Inspire 18 - Coupa extends spend management to embrace payments, VMS

Profile picture for user pwainewright By Phil Wainewright May 8, 2018
A raft of announcements at Inspire18 include plans to extend and embrace Coupa Pay and contingent labor sourcing in the business spend management footprint

Raja Hammoud, Coupa Inspire18 by @philww 370px
Raja Hammoud, Coupa

AI-augmented fraud detection, integration to third-party catalogs and an Alexa interface to inventory management were amongst a raft of product enhancements launched by spend management vendor Coupa today. But the traditional second-day product keynote of its annual Inspire conference was most notable for revelations of two new features that currently remain in development — Coupa Pay, which will bring digital payment capabilities directly into the Coupa environment, and an extension of its services spend capabilities to encompass contingent labor, normally the preserve of separate vendor management system (VMS) applications.

The aim of Coupa Pay is to streamline payments and give spend managers more insight and control from within the Coupa platform. According to Raja Hammoud, SVP Products, organizations currently struggle with disparate systems and find it hard to keep track of payment details:

In so many conversations with you about these processes, you have told us that your payment processes are highly convoluted. Making payments to your top suppliers is fairly easy, but when it comes to your long tail of thousands of suppliers, it is not so easy.

You are so swamped getting the payments out the door. You don't even have time to think about how to optimize your payment systems. It was very clear from the conversations, it was time to give payments the Coupa touch.

Paying suppliers and employees

Coupa Pay will take on the task of collecting and then executing digital payment information, prompting suppliers to input their details when viewing a PO, invoice or other Coupa touchpoint. The supplier can then enable not only that customer but any other Coupa Pay users in its network. Coupa Pay will also collect payment details from employees, so that they can receive expense reimbursements without having to wait for payroll runs. Accounts payable will be able to delegate payment approval to authorized managers. Hammoud concludes:

This is the future of payments — where we pay your employees and suppliers as easily as we pay our friends.

There's potential to do even more with Coupa Pay in future iterations, says CEO Rob Bershteyn:

Credit terms, dynamic discount, accounting collaboration. Think about being able to send your payment with the order ... maybe instead of a dollar, we'll send you ninety five cents because you're going to get the money earlier and we'll get the product when we get it, around the SLA.

So there's a lot of innovative things we could do around payments and we want to bring the same usability to all components.

Contingent labor sourcing

The second new feature in the development pipeline is the extension of the services procurement application to handle contingent labor sourcing. This will become a new class of project resource that users will be able to search for, specifying the role, requirements and location, and also calibrating the skills mix associated with that role that best suits their needs. Once a match has been selected, the services procurement manager can then view the various activities that need to be set in motion to bring the contingent labor on board, as part of a dashboard that gives them an overview of contingent labor within their overall services spend. Hammoud sums up:

We are looking at the entire process holistically, from sourcing and onboarding, to managing deliverables and off-boarding activities.

More new capabilities in Coupa

Hammoud's keynote mentioned many other capabilities that are either now generally available or entering early access. They included:

  • Extending the reach of contract collaboration in Coupa to allow editing in Microsoft Word — and integrating digital signing by DocuSign into workflows.
  • Using Alexa with Coupa Inventory so that workers who need hands-free operation, such as nurses and chefs, can use voice commands to locate items, adjust inventory balances, and reorder stock.
  • Expanding the Coupa Open Buy program, which supports integration of items and pricing content from third-party catalogs into the native Coupa user experience. This launched last year with integration to Amazon Business in the US and is now also generally available in the UK, France and Germany. There will also be early access to add content from other suppliers such as Imperial Supplies, Office Depot, and Staples.
  • Extending Coupa Risk Aware with the ability to integrate customers’ own sources of governance, risk, and compliance data to customize their supplier health scores.
  • Approver Cycle Times, a feature that gives individual managers feedback on how their approval response time compares to their peers.
  • Spend Guard, which uses artificial intelligence to analyze employee spend transactions, looking at employee behaviors across all spend applications on the Coupa platform to help detect potential fraud.
  • Commodity Insights, which helps businesses optimize category spend by providing spend benchmarks, identifying top suppliers for critical commodities, and making recommendations to maximize spend value.
  • Automatic tax coding for supplier invoices, extending into Latin America with clearance model support, in addition to the existing post-audit approach common to EU countries.

My take

One of my questions about Business Spend Management, Coupa's new catch-all term for the full range of activities it supports, is to wonder where it stops and other enterprise applications begin. Contingent labor, traditionally handled by a separate VMS, is one example that falls somewhere between procurement and HR. Payment processing, similarly, falls somewhere between procurement and finance. It's interesting therefore to see Coupa's ambition for BSM making a grab for both.

Of course that still leaves a need for integration across to the HR system of record and the finance system of record. While it may be reasonable to source contingent workers in a spend management system, their identities, certifications and training needs must still be managed from the HR system. Similarly, all spending payments must ultimately be reconciled to the general ledger. Bringing the sourcing and spending into BSM merely shifts the integration boundary rather than eliminating it.

Coupa must also tread carefully as it absorbs activities previously provided by partners in its CoupaLink certified ecosystem. Its first step into payment automation came last year in a partnership with Nvoicepay. It's not clear at present whether Nvoicepay will have a role once Coupa Pay rolls out.

Similarly, one new partner on the show floor at this year's Inspire is Beeline, a VMS provider which is currently building an integration to Coupa. The two have customers in common, and Beeline is there to provide a solution until Coupa's contingent labor capabilities come out of development — but again it's not clear whether it will have a role beyond that point.

Coupa is very open with its partners about its roadmap directions, CEO Bernshteyn tells me:

We're very honest about it with our CoupaLink partners. In some cases we integrate to those solutions. They're best in class in some areas, but if we are considering building into those categories, we let those who partners know we have a roadmap to get into those areas over the next couple of years.

The full product footprint will become clear once these new functions move out of development and into early access. But for now, Business Spend Management as defined by Coupa looks as though it's growing to embrace and extend somewhat beyond the traditional scope of spend management. These extra areas are logical extensions, but they represent fresh territory for Coupa to conquer.