Coupa: “Take My Credits, Please”

This is the first in a series of posts that will undoubtedly stimulate significant debate and hopefully lead to a “meet somewhere in the middle” compromise between ProcureTech solution providers and Practitioner customers. PLEASE NOTE: I still need to confirm if and when Coupa plans to roll out the credit model, but it doesn’t hurt to get ahead of the curve, should this be the direction they take.

Coupa would likely chose the credit model because it is financially safer, easier to scale, and more aligned with private equity playbooks—even if it sacrifices the transparency and mutual value alignment seen in successful initiatives like Virginia’s eVA.

Coupa’s challenge will now be to prove that “credits” = measurable outcomes, or risk customer backlash and attrition when the ROI doesn’t align with the spend.

FOR WHOM IS THE MODEL BETTER: PROVIDER OR PRACTITIONER?

From the practitioner or client standpoint, the clear preference—in principle and in practice—leans toward the eVA model of transaction fees based on usage and actual realized value, especially when the goal is ProcureTech implementation success and ROI alignment.

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⚖️ Comparative Summary: Practitioner Perspective

Criteria	eVA Model (Transaction + Value-Based)	Coupa Model (Credits + 3-Year Contract)
Transparency	✅ High — based on actual results and throughput	❌ Low — opaque credit definitions and usage
Flexibility	✅ Pay-as-you-go, adaptable to usage spikes/dips	❌ Locked 3-year minimums reduce agility
Alignment to ROI	✅ Strong — fees tied to savings or throughput	⚠️ Weak — credits not clearly mapped to value
Ease of Forecasting	⚠️ Medium — depends on data tracking maturity	✅ High — predictable upfront budget tiers
Incentive Structure	✅ Shared success with vendor	❌ Vendor earns regardless of client outcomes
Innovation Friendliness	✅ Encourages experimentation	❌ Credit burn risk discourages exploration
Implementation Success Impact	✅ High — aligned to outcomes and adoption	⚠️ Variable — high lock-in may suppress adoption risk discussions

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Strategic Insight

Why eVA’s Model Is Better for Practitioners:

• You only pay when value is delivered.
• It keeps vendors accountable.
• Encourages more thoughtful deployment of modules and automation (because ROI must be demonstrated).
• It de-risks implementation by tying cost to performance and adoption.

Why Coupa’s Model Serves Coupa More Than Clients:

• It’s structured for revenue predictability, not customer value predictability.
• The abstraction of “credits” shifts risk to the client.
• The 3-year lock-in undermines negotiation leverage and future optionality.

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Impact on ProcureTech Implementation Success

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Final Verdict: eVA is the Better Model for Clients

Best for Customer Outcomes: eVA’s model aligns vendor success with client results—minimizing risk, maximizing adoption, and enabling strategic experimentation.
Best for Vendor Revenue: Coupa’s credit model creates locked-in revenue with limited accountability for actual business impact.

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Recommendation for Practitioners:

If considering Coupa’s credit model, ask for:

1. Credit-to-action mappings (e.g., “1 sourcing event = X credits”)
2. ROI impact projections per credit tier
3. Rollover clauses, burn-rate reports, and termination outs tied to actual performance
4. A pilot contract or phased buy-in, not full 3-year commitments upfront

SCORECARD COMPARISON

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BONUS COVERAGE

Only a minority of practitioner clients actually realize the high average ROIs reported for ProcureTech initiatives. Here’s what the data shows:

• Success Rate:
  Industry analyses indicate that 20–40% of ProcureTech initiatives achieve their intended ROI or better. The majority (60–80%) experience delays, cost overruns, limited adoption, or outright failure, and thus do not realize the full promised returns.
• Reporting Bias:
  Of the successful initiatives, only about 30–40% are publicly reported—meaning the true rate of high ROI realization is likely even lower in practice, as failures are underreported and marketing focuses on success stories.
• Key Factors:
  High ROI is most often achieved by organizations with strong alignment between solution, process, and practitioner needs (e.g., high Hansen Fit Score), robust change management, and executive sponsorship.

Summary Table

Conclusion:
While the average ROI potential for ProcureTech investments is very high, only about 1 in 3 practitioner clients actually realize these results. Most struggle with implementation, adoption, or misalignment, which significantly reduces the realized value from their investments.