Monday, 24 February 2014

DIY Opportunity Assessments a Reality with Category Dojo


Thanks to Kelly Barner for her recent post on Category Dojo (2/4/2014)

Opportunity assessments have long been tied to service agreements or consulting engagements. They are expensive to conduct, have a limited shelf life, and are often cloaked in mystery. Once the effort required to collect and analyze data has been completed, consultants may use the opportunity to sell additional services, making the case that they should stay involved in order to meet the category requirements or timeline associated with the sourcing waves.

Not all procurement organizations have the budget to bring in an outside firm to conduct an opportunity assessment. Those that do may prefer to be in control of the process and results themselves rather than being reliant on an outside group for collecting and interpreting information on their behalf.

In November of 2013, Market Dojo, a pioneering software-as-a-service (SaaS) company based in the UK, released Category Dojo. Category Dojo can be used alongside Market Dojo, their sourcing and auction platform, or Innovation Dojo, their buyer/supplier collaboration platform, or as a standalone solution. It enables companies to conduct their own opportunity assessments by putting them in the driver’s seat to enter category-level information about spend and then adjust the criteria weightings to prioritize sourcing opportunities, estimating savings and recommending the best sourcing strategy or route to market.

The algorithm that serves as the backbone of the assessment is logical, organized, and consistent. It allows each organization to establish and analyze criteria such as complexity, auctionability, time to implement and risk tolerance. The reports that are created by Category Dojo address a number of perspectives on the categories of spend in question, including Sourcing Strategy, Spend vs. Complexity, Time vs. Return, Savings Potential, and Power Balance. The Power Balance report applies the Kraljic matrix to help procurement see themselves in relation to their suppliers, as well as how their suppliers see them. It reflects the growing trend of placing an emphasis on collaboration with suppliers in strategic categories.

As with their other solutions, Market Dojo designed Category Dojo to be intelligent and easy-to-use with commoditised pricing. In fact, procurement organizations can create a portfolio and enter category information, run the algorithm, and access four of the seven reports for free.

Although Category Dojo is new, it has been received warmly by procurement practitioners. Companies in a range of industries are already putting it to use in-house. Housing 21, the UK’s largest non-profit care provider and a national leader in providing innovative, affordable housing for older people, were one of the first to use Category Dojo. They analysed over 45 categories side by side.

"Market Dojo has played a key part in driving our planning process in ensuring we ask questions on a consistent basis across all our spend categories,” said Paul McGinnes, Housing 21’s Head of Procurement. “This analysis has enabled us to obtain a comprehensive three dimensional result by comparing vastly different categories in a single unified format."

In an environment where the trend is to move everything to a services model, Market Dojo saw an opportunity to combine the advantages of SaaS solution with the independent capabilities of procurement organizations to allow them to conduct their own opportunity assessments. In addition to enabling companies to manage the process themselves, having hands directly on the solution means that adjustments to criteria can be done on the fly to better understand their impact on project prioritization and to facilitate conversations with executives and internal stakeholders.

As we’ve noted in the past, Market Dojo never releases functionality without having their sights set on the next goal. The Category Dojo mobile app for ipad and iphone has just been released. They are also looking at building additional capabilities around savings tracking at the category level. Stay tuned for more, and file under ‘Savings Dojo’.




Friday, 21 February 2014

Market Dojo: A Dragon’s Den View by Jon Hansen

Posted on February 4, 2014 by PI Blogger


Editors note:  We had the great pleasure to be picked as a finalist for the 'Year in the life series' on the Procurement insights blog.  Unfortunately we did not win however, Jon Hansen gave us a great write up after our radio interview.

Editor’s Note: On December 19th, 2013 I had the opportunity to interview Year in the Life candidate Market Dojo, a New Wave company that that helps clients to “maximize” their purchasing power.  In the post-show commentary, our Dragon’s Den (or Shark Tank if you prefer) panel of experts provide their take on the interview and offer advice to the company.  In today’s review I will provide my take on Market Dojo;
PI Market Dojo
While creating a more efficient supply chain may not be rocket science – although given the multitude of past challenges in successfully launching an initiative to automate the process may make one think it is – in talking with the founders of Market Dojo I was immediately reminded of a group of bespectacled, lab coat wearing scientists.  It was not so much the way they actually looked, but their manner in explaining the methodology they employed to create the “perfect” e-Sourcing solution.  Within this context, it would be easy to conclude that they would be equally at home in a NASA lab, as they are in a boardroom or testifying before a government committee.
In the many times that I had communicated with them leading up to the December 19th radio interview, I got the distinct impression that they are always figuring the angles and aligning the different variables in an effort to meet the at time complex needs of a rapidly changing market.  Or to put it another way, this is not a let’s win the business first and worry about making it work later group of people.
When you visit the Market Dojo site you will quickly discover that the only Madison Avenue element of the company is their somewhat whimsical name.  Outside of that you will be provided with a stark, highly functional very factual overview of what they do, why they do it and how you can benefit from their expertise.  In short they are a no sizzle all substance enterprise that employs the slide-rule more than the hard sell to win customers and deliver results.
All this being said, there is a downside for a company that uses hard logic as its main lever for winning business.
For many of their potential customers who have expended substantial sums of money and time in an effort to implement traditional procurement applications that have for the most part failed to deliver the expected results, choosing to go with a company that can provide an almost immediate return for a fraction of the cost is a difficult pill to swallow.  

Let’s face it, how do you explain to your board that you have thrown good money after bad for so long while a better and more affordable solution was literally available right under your nose.  There is no logical argument that can help you to reconcile this discrepancy in judgment.  This is perhaps why so many of the old application vendors are trying to acquire the most promising up and coming cloud-based solution providers.  It gives the customers a chance to make a change within the framework of their existing relationships.
With Market Dojo, or for that matter any of the New Wave Companies that are coming to the forefront of market consciousness, being able to navigate these at times contradictory realities as opposed to providing the best solution will be the key to their ultimate success.  At this stage I am not certain that Market Dojo possesses the prerequisite marketing know how to gain the traction that their solution warrants.
For this reason I believe that 2014 will be the most critical year for the company, because after all there are only so many shopping days before Christmas meaning that there is a relatively short window of opportunity for them to make their mark.
On a closing note, the founders of Market Dojo might actually wear lab coats as Alun Rafique is an Aeronautical engineer, Nick Drewe has a Masters Degree in Mechanical Engineering, and Nicholas Martin a physicist.
Big-Bang-PI Post
The MarketDojo Team?
Be sure to check out our other Year in the Life Candidates as well as follow The Year in the Life 2014 Series on Twitter #YRiLife2014.

Tuesday, 18 February 2014

Tender evaluation and linearity

As two of the founding members of Market Dojo are engineers and the other a physicist, we take our maths very seriously.  One of the reasons for developing our auction platform for the public sector during our first grant is that we wanted to demonstrate how easy it was to set up and execute a weighted tender.  The specific area we want to address here is the scoring system.

We have been baffled by the illogical and non linear nature of many of the scoring systems in the market, and were determined to provide something better.

Firstly we would like to describe how we have approached the problem and then look at why some of the other common techniques on the market are challenging to use from the buyer and supplier side and how some are even fundamentally flawed.

Here is a section of our capability; the full version can be seen here.



We think any scoring mechanism should be linear and straightforward.  Thus if you are running a weighted tender you need to be able to clearly communicate the mechanism for converting the various elements to scores and how they are combined.  

[You can try out all that you read here by just registering with Market Dojo for free and experimenting with setting up weighted events in the Sandpit.]

Questionnaire scoring:

We have made the set up for a questionnaire very easy, providing many different question types.  On top of this you can create a questionnaire which is scored and also weighted by question, section or both.  The simplest way to show you what this means is an example output.



Here you can see that this questionnaire is scored and also weighted by question and section and the total weighted score is the final result for the questionnaire for this participant.

Price Scoring:

We have two techniques for price scoring on our application.  

Pro Rata: The system scores the price based on where it sits between the lowest price and the qualification price. This is a simple linear method of determining differences between prices. The qualification price is set before the event and is the highest bid you are willing to receive. The lowest price is the current lowest bid in the event. [One could look at a further extension to this method by setting the lowest bound but this presents its own challenges].

You might use this method when you are looking at many complex factors and need to have greater control about making the scoring methodology suit your tender. You can judge your price scoring against your highest acceptable price.  

Percentage of leading bid: The is a simple and powerful technique.  As an example, if the highest bid in a reverse auction is £100 and the next best bid is £110, then the lowest bid gets 100% and the next highest bid gets 90%, as it is 10% over.  This is also a linear mechanism which does not need a qualification price.  One potential disadvantage is that if a bid is double the lowest bid, the participant will get a score of zero, although that may be a fair outcome.

One benefit of this method is that the non-price elements can be equated directly to price.  For example if the non-price element is worth about 1% of the estimated final price then you can weight the non-price elements to be 1% and the price 99% and the evaluations works out consistently (see the example below).  

This method can lead to difficulties in the public sector arising from rogue bids and/ or participants having the same score of zero when they have different bids.  In the private sector though you have more flexibility and can decline participant during an auction.

Combining scores:

The weighting for the price and the questionnaire should be set before the event. The participants bids are ranked on their score, calculated as:

[Questionnaire weighting] * {Questionnaire score} + [Price weighting] * {Price score} = Overall score.

For example:


You can see in the scenario above that the ‘Percentage leading bid’ method works very well.  Here in round 2, one supplier with better payment terms but a worse price has an equal overall score.  The added value of 90 days payment terms compared to 60 days equates very nicely to 1% of the overall score.

Auction:

During the auction you want to easily see the overall score live and to exactly determine how the weighting is effecting the result.

Here you can see the leading supplier based on the overall score:



And you can also drill into the weighted scoring per bid:


The result is an easy to use weighting mechanism that can be used during a live auction with good visibility of all the related scoring..

Issue with current scoring mechanisms on the market:

Whereas any scoring system will have potential flaws, there are some systems on the market which are more flawed than others and some that are simply incorrect.

The multiplier:

This method uses the questionnaire score to create a price multiplier during the auction.  We find it hard to imagine something so incorrect.  There are many issues with this type of mechanism, which we can only think is a result of a software provider not developing an appropriate mechanism but fudging an exchange rate approach to solve the issue,  such as:

1.  In a weighted auction, if the participant has a price score of zero, they should still have a questionnaire score.  However, with the multiplier mechanism the overall score will become zero.

2.  The methods we have seen for determining this ‘multiplier’ are very much non linear and are impossible for the buyers and suppliers to truly understand how the mechanism would react.

3. This method skews non price elements. Let’s say that quality is the non price element used to determine the multiplier.  During the auction the multiplier will create different results based on the price.  Let’s say Supplier A has a price of £10 and Supplier B has a price of £12.  Let’s also say the multiplier is only applied to Supplier A and is 1.1.  In this case the overall score for Supplier A would be £11 to put them in first place.  Alternatively, let’s say Supplier A had a price of £100 and Supplier B with £102.  Here the price is still separated by £2 but with the multiplier applied to Supplier A (£110) they now fall into second place.  In other words the non price element with the multiplier means different things at different prices.

Percentage of leading bid:

For a forward auction, the equation for percentage of leading bid is a simple linear scoring result : ‘Bid divided by Highest bid’.  However, in the public sector we have often seen the inverse of this formula used as the price score calculation in a reverse auction, i.e. Lowest Bid divided by the Bid.  This is mathematically incorrect and actually gives a non linear result, as shown below.  It makes it even harder for the buyer to know how the scoring mechanism would react.



Normalised questionnaire scoring:

We encountered this being used at a council who had applied rigorous OJEU mechanisms to every type of tender, of any value.  In their questionnaire scoring they took the participants’ results and normalised them.  So for example let’s say that the questionnaire is worth 50 points.  Participant A scored 5 out of 50 and Participant B scored 10 out of 50.  After normalisation Participant A gets 25 and Participant B gets 50.  Thus you can see that even if the participant does incredibly badly in the questionnaire, they can still get high points if the other participant has also scored badly.  From the actual points you can imagine how this could drastically change the tender.  In some ways it is saying that there is not room for improvement.  Imagine if the questionnaire was related to quality?  The normalisation could transform a low quality score into a very commendable one, which sadly masks the reality of the situation.  

Conclusion:

In summary the mathematics of a weighted tender are actually quite simple and we are proud of the straightforward linear methodology we have developed.  Not only do we believe it is easy to set up but you can also analyse what is going on during an auction.  This is exactly as it should be: fully auditable and compliant.

We are amazed by some of the current mechanisms used in the public sector today. At best they can distort the results in an unpredictable way and at worst are incorrect and non compliant.  Suppliers involved in these tenders might even have the ability to challenge the results which, if you think about it, could create quite a stir.

The biggest disadvantage of these mechanisms is that they are just plain confusing.  Any buyer setting up a tender using these techniques cannot fully grasp how the mechanisms will behave.  And if the buyer will have difficulty, just imagine what the suppliers will think.

Wednesday, 12 February 2014

Domestic eSourcing - a follow-up to Spend Matters

This article is a follow-up piece by Nick Drewe, co-founder of Market Dojo, who used the Market Dojo eSourcing tool to let a contract with local builders for his own home extension.  The series of articles (found here, here and here), written in late 2013, was picked up by Peter Smith at Spend Matters who raised some interesting observations.

Several months have passed since I conducted my domestic eSourcing event involving some 96 Bristol-based builders.  The outcome of the event was implemented savings to the tune of 33% versus my best pre-tender offer.  Furthermore, due to the preparation that is typically required to enable an eSourcing event to be run, the implementation was simply a case of ‘sign here please’.  The contract has since been signed with the successful builder and work is due to start imminently.  

The reason I bring this up is that I stumbled upon the coverage of Part 2 of this series by Peter Smith at the excellent Spend Matters UK blog.  You can find the original article here.  Peter raised a number of interesting points, which I attempted to answer via the ‘Comments’ facility on the blog.  However, I would like to re-address some of those points here, as they deserve further attention in my view.

First of all Peter asks:

“Can auctions be used for pretty much anything?”

The first thing that popped into my mind was that I wasn’t necessarily running an eAuction.  At this point, I was conducting what would be more formally recognised as an RFP, using online scored questionnaires and a bespoke pricing structure.  Ultimately, the RFP was all that was needed, as it became clear that any further significant cost savings would arise from changing the specification and not from negotiating the rates.

As I mentioned at the time, I did think about running a weighted tender, taking into account the supplier questionnaire responses, my opinion of their site visits and testimonials from their previous clients.  I decided against this because although a weighted tender helps to identify the overall top performers, sometimes you just have to go with ‘gut feel’ - totally illegal in EU Procurement rules, I know!  I simply wouldn’t know what price to quality ratio to set, nor how much weighting to assign to aspects like the client testimonials until I actually heard from the clients.  If the clients were all impassive, I would largely disregard this criterion.  However, if the clients were passionately pro or against a particular supplier, it would weigh heavily on my mind, perhaps far more so than the price itself.  In a word, a weighted tender would have been too ‘rigid’, whereas sometimes there are merits in having a fluid decision-making process.

Peter continued:

“And perhaps most striking, is the thought that there might be domestic applications for some B2B eSourcing tools.  Might a consumer be able to use sourcing tools when buying a new car? a holiday?”

Now this I know the answer to - yes, absolutely!  Aside from my case in point, which is the first example I know of that incorporates a true business-to-business eSourcing tool for a domestic purpose, there are a host of other ‘eSourcing’ tools that can be used by consumers.  There were numerous eSourcing tools for the building trade, such as RatedPeople.com or MyBuilder.com.  Buying a new car via reverse auction can already be done on AutoeBid.com.  Another example I used was when I recently transported a sofa from my flat in Bristol to my parents house in Sussex.  I sourced the delivery using AnyVan.com.  In the end my final price was entirely free by piggy-backing off an existing delivery, although my parents gave them a fiver for carrying the sofa upstairs!  

Electronic sourcing is about finding online the right supplier at the right price for the right goods or services that you desire.  A good eSourcing tool will make this task easier, quicker and more effective for you, and so the fact that there are so many eSourcing tools for consumers is testament to those benefits.  The question is, as the internet becomes more ingrained in our daily lives, which of B2B or B2C will adopt eSourcing more comprehensively?  At this rate, I’m inclined towards B2C.

Anyhow, before we deviate too far from the main topic, let’s get back to more from Peter:

“One barrier [to eSourcing] is that you need to have some real competition to get the benefit of tools and indeed of the processes themselves.  So it is less applicable if you definitely know which hotel in Obertauern you want to visit, as in our case!”

The reliance upon competition is certainly true.  However, the trick is to create competition.  If you want an iPad, you know Apple is the only manufacturer and so you might think you have zero competition.  However, there are many distributors, retailers, stockists etc. that you can involve.  They each have regional, time-bound or even personal targets to meet.  They have their own margins they can play with.  I’ve run an eAuction in the past where an Apple stockist outbid Apple themselves!  

In the hotel example, whilst Peter knew which hotel he wanted, he could have created the competition by involving other hotels that he may equally have been attracted to if the price was right (and there should always be such a price, e.g. if another 5 star hotel offered rooms for £10 a night perhaps?).  So in the eSourcing context, invite hotels that you could be incentivised to book with and see what they can all offer.  Perhaps you’ll find a reason to book with another, or perhaps you’ll head back to the original choice but with a better deal.  Other consumer eSourcing tools like LateRooms.com or Trip Advisor might also be able to find you that deal despite the initial lack of competition.

A final point raised by Peter was:

“Another issue of the consumer is that we often don’t have significant repeat business to offer, unlike most corporate situations. So if Nick accepts a low bid, will the builder really care about doing a great job, knowing that he probably isn’t going to buy another project for some time, if ever?”

Now this simply comes down to finding the right supplier, someone who will respect your value of business.  It has very little to do with the eSourcing process itself.  If I asked Balfour Beatty to sort out my house extension, I’d be laughed at and quite rightly!   As the largest construction company in the UK, what would they care about my project?   However, if I approached a company that has an excellent reputation but is still in their early days and wants to use this opportunity as a stepping stone for greater things, they will be devoted to the project so they can use it as a flagship case study for their future proposals.   

Hence this comes back to using an element of ‘gut feel’ when awarding the contract, as you get a sense of this motivation only when you meet the suppliers.  As it happens, the builder I signed the contract with was not the most competitive and yet I signed with them for exactly those aforementioned reasons.

Anyhow, that wraps up some of my thoughts when I re-read the commentary that Peter kindly provided on the original piece.  Since then we’ve negotiated a new kitchen and bathroom (aggregated together to leverage the extra spend) and boy did we wish we had reverse auctioned that to save time!  We were actually glued to the phone in the car trying to finalise which supplier we were supposed to drive to whilst our three shortlisted suppliers went back-and-forth undercutting each other!  It was worth it in the end, as we did implement a 50% saving from the initial discounted offer, but a part of me wonders what would have happened in an eAuction.  I guess we’ll never know!

Reverse auction entrepreneurs to bid for expansion with award


By The Bristol Post  |  Posted: February 05, 2014

By Gavin Thompson

A NORTH Bristol firm has led the way in online reverse auctions, in which businesses get suppliers to bid against one another for contracts.

And now Market Dojo has been awarded £24,950 from the Going for Growth fund to develop software sector specialists can tailor to their own market and customers.

The Gloucester Road company was founded three years ago by former Bristol University graduates Nick Drewe, 31, Nicholas Martin, 389, and Alun Rafique, 39.

Alun and Nick had worked as consultants running reverse auctions on behalf of companies.

"A reverse auction means if you are a buyer and you have three possible suppliers, you set up a timed auction so the first one might bid £100, so the second bids £98, then £95 and so on and the winner has the lowest bid," explained Alun.

But the group saw a change in the market and believed it was an opportunity to set up on their own.
"People wanted to run the auctions themselves rather than bring in consultants," said Alun. "We saw that shift in the paradigm shift and developed Market Dojo software to allow them to do that."

Since then the Gloucester Road firm has secured two grants from the Technology Strategy Board, the first to expand Market Dogo into the public sector and the second to develop Category Dojo, which helps companies find and plan procurement.

It has since added Innovation Dojo to its offer, a tool to help companies work with suppliers on new ideas.
The Going for Growth grant will be used to develop the platform further.

"It's a bit like on eBay you have people who set up eBay shops," said Alun. "We want people who have specialist knowledge and contacts in a field, say energy, to be able to run their own procurement business through Market Dojo."

Most of the company's work is outsourced but as part of the terms of the grant, it has pledged to recruit at least one member of staff this year, most likely in development or sales and marketing.

Alun added: "Hopefully it will be more than one person, we've certainly got plenty to do."

http://www.bristolpost.co.uk/Reverse-auction-entrepreneurs-bid-expansion-award/story-20561353-detail/story.html#ixzz2sWqOBAdo

Monday, 10 February 2014

Spend Matters - Innovation Dojo – another new product from Market Dojo


PETER SMITH - January 16, 2014 12:05 AM

Categories: Reviews | Tags: Market Dojo, Technology

http://spendmatters.com/uk/innovation-dojo-another-new-product-market-dojo/

We featured Market Dojo and their new ‘Category Dojo’ product earlier this week. Their other recent new tool is ‘Innovation Dojo’.  This originally came from a client request for a tool that could help them capture innovative ideas from suppliers. This is a hot topic, with every SRM survey or report talking about ‘innovation’ as one of the key objectives of SRM programmes – even if often organisations don’t seem to know quite what they mean by the expression!

Innovation Dojo is a cloud based collaboration platform for buyers and suppliers to share ideas. The buyer can create a topic – perhaps “innovative packaging ideas” for a particular product. A deadline can be defined, and buyers can choose a simple or complex scorecard, which define different factors against which the ideas will be assessed. (A future development will be to allow users to enter their own evaluation criteria). Suppliers can then be invited via the platform to submit ideas on that topic. They can describe their ideas, add documents to their response, and suggest benefits.

The host (the buyer) gets a notification when ideas have been submitted, and can score against the criteria e.g. ease of implementation, likely time taken (there’s also a neat ‘slider’ scoring tool in the system). Once the ideas have been scored, there are a range of charting tools provided to enable the buyer to look at how ideas rate against each other.

There is also the option to allow suppliers to kick off the process – submitting whatever ideas they feel are worthwhile.  Ideas could then be widened out to the wider supply base, although of course the buyer would need to be cautious about intellectual property here. In all cases, the buyer controls which suppliers are able to access the tool, so you won’t get random ideas (although that might be interesting at times – perhaps there’s another idea!)

So one key benefit here is the ability to track and manage the ideas generation process. There’s no reason why you couldn’t do much of this manually, but then there is the issue of keeping track of which supplier has suggested what, who needs a response and so on. This tool systemises that process – it is basically a collaborative process management tool. As such, it is not the most advanced or ‘bleeding edge’ technology we’ve ever seen. But it is a neat solution to a problem, (or more accurately, an opportunity), that many organisations and procurement practitioners have – how to drive more innovation from their suppliers.

Like Category Dojo, the pricing model starts with a ‘Freemium’ plan with some basic functionality to create innovation topics – but not share them with suppliers. Then a single user licence with the full functionality is £300 per month, with a sliding reducing scale rapidly as you buy more licences. Like their other products, it is competitive positioning from a cost point of view and encourages users to try the product. It should not require months of work on a major business case to justify the investment, and as such it looks attractive for organisations to at least give it a try.

 So Innovation Dojo should meet a need for many potential users, we suspect, with a strong combination of low cost and ease of use. And we’ll be interested to come back in a few months and see if we can talk to some users to establish if it is really making a difference to their innovation capture from the market.


Spend Matters - Category Dojo – a new product from Market Dojo


PETER SMITH - January 13, 2014 7:31 AM

Categories: Reviews | Tags: category management, Market Dojo, Technology

http://spendmatters.com/uk/category-dojo-new-product-market-dojo/

If all the surveys and predictions are correct, topics such as supplier relationship management, capturing supplier  innovation, and collaboration are set to be priorities for procurement through 2014. But we also know that the tools  available to support this sort of activity are not as well developed as ( for instance) those available in the areas of sourcing or purchase to pay.

So when we saw Market Dojo at the eWorld event in the Autumn promoting a new product called Innovation Dojo, we were interested and (eventually) caught up with Nick Drewe and Alun Rafique, founders of the firm, for a chat and a look at what they’ve been up to.

Market Dojo is now four years old, and has grown steadily, doubling in each of the last couple of years – it’s still largely the three founders plus a range of outsourced support (developers, admin and marketing support) but revenues should be over £500K in 2014. Their basic premise remains to provide easy to use, cloud-based sourcing and related tools, priced very competitively. Auctions is the area where Market Dojo is principally known, but their sourcing product is more than that, covering RFIs, RFQs, tendering and similar options.

As well as the original Market  Dojo (sourcing) product, the firm has recently launched two new products –  Innovation Dojo and Category Dojo. We’ll cover Category Dojo today, and come back to Innovation Dojo tomorrow.

Category Dojo was only launched in December, funded in part by the firm’s second grant from the Technology Strategy Board, but there are already a handful of ‘presold’  live users (generally users of the core product), covering major private sector firms and the public (housing) sector. It’s what we might define as a ‘expert system’ tool. It enables a category manager, or a procurement executive who has responsibility for a number of categories, to develop overall category prioritisation and plan, and suggests appropriate sourcing routes for each category.  As far as we know, it is the first SaaS tool of its type available (certainly in the UK).

So the user creates a portfolio of spend that defines the area to be considered (which might be the organisation’s total spend or a subset). The scope is then defined by the user in terms of individual categories or sub-categories, with spend levels, whether EU rules apply (public sector), currency and other key questions.  The user also responds to questions at category level, such as establishing long it is since the category was last addressed, number of incumbents,  market competition etc.

Algorithms within the platform then calculate the likely savings per category, and an assessment of the complexity / difficulty of addressing it. The platform also suggests which route might be most appropriate in terms of auction, RFQ, RFI (if the category is not mature enough for a direct competitive approach), or more public sector focused options where relevant such as competitive dialogue. Various charts and graphs can be produced, such as ‘bubble charts’ showing spend or savings potential versus complexity of category.
The tool is not positioned as the answer to all your category management problems – it is fairly limited in the sense that it is not an end to end, take you through the seven steps of CatMan tool, for instance. And the output depends to a large extent on the data entered, of course. But for users at a relatively early stage of introducing category management, it would be a very useful tool for starting to prioritise and consider approaches within the overall category programme.

And the cost makes it even more attractive. Market Dojo are following a ‘freemium’ model, so you can actually do some analysis free, then a single user licence is just £1,000 a year (with a sliding scale for more users, so £400 a user for 10 licences, for example).  So there’s a real encouragement to give it a try.
And we’ll be back with more on Innovation Dojo later this week.