Is it purchasing or procuring? The difference first became crystal clear to me 8 years ago when talking to our customer (a large Stuttgart-based automobile manufacturer) about his procurement solution. He still calls the system eShop today. But back then there was no talk of a purchasing experience. First, it was a matter of the operational procurement costs of indirect material for the company headquarters, later for the overseas companies, and in the meantime a global procurement platform for many subsidiaries.
At the time, it was mainly process costs which were to be reduced in the companies. Only much later did we, together with the customer, concern ourselves with the purchasing experience. Today, more than 400 enterprise customers use the Heiler Business Catalog as a procurement shop. Some of these customer receive up to 300,000 hits per day and have 5 million sell-side products. First and foremost, customers want to make sure that only those products and items which comply with a narrow, predetermined product selection made by the company can be ordered by employees.
But what's that all got to do with PIM?
Well, these internal corporate shops (preferably referred to as procurement, but also as 'Supplier Relationship Management - or SRM systems in short) today represent significant marketing channels for many distributors and dealers. To begin with, these distributors use the PIM solution to create catalogue files from their master file data. Initially, customers only wanted simple data sets from their distributors on CD-Rom. But soon BMECat-XML became standard in Germany and xCBL was introduced in the USA. These formats could also display more complex catalogs in a standardized format. However, this did not run in quite such a standardized way. There were - as so often - variations of the standard and to begin with formats had to prove the test of time in daily business operation. Thereupon, corporate customers increased their demands in terms of special product ranges, languages, media assets and, above all, customer-specific prices. Because PIM was able to do all this too, customers then came forward with a new request: "differentiation of the organization structure within the corporation". Or to put it more simply, customers wanted the product content to be processed for several procurement sides. This was also made possible, both in PIM as well as in the procurement catalog for purchasers.
And how did this develop alongside pure procurement? Not a lot was found in the users' (consumers') catalogs. The unpopular maverick deals also came to a halt. Thus product ranges were expanded and product presentations improved.
Nowadays, there is a trend to link directly the Group-wide procurement system with the e-commerce system of the distributor. The principle is called "PUNCH-OUT" and is simple: The order catalogue, including the user guide, is connected to the customer's transaction system via the Internet, e.g. via a so-called OCI interface. Of course, the sender (distributor) must support all B2B facets and variations already known by the internal customer system. The demands on distributors by key account customers are, however, substantial - in particular in terms of catalog management, price and product range control and also the quality of product data. Here, as is so often the case, the devil is in the detail.
In 2004 we implemented such a B2B sell-side solution for the first time, with software at either end, for a large electrical materials distributor. Since then solutions have become vastly more refined. PIM and catalog ordering solutions must form a unified whole, otherwise it just doesn't work - especially with the demands of a key account customer. And the requirements of B2B customers are growing further. In more and more cases, they are looking to create an inspiring purchasing experience for their 'consumers'. I will explain why in another blog shortly. Perhaps I'll call it, "The Amazonization of purchasing in 2010" or something like that.
When I think about it, it hasn't really been a simple matter of procurement with the B2B channel for some time now. Therefore from now on we'll call it "Purchasing with a positive procurement experience".
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