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As Motorola's and GE's Supply Goes, So Goes Elance

Services procurement and management software developer Elance Monday announced the availability of the latest version of its supply control tool for the corporation.

Called SPM version 4, the package is designed in order to deliver greater controls and efficiencies over its previous edition, like a built-in change-order process for suppliers.

Although the biggest suppliers need to get their materials from somewhere, the need to control and improve the procurement process is the same for everyone. GE and Motorola are two such companies, and the first two to announce their use of SPM 4 in their businesses. Motorola will use the software in its IT consulting and software licensing divisions, while GE will incorporate the software throughout several areas of the company.

Diana Jovin, Elance vice president of enterprise solutions marketing and business development, said the need for less hands-on involvement at the top levels are a reason for businesses picking up the software.

"One of the things that we've seen over the last year is a trend away from companies managing services from a single-service commodity perspective," she said. "They'd rather keep that holistically so that they can centrally manage those services and embed it the practices out in the organization."

SPM provides a variety of efficiencies in the organization, including reducing cycle times and automating reconciliation. The software also lets companies incorporate its best policies into the program and forecast future or current needs.

New to the latest version of its SPM, Elance has included bill of services support for complex contracts, the ability to configure customized categories for company-specific functions and services lifecycle collaboration, which allows for interaction throughout the supply lifecycle.

"What we commonly hear from companies is that while they have good control over their internal resources, when it comes to interacting with preferred vendors they are really looking to have greater visibility and control over their spending patterns."

According to Forrester Research, a company typically spends 30 percent of its yearly budget on services. Elance predicts it can shave 10-20 percent off that figure with the inclusion of their software in the corporation. The software does it by: reducing invoice errors, making early payment discount deadlines, compliance to preferred suppliers and compliance to negotiated MSA rates.

Another key feature of the Java-based software is its compatibility to popular enterprise software applications such as Ariba, Oracle and PeopleSoft.

Cost of the SPM4 software depends on the type of license companies sign up for: a three-year license will run $3-5 million (for the license and servicing) while a perpetual license will change the pricing to the size of the deployment within the organization. Integration, officials say, takes between seven and 16 weeks.