SAP Ariba Live – making procurement strategic again

Sorry it is the crazy season of United States presidential primaries and I had to tap into the Donald Trump tag line. I think I am a little punchy after spending a few days at the Cosmopolitan casino in Las Vegas. Other than the usually craziness that occurs in Las Vegas, I spend my time with the SAP Ariba team learning of their indexdirection for 2016 and beyond. The biggest theme I took away from the event was the re-positioning of procurement. Evolving from being primarily a spend management tool to a much more global and strategic function. Taken in the context of how commerce, both from a B2B and B2C world have evolved, the ability to approach spending with greater flexibility and insight is crucial to remain not only competitive but to also capture opportunities. The highlights from the show:

  • Massive volume of commerce passing through SAP Ariba: With $1 trillion worth of commerce volume passing through SAP Ariba, 8 documents per second and $40 billion in payments passing via their platform and 113 million annual PO-invoice transactions in 2015, it is impressive the volume and amount of commerce that is being handled.
  • Simple, Global and Innovative – this was the mantra from main stage right from the get go. SAP Ariba has been hard at work to make the business platform simple to use – almost like the interfaces and transactional systems we are used to as consumers! Both from being able to tie in greater amounts of necessary data, to stream lining the process to the look and feel of the system the simplicity of being able to leverage the tool was apparent from main stage and in conversations with the team. The challenge for SAP Ariba and their team will be with regards to being global and innovative. These terms are too often thrown around with out much thought behind what they truly mean. Being global is necessary to truly meet spend needs from customers but the innovative side is one that SAP Ariba will have to work with their clients to demonstrate true innovation and not have it become an empty tag line.
  • Guided buying – bringing the user experience of the B2C eCommerce world to the world of procurement. The guided buying platform brings the interface and ease of use that we expect to as consumers to the B2B space. Similar to our experience as consumers, the system applies a layer of intelligence to allow the user to be guided towards the best options. When we interact with an Amazon as well as other online commerce, we are accustomed to and expect to be providing with suggestions for related products or ancillary goods. With guided buying, SAP Ariba is providing this layer of intelligence to the procurement world.
  • Supplier management – the network is only as powerful as the ability to add (and by definition subtract) suppliers to the network. A crucial characteristic of any robust network is the ability for customers to rapidly onboard vital suppliers. Whether it is to find a new source of material, to add new suppliers that can support a new product or entering a new market. SAP Ariba is adding simplicity and efficiency to the process. This is vital as speed and flexibility with regards to buying is crucial as the speed of business continues to accelerate.

Another interesting undertone – is the view of leveraging this platform to become one that goes beyond simply procurement but to being able to added data feeds such as IoT. The example provided revolved around picking up a signal from an IoT beacon around predictive maintenance. The signal would feed the platform warning of a possible break down of a product. Users can then tap right into the SAP Ariba platform to order the necessary part. This was a great example of how the open platform can allow for new business models to evolve and keep pace with digital disruptors such as IoT.

SAP Ariba is working on making “procurement cool again” I would argue they are making procurement more strategic again. Procurement and buying have to be taken into account with all other aspects of the supply chain. As customers continue to drive the ecosystem – regardless of B2B or B2C – a holistic view of the entire network is vital to capable to meet demands and uncover opportunities.

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