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Dr. Kenneth SullivanNext Practices in Leadership and

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Improving Results While Making the

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Ariba® Contract ManagementFacilitating Signature and Compliance

February 3, 2015

10© 2014 Ariba - an SAP company. All rights reserved.

Speakers

Leslie Martensen is senior product manager for Ariba Contract Management Solution. In

this role, she is responsible for the Contract Management solution including, new features,

roadmap and plan.

Leslie has been with Ariba for almost 5 years. She started as the senior product manager

for Ariba Platform and became senior product manager for Ariba Contracts Management in

June of 2012. Before joining Ariba, Leslie worked as senior product manager at Callidus

Software for 10 years where she was responsible for the Callidus TrueComp product

strategy, features and roadmap. She also spearheaded the new product design for the

Callidus TrueResolution product.

Michael Koch, Director, Ariba Solutions Marketing, has been with Ariba since 2011, He is

responsible for Sourcing and Contract Management. Michael has held positions in the

Network Growth and the Customer Management Organization within Ariba. He has

worked with some of the larger and tenured customers as well as new customers joining

Ariba. Prior to Ariba, Michael worked in Marketing and Product Development at

MasterCard and GE.


Topics

Introduction

Typical Contract Management Business Requirements

Solution Overview and Differentiators

Customer Success in Action

Demo


Increased Globalization Expansion into new markets

Global process standardization

International supply chains

Economic Volatility Volatility in markets

Decreased stock valuation

Slow economic growth

Pressure on Margins Profitability by segments

Decreased budgets and spending

Determination of the cost to serve

Focus on Risk Supply chain disruption

Financial risk and fraud

Commodity risk

New Business Models Shared services organizations

Business partnerships

Leveraging big data for decisions

Regulatory Changes Increasing disclosure requirements

Country-specific regulations

Industry-specific disclosures

CPOs Need Help to Navigate a Changing EnvironmentCompeting Pressures on Procurement Organizations


Contract lifecycle managementRisk management, visibility, and compliance concerns are paramount

Source: Aberdeen Group, Procurement Contract Lifecycle Management, January 2012

Top 5

reasons

cited

Establish better control of enterprise spend66%

Poor visibility of contractual relationships 44%

Pressure to reduce supply and supplier risk40%

Need to improve compliance 37%

Poor visibility into supplier performance on

contracts34%

Contract lifecycle

management technology

provides an opportunity

for procurement

organizations to take

contract maintenance out

of the hands of legal

counsel while allowing

them to focus on

increasing efficiency and

driving cost savings.*

Contracts of the future will

be seen as instruments to

describe and safeguard the

delivery of economic value

and will achieve this

through an apportionment

of risk and responsibilities

that is appropriate to the

capabilities of the

contracting parties and the

nature of the transaction.*

*Source: THE FUTURE OF CONTRACTING : Ariba and IACCM 2012


Ineffective Contract Lifecycle Management Results in Increased Compliance Risks

Draft Contract

Negotiate Contract

Approval/ Signatures

Storage/ Repository

Manage Compliance

Admin/ Optimize

Creation Visibility Performance Management

Inconsistent and email-intensive

processes

Long Negotiations approval cycle

times

Lack of tight controls ( e.g. for non

standard contracts /language

Legal Risk

Organizationally dispersed contracts

Redundant contracts

No visibility into commitments

(financial, legal)

Inability to track regulatory

compliance or understand contract

history

Poor contract compliance

( PO, Invoice, SLAs )

Poor renewals management

Lack of performance

information hinders re-

sourcing or resale efforts .


60% of corporate

litigations are

related to

contract disputes

Source: Fulbright & Jarowski 2010

Annual Litigation Survey


Companies Leveraging Contract Management Solutions

Drive Superior Procurement Results*

* Source: Aberdeen Group, Procurement Contract Lifecycle Management, January 2012

Laggards – Bottom 30%

Industry Average – Middle 50%

Best in Class – Top 20%

67%

4%

8%45%

8 16

Spend Under Management Average Days for Contract

Review & ApprovalRealized Contract Savings

79%17%

47

Up to 50 percent reduction in contracting cycle times

More than 50 % increase in realized contract savings

25% increase in Spend Under Management


- - - - Leading to Better Visibility and Compliance*

Stated Benefit Contract Management

Metric

Best-in-

Class

All Others

Spend Visibility Compliance by Suppliers to

Service Level Agreements

75% 58%

Contract Visibility Percent of suppliers managed

under contracts

71% 51%

Supplier Visibility Percentage of supplier

contracts stored in a central

repository

75% 52%

* Source: Aberdeen Group, Procurement Contract Lifecycle Management, January 2012


These are the Challenges We Hear From Our Customers

Legal

Weak Contract Management. Poor

contract compliance, belated

renewals management, and lack of

performance information

Ineffective Contract Creation. Lack

of tight contract authoring controls,

creating legal risk

Poor Contract Visibility. Dispersed

and redundant contracts and the

inability to track regulatory

compliance or understand contract

history

Disconnected Negotiation

Processes. Inconsistent and e-mail-

intensive processes, long negotiation

and approval cycle times, and risk of

not including the correct stakeholders

Slow Time-to-Value. Poor user

adoption, lengthy deployment, and

limited process and data integration


What if you could…?

Manage all of your agreements on

an integrated SaaS platform

Address your complex scenarios

with robust, configurable workflows

Leverage pre-built best-practice

templates and workflows

Execute contracts electronically

making the contracting process 100

percent paperless

Improve collaboration with suppliers

via the Ariba Network

Incorporate deployment and best

practices services in order to

achieve your ROI

...And receive all of this in a single

subscription pricing model with no

hidden or additional costs?

Average $3.5 million in annual savings with

14x ROI on a $250K investment from an

Ariba customer:

$1M to $2M due to improved efficiencies in contract search and visibility

$1M to $2M due to contract creation efficiencies (eliminating rekeying, reduced time drafting, etc.)

$400K to $800K due to approval process improvements

$400K due to reduction in FTE support for ongoing enhancements (comparison of CD installed software vs. SaaS delivery model)

$350K with elimination of support and maintenance of CD software

Improved data integrity between contract data and transactional systems

Improved consistency and use of standard terms


Topics

Introduction




Demo


Ariba Contract ManagementSupports the entire contract lifecycle

Draftcontract

Negotiate contract

Approval and signatures

Storage and repository

Manage compliance

Admin and optimize

Contract visibility and repository

Contract execution and compliance

Contract creation

Automates the contract creation cycle, from draft

to reviews and approvals

Contract authoring tools, including clause libraries

and conditional templates

Creates a contract repository with access-

controlled search and reporting

Audit trail for internal and external and regulatory

requirements

Deep, bidirectional integration within the source-to-

contract process

Expiry notification for improved renewal

management

Centralized electronic task-driven notification alerts

Rapid time to value with on-demand deployment

Microsoft Word integration

Integration to leading eSignature providers –

DocuSign and Adobe EchoSign


Delivering Optimized Contract Lifecycle Management

Improved Contract Management.

Improved contract compliance, timely

renewals management, and visibility to

performance information

Effective Contract Creation. Tighter

controls and minimized legal risk

Full Contract Visibility. Single repository

for contracts, elimination of redundant

contracts, visibility into commitments, and

the ability to track regulatory compliance

and understand contract history

Streamlined Negotiation Processes.

Streamlined and controlled processes,

abbreviated negotiation and approval

cycles, and inclusion of the right

stakeholders

Rapid Time-to-Value. Enables strong user

adoption, delivers rapid on-demand

deployment, and provides process and

data integration


Third Parties Agree: Ariba is THE Single Best-in-Class SaaS

Solution for ALL Contract Types and Agreements

More than four million contracts every day…

At Ariba, we help our customers manage more than four

million contracts every day with than 500 total customers

Extensive experience and customer reach across both

procurement as well as sales contracts

Consistent Leader in CLM according to…

Gartner Magic Quadrant, June 2013

Forrester Research, SVM Toolset, Q1 2013

Benefits of OnDemand deployment …

Y1 TCO 5X-10X less than installed software

50% faster implementation cycles

25% more spend under management

2X-4X more innovation releases

Sources: Aberdeen, AMR, Triple-Tree, Ariba

Publication Date: June 2013

Gartner MAGIC

QUADRANT

Forrester WaveTM Q1 '13


Ariba Contract Management (Buy and Sell) Driving Spend Compliance Across All Contract Types

Contract Creation

• Contracts of any type: Buy, Sell, Internal/Corporate

• Collaborative authoring – including integration with Procurement & CRM systems

• Single point of access for sellers across all buyer relationships

• Standardized contract creation from templates and clause libraries

• Deep integration with the sourcing process for contract creation

• Powerful workflow and approval engine controlled completely within the user interface

Repository, Reports, and Alerts

• Customizable, role-based dashboard for contracts data

• Advanced repository and search

• Automated compliance monitoring and alerts

Compliance and Usage

• Performance/audit management on contracts

• Integration with back-end systems for automated P2P usage of agreements

eSignatures through DocuSign and Adobe Echosign

L1 Customer Support, BPC expertise, Setup included in Subscription

Out of box integration to Sourcing and P2P systems


Contract

Complexity

Our Paper Their

Paper

Strategic Alliance

Sales Agreements

Leases

Sales NDAPurchasing NDA

eContracts

Purchasing Agreements

Ariba Contract ManagementAddressing ALL Contract Types


Effective Contract Management is the Spend Management

Linchpin

• Includes all aspects of contract

creation from initiation through

execution

• Questionnaire-based templates

driving the contracting process

configured to YOUR requirements

• Powerful workflow and approval

engine controlled completely within

the user interface

• Contract management without

eSignatures is incomplete: leading

electronic signature capabilities

making contracting 100 percent

paperless

• Integrate data with your third party

systems for streamlined process

flows

Contract Management with Ariba:


• Centralized electronic contract

repository permitting search and

reporting across all relevant

documents and correspondence (not

only the contract itself)

• Task-driven notification alerts

scheduled or based on milestone

events/dates

• Expiry notification for improved

renewal management

• Improved collaboration and better

contract fulfillment visibility resulting in

more-satisfied trading partners

• Improve ability to manage cash

through improved revenue and

payment forecasting and visibility

Commitment Management with Ariba

Commitment Management :


Ariba® Contract Management eSignature Services in partnership with Adobe®

EchoSign® and DocuSign® help customers to go INK and Paper free and close

deals faster and more efficiently, increasing savings, revenue and productivity.

B u y e r s E - S i g n a t u r e P a r t n e r S e l l e r s

Ariba® Contract

Management

API’s

Integration with leading Electronic Signature providers

http://www.ariba.com/assets/uploads/documents/Partners/Adobe-EchoSign-Overview.pdf

http://www.ariba.com/assets/uploads/documents/Partners/Adobe-EchoSign-Overview.pdf

https://www.docusign.com/

https://www.docusign.com/


Electronic signatures Value Proposition Faster Contract Completion, Reduced Costs, Improved Controls

Source: IDC White Paper, sponsored by Adobe, Bridging the Information Worker Productivity Gap: New Challenges and Opportunities

for IT, September 2012.

Contracts completed in 1-2 days vs. 2-3

weeks

80% reduction in paper and supplies

Detailed audit information and compliance

copies of every signed document


The Market-Leading SaaS Solution to Better Manage Contracts & Commitments

Key Imperative Why Ariba Contract Management?

• Most widely adopted contract management provider with over 450

total customers

• Manage the entire contract lifecycle for all agreements on an

integrated SaaS, spend management / sales acceleration platform

• Ranked as a leader by numerous independent analysts

End-End Contract

Management

Improve Contract

Management

Efficiency

• Flexible approach with configurable workflows in the contract

management lifecycle incorporating all relevant activity and information

• Process standardization tools driven by best practice templates to

remove bottlenecks and improve overall contracting efficiency

• Tightly integrated electronic signatures capabilities making contract

execution more transparent, faster, and more secure

• Configurable dashboards with robust search, reporting, and task

driven alerts providing audit trails for operational and regulatory

compliance for best value agreements

• Enhance ability to manage cash through improved visibility and

forecasting

• Plug in to the Ariba Network to improve contracting efficiency and

effectiveness while assuring your return on investment

Manage

Commitments

More Effectively

Driving ROI


SaaS Data SecurityWith Ariba, Your Sensitive Contract Data Is Secure

Physical Security

24x7 guarded servers

Surveillance cameras

Motion detectors

Limited Ariba access

Biometric access control

Data Security

Three layers of firewall protection

HTTPS – 128 bit encryption

Intrusion Detection System to monitor traffic for anomalous behavior

Password encryption with expiration

Access control entries on load balancers

Availability & Reliability

99.5% uptime

Comprehensive backup schedule

Redundancy at all tiers: web, application, database

Proactive notification of downtime

24x7 disaster recovery plans & centers

Security Certification

WebTrust audited every six months

Independent CPA has determined Ariba conforms to established principles

WebTrust principles: security, availability, processing integrity, privacy, confidentiality

Hosting facilities in the USA and EU and SAS70 certified


Topics

Introduction




Demo


Ariba Contract Management delivers Measurable

Benefits - - - -

350 Suppliers Enabled to-Date

85-90%+ Spend under Management

1.3 Billion Sourceable Spend

7500 Suppliers

100%+ Compliance within TopSource

1300 Contract Workspaces

11 Different Process for various departments

Multi-Location Benefits


5500+ Contract Workspaces and

signed till date

2-3 Billion Procurement Spend under

contract

14 Categories managed

1200 Contracts signed through

electronic signatures

Ariba Contract Management delivers Measurable

Benefits - - - -



Deployed in four weeks! Strategic sourcing initiatives including spend visibility, sourcing, and contract management now on a single, integrated platform.

“Having an external party such as Ariba to assist gives it a burst of energy. The concentrated focus from Ariba has been a great kick start and also reduces the ‘wheel spinning’ that can happen internally.”

The contracting process, which might have taken six months before, has now been greatly reduced. What used to take two weeks now takes only 20 minutes with the push of a button”

• Paper contracts with no

central storage and limited

visibility

• Highly manual,

disconnected processes

with no reminders for

contract-related tasks

• Non-compliant purchases

draining negotiated savings

• Decentralized purchasing

groups with few

consolidated vendor

agreements

• Lack of IT resources to

deploy software

Issues Before Ariba: Some Notable Examples:



Leveraging solution for many agreement types with benefits to Legal, Audit, Compliance, and Risk Management groups.

“Ariba’s technology has allowed us to create and maintain a centralized contracts repository with rich search capabilities that we can leverage to achieve [our] goals. It’s a significant cost saving to owning and maintaining the software ourselves.”

Over 120 facilities and 1,200 users leveraging solution for sell-side contracts with benefits including process standardization, organizational flexibility, and improved visibility into contract terms.

Paper contracts with no central storage and limited visibility

Highly manual, disconnected processes with no reminders for contract-related tasks

Renewal problems resulting in missed revenue opportunities

Approval bottlenecks, especially during crunch times, delay revenue and cash streams

Lack of IT resources to deploy software

Issues Before Ariba: Some Notable Examples:


runs Ariba Spend Visibility, Sourcing and Contract Management

Challenges Solution Results

Variety of compliance

issues including operational

and regulatory

Requirement to centralize

contract management

process

Seeking to improve supplier

relationships

Inefficient and costly

contracting cycles longer

than necessary and not

driving significant value to

company bottom-line.

Leverage strategic sourcing

elements of the Ariba

Commerce Cloud including

Ariba Sourcing to improve

collaborative sourcing

processes

Deployed Ariba Contract

Management to improve

efficiency and effectiveness of

contracting processes and to

drive better compliance

Leverage Ariba Spend Visibility

for sourcing pipeline building

activities

Reduced contracting cycle times by

57 percent (average reduction from

30 to 13 days)

Reduced number of contracts

“outsourced” and dependence on

legal

Accommodated 12 percent

increase in volume (35 percent

based on weighted average of

complexity) without addition to staff

or reduction in service levels.

Provided much needed contractual

visibility for M&A activity

Assisted in supplier rationalization

efforts

Get the full story from Robert Muszynski, Vice President of Contracts at Selective Insurance: http://bit.ly/96Lkf8

Reduced Contracting Cycle Times by 57 Percent

Selective Insurance Group, Inc. is a holding company for seven property and casualty insurance companies rated “A+” by

A.M. Best offering primary and alternative market insurance for commercial and personal risks, and flood insurance.

http://bit.ly/96Lkf8




Shared drive with folders for

templates acted as central storage

vehicle

This approach offered little in the

ways of capabilities, visibility, or

scalability

No audit capabilities – a pressing

requirement for a financial services

organization

Data security was an ongoing

concern – files could be updated or

deleted without notice

No ability to do quantitative analysis

of existing agreements

Poor collaboration between legal

and functional groups

Deployed Ariba

Contract Management

and Ariba Sourcing in

early 2009

Currently used by 20

sourcing professionals

as power users

Usage extended to 30

approvers and over

300 analysts across

the organization

Improved audit capabilities has been

a tremendous benefit given the

organization’s business and focus

Workflow and approvals assure that

standardized processes are being

followed

Data security of sensitive contract

data in SaaS delivery model

Expiration notification allows business

users to take action proactively

Ariba serves as a knowledge-base for

language, terms, and

agreements…something Experian

plans to build upon in using clause

library functionality in the future

Audit of Contracting Critical for Organization Specializing

in Risk Data

Experian’s mission is to help businesses manage credit risk, prevent fraud, target marketing offers and automate decision

making as well as providing individual credit scoring. Hear directly from Stacy Huffman, Financial Analyst at Experian, about

their experience with Ariba Contract Management: http://bit.ly/aCYXc2

http://bit.ly/aCYXc2




Lack of IT resources and

budget to deploy software

28 disparate ERP systems,

which is why they decided

to go with a best-of-breed

provider

Renewal management is a

problem as they did not

have visibility into contracts

that were expiring

Interested in capturing

all agreements (not

only procurement)

Deployed Ariba Contract

Management, Spend

Visibility and Sourcing

Advantages were flexibility,

ease of implementation,

and single channel delivery

All configuration was

performed by business,

contributing to lower TCO

Deployed in four weeks!

Template-driven process easy to use

and flexible

Powerful workflow capabilities have

allowed better collaboration between

procurement and legal

Now have visibility into expiring

contracts

Strategic sourcing initiatives (spend

analysis, sourcing, and contract

management) are integrated on a

single platform

Ariba has been a true partner, working

with Stanley Works to set goals and

create a plan to achieve them

Stanley Black & Decker, Inc., formerly known as The Stanley Works, is a Fortune 500 American manufacturer of

industrial tools and household hardware and provider of security products and locks headquartered in New Britain, Connecticut

Reduced Contracting Cycle Times by 57 Percent


Topics

Introduction




Overview Demo


Thank You !


Questions?


For Additional Information . . . . . .

Michael KochDirector

Solutions Management

Ph: 1 203.270.0765

[email protected]

mailto:[email protected]


Welcome to the

cloud built for

business

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