At the 2018 SAP­PHIRE NOW and ASUG Annu­al Con­fer­ence, SAP was clear about its inten­tions to con­nect front-office and back-office tech­nolo­gies through the con­cept of the intel­li­gent enter­prise, with some help from the cloud. SAP’s pro­cure­ment and sup­ply chain offer­ing, SAP Ari­ba, fits right in the cen­ter of such a tech stack. We were able to catch up with Bar­ry Pad­gett, the new pres­i­dent of SAP Ari­ba, at ASUG Annu­al Con­fer­ence to get his posi­tion on the future of SAP Ari­ba and how it can make enter­pris­es more intelligent.

Lessons for SAP Ari­ba From SAP Concur

Based on the 20 years Pad­gett spent work­ing with SAP Con­cur, he sees plen­ty of par­al­lels and strate­gies that apply to SAP Ariba. 

He calls out three spe­cif­ic oppor­tu­ni­ties SAP Ari­ba has to grow:

1. Deliv­er­ing a delight­ful user experience. 
2. Shift­ing its strat­e­gy to think of it as a net­work or plat­form instead of as a product.
3. Adapt­ing the plat­form for use in the small busi­ness market.

These are the advan­tages that Pad­gett believes allowed SAP Con­cur to gen­er­ate new rev­enue streams in the midst of the mas­sive cloud migra­tion we’ve seen in the past 10 – 15 years. ​“When I looked at Ari­ba I thought, here are the oppor­tu­ni­ties to bring some of my learn­ings and expe­ri­ence to Ari­ba,” said Padgett.

SAP Ariba’s User Expe­ri­ence Facelift

SAP Ari­ba is already mak­ing some strides. At Ari­ba Live in March 2018, SAP Ari­ba launched a new user expe­ri­ence for both the buy­er and sup­pli­er. This con­sumer-friend­ly expe­ri­ence is a big leap for­ward, as the user inter­face hadn’t been touched in near­ly a decade.

SAP Ari­ba is also dip­ping its toes into the small- and medi­um-sized busi­ness mar­ket with its SAP Ari­ba Snap offer­ing. Pad­gett describes this as ​“cheap and cheer­ful in terms of get­ting small- and medi­um-sized busi­ness­es onto a plat­form where they can start con­nect­ing with their sup­pli­ers and trans­act­ing dig­i­tal­ly with respect to their POs and their invoices.”

What’s in Your Sup­ply Chain?

Today’s con­sumers want the pow­er to be able to see down your sup­ply line to make sure they’re ful­ly com­fort­able with your busi­ness prac­tices. SAP Ariba’s source-to-pay sys­tem makes that pos­si­ble. As Pad­gett out­lined, ​“With Ari­ba, it’s the idea of not only know­ing who you’re doing busi­ness with, but also know­ing who is doing busi­ness with your sup­pli­ers and tak­ing that two, three, four, five, six, sev­en lay­ers down through the sup­ply chain. You can make all that vis­i­ble now for the very first time, hav­ing a plat­form where not only you have vis­i­bil­i­ty, but the com­mu­ni­ty itself has visibility.”

Com­pa­nies that use SAP Ari­ba can see rat­ings on the eth­i­cal nature of sup­pli­ers and clas­si­fy them into groups, so they can fil­ter who is tak­ing a cer­tain posi­tion on the envi­ron­ment, eth­nic diver­si­ty, or oth­er issues. ​“We don’t want to be the cer­ti­fi­ca­tion board for the world’s sup­pli­er com­mu­ni­ty,” says Pad­gett. ​“We want to be the plat­form that allows those cer­ti­fi­ca­tions to happen.” 

How SAP Ari­ba Makes the Enter­prise Intelligent

Pad­gett iden­ti­fied pro­cure­ment and sup­ply chain as log­i­cal first prov­ing grounds for those look­ing to take advan­tage of tech­nolo­gies like machine learn­ing and blockchain. ​“The first place you can real­ly go to add val­ue in your com­pa­ny with some­thing like machine learn­ing is mak­ing sure that you’re not pay­ing dupli­cate invoic­es or the invoic­es that you’re get­ting actu­al­ly match to the pur­chase orders that were cre­at­ed, that the goods invoice actu­al­ly match­es the invoice. Those sorts of things are very, very sim­ple to do, but very pow­er­ful in terms of pro­vid­ing real cost sav­ings and cost effi­cien­cies in the business.” 

Pad­gett also acknowl­edged how using tech­nol­o­gy like the Inter­net of Things (IoT) can allow a com­pa­ny to take advan­tage of mul­ti­ple con­nect­ed plat­forms such as SAP Ari­ba, SAP Field­glass, and SAP Con­cur. Padgett’s Boe­ing exam­ple brings the mes­sage of SAP’s intel­li­gent enter­prise to life: 

“Boe­ing is fit­ting a lot of the air­plane parts with IoT sen­sors, sen­sors to check fatigue in the met­al or to check the num­ber of flight hours on a par­tic­u­lar part, and these sen­sors are sup­posed to raise their hand and say, ​‘Hey, I’m due for main­te­nance’, or, ​‘I’m about to fail.’ At that point, the net­work should make pos­si­ble the idea that we have this auto­mat­ed process where the part alerts the com­pa­ny that it needs to be ser­viced. That kicks off a pre­de­ter­mined activ­i­ty to go and find the part and pur­chase the part. It kicks off a Field­glass search to find the tech­ni­cian or the engi­neers that are cer­ti­fied and capa­ble of work­ing on that air­plane and that par­tic­u­lar part, and it starts a Con­cur process to actu­al­ly move the engi­neers or the main­te­nance folks to the actu­al airplane.” 

The Next Sup­ply Chain Transition

One thing that SAP ECC cus­tomers should know about is SAP Ariba’s hes­i­tan­cy to con­tin­ue offer­ing them inte­gra­tion sup­port. Pad­gett believes that many com­pa­nies still run­ning ECC may also be run­ning SAP’s lega­cy SRM tool for its sup­ply chain process­es, while SAP’s sup­ply chain future is in Ari­ba. But Pad­gett sees this as a poten­tial oppor­tu­ni­ty for those prepar­ing for the next dig­i­tal step. ​“It’s more the oppor­tu­ni­ty for an ECC cus­tomer, who maybe has a dig­i­tal trans­for­ma­tion goal in mind, to start with some­thing where there’s a quick win. A lot of mate­r­i­al busi­ness­es hate sav­ings, so they move the SRM, on-prem, SAP stuff to Ari­ba, and then they take the next step after that, which is maybe mov­ing from ECC to SAP S/4HANA.”

Embrac­ing the Dig­i­tal Sup­ply Chain

SAP Ari­ba is clear­ly poised to evolve into a key con­nec­tor in SAP’s intel­li­gent enter­prise. As the poten­tial bridge between SAP S/4HANA and the new SAP C/4HANA ini­tia­tive, SAP Ari­ba is ready to help cus­tomers who want to inte­grate their front- and back-office oper­a­tions and opti­mize the SAP user expe­ri­ence for their employ­ees. Some com­pa­nies will be in dan­ger of falling behind if they wish to con­tin­ue their ECC deploy­ment for the fore­see­able future. But if you’re ready to embrace the dig­i­tal trans­for­ma­tion and SAP’s vision of the intel­li­gent enter­prise, SAP Ari­ba is ready for you.

If you’re look­ing to learn how your peers are doing more with enter­prise asset and sup­ply chain man­age­ment, you should join us at the SAP-Cen­tric EAM & Sup­ply Chain con­fer­ence, March 16 – 18 in San Anto­nio, Texas. You can also reg­is­ter for our web­cast, ​“The State of the Sup­ply Chain for SAP Customers.”