We’re back with the second in our series of blogs where we ask a few thoughtful questions to the Founder of a procurement software company!
Every month we do this, our goal is to get to know them personally and also their product a little better.
By doing this, we shine a light on some of the lesser-known solutions. These 5-minute insights are perfect to read on a coffee break if you’re keen to grow your knowledge of digital procurement tools.
Up this month is Paul Gurr, Founder and Managing Director of UK-based procurement performance management tool Provalido.
You can also find Provalido in our Software Finder App here.
Paul was also in the spotlight back in March when we did a live demo of Provalido together on our regular LinkedIn Live Demo Series.
So, over to Paul to tell us a bit more about him and about Provalido…
1. What did you do before you were Founder / CEO of your company? Where are you based?
Like most procurement professionals I fell into procurement accidentally after graduating and not really knowing what I wanted to do. A friend got me a 3 month temporary contract managing the supply of electronic components for printed circuit assembly.
Those 3 months became 3 years at my first employer as I learned the ropes of supply management and then more specifically procurement. I’ve remained in procurement ever since, both as a practitioner managing categories such as plastics and IT, then as a consultant working on transformation programmes and procurement outsourcing on both direct and indirect materials.
I founded Provalido in the UK in 2013 and I’m based in Swindon. Most of our team are in Scotland.
2. Give a brief overview of the problem that you set out to solve with Provalido
Everywhere I’d worked we had been using either spreadsheets or clunky access databases to report procurement savings.
It seemed crazy that something as important as this was being managed in this way. The reporting was invariably difficult to consolidate, prone to error, and a driver of frustration, with little credibility in the numbers actually reported.
Savings reporting and the wider management of savings initiatives seemed an obvious candidate for a web application, but very few technology companies were focusing on this area. Having had some experience of technology development at one of the consultancies I worked for, I thought I’d try to develop something that would fill this gap.
3. Which geographical territories, business sizes and industry sectors are you most active in?
We are active in 6 continents (we’ve yet to have any users in Antarctica), and many industry sectors, including industrial, healthcare, services, FMCG and technology companies. I would say our tool is industry agnostic.
In terms of size, our smallest customer has a turnover of just $50m, but 80% of our customers are $1bn+ companies and it’s this size where the benefits of the tool really kick-in.
4. What makes Provalido different from other competitors?
We’ve focused on this niche of savings tracking / procurement performance now for 11 years and to my knowledge that’s the most experience any company in the world has concentrating on this single aspect of procurement technology.
They say to be world class at something you need to put in 10,000 hours of practice. We’ve put in over 40,000 hours and counting of development into our tool and we certainly hope this makes it class-leading.
We’ve also stuck to our mantra of keeping things simple and flexible, which means new customers find our tool easy to use, but it’s also flexible enough to fit exactly to their established process for managing cost reduction.
5. What is your biggest challenge as Founder / CEO of a procurement tech business?
Our biggest challenge is ensuring our tool stays relevant. Procurement evolves over time and the way teams want to run and manage projects and the types of benefit they want to deliver changes too.
Continuing to develop a complex tool is not easy, but the hardest thing is prioritising development so that we focus on areas that will give most customers the most benefit.
We collect development ideas from 3 sources:
- Suggestions from our existing customers;
- Questions from potential customers in sales meetings (this acts as a guide to what the wider market may want);
- Ideas we have ourselves that we think would be useful.
We then figure out how to develop these ideas in a way that maintains the simplicity and flexibility of the tool.
6. Why do you think this particular challenge is the biggest?
If you get it wrong you can waste a lot of time developing something that is not used or only used by a very small proportion of our customers. Large new features can take several months to develop and what seems like a high priority when you start may not still seem like a high priority by the time you finish.
We’ve not always got it right in the past, but I think we’ve learned better how to prioritise and how to get into a good development cadence over time.
7. Can you share what you think will be the major trends over the next 3-5 years in the procuretech space?
Tech has replaced a lot of the transactional type roles in procurement over the last couple of decades and I think we’ll see a shift to tech replacing advisory type roles.
Who needs a team of consultants to tell you where opportunities lie, if you can get that information almost instantly via AI or at least clever algorithms? As ever it will be the really useful tech that saves people time or improves results (usually they go together) that actually lasts and thrives.
The barriers to entry are higher now than they were when we started due to the more complex needs of customers and more significant data security requirements. I don’t think it would be possible to build a credible tool now without significant investment, so it will be harder for bootstrap start-ups to enter the fray.
8. What has surprised you the most when it comes to working with procurement?
Two things.
Firstly, how many aspects of procurement just stay the same. It’s 30 years since I started in procurement but a lot of the issues and frustrations I hear from the procurement folks I talk to are exactly the same as I was experiencing myself in the mid-1990s.
Secondly, I have to say I’m often disappointed with how procurement handles prospective suppliers. Poorly run RFPs are common, but most frustrating is the lack of courtesy and feedback when our tool hasn’t been selected.
It’s really unusual to get any meaningful input in these situations, which I don’t understand. It’s the buyer’s opportunity to help shape the market for the future – if we get 3 customers all choosing another route for the same reason, there’s a good chance we’ll do something about it which would then make us a viable option if they come to re-tender in 2 or 3 years.
