The power of the platform combined with external advisory is back! Typically, an organisation will go for the platform of choice for its needs, complemented by third-party advisory. These days it is not so common to have the platform and people come from the same organisation.
Cirtuo, is a one-stop shop for specific procurement technology and coaching. Headquartered in Austria, but delivering globally, Cirtuo considers itself an exclusive boutique with a laser-like focus on enhancing the skills of the procurement team, developing its optimal category strategies and managing its suppliers effectively. The firm was founded in 2009 by Drasko Jelavic, an impressive character with firm opinions on tactical versus strategic procurement and how this is often confused, resulting in sub-optimal responses and results. Drasko is all about the strategy, or more accurately, ‘analysis, strategy, initiatives and results.’
Cirtuo is focused on the development of strategic procurement provided through three solutions: procurement development, category management and supplier management.
Their model centres on providing a platform and coaching programme to align objectives with the business and involve stakeholders. Category management combined with technology doesn’t happen often, so it’s interesting to understand the business driver behind Cirtuo. “To use the terminology ‘strategic sourcing’ is incorrect. There are two key drivers in strategic procurement: suppliers and categories,” affirms Drasko. “Sourcing is a tactical phase of procurement.”
“Imagine a football game: the CPO is the team manager. Having the manager run onto the pitch to help the team is not the role. Providing strategy and guidance is the role of the manager,” states Drasko to emphasise the difference between tactics and strategy.
The Cirtuo platform takes the user through establishing business requirements, developing content, understanding context, delivering the story for stakeholders, providing intelligence, mapping and classifying spend and guiding strategy creation. It continues by facilitating supplier relationship management, with supplier spend information and KPI building, tracking and reporting.
Drasko confirms: “By the end of the year we will introduce the Guided Strategy CreationTM approach in the tool. A set of questions and sample answers will guide a Category Manager through category analysis. The tool will automatically generate the strategy proposal, which can be reviewed by the Category Manager. Client feedback is overwhelming.”
Cirtuo certainly offers something of significant value in the S2P arena: the tricky area of category strategy, stakeholder buy-in, and KPI building, combined with a coaching model to provide knowledge and develop competencies within the procurement team to help elevate them to a more strategic level, where not that many players compete.
Richard Beaumont is Cirtuo’s guy on the ground in the UK. I caught up with him after ProcureCon EU which Richard hosted with his trademark tweed and exuberant, conversational charm. As part of Cirtuo’s coaching team, Richard really sees the value of the combined platform and coaching approach.
“For decades we have taught buyers how to build the content – different analyses, category and supplier intelligence etc., but we failed to teach them how to make this content relevant to their business context and to how to sell the story on strategy and business case to stakeholders. Cirtuo helps us to execute strategic procurement in a consistent and guided way, enabling Category Managers to create innovative strategies supported by clear guidance from an AI-enabled expert system. But it’s more than just a tool, it’s a training platform that ensures business alignment and greater stakeholder mobilisation.”
Corporate alignment and stakeholder engagement are what Cirtuo see as the two tenets of effective category and supplier management, which in turn form the basis for procurement’s development and growth into a C-class strategic function. It aims to simplify the management of the complex strategies, initiatives and outcomes that are the procurement bane. We will continue to watch Cirtuo intently as it strives to succeed in this challenging area.