DeepStream: Raising Financial Efficiency with E-Procurement

As industry priorities change due to rising costs, disruption and economic uncertainty, cost reduction has become a top priority for many. 

The Founder and CEO of DeepStream, Jack Macfarlane, describes that by leveraging digital platforms, procurement professionals can improve cost-saving capabilities whilst increasing efficiency. 

Jack discussed how technological advancements have enabled DeepStream to replace manual procurement practices with a streamlined cost-effective digital process. 

For those unfamiliar with DeepStream how would you describe its main activities?

“We call ourselves an RFx platform, because essentially our product allows buyers to request any information from multiple suppliers concurrently; getting the data they need to contract for a particular good or service.

"In doing so, our cloud software replaces the thousands of emails and attachments exchanged every day between businesses in strategic procurement with a single platform. This covers: 

• Buyers’ discovery of new suppliers
• Creating sourcing events
• Pre-qualifying suppliers
• Sequencing sourcing workflows across multiple stages
• Evaluating complex qualitative and quantitative supplier responses
• Managing suppliers through a sourcing funnel
• Optimising commercial terms with competitive bidding (including live auction stages)
• Awarding and completing contracts with suppliers. 

"Our main target is the mid-market, where procurement teams are between five and 30 people and the spend through procurement is a significant percentage of overall business revenues. This tends to be in heavy industrial businesses such as manufacturing and transport.”

What are the most common inefficiencies you see in traditional procurement processes, and how does e-procurement specifically address these issues?

"The overriding pain point is operational pain, which leads to a disproportionate amount of time being consumed in engaging with suppliers to get a commercial contract awarded. This directly affects mid level operational procurement.

"You wouldn’t believe how cumbersome this process is; imagine having to run 10 competitive bidding processes a month with 15 suppliers for each one, where each supplier requires five pricing sheets, over 50 questions and 100 clarifications- all through email. 

"Whilst the simple ‘cost’ to this status quo is time, and having to hire a lot of manpower to manage the process, the knock-on effect of this is that procurement departments hate running too many sourcing initiatives, especially with many suppliers, as this compounds their pain. So they don’t.

"This means less competition and a lack of exposure to new innovative suppliers who can deliver a better price and higher quality. Ultimately, this cost shows up as both inflated (versus what could be achieved in an efficient market) spend on the CFO’s PnL statement, and lower supplier quality delivered to the business.  

"An emerging trend we have seen over the last year or so is around having accurate visibility across supplier engagement activities.

"How do they really know that suppliers are engaged on a level playing field, with all policies followed, if they can’t see automated reporting which aggregate activities from source?"

Can you share a specific example of how DeepStream's e-procurement platform has significantly improved financial efficiency for a client?

"The clearest and most recent example is a traditional manufacturing client we onboarded last year who operated their sourcing events manually over email, getting single bids in from a small group of suppliers each time.

"Our Customer Success team got their team up and running on the platform in two weeks, and within six months they had embedded our RFx Auctions module into their sourcing funnel, expanded the suppliers they engaged with by over 150%, and saw full organic adoption from their team and their suppliers.

"The financial result? In year one DeepStream’s automated bidding and eAuction technology delivered spend reductions of over $2.0m: over 40x ROI against the total annual cost of our software."

What are your goals, personal and professional, for the next 12 months?

"Personally, I want to learn Norwegian as my fiancé speaks to our little half Norwegian son in Norwegian and I am at risk of being cut out of the language loop! 

"Professionally, I want to see the baby we built- a product with eight years of blood, sweat and tears invested into it- grow up and run for itself.

"Last year we expanded our client base by 2.75x, this year we want to do at least the same again and dovetail that expansion with clear value metrics from their use which demonstrates why digitising the Sourcing RFx in global commerce is a force for good."

******

Check out the latest edition of Procurement Magazine and sign up to our global conference series – Procurement & Supply Chain LIVE 2024.

******

Procurement Magazine is a BizClik brand