past.


Who even needs experts...

The easiest way to stop spending so much money on marketing materials is to reduce the demand for marketing materials. The second easiest way is to change what you’re buying.

When marketing wants to buy something they will go to procurement or the supply chain and say something like: “I need a good quality 16-page brochure” or “I want an FSDU which looks like this”. Now, as you can imagine, there is a vast sea of complexity around these specifications. Anything from the machinery used to produce the item, to the location of where the raw materials were sourced from, will affect the price and environmental impact of the item being sourced.

Are you drowning in the sea of complexity?

So how do we decide on an exact specification? We don’t, currently, the standard method of operation is to go out to your supply chain, consult your suppliers for what they have and what they recommend and then pick what suits you best (usually based on price). We do this because everything is so complicated… Not every organisation can have an expert on FSDU’s who can identify how every small change to a specification will alter the environmental impact and cost.

But what if you did have one of those experts, someone who could understand any written specification you give them in plain English/German/Spanish/Russian/Chinese? What if this person could then give you a breakdown of what you can do to reduce your environmental impact and cost and also improve your social responsibility impact while keeping the function and form of the product the same? What if we could ensure that every specification adheres to company-wide policies? What if all specifications ever purchased are visible to all key decision-makers so that there are no fragmented supply chains across separate regions? The reliance on specific suppliers or costly consultants will no longer be a given.

Axiom’s AI can do all of this, with a knowledge engine that continually learns about every specification and supplier it encounters, it can:

1) Predict the price of any specification

2) Advise you on which of your suppliers to consider

3) Inform you of the environmental impact of your order

4) Offer modifications to a specification to align it with your company’s strategic objectives

5) Understand any specification request in plain language, there is no need for complex form-filling


AI in Procurement — Common Uses

In computer science, the term artificial intelligence (AI) refers to any human-like intelligence exhibited by a computer, robot, or other machine. In popular usage, artificial intelligence refers to the ability of a computer or machine to mimic the capabilities of the human mind — learning from examples and experience, recognizing objects, understanding and responding to language, making decisions, solving problems — and combining these and other capabilities to perform functions a human might perform, such as greeting a hotel guest or driving a car.

AI in Procurement

In order to compete effectively in an increasingly complex global market, many companies of all sizes have embraced a variety of technologies as part of their pursuit of digital transformation. But not every area of business has proven quite as eager to accept emerging technologies like artificial intelligence (AI), real-time analytics, or process automation. For many businesses, regardless of industry, one area in particular — the procurement function — has, until recently, persisted with traditional technologies and processes. In doing so, these organizations may be sacrificing essential gains in efficiency, accuracy, and strategic decision-making that could help them build or maintain a competitive advantage.

Let’s look at some examples…

Example 1: Spend Classification

How to classify spend into procurement categories is one of the oldest and most common applications of AI in procurement. Many procurement organisations follow the ‘Category Management’ model of procurement whereby every purchase is mapped into an often complex hierarchy of categories and sub-categories.

A particular purchase is sorted into a category based on data coming from invoices, purchase orders or other data sources. The technical challenge of this is not the AI itself but rather bringing disparate data sources together to provide as much information as possible to whatever classification algorithm is used. This is because with AI your solution is often only as good as your data.

A common type of classification in AI in spam detection.

Is Spend Classification Useful?

Spend classification is an attractive solution as it enriches and brings some order to an organisations data, this can help when analysing the data further. There is however no direct value add from classifying your data in this way and it is not a perfect solution as even though you have classified a category you have not standardised the way in which information is reported within the category itself so in-depth analysis is not possible.

Beyond Spend Classification…

Axiom uses spend classification algorithms to classify the data we gather and then use information extraction algorithms to fill in standardised forms with any information available in internal databases or external data sources (e.g. environmental and social responsibility measurements). The AI will also try to fill in any missing fields by looking at your past purchasing behaviour. By doing this we reduce the amount of manual input required to accurately specify a product. Once a product is accurately specified, a useful and thorough analysis can be carried out.

Example 2: Supplier Performance

An organisations procurement performance relies on the performance of its suppliers. Organisations will try to identify poor performing suppliers using their own metrics along with ad-hoc analysis. The metrics used are often too qualitative and the analysis over generalised or statistically insignificant.

Adhoc, overgeneralised, statistically insignificant

An Example of Poor Analysis

When a procurement professional is comparing two print suppliers (Supplier A and Supplier B) and trying to determine which is better they may start looking at the cost of certain products on an ERP dashboard. They may observe that for 75% of similar orders of leaflets Supplier A has been less expensive than Supplier B. The professional decides that Supplier A is better and the organisation should no longer use Supplier B.

This is an example of over generalised analysis, the possible reasons Supplier B has been more expensive are numerous and quite often due to the specification of the order, date of when the order was placed or poor/no negotiation with the supplier.

Analysis with AI

Axiom uses advanced statistical models to rank suppliers based on price, quality, risk, etc. down to a specification level so that for every order the customer knows which supplier to go to and how much they are likely to pay. These models allow Axiom to continually review and automatically flag suppliers who are performing poorly.

Example 3: Price Prediction

Procurement purchases most things either by strategic, tactical or spot sourcing. For most organisations, strategic sourcing makes up the majority of purchases. These purchases are those that are planned in advance, take into account company requirements and supplier capabilities and usually have long lead times. Availability and price are considered in the decision, but equally important is the impact on the overall organisation. Finally, a strategic sourcing model encourages communication and aims to keep that communication open throughout the contract lifecycle.

For tactical and spot sourcing the primary factors of consideration are price and delivery time. As there is a low average order value there is often a huge amount of budget wastage in these purchases since they are not given a lot of attention and procurement professionals aren’t keen to spend their time trying to find the best price and the suppliers know this!!! The variation in the price of a small order (<$10,000) placed the same week from the same supplier can frequently be more than 300%!

Past Solutions

  1. Asking for quotes from 2–5 suppliers.

By asking for a number of quotes from different suppliers you are effectively sampling the distribution of prices and therefore making it less likely that you will accept an absurdly high price. This method however is cumbersome since to actually get to a fair price you have to contact many suppliers and in truth, you never know when a price is actually fair.

Sampling the distribution of prices

2. Price prediction for a particular repeated specification.

Some procurement software solutions offer a basic price prediction capability that uses historical purchases for a particular item at many volumes and then fits a polynomial curve through the points using some unknown loss function. This method is fraught with error mathematically as the curve is likely to fit the data poorly due to a small data set size (each specification is treated as its own data set), a small signal to noise ratio within the data and may other reasons. Practically it is a poor method as in order to predict the price of something you need to have purchased it many times already.

Axiom’s Solution

Using advanced statistical methods Axioms TruePrice takes into account every order from every supplier when predicting the price a customer should pay for any specification, whether they have purchased it before or not. The customer decides what they think is fair to pay in the distribution of the market prices, whether that be the 25% or the 75% centile. The customer can then go out to suppliers with knowledge of what a fair price should be and in our experience be able to tell the supplier what they are willing to pay and not ask what the supplier wants them to pay.


Why we hate data

As we push on in the information age you have probably grown sick of the word data or big data or data lake, data cleaning, data pipeline, the list goes on… Everyone is talking about data but very few people are using it because there are a million and one things that data does to try and stop you. If you can jump through the hoops and over the puddles that data puts in your way then it’s green pastures and blue skies.

“Without big data, you are blind and deaf and in the middle of a freeway.” — Geoffrey Moore

So, how do I get to the promised land?

Clean Data

What is clean data? The easiest way to describe clean data is as the antithesis of bad data. Bad data is an inaccurate set of information, including missing data, wrong information, inappropriate data, non-conforming data, duplicate data and poor entries (misspells, typos, variations in spellings, format etc).

As more and more information enters your organisation from different points of origin, the likelihood that mistakes will be made automatically increases. The first mistake that many organisations make is disregarding the potentially damaging impact of bad data that’s already flowing around between their enterprise applications and playing down the problem by assuming that their data is clean and accurate.

“Torture the data, and it will confess to anything.” — Ronald Coase

The solution?

It’s simple really, just remove duplicates, verify new data, update existing data and the most important one IMPLEMENT CONSISTENT DATA ENTRY. By the way, consistent data entry is not Tom and Steve being the only ones to enter a product specification in a text box because “they know how to do it”. Data should be entered into a standardised format with validation rules implemented for every data feature.

Disconnected Data

The second mistake that organisations make is to allow different parts of the business to become completely isolated from one another, as this creates departmental silos. Once these silos have been created and taken root, not only are they hard to break down, but they also encourage the use of data definitions that are different to those used by other parts of the organisation. This makes it difficult to manage and reconcile important data between teams and applications.

“If we have data, let’s look at data. If all we have are opinions, let’s go with mine.” — Jim Barksdale

The solution?
There is no one size fits all solution to this problem and unfortunately, the solution is usually a long one. It involves integrating all of your data, gaining agreement between teams on data definitions and a historical review of all your data to sort the wheat from the chaff.

No Data or Not Enough Data

Although some organisations have been collecting data for a very long time and that data may even be clean and connected. Once an organisation tries to use this data for something other than simple reporting they usually run into problems. They realise the data they have contains no information and they don't know where to find the information they want.

The solution?
It all starts with a plan. Gather some big brains who have domain expertise and think about what questions you want to answer with your data yesterday, today and five years from now. Then for each question hypothesise five different ways you could answer these questions and the data you would need to get to these answers. For each data feature write accurate and specific definitions of what it means and for the love of all that is good in this world, try to make the data feature categorical or quantitative!

Now, there is a fourth, fifth, sixth … and two hundred and fifty-eighth reason but we will stop at three.

This all seems like a lot of effort…

It is. And it is not a one-time effort, large organisations will continually have to fight to keep their data clean, their information accessible and their insights true. However, when it comes to marketing procurement information, Axiom is here to help. With domain expertise and advanced data collection, cleaning, modelling and analytics capabilities we can optimise your procurement process, reduce your environmental impact, ensure you’re buying responsibly and save you money.


Putting Procurement-Intelligence in your hands

Axiom is delighted to be part of a rapidly growing ecosystem of disruptive start-up ProcureTech businesses across the world. Most of these new, agile organisations are inhabited by thinkers and doers who have been inspired by the need to solve a specific range of global procurement challenges in uniquely complex and challenging times. It is these organisations that will fuel the innovation that is needed to revolutionise procurement and put the function at the very centre of the organisation, leading company economic recovery and sustainability.

Progressive procurement leaders recognise that a revolution will be required to reinvent procurement and equip their teams to responsibly deal with the extent of change that is needed to make budgets go further, while at the same time driving, measuring and managing Environmental Stewardship, Social Responsibility and Governance across their supply chains. Ensuring rapid, positive and tangible change is no longer optional as it is being demanded by organisations, consumers, society and governments across the world.

It is easy to identify the reasons why large organisations are turning to specialist businesses such as Axiom to help them to remove pain points and the lack of transparency that they have had to tolerate for far too long. The biggest single hurdle for most procurement organisations is having complete, accurate and reliable data at their fingertips and then having the domain knowledge, the AI and the analytics capabilities to drive the insights that show what needs to be done with it.

Axiom partners with procurement leaders so that they are able to confidently take ownership in tackling these challenges within the specialist Print and Marketing Materials categories. Our unique combination of global sector and domain knowledge, practical methodologies, unique software and disruptive analytical approach will help you make the positive step change that a traditional category management approach simply cannot achieve on its own.

If you wish to take that positive step towards significantly and forever reducing budget wastage and aligning Print and Marketing Materials ESG performance with your wider organisational objectives as part of your digital procurement strategy, then please contact us at procurement-intelligence@axiomdata.io and we would be delighted to arrange to share our approach with you.