uc chandra yeleshwarapu and rick collison © 2011 ariba, inc. all rights reserved. ariba procurement...

UC

Chandra Yeleshwarapu and Rick Collison

© 2011 Ariba, Inc. All rights reserved.

Ariba Procurement SolutionsWhat's New, What's Coming, Best Practices

Agenda

• Procurement State of the Union What’s New

– Procure to Pay and Procure to Order– Procurement Content– Services Procurement

What’s Coming– Product Roadmap– Vision

• Summary and Q&A

© 2011 Ariba, Inc. All rights reserved. 2

Economy ScorecardRate of change is increasing


Responding to Changing MarketCPO Priority: Focus on spend management outcomes


1

2

3 Slower Investment

Tight budgets

Conserve Cash

Cash flow focus

Risk and Compliance

Supply Risk

Renegotiate Contracts

Spend Mgmt Effectiveness

1

2

3

Top Drivers Top Priorities

The CPO Situation


Drive more savings

5

“Can you give me some shade?”

What are your top business drivers in 2011?

• Ariba / ISM (Institute for Supply Management) Survey conducted February 23, 2011

Normal channels have less to giveYou are here


The Business Commerce Problem…Investments Inefficiencies Remain Between Companies

+ Average number of trading partners: 134,500(Source: Forbes Global 2000)

+ Transactions completed manually: 80%(Source: Celent Communications)

+ Paper-based invoices and payments: 85%(Aite Group: Global Cash Management: Going Green. 2009)

• Costs of ineffective collaboration: $650 Billion(Source: Basex Research- “Information Overload” Feb, 2008)

Inefficient Commerce Collaboration is Costing G2000 $338 Billion(Source: Ariba Benchmarking)

Source Procure Pay

Sell FulfillInvoice &

Collect

Wastedtime andresource

Lostnegotiation

history

Poorvisibility intocompliance

Manualad hoc

collaboration

Delayedpayment;

Cash“mis-mgmt”

Limitedvisibilityand risk

Buyer

Seller

ERP or Niche ERP

CRM ERPOrder Mgmt.

The Impact on Procurement


• Poor control of spend• Poor visibility into what

is being spent and with which vendor

• Lack of standardization across business units and geographies

• High maverick spend• Spend not compliant with

negotiated terms• Poor visibility and management

by post-spend auditing• Failure to meet commitments

increases risks and costs• Multiple contracts and terms

with the same vendors• Duplicate processes and

global disparities

7

Challenges Business Impact

Efficiency Prize in Procurement


What are your targets for improving P2P processing costs within the next two years:

Source: Defining and expanding the value proposition of P2P survey, ISM, Forrester, Ariba; February 2011; relative population sample.

The Approach: Holistic


What is your top Procurement initiative for 2011?B

ett

er p

roce

sses

an

d a

uto

mat

ion

Source: Defining and expanding the value proposition of P2P survey, ISM, Forrester, Ariba; February 2011. Entire registrant population of 1,137.

Multi-yearstrategic plan withenterprise goals

Internal andexternalcollaboration

Compliance Training &

investment

Procurement Business Processe-Procurement



Solution Ariba Commerce Cloud

BUY MANAGECASH SELL

COMMUNITY

CAPABILITIES

Peer CollaborationPeer Collaboration Partner EcosystemPartner EcosystemWorld’s Largest Trading NetworkWorld’s Largest Trading Network

Domain ExpertiseDomain Expertise Execution SupportExecution SupportValue EnablementValue Enablement

TECHNOLOGY

ApplicationsSpend Mgmt. | Collaborative Finance Mgmt. | Sales Acceleration Mgmt.

ApplicationsSpend Mgmt. | Collaborative Finance Mgmt. | Sales Acceleration Mgmt.

PlatformAnalytics | Security | Performance | Integration | Mobility

PlatformAnalytics | Security | Performance | Integration | Mobility

Ariba Procurement: Compliance, Collaboration, Visibility


Automate AP:

Compliant ERP Ordering:

Require ERP receipt or payment:

Control goods, services, across all ERP’s:

Why It Matters:

Up to 80% of spend is Services:

• Recapture Savings Leakage: Supplier, Price, Term• Improved Processes and Visibility• Lower resource needs: short- and long-term across all ERPs• Flexible many-to-many networking = long-term system efficiency• Allows for strategic cash management

• Proven value

Supplier Network

Ordering Approval Fulfillment Receive Reconcile SettleContractSource

Collaboration on the Network is the Key


“We feel the system is beneficial from the upfront control process. We also think the system is very easy to use. It's intuitive and our users have been able to adopt it quickly.”

– Bob Fair, Director of Global Procurement OperationsMcGraw Hill

13

ERPERP

SupplierSupplier

Supplier

Supplier

Buyer

Sourcer

Buyer

Buyer

Mgr

Any Buyer

Any Supplier

Any ERP

Total Process Control

Comprehensive Spend Management


Supplier on Boarding

Time and Labor

Payments

Plan to Procure

Capacity Constraints & Sourcing Splits

Extended Enterprise – On Time Delivery

Catalog Management

Source to Procure

Bids and Auction

IndirectService

Direct

Commodities & Options

Direct

Best Practice - Procurement 2011

• Process Efficiency Hyper Collaboration and Usability Expand Spend Categories under process control

• Spend Visibility Control contract leakages and identify the savings

• Supply Risk Management Use the Ariba Cloud Commerce, Expand spend

categories and implement across geographies


UC

What’s New


Disciplined Innovation ApproachCombining all customer experience into the journey


Functionality and usability testing

Early access programs and design partnerships

Feature surveys

connect.ariba.comOn-site customer visits

Advisory councils and user groups

Common Code Line

On-Demand Releases

9s59s5 10s110s1 10s210s2 Future ReleasesFuture Releases

Thanks for Making Ariba the Leader


Ariba Procurement Leader

What’s new in Procurement?Theme – Process Efficiency and Usability


Procurement Content

Procure to Pay • Determine Account Type by Item Price

• Denial by Approver in Parallel Chain

• Mass edit of Partial Items

• Support Flexfields in Receipt Import

• Reporting - Accounting Contract facts

• Respect User ship to and Deliver to in requisitions

• New Language support – Swedish, Dutch, Danish, Norwegian

• SRM 7 Certification

• Catalog Self Service

Services Procurement • Collaborative Requisitioning

Determine Account Type by Item Price


• We support determining account type based on commodity and the spend

• This enhancement allows users to determine the account type by price of the commodity

10s2 SP1, P2P, P2O

Account Type PolicySpend ≤ $1,000 Expense AccountSpend > $1,000 Capex Account

Since spend is $5000, it will be Capex Account

Account Type PolicyPrice ≤ $500 Expense AccountPrice > $500 Capex Account

Since price is $10, it will be Expense Account

Example RequisitionItem per unit price = $10Quantity = 500

Denial by an Approver in Parallel Chain

• Earlier, even if Archie denied the requisition, Gene could approve the requisition without knowing that Archie had already denied it

• The requisition was eventually denied• Now, the approver in the parallel chain cannot

approve this requisition


10s2 SP1, P2P, P2O

Catalog Self Service – 1 of 2


Features

• Complete self service in enabling and maintaining catalogs• Buyers

Self service to set up catalog validation rules Support for supplier specific rules

• Rule Engine Load catalog default rules Create, modify and save new rules Validate catalogs against the defined rules set Identify and display errors in catalog to both suppliers and buyers Communicate error status via email

• Suppliers View and download catalog validation rules View and correct catalog errors Do catalog comparison

Description

Ability for buyer and supplier to manage catalogs in a self service mode

Catalog Self Service – 2 of 2


Benefits

• Buyers Reduce cycle time. Faster catalog enablement. Lower enablement \ maintenance costs by reducing manual steps Enabling more catalogs

• Suppliers Reducing time and cost to enable catalogs Increased visibility and transparency Increasing catalog coverage > More transactions

Examples

• Loading catalogs with rules to check. Required fields filled in (Price, Classification Code, UOM, Lead Time Supplier specific check on (Classification code range 4312****, Lead

time < 10days & UOM = EA)

Description

Ability for the buyer and supplier to manage catalogs in a self service mode

Catalog Self ServiceNew Process


SupplierSupplier

Prepare CIF

AN

Validate Data Completeness and Accuracy

Raw CIF File Load CIF

Normalize Raw CIF fFile

Pass?Send Error Messages

Error Messages

Update CIFUpdated

CIF

No

Where? TBD

Buyer

Buyer Rules

Configure Buyer Rules

GSO

GSOGSO Enrich the Data

Enriched CIF File

P2P

Load CIFEnriched CIF FileBuyer

Normalized CIF File

Yes

Collaborative Requisitioning

• Description Ability for the buyer to collaborate with suppliers on all requisition types

• Features Extends collaboration to catalog and non catalog items (deployed on P2P, P2O, APC) Can enforce X Bids and a Buy on any type of requisition (deployed on P2P, P2O, APC,

Services Procurement) Quick Enablement Collaboration Request

• Benefits Buyer can negotiation with supplier on any type of requisition, X bids and a buy can be enforced Suppliers no longer need to be on the AN to receive a Collaboration Request

• Examples Buyer has a standard catalog item (Widgets at $10 a unit) from Supplier XYZ. They can

collaborate with Supplier XYZ and 2 other suppliers on this item to see if the supplier has the item in stock and to negotiate a lower price.


Procurement Track Overview

© 2011 Ariba, Inc. All rights reserved. 28 © 2011 Ariba, Inc. All rights reserved. 28

Sr. No Title Presenter Time

1. Collaborative Procurement Cathal O’Sullivan Monday April 114:45 to 6:00

2. Ariba Procure to Pay and Procure to Order Sybel Bevington Tuesday April 121:30 to 2:45

3. Ariba Payment and Invoice Management Chris Chase Tuesday April 123:15 to 4:30

4. Ariba Network Order Management Achim Voermanek Tuesday April 123:15 to 4:30

5. Ariba Supplier enablement Olaf Schrader Tuesday April 124:45 to 6:00

6. Best in class approval rules Leslie Martensen Tuesday April 123:15 to 4:30

7. Ariba procurement content and catalog management Dawn Fischer Tuesday April 124:45 to 6:00

UC

What’s Coming


Ariba’s New Release ModelGuiding Principles



Ariba’s Future Release VisionMore improvements behind the scenes

“Cloud Cadence”

11s1 (Spend Vis, Sourcing,

SIPM, Contracts)

11s1 (Spend Vis, Sourcing,

SIPM, Contracts)

11s2 (Procurement & Invoicing)

11s2 (Procurement & Invoicing)

11s3 (Ariba Network)

11s3 (Ariba Network)

11s - Series 12s - Series

12s112s1

12s212s2

12s312s3

13s113s1

13s213s2

13s313s3

14s114s1

14s214s2

14s314s3

13s - Series

31

What’s coming in Procurement?Theme – Network & Usability


Procurement Content

Procure to Pay • Enhanced accounting information in contracts

• Improved Budget Management

• Improved e-mail notification

• Enforce Minimum and Maximum order size from contract

• Handle Old and hanging POs

• Adhoc shipping address in user profile

• Improve Operational Reporting

• Catalog Search

• Catalog Reporting

Services Procurement

• Enhanced Contingent Labor operational reports

• Time Sheet Supplier upload

How to Get Involved and Influence Direction


• Get involved on ariba.exchange.com

• In addition to User Groups, other forums include venues such as our Advisory Council, customer surveys, beta programs and design partnerships, and functionality and usability testing

• Get involved in the early access program before each release

• Volunteer to provide feedback to the Solution Manager for your product

http://exchange.ariba.com/community/solutions

UC

Vision Discussion


Trends

• Data explosion requires new navigation paradigm• Consumer technology trends impact the way

business is done• Procurement organizations have myriad

operational models


#1 Data Management and RetrievalEnterprise Data Growth & Enterprise Search


Skimming the SurfaceData Explosion

Information Maze


Where is it?• Desktop

• Intranet

• Internet

Access?• Security

• Navigation

Relevance?• Role

• ContextRich and

actionable?

Find the InformationGo right then left and then

right, then left …..

Take decision based on inadequate data ……


# 2 Consumer Technology Trends Are Changing the Way Business Is Done

Then

Now

• Broader access to data• Social networking going mainstream• Increased collaboration between companies • Information provided contextually

Matching Services

Access to Content

Mobile Computing

CommunicationNetworking

Solution:Enterprise Search & Collaboration


Multiple Sources Distributed Information

Internal

Extended

Enterprise

Outside World

# 3 Trends in ProcurementEmerging models need Flexibility in Procurement


• Integration

• Extensions

• Deployment

Solution:Flexibility & P2P Automation


Business Process Automation1. Direct Spend, Service Spend2. Invoicing and reconciliation3. Contract and terms

Overlay With Network & Collaboration1. Social Network and collaboration2. Network Operations3. Add on Functions

Ease of Integration with legacy applications

In SummaryFocus on process efficiency

• Collaboration is the key to process efficiency Use the Ariba Cloud Commerce, Expand spend

categories and expand to other geographies Hyper Collaboration and Usability

• Ariba is committed to improving solution usability and process efficiency Control contract leakages and identify the savings Expand Spend Categories under control


Questions


“Safe Harbor” Statement

This information reflects the status of Ariba solution planning as of April 2011. All such information is the Confidential Information of Ariba (per the contract between our companies), and must not be further disclosed, as stated in the confidentiality clause of that contract. This presentation contains only intended guidance and is not binding upon Ariba to any particular course of business, product strategy, and/or development. Its content is subject to change without notice. Ariba assumes no responsibility for errors or omissions in this document. Ariba shall have no liability for damages of any kind including without limitation direct, special, indirect, or consequential damages that may result from the use of these materials.


UC

Chandra Yeleshwarapu and Rick Collison


Ariba Procurement SolutionsWhat's New, What's Coming, Best Practices

uc chandra yeleshwarapu and rick collison © 2011 ariba, inc. all rights reserved. ariba procurement...

Documents

ariba ism institute

procurement initiative

supply management survey

global cash management

management outcomes

business units

business drivers

global disparities