How SAP Ariba is unlocking the value of a digital economy
The SAP ARIBA Live 2016 showcased the ambitious plans of SAP Ariba, as it aims to expand its network from two million suppliers to five million suppliers by 2020
By Ankush Kumar
With more than 50 interactive breakout sessions, informal networking opportunities and one-on-one executive meetings, SAP ARIBA Live 2016 showcased the potential of e-procurement systems. The major focus was on simplifying the complex procurement system, using e-commerce to automate the business transactions and the company’s strategy behind the digitization of business. SAP Ariba considers the Asia Pacific region as a region with the greatest number of connected and digitally savvy consumers primed for e-commerce. The software and information technology services company located in Palo Alto, California is providing a dynamic, digital marketplace, where buyers and sellers can find each other, collaborate together and get more than $2.5 billion in commerce done every day.
“Sap Ariba is the future of SAP as it is 100 percent cloud based and it is established on the idea of connecting companies together. Ariba was acquired in 2012 by SAP and the intention was not to just buy a good cloud procurement solution but to also buy the capabilities of the network of connecting companies to each other,” said Alex Atzberger, President, SAP Ariba.
Digitization remains the key
Talking about the company’s focus on digitization and the value proposition that can be derived out of it, Atzberger said that the world’s biggest companies are mostly the technology companies. The world has become more digital and consumers are expecting to interact in a digital format. The supply chain has also becoming extremely digital. In order to unlock the value of the digital economy, one need to combine the adoption of a solution on a truly digital platform. So digitization starts with adoption, automation and then it goes into transformation. The power of digital cannot be only ascertained by the transformation of organization from paper to digital but to also derive additional value from it.
Investment and expansion plans
Sharing the company’s investment and expansion plans, Atzberger said, “We have stated goals about where we want to be in terms of size of our network. When I look at our business, I don’t just look at the revenue figures. I look at the size of the network. We want to take our network from two million suppliers to five million suppliers by 2020. Because of the growth that we see in this region, we have around 500,000 suppliers in Asia Pacific region and by 2020, I would like to scale this to 1.5 million suppliers in Asia pacific including China. So we will triple the number of suppliers and for this we are investing in the region. We have specific investment plans around China, Japan and South East Asia. India is still at a phase where we can do a lot of things today so it is not only about investments.”
Where social networks and businesses meet
Every day, billions of Asian consumers tap into social networks like Alibaba, WeChat and Kakao to shop and share. Everything they need to manage their personal lives is in these networks – there’s no need to leave these networks to make things happen. SAP Ariba is trying to do the same in the enterprise space through its cloud-based applications and business network.
“Procurement is no longer about buying things at the best prices, but collaborating in new, more efficient ways that create value across the entire source-to-pay process,” said David Man, AIA Group Controller. “To do this requires more than just point solutions that address specific tasks. It takes an end-to-end offering that combines the convenience and agility of the cloud with the connectivity and global reach of business networks and strength of enterprise applications. With SAP Ariba, this is exactly what we get.”
And suppliers like Malaysia-based Alphamatic Systems can collaborate more efficiently with customers, streamlining sales cycles and improving cash control along the way. “With SAP Ariba solutions, it is very easy to track purchase orders and invoices online,” said Chan Woei Liang, Sales Director, Enterprise Business Solutions, Alphamatic Systems. “Time spent on follow ups for payment has been reduced significantly and we have even seen businesses grow.”
Where commerce happens
In the last year, the number of suppliers connecting to the Ariba Network to efficiently collaborate on transactions and boost their revenue rose nearly 200 percent.
“Asia is among the most connected and digitally savvy economies in the world,” said Grant Clinch, Head of APJ, SAP Ariba. “And in embracing cloud-based solutions that enable them to connect in new and innovative ways, they will open the door to incredible opportunities for growth.” The company shared that more than half a million buyers and suppliers in Asia use SAP Ariba’s solutions to digitize and simplify commerce.