Diana Brown Senior Director, Network · PDF fileDiana Brown – Senior Director, Network...

Diana Brown – Senior Director, Network Strategy

The New World of the Networked Business

© 2014 SAP AG. All rights reserved. 2 PMAB

The Challenge: Too many ineffective approaches for B2B

collaboration across the End to End Process

Your

Company

Buyers

Mail, Phone, Face-to-Face

Enterprise and Supplier Portals

EDI VAN’s

Single Process Solutions

Dedicated Direct Connect

Fax Server

Manual paper-based collaboration

Suppliers

(*) Basex Research

Wasted time &

resources Missed sales

opportunities


The Opportunity: Business Networks facilitate electronic

inter-enterprise collaboration between trading partners

Strong business networks can create competitive advantage and help organizations grow top-line and save on the bottom-

line simultaneously1

Suppliers Buyers

Business

Network

65% of Best in Class companies have the

capability to effectively collaborate with their

network of suppliers versus only 21% of

laggards.

B2B Integration and Collaboration: Strategies for Building a ROI Business

Case, Aberdeen Group. June 2011

“

”

(1) Based on Ariba customer engagements and benchmarks

20% improvement in working capital

4 -15% reduction in unit price

60% improvement in compliance

4x increase in process efficiency

$

Higher Margins &

Positive EPS Impact


The Value: A winning proposition for buyers and

suppliers

Your Objectives

Procurement | Supply Chain

Finance | IT

• Significantly shorten contracting cycle times.

• Significantly grow seller base by building new

relationships.

• Reduce supply chain costs and risk.

• Gain better visibility and predictability.

• Manage working capital.

• Lower manual paper-based collaboration.

• Improve compliance.

• Faster cash-flow through discounts and proper

payments in-time.

Suppliers’ Objectives

Sales & Mktg. | Customer Service

Accounts Receivable | Business Development

• Improve payment visibility and timing.

• Lower customer service costs.

• Increase sales.

• Drive higher customer satisfaction.

• Find sales opportunities

Better Collaboration Leading to Winning Outcomes

Two-sided value proposition

Driving outcomes across your organization and for your suppliers


Typical benefits are significant Leveraging SAP and Ariba network and source-to-pay solutions

4-15% Sourcing savings

70% Operating cost reduction (AP & Procurement)

1-4% Compliance savings

$2-3M Discount savings for $1B addressable spend

40%+ Cost reduction

6 Days DSO reduction

15% Increased sales & wallet share

Buyer Benefits Supplier Benefits

BEST IN CLASS BENCHMARKS1

75% % of PO & Invoice

lines against item

Master/ Catalog/

Contract

86% of addressable

spend managed

strategically(2)

10,000 POs processed per

FTE

Invoices Processed

per FTE

% of spend under

early payment

discount

50,000+ 20%

(1) Based on Ariba customer engagements and benchmarks (2) Specific to Consumer Products industry; SAP Benchmarking & Best Practices Program


Invoice Against

Contracts

Services Invoicing

Procurement Content

Catalogs

PO & Invoice Automation

E-Transactions & Status

Sourcing

Analysis. Sourcing & Contracts

Your Trading Partners Your Applications

1.2+ million

Trading Partners

65+ million

Annual Invoices

190

Countries

>60%

Global 2000 use the

Network

$500B

In Annual

Commerce

40+ million

Annual Purchase Orders

How? The Ariba Network & Cloud Assets Addresses all trading partners, processes and back-end systems, simply

Discounting

Dynamic Discounting


Financial Services

CPG & Retail

Technology

Chemicals, Energy, Mining

Healthcare and Pharma

Manufacturing & Construction

Services and Other

BUYERS SELLERS

Network Experience across the Globe in many Industries

Businesses of all sizes, regions, sectors -- incl. 90% of Fortune 100

http://www.iwilson.com/

http://www.brandsoftheworld.com/brands/0003/0370/Verizon.eps

http://www.aramark.com/default.aspx

http://www.brandsoftheworld.com/brands/0013/7505/AT_and_T.ai

http://www.mcjunkinredman.com/

http://www.cleanharbors.com/

http://www.veoliaes.com/

http://www.airgas.com/


End to End Supplier Processing with Suppliers Standardized Approach – Ariba + ERP

One single solution for Suppliers

For all connected Clients

For all Processes

Supplier View

Procurement Spot Buy Request

Spot Buy Bid

PO, SO, BPO

Change Order

Forecasts

Order Confirmation

Adv. Shipment Notices

Service Entry

Enable & Catalog Supplier Enable

Catalog Enable

Catalog Manage

Sourcing Discover

Negotiate & Contract

Invoice & Pay PO /Non PO invoices

Invoice Against

Contracts

Credits

Invoice Status

Pay Schedule

Discount Update

Remitrance

Manage Data Updates

Performance

FI PM

SCM

MM VIM

SRM


Sourcing

Analysis. Sourcing

& Contracts

End to End Sourcing Support – Tactical to Strategic

Collaborative Sourcing Solution Analysis and Sourcing

Visibility into all supplier information

Supplier profile information on one tab

Supplier performance information on another – Scorecards – Contracts – Spend Analysis – Sourcing Events

Execute and Monitor Sourcing Projects and Forecasted Savings Opportunities – Strategic RFx Mgmt – Tracking & Monitoring – Tactical Bidding

Integrated Contract Initiation, Authoring and Negotiation


Procurement Content

Catalogs

Collaborative Commerce Catalogs – Seamless Shopping from ERP

Catalog Storage, Classification & Rich Attribute Searching

Contract Compliance

External Catalogues

Catalogue Reporting

Catalogue Validation

Catalogue Reporting

“Spot Buy” quote requests

Content Validation


Extending Collaborative Commerce to Suppliers

PO & Inovice Automation E-Transactions

& Status End to End PO Collaboration

Elimination of Lost POs

Supply Visibility & Assurances

Real Time Acknowledgements

Process Compliance Controls

Advanced Ship Notice collaboration

Invoice Receipt & Validation

Receive invoices in ANY format

Upfront Matching prior to Post to ERP

Real Time Communication of errors

Service Entry Compliance to Contracts

Supply Chain Assurances,

Visibility & Process Compliance

Immediate and clear explanation of Invoice exceptions

to SUPPLIERS prior to posting to ERP

Supplier View


Ariba’s Smart Order and Invoicing Approach

Invoice

Error

Exception

BUYERS

Ariba’s Smart Processing approach drives auto post rates of 98% by

eliminating errors and exceptions at the point of supplier submission

PO & Inovice Automation E-Transactions

& Status

AR

SUPPLIERS

Acct Coding

Price Compliance

Contract Match

VAT/GST Compliance

Qty Threshold

Unit Amt Threshold

Invoice” Number

Invoice Date

Ship to Address

Bill-to Address

Ariba

98%+

Auto Post

Supplier Portal provides real-time

access to PO, invoice and

payment status eliminating

inquiries to AP & Procurement

Over 80 configurable rules that

capture errors and exceptions

before they reach AP & Proc

Treasury

EAM

Procure- ment

SCM

MRP

AP


Complex Services Services Invoices directly again Contract Price Book Compliance

Complex Services Services Invoicing

Invoice Against Contracts by Suppliers

Direct compliance to Rate Terms

Complex Rate Term modeling

Immediate validation back to Suppliers

Field Approval (optional)

Approval of service delivery

Mobile access & handling

Supplier View


Service Entry Sheets & Invoice Creation

Easy Entry of SES’s by suppliers – conforming to Service POs (line & sub line compliance)

Flip approved SES’s into Invoices to assure invoice compliance

Contract Compliance & Mobile Approvals (optional)

• Automated and direct compliance to contract data

Mobile Email, PDA, iPad approvals & visibility

Services Entries for Complex Project Categories Network based management of service entry collaboration

BUYERS

Procurement

Field

Engineer

Finance/


Supplier View


Complex Services Invoicing Service Entry for Services Orders (cont)

Suppliers can do service entry for confirmed Services PO

Supplier View



Services Invoicing Supplier Outbox / Buyer Inbox for Service Entries (cont)

© 2013 Ariba, Inc. All rights reserved.

Services Invoices: Supplier Inbox/ Buyer Inbox

Buyers and suppliers have listing of all submitted service entry sheets and related status with filtering logic and export to excel.

Suppliers can create invoices for any buyer approved Service Sheet

Suppliers can create invoice for multiple SES’s from the same PO.




PSFT + Ariba Network

SAP + Ariba Network

Oracle + Ariba Network

Automation with >2,500 suppliers

>16% of suppliers offering early payment discounts

Automation with > 400 suppliers & 300 catalogs in less than 8 weeks

PO and Invoice Automation efficiency on >$4.5B in spend

Cut 75% Processing Costs


Integrated with 8 SAP systems

Cut >30% BPO costs

Aligned Interest between Procurement & AP


Cut 80% processing costs

Cut cycle time 70%

Eliminated over-spending in field services ($1B+) with ‘Inv against Contracts’ on Network

Improved DPO 5 Days while expanding discounts $1.3M+ in Year 1

Ariba Network for Buyers

Value Achieved (SAP and Non-SAP)

Large Entertainment Co.

MAXIMO + Ariba Network

Transforming AP into a Profit

Center Transacting in 50+ countries

Process

Efficiency

Effectiveness &

Compliance Cycle

Times

Discounts &

Working Capital

Key Value Drivers

Increased Buyer Productivity 30%+

70% of invoice volume automated in 12 mos on Ariba Network

98.8% touchless invoice rate


Sellers also benefit from using Ariba solutions

Benefits

Decrease in PO errors.

Approved PO initiates

Perfect Order process

Decrease in Invoice errors

Reduced manual

intervention and decreased

customer support costs

Greater Process Efficiency Getting Paid Faster Top Line Revenue Growth

Reduced order processing costs 75% and 40% reduction in customer service calls

Order processing costs reduced 30%

Dramatically reduced invoices rejected by customer, resulting in significantly faster payment

Reduced days outstanding

by 75%

Several customers have grown triple digits through catalogs

Increase orders on contract

for up to an 80% decrease

in unauthorized spending at

customer

Benefits

Provide visibility into when, how

much, and what suppliers will be

paid for

Eliminate misplaced invoices

Improve on-time payment and

reduce Days Sales Outstanding

(DSO)

Benefits

Increase orders on contract

Extend catalog visibility to all

end users

Participate in Sourcing and

Spot Buy events to win new

business

http://www.dell.com/


Recommended Journey for Optimizing Supplier

Collaboration

Beginning Phases

Improve

Automation

Connect ERP to Network for PO to Invoice processes

80% electronic

98% touchless

60-80% process cost reduction

Improve Discount

Savings

Optimize Pay Terms – take advantage of Dynamic Discounting

$2-3M savings per £1 billion targeted

24%+ annualized rate of return on cash

25% of targeted suppliers participating

Improve

Sourcing

Enrich, rationalize and identify sourcing opportunities to drive down costs

30% decrease in sourcing cycle time

RFX creation and management

Identify and qualify suppliers, negotiate best-value agreements

Implement supplier agreements, track savings, and manage supplier performance

Improve

Procurement

Increase Catalogs – Materials & Services

Enable Supplier Self Service of content

Increase compliance during transaction process – materials & services (POs and Invoice against Contracts)

Eliminate over-spending from contract rates

Improve Supplier

Management

Manage the entire supplier

life cycle from discovery to on-boarding to risk and performance management

Unify supplier profiles across the company

Determine if suppliers deliver on contract

Have fact-based conversations with suppliers regarding performance

85% reduction in supplier management costs

$

Future Phases

THANK YOU!

Diana Brown

Senior Director, Network Strategy

Ariba, an SAP Company

Email: [email protected]

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