ASUG News + Views
The SAP Busi­ness Net­work Opportunity
Josh Greenbaum May 6, 2022
Bookmark
Share Article:

It’s 2022 and SAP is poised to ful­fill a decades-old dream of build­ing and main­tain­ing a busi­ness net­work. This isn’t just a pro­cure­ment, logis­tics, com­merce, or any of the oth­er net­works that SAP and oth­ers have been build­ing and mar­ket­ing over the years. (Remem­ber SAP Mar­kets, any­one?) The busi­ness net­work that SAP will re-announce next month at SAP Sap­phire & ASUG Accel­er­ate Orlan­do will be the kind of many-to-many net­work the world has been wait­ing for — one that’s got some­thing for buy­ers and sell­ers, man­u­fac­tur­ers and dis­trib­u­tors, and man­agers from a wide range of depart­ments, such as sup­ply chain, finance, logis­tics, sales, ser­vice, and oper­a­tions. The SAP Busi­ness Net­work will sup­port sus­tain­abil­i­ty, com­pli­ance, risk man­age­ment, trade finance, and advanced cus­tomer and employ­ee expe­ri­ences. And so much more.

Of course, that will be the announced vision. How­ev­er, real­iz­ing a ful­ly oper­a­tional busi­ness net­work that can do all those things will take some time. This vision comes with some seri­ous bar­ri­ers, inter­nal and exter­nal, and no short­age of basic chal­lenges. For one, there are few buy­ers with titles like VP of Busi­ness Net­works.” Ques­tions also arise about how to best use — legal­ly and eth­i­cal­ly — the data that such a net­work will gen­er­ate. And, loom­ing large, is the ques­tion of how to enable small­er sup­pli­ers to see imme­di­ate val­ue, and not sud­den­ly find them­selves dis­ad­van­taged by being forced to swim in a large pond with their much larg­er competitors.

Time to Mature

Luck­i­ly, the devel­op­ment and adop­tion of the SAP Busi­ness Net­work in its entire­ty will be a slow-mov­ing train rolling out over the next few years. This is a good thing for a con­cept that will need time to mature in the minds of SAP cus­tomers and part­ners, as well as with­in SAP itself.

Nonethe­less, the long-term vision is impres­sive. On the sup­ply side, the Busi­ness Net­work will han­dle the mega process­es that go into sourc­ing, mak­ing, and deliv­er­ing prod­ucts. On the demand side, the Busi­ness Net­work promis­es to sup­port the lead-to-cash mega process for vir­tu­al­ly any size com­pa­ny, in any indus­try. To make this pos­si­ble, the func­tion­al­i­ty under the Busi­ness Net­work rubric will include sales, pro­cure­ment, plan­ning, logis­tics, ful­fill­ment, man­u­fac­tur­ing, ser­vice, and finance. Fur­ther­more, it will include con­tin­gent labor, sup­pli­er man­age­ment, com­pli­ance and risk man­age­ment, and sus­tain­abil­i­ty. And it aims to all be tuned to the needs of spe­cif­ic indus­tries and geographies.

This means that ele­ments of prod­ucts such as SAP Ari­ba, S/4HANA, Cus­tomer Expe­ri­ence, Suc­cess­Fac­tors, Inte­grat­ed Busi­ness Plan­ning, and Field­glass will be there, as will pret­ty much every­thing else SAP has to offer a busi­ness user. The nascent SAP Logis­tics and Asset Net­works will also be sub­sumed in the Busi­ness Net­work. You can add the recent Tau­lia acqui­si­tion to the list as well, under the cat­e­go­ry of cap­i­tal man­age­ment and trade finance.

What About Right Now?

So much for a 30,000-foot view of the long-term val­ue. What about the short-term val­ue? What can a com­pa­ny get from SAP Busi­ness Net­work today?

An ear­ly quick win will be the increas­ing­ly impor­tant, and increas­ing­ly oner­ous, require­ment for sup­pli­ers to self-cer­ti­fy their human rights and envi­ron­men­tal reg­u­la­tion com­pli­ance. Accord­ing to Paige Cox, who heads the SAP Busi­ness Net­work effort, it can take lit­er­al­ly hun­dreds of hours for a sup­pli­er to fill out the required mul­ti-page ques­tion­naires and pro­vide the nec­es­sary cer­ti­fi­ca­tions. This isn’t just 100 sequen­tial hours either — there can be a fair amount of back and forth in order to cut through all this red tape, and for some com­pa­nies, this can take many months.

The beau­ty of SAP Busi­ness Net­work, and any pro­cure­ment net­work, is that a sup­pli­er need only do this once; after­ward, the results can be avail­able to any buy­er. More impor­tant­ly, while these kinds of cer­ti­fi­ca­tions are tables takes for pro­cure­ment net­works such as Coupa — a favorite among the SAP cus­tomers who have no love for Ari­ba — being part of the SAP Busi­ness Net­work means that a com­pa­ny can tap into the grow­ing list of addi­tion­al process­es that will roll out in the next few years. Some, like the Tau­lia inte­gra­tion, are on a fast track for 2022, as are risk mon­i­tor­ing, trace­abil­i­ty, and assort­ed sup­ply chain trans­paren­cy capa­bil­i­ties. This should make the nascent SAP Busi­ness Net­work a good invest­ment for today and tomor­row. Like any good net­work, the ben­e­fits are expect­ed to grow as the fea­tures mature.

All About Integration

What’s the catch? SAP has a lot of work to do when inte­grat­ing all this soft­ware to work togeth­er. It must ensure that non-SAP tech, such as Coupa, Sales­force, or any­thing else the cus­tomer may have on board, can also work well in an SAP Busi­ness Net­work. SAP must also fig­ure out the Busi­ness Net­work busi­ness mod­el — what it can charge and who will pay — as well as be clear on what it can and can­not do with the petabytes of meta data that the net­work will generate.

But the biggest bar­ri­er is per­haps at the cus­tomer site. Get­ting cus­tomers to do the things they’ve always done under the aegis of this new Busi­ness Net­work will require a lot of change man­age­ment. That’s why the incre­men­tal roll­out is a good thing: cus­tomers will need to start slow­ly in order to suc­cess­ful­ly adopt the full panoply of Busi­ness Net­work process­es. But if SAP can exe­cute on this extra­or­di­nary vision, and cus­tomers start buy­ing in, the day will soon come when net-new busi­ness­es, prod­ucts, and process­es will deliv­er new capa­bil­i­ties and lev­els of pro­duc­tiv­i­ty that only a many-to-many net­work can offer. At which point, SAP Busi­ness Net­work will have been worth the wait.

Joshua Green­baum is prin­ci­pal at Enter­prise Appli­ca­tion Consulting.

You Might Be Interested In


Insights Included in Membership
View All Insights
Bookmark
Bookmark
Bookmark
Bookmark