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SAP Ariba Watches Procurement Find Its Purpose In Global Markets

Fresh off the Ariba Live event held in Prague earlier this month, SAP Ariba is taking a fresh dive into the trends driving procurement. The company recently released its Spot Buy solution in Europe, too, through a collaborative partnership with Mercateo. Now, said SAP Ariba GM of EMEA Operations Paul Devlin, the company will be running with the insights procurement executives offered at the event as SAP Ariba looks strengthen its position in Europe and other markets across the globe.

The launch of Spot Buy in Europe, announced earlier this month, is a response to customer demands, Devlin told PYMNTS, for employees to be able to make purchases that aren’t found within their organizations’ supplier catalogues but still adhere to corporate procurement policy.

There are two key focuses for SAP Ariba with a solution like this, he explained: The first is to deliver an experience to employees that looks so similar to online shopping at a platform like, say, Amazon, that it requires no special training to use. The second is to ensure that everything offered via Spot Buy adheres to corporate rules.

“This is customer-driven,” Devlin explained. “Through the meetings that I’ve been having with CPOs across Europe, they realize that this is a significant portion of their spend.”

Spot buying can actually save companies a lot of money, too. For instance, Devlin said, if an employee wants to procure a particular model of a laptop that’s not already in the company catalogue, deciding not to establish a new contractual commitment with that laptop supplier may mean an employee can find it for a significantly discounted price.

But without automated solutions in place, finding products at affordable prices and ensuring that they are aligned with corporate procurement policy is a major source of friction for many businesses.

“The reality is, it’s very labor-intensive,” the executive noted. “It’s very mind-power-intensive. It’s very process-intensive.”

When companies don’t automate supplier on-boarding and compliance checks for one-off purchases, “then companies have to take on that responsibility themselves.”

That means manually onboarding suppliers and keeping catalogues up-to-date. With procurement going global, ensuring compliance with purchases made across borders can be more tricky, too.

“Why would you ever want to do that yourself?” Devlin asked.

The launch of Spot Buy in Europe and the SAP Ariba Ariba Live event held in Prague signal a renewed focus on the EU for the company. But according to Devlin, the issues discussed at the event are applicable to the procurement industry the world over.

The discussion continues regarding the increasingly strategic role of procurement within the enterprise, and that conversation was loud and clear at the event, Devlin said.

“Procurement hasn’t been very good about shouting about itself and the value it brings,” he said, adding that the Ariba Live event offered an opportunity for attendees to tape videos of how they are playing their part in promoting that strategic role of the procurement function.

The executive also noted that there is growing chatter about the role of next-generation technologies like artificial intelligence, machine learning and blockchain in procurement, too. SAP Ariba recently struck a partnership with IBM to bring a new level of intelligence to supplier management, contracts and sourcing. According to Devlin, SAP Ariba will be rolling out solutions in these focuses later this year that deploy machine learning and artificial intelligence technologies.

“These are going to take procurement 100 steps forward in their ability to optimize sourcing and contracts and drive value into companies,” he said.

There are bigger ways, though, that procurement is taking on new meaning within the enterprise: beyond saving a company money, deploying innovative solutions or playing a strategic role in a company. According to Devlin, many of the discussions at Ariba Live focused on “procurement with purpose.”

He pointed to one company, Samasource, a SAP Ariba partner that works to combat poverty by ensuring fair labor practices across a company’s supply chain. Other discussions landed on eradicating slave labor, and in particular child slave labor, across the supply chain, too, while conversations also explored the rising role of women in procurement.

Topics like these span borders and demonstrate the potential of procurement to go beyond cost savings, Devlin said.

“What you’re starting to see is the excitement around procurement and its move toward transformation,” he explained. “I think the transformation that procurement is going to go through in the next three to five years is going to be huge.

“We want to understand what the digital transformation journey means to our customers,” he continued. “Procurement with a purpose, women in leadership and within procurement these are just some initiatives key to supporting procurement to make that transformation.”

 

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