SAP Community - SAP Ariba Contracts

Boost SAP Ariba value with SAP Cloud ALM

2022-09-29T13:39:04+02:00

The message for you who are already using or planning to use market-leading SAP Ariba for your digital commerce, is the urgency to accelerate business outcomes and maximize consumption by effectively communicating, execute, and overcome challenges when managing their implementation and operations.

A key element you require to succeed on a day-to-day basis is to have all participants in the solution lifecycle on the same page as a collective group. Collaboration is what SAP Ariba is all about: buyers and suppliers connecting to get business done, discover new opportunities, collaborate on transactions and grow their relationships to provide a compelling user experience. To support these objectives, SAP Cloud ALM is fundamentally intended to seamlessly implement and operate intelligent cloud and hybrid business solutions including SAP Ariba, on a single, integrated cloud platform.

With SAP Cloud ALM, included with your cloud subscription, you can now benefit from an out-of-the-box, native cloud solution, designed as the central platform to manage your SAP-centric landscape that includes SAP Ariba, with content driven implementation and highly automated operations.

SAP Cloud ALM provides value to SAP Ariba customers and partners by:

Accelerate fit-to-standard workshops of integrated SAP Ariba processes with powerful project management capabilities

Reduce implementation and configuration efforts for SAP Ariba, for faster time-to-value, leveraging 7 scenarios with 37 solution processes + SAP Activate Roadmap tasks

Enable operational stability by providing a unified operations user experience using a common look-and-feel and handling experience

Improve business continuity through proactive monitoring and alerting of 4 key SAP Ariba scenarios: Sourcing, Procurement, Network and Cloud Integration Gateway messages

Convenient business process models help determine the scope of Fit-to-Standard workshops.

SAP Ariba messages are monitored to visualize the current integrations status, identify critical issues, and trigger corrective actions.

In a nutshell, customer and partner teams are being challenged to implement and operate SAP Ariba to increasingly high standards while also performing day-to-day activities. SAP Cloud ALM provides relief to implementation and operations teams with superior collaboration and higher efficiency. As a result, customers and partners together, can make better decisions, complete team tasks quicker, and take advantage of cross-team adoption transparency.

Realize the benefit many other customers have already experienced with SAP Cloud ALM. Act today to raise your efficiency, and enjoy a big organizational win by taking resilient, scalable and sustainable steps by leveraging SAP Cloud ALM for SAP Ariba.

Learn more about how SAP Ariba customers and partners can benefit from SAP Cloud ALM at the SAP Cloud ALM for SAP Ariba homepage.

As thought leaders for SAP Cloud ALM, we’re here to help!  Feel free to include your comments below or contact us at cloudalm@sap.com with any questions or requests for advice.

Thank you for visiting this blog post and for your partnership in making your experience and business outcome a world-class success!

Transforming your contracts into strategic advantage

2023-01-25T07:49:35+01:00

Imagine bottling your most effective contract writers and always bringing your best clauses and language to the negotiating table. Couple this with a system that automatically alerts you to every expiry date, price break opportunity, compliance check, and potential breach. You have considerably reduced process time, a significantly stronger commercial operation, and a more professional approach to business. You have no more forgotten milestones. No penalties. No need to reinvent the wheel every time you onboard a new supplier. You always get the total value from the terms you worked hard to negotiate. In short, no more leakage'.
Congratulations! You have just achieved contract intelligence.

Contracts are the foundation of commerce, governing the rights and obligations between parties. Traditional contract management is often manual and siloed, creating inefficiency and risk while leaving value unrealized. Early in 2022, SAP and Icertis announced an expanded SAP endorsed* partnership for enhanced contract management to help companies increase efficiency, minimize risk and realize the full intent of their agreements. Icertis Contract Intelligence (ICI) with SAP Ariba and SAP Customer Experience solutions helps structure and connect data within contracts across an enterprise, enabling businesses to increase efficiencies, identify and mitigate potential risks, and drive bottom-line value throughout the contract lifecycle.

Icertis solutions are available here on the SAP Store, the digital marketplace for solutions from SAP and its partners. SAP Store provides customers with real-time access to more than 1,800 innovative solutions from SAP as well as partner solutions that complement and extend their SAP applications. The Icertis Contract Intelligence (ICI) platform has been recognized as a leader in the CLM space by leading analysts such as Gartner and Forrester.

Transforming Contracts Into Strategic Advantage

Icertis and SAP procurement solutions go hand-in-hand because contracts and procurement go hand-in-hand. To explore further, let’s look at a typical enterprise IT scenario. You've embarked on a digital transformation program and successfully digitized procurement with SAP. At the end of the procurement process, the resulting contract with the supplier—with all the terms you fought hard to secure—gets exported as a PDF and is filed away.
In this scenario, the transformation is not complete, because the contract has not been digitized with the rest of the processes. Without structured and connected contract data that can be managed, analyzed, and operationalized after execution, a company is exposed to the value leakage that results when the intent of a contract is not realized in practice. Contract non-compliance costs you money, creates risky compliance issues, and stops you from maximizing the benefit of your commercial relationships.

Fulfilling a universal need

These challenges are solved with contract intelligence that leverages cloud computing and AI to structure contract data and connect then it to the system contracts touch. With contract intelligence, the intent of every contact is correctly memorialized and fully realized.
The Icertis Contract Intelligence (ICI) platform not only covers the full lifecycle of contract management capabilities such as intelligent contract setup, authoring, approvals, and negotiations, but also solves previously intractable contract challenges such as digitizing legacy contracts and importing third-party contracts at scale, analyzing past negotiation history to gain insights and deep data visualization capabilities for unprecedented visibility into contract relationships and performance.

SAP Endorsed Contract Lifecycle Management Provider

A major advantage of contract intelligence is that it transforms the business information found in contracts into data that can be integrated into other systems. By connecting contract data into SAP products, there is amplification and extension of the value SAP and Icertis can deliver. Today SAP and Icertis are working collaboratively through joint development efforts. Read more about the partnership here. Icertis’ mission of becoming the contract intelligence platform of the world is perfectly aligned with SAP’s goal of building intelligent, sustainable enterprises that consistently apply advanced technologies and best practices within agile, integrated business processes.

*SAP endorsed apps are a category of solutions from SAP’s partner ecosystem to help customers become best-run, intelligent enterprises. Endorsed apps complement and extend SAP products and are meant to deliver value with desired outcomes – quickly, easily, and with support from SAP. The solutions are tested and premium certified by SAP with added security, in-depth testing and measurements against benchmark results. SAP Endorsed Apps can be identified by their unique gold and black logo.

Things I think are cool in the SAP Ariba 2302 Release

2023-03-06T22:34:26+01:00

For almost every release over the last 5 or so years I have written an internal email with that title to (1) force myself to read the release summaries as there can be well over 100 new features being released in any given quarter, and (2) as a former practitioner give my perspective on what is important and I wish I had when I had responsibility for global procurement operations in my former life. I have also tried to summarize the same sessions I do for the Customer Success Days.

This release has around 70 new features and here are a few of those to highlight:

Supplier self-assessment questionnaire – Human Rights [SA-30188] - The original driver for this feature was the German Supply Chain Law (LkSG) with the vision that the regulation would expand with additional country level and EU regulations globally. However, the cool thing is that this capability for a supplier to answer a questionnaire once and then share it with multiple customers opens up the door to any number of industry standard questionnaires. If you have a strong need, please put in a customer influence ticket to accelerate the prioritization.

Sustainability ratings on Trading Partner Profiles [SA-34702] – This capability allows for suppliers to establish their sustainability credentials either through a vetted source (with can come with a badge) or self-declaration. This will make it easier for buyers to connect to suppliers with a higher sustainability focus and provide transparency of their ESG practices (environmental, sustainability, governance).

Diversity Information available in catalog [SA-16949] – previously, this had been available for non-catalog purchases with the idea that catalogs were decided at the corporate level and that the diversity data for non-catalog items was a higher priority as this is where the general buyer user needed more information in order to make a buying decision. Now this information will display for all purchasing types.

SBN: Dun & Bradstreet Integration [NS-18198] – A common complaint is that the supplier may or may not be aware of their existing network profile so by integrating with D&B to normalize the data entered, any potential duplicate is identified much sooner with the added benefit of having more complete and accurate information as part of the standard supplier profile.

Enhancements to Summary area in supplier 360° profile to show Sourcing and Contracts data [SM-32192] – The supplier summary screen is adding sourcing and contract cards to the main screen and is on a path to continue to add cards for additional modules and activity. This capability really helps to highlight the connection in the modules and also help users make better decisions around that supplier like “Are there active contracts?” etc.

Those were my top five. Curious what you think.

Also Rob Jones puts together a great list of feature highlights here and I always check my list to see how many we match after I write mine (2/5!).

How integration between SAP Ariba Contracts and SAP Ariba Buying works

2023-06-27T16:16:46+02:00

Throughout my experience in projects, the topics with the highest number of questions tend to be those where multiple Ariba modules interact with each other. Today, we will explain the integration between the SAP Ariba Contracts module and SAP Ariba Buying, which allows reinforcing the compliance of trade-relationships between Buyer and Supplier.

SAP Ariba Suite Integration

Before starting the detail of the process, it is important to know what it means that an Ariba environment is with its integrated modules (Suite Integration).

Suite Integration means that Ariba is integrated between procurement or invoicing solutions from SAP Ariba Procurement solutions and other solutions such as SAP Ariba Contracts or SAP Ariba Sourcing. Source Integration occurs through the parent site.

In the table below, we can find the Suite Integration functionalities, where the flow described in this article can be found:

Suite Integration functionalities.

For the E2E flow explained in this article, it is mandatory that the system is defined as Suite Integration.

SAP Ariba Contracts workflow in Suite Integration

SAP Ariba Contracts workflow

In the image above, we can see the E2E flow of the SAP Ariba Contract flow integration. The details of each step are as follows:

SAP Ariba Sourcing (Yellow)

During this article, we will not cover in detail the steps to be performed in the Sourcing module. This module will allow users to bid and negotiate with different suppliers to obtain the best prices and specifications of the materials needed.

Once the supplier has won the bid, items awarded will be integrated to SAP Ariba Contracts to manage terms, documents and conditions.

SAP Ariba Contracts (Green)

Step 1 - Contract Request - Ariba Contracts users have the possibility to request the creation of a contract through a Sourcing event or directly in Ariba.

Step 2 - Contract Workspace - Once the contract is generated, different types of documents can be added to the project. In the case of this integration, the most important documents are:
- Line Item - This document will allow adding or integrate from the Sourcing project, the materials to be negotiated and their characteristics such as price, unit of measure, commodity code, and so on:

Line Item document in Contract Workspace

Line Item detailed specifications in Contract Workspace

- Contract Terms - This document defines all the features of the integration with Ariba Buying such as limits, availability, material specifications, and so on. It is important to note that line Items defined in Contract Workspace will be integrated automatically in Contract Terms:

Contract Terms document in Contract Workspace

Step 3 - Main Agreement - During the process of tasks and negotiations with supplier, the contractual document must be generated and agreed with the supplier to define the clauses of the agreement.

Step 4 - Contract Approval - This is a flow of tasks and approvals that must be completed prior to contract publication.

Step 5 - Electronic Signatures - In case that Docusign or Adobe Sign are integrated with Ariba, the corresponding stakeholders should sign the contract.

Steps 6 - Contract Terms - In the case of integration with Ariba Buying, the contract terms are the most important document to be worked on, so we will detail them in the following sections.

SAP Ariba Buying (Blue)

Step 6 - Contract Terms - Once the contract is published, the contract terms document will generate a catalog:

Catalog activation using Contract Terms as reference

Catalog Item defined through Contract Terms

Step 7 - Purchasing Requisition - After this catalog is activated, Buying requesters will have the items available in the catalogs:

Line item in Ariba Buying after Contract Integration

Next steps in SAP Ariba Buying (Requisition approval, Purchase Order and Receipt) - The next steps to be done in Ariba Buying are the same as a common purchase requisition, with the only particularity that we can configure particular approval flows based on whether the item is associated to a contract.

SAP Ariba Invoicing (Orange)

During this article, we will not cover in the details the steps of invoicing. Once the purchase order has been generated and received, the invoicing module will allow us to assign invoice approval and reconciliation flows to ensure that the invoice sent by the supplier is valid and payable.

How to configure Contract Terms

As we have seen above, the most important document for this integration is the Contracts Terms. During the Contracts project configuration we have two options to generate this document:

Add Contract Terms on Template - This will allow all contract projects generated through this template to always have a contract terms document associated with them. Normally, this document is associated with a set of conditions or questions to be answered during the creation of the project contract:

Example of Questions to add visibility conditions to Contract Terms

Contract Terms associated to a question condition during template creation

Add Contract Terms manually during project creation - In the scenario where our project templaes has not define a Contract Term document, use can add this document in 'Documents' tab through 'Actions' button:

Action to add Contract Terms at Contract Workspace

Once the Contract Terms document is created within the Contracts project, the user must define all the necessary information to integrate with Buying, here are some examples:

Example of Limits tab during Contract Terms generation

Example of items triggered from Line Item document during Contract Terms generation

Example of Summary tab before to finish Contract Terms creation

Best practices

Our consultants recommend adding this document to the contract templates used and configuring the visibility of the Contracts Terms based on the conditions of questions.

Take into account catalog views and visibility configuration to avoid that everyone could buy contract items in SAP Ariba Buying.

Limits and milestones will help business user to control when items expires.

We recommend configuring notifications to know the status of the contract and when it's close to expiring or reach limits.

After this explanation, we hope that you will be able to work this functionality with your customers and take full advantage of the benefits offered by Ariba.

Follow me for other episodes and videos coming in the next few months!

The Procurement Monthly - July 2023

2023-08-03T16:40:47+02:00

Each month ill review articles, research papers and webinars, and provide you with a brief summary of the most important papers, what they contain, what they may mean and try to draw some parrels between them.

S&P Sourcing

This was a “special” from supply management, authored by S&P global, and had some interesting insights around how technology can be used to drive better data driven decisions for sourcing. Sourcing as many reports have indicated is increasing as organisations both need to manage cost increases, but also seek to increase numbers of suppliers to mitigate risk. This article goes to understanding how up to date information, helps to formulate and change strategies.

According to the study only 52% of respondents felt their organisation ranked medium or low in sourcing performance. The report states that failing to address the entire spend of an organisation is one issue, with many organisations overlooking indirect or ‘tail-end’ spend in their sourcing management activities, where significant potential savings can be achieved using tools such as reverse auctions.

One factor that could hold businesses back here is their technology. According to S&P Global’s research, just 31% of organisations say their sourcing functions make full use of sourcing technologies for all types of spend. This means many may have sophisticated platforms and technologies which they are failing to use to their full functionality, in some cases using them for no more than a platform on which to share spreadsheets or Word documents.

VIZIBL – Procurement Decarbonisation

This report identifies that most companies despite having pledges to reduce scope 3 emissions may not be ensuring that these are capable of being achieved. In fact, only about ¼ feel confident that they will happen. The reasons the report gives are that many responders are struggling with education (only 6% feel well educated) , understanding the strategies (around half feel that strategy has been well communicated) and appropriate incentives, according to this report, only 8% feel that they are full incentivised to achieve them, and as we know incentives drive actions.

BCG 7 Forces in procurement

This was a really interesting article covering some key forces reshaping procurement. From geopolitical tensions to sustainability to mining the market for risks and opportunities, it is a very thought provoking read. The article suggest that procurement leaders must understand these trends and be prepared quickly to adapt. These trends are:

Geopolitics elevating risks.
- Procurement leaders must actively monitor and manage their exposure to geopolitical risks.

Natural Disasters occurring more often.
- Natural disasters can severely harm commercial property, assets, and raw materials. Procurement functions must help to mitigate the associated risks to resource availability, shipping, and the speed and quality of production.

Inflation & recession cause uncertainty
- An inflation-ready procurement function comprehensively considers categories of all sizes, utilizes strategies like hedging and price-indexing, and scrutinizes every price change.

Adoption of climate & sustainability is accelerating.
- Procurement functions play an essential role in helping companies achieve their climate goals. For example, a company must involve strategic suppliers in its sustainability initiatives. This includes requiring suppliers to commit to implementing green practices and reducing Scope 3 emissions as part of the tender process.

Companies strengthening commitment to social equity.
- Procurement strategies should include goals for giving opportunities to diverse suppliers—that is, businesses that are majority owned and operated by individuals or groups who are traditionally underrepresented or underserved. This might entail, for example, asking for information about a supplier’s diversity in RFPs or setting a target for the percentage of diverse suppliers used by the company.

Next Gen Tech promotes efficiency.
- In a 2022 survey, IDC asked more than 1,100 procurement leaders which technologies they planned to implement during the next 12 months and three years. AI and blockchain showed the biggest increases in implementation over three years versus 12 months.

Procurement faces talent shortage.
- Procurement leaders must assess their operating model and create a talent development plan that can support the overall procurement strategy. A well-balanced procurement team focuses on category management while striving to automate routine tasks, such as buying and contracting.

Ardent Partners – State of Procurement

This annual report is a mainstay of procurement strategy. Now in its 18^th year, this year’s report is as insightful as ever and provides insights from over 300 respondents.

For 2023, the report identifies that Cost savings (46%), managing risk (43%), digital transformation (38%) as key priorities, with complimentary strategies of pursuing digital transformation (39%), collaboration internally (38%) and cash – liquidity management (33%) as key strategies to deliver against the priorities.

Also in the report was the state of procurement performance, showing that whilst spend under management on average at 65% was trending down, targeted savings at 6.6% was trending up (though delivery was flat at just over 6%).

Chapter 4 is really worth a read, as it states on multiple occasions that procurement is at a crossroads on many things from data strategy to digital transformations, change management strategies. Its these insights for me that really make the report a must read.

High Performance Procurement – Procurious

I enjoyed reading this report where it looks at what is it that makes high performing teams in procurement and uncovers some concerns, especially if you read alongside either of the Deloitte or Ardent (or Economist Impact) reports.

Some startling numbers – 75% of respondents dount the accuracy of the data they present, which means that nearly 80% of non-procurement leaders are not confident in using data that comes from procurement, which will clearly negatively impact our credibility internally.

In the recent economist report (decoding confidence in procurement) it states that whilst many C suite recognise the importance of procurement, only around half believes that procurement collaborates well internally. This report confirms that with 43% don’t collaborate with manufacturing, and even less with sales.

When it comes to reporting, its still cost savings that dominate the reporting with over 70% saying negotiated or realised savings are KPI reported, with other areas such as sustainability under half.

Perhaps a driver for both, is that spreadsheets still dominate the tools used to track and manage procurement performance with nearly ¾ of respondents still using them.

Deloitte CPO Report

The 12^th edition of this report was published recently.

Some really interesting takeaways which in many ways confirm the Ardent report, as well as the Economist reports. Procurements remit is broadening, with not much to choose between the top priorities from driving efficiency, ESG, cost, digital transformation and risk all within 5% of each other in terms of priorities.

However, it does identify that procurement performance is dropped. Under 70% hit their targets last year and self-perceived performance in partnering with other areas (i.e. collaboration) dropped by up to 11%

So it makes sense that in terms of top strategies being employed to achieve these priorities is collaboration (#1) – both internally and externally with suppliers and a renewed focus on category management renegotiation at number 4. Demand management and digital transformation make up the top 4.

There is a detailed discussion on operating models, which most reports identify as evolving as organisational operating models change, as well as a focus on Supplier Management as a key part of value delivery.

Like Ardent, the report shows a marked difference between top performers (in this report called orchestrators of value) and the rest. Some areas where these top performers concentrate include SRM, market intelligence, scenario planning, digital deployments, and standardisation of approaches.

I have linked to each of the reports mentioned for you to download and consume on your own, but hopefully this has given you a taste!

If you want to discuss further, please reach out!

Things I think are cool in the SAP Ariba 2308 Release

2023-08-25T20:16:19+02:00

Here are the 4 areas of new features out of my quick count of 64 new SAP Ariba features and 27 SAP Business Network features that I thought were really interesting in the August 19, 2023 (2308 Procurement and 2308 Business Network) release for SAP Ariba.

SAP Ariba Category Management [CAT-3503] - IMHO, this solution deservers its own blog post. The ability to now much more robustly manage categories, set and track progress against corporate initiatives, and to have all of that capability natively integrated with the other source to pay modules is really just beautiful. I remember managing any number of corporate initiatives and trying to manage progress on spreadsheets and not being aware of multiple sourcing activities that were directly related to the savings or strategic opportunities. There aren't too many features that release that make me want to go back to my old job, but this really made me pause. Here is a link to an updated demo page that includes datasheets, FAQs, etc.

Two features are improving the integration between SAP Ariba Contracts and other modules
- SAP Fieldglass [SC-16976] - this is a really cool feature to better integrate Statements of Work (SOWs) between SAP Fieldglass and SAP Arba Contracts by creating a SOW in SAP Fieldglass when a contract is published for purchasing in SAP Ariba Contracts.
- iCertis [SC-19434] - this integration from Guided Sourcing lets you automatically create the contract detail in iCertis as the result of a Guided Sourcing award. In the past, this would have only allowed you to create a contract in SAP Ariba Contracts - but there is still integration to keep the solutions synchronized.

Recommended Alternatives for Non-Catalog Items [GB-23280] The Non-Catalog Request page and line item forms can now display the recommended alternatives carousel, which encourages users to buy catalog items instead of non-catalog items. This function really plays on the idea that your business users will do whatever is the easiest for them. So if they are looking to buy a non-catalog item the solution will suggest to them alternatives that are more in line with the corporate partnerships and strategy - sort of like how SAP Concur calls out your selected airline isn't the best option for the company in this situation. Here is a link to a demonstration as well.

New Widgets for Procurement Collaboration: I really appreciate the flexibility and transparency the SAP Business Network widgets give to both buyers and to suppliers. Collectively, we tend to think of how to help our buyers but these features for suppliers encourage more engagement on the network and helps our suppliers build stronger and healthier relationships. Here are two good ones:
- Change Order Rate Benchmarking Widget [BNA-1037]
  The Change order rate benchmarking widget allows suppliers to compare their customers’ change order rate performance against the aggregate performance of the network. So if a supplier sees you with a high amount of churn, they can take steps to engage on improved forecasting to help every reduce cost, resources, and time. Win Win.
- Invoice Exception Rate Benchmarking Widget [BNA-199]
  The Invoice Exception Rate Benchmarking Widget allows suppliers to compare their customers’ invoice exception rate performance against the aggregate performance of the network. This will help provide more encouragement and transparency to those suppliers that need to improve their invoice quality and support their customer's process improvement objectives.

As well one features is becoming mandatory as part of the 2308 release:

Supplier List Page Enhancements Enabled for Everyone [ARI-20543]
Supplier List Page Enhancements is changing from a self-service optional parameter to enabled on for everyone in 2308 GA. The feature will be enabled on with no option to disable it. It will no longer be a customer configured feature using a self-service parameter.

The other release readiness information has moved around a bit but I like this new consolidated view of the release content including replays that spans the current and historic releases.

The Procurement Monthly - August 2023

2023-08-29T19:16:10+02:00

Hackett Digital World Class Procurement

This annual report looks at and quantifies the impact that digital world class procurement functions have over their peer group. The Hackett Group defines Digital World Class® organizations as those that achieve top-quartile performance in business value (a composite of stakeholder experience, digital enablement, and traditional effectiveness metrics) and operational excellence.

The report states that Digital World Class procurement organizations run at a 21% lower cost than peers – a $6 million advantage for a typical $10 billion enterprise – with 32% fewer fulltime equivalent (FTE) staff. Just as significant, they deliver greater value – for example, 96% higher spend cost reduction savings. As a result, they are 86% more likely to be perceived as a valued business partner.

In operating costs most of the reductions sit in the labour element, whereas the increase is in technology. In Labour element, there is less in operations and compliance, and sourcing as the teams have automated and let their digital solutions deliver the value. Interestingly there is an increase in planning and strategy FTE.

So, what do you get for digitising beyond operating with a 21% cost and 32% FTE advantage?

They dissect these into these 5 areas.

Effectiveness – from cost savings to lower saving leakage

Experience – nirvana for procurement is to be considered a business partner and be aligned to organisations – 86% are more likely to be viewed as a business partner.

Enablement -7 x higher use of auctions

Efficiency lower costs per order, quicker transaction times and sourcing times

Automation – greater use of electronic invoices, transaction processed electronically.

North Carolina State Sustainability Survey

This study from North Carolina and GEP looked at how organisations were handling sustainability imperatives in face of disruptions and cost pressures. The pressure for ESG improvements is increasing and unrelenting, despite the economic pressure companies are experiencing, however balancing these seemingly competing demands, even in the best of times without disruption, is immensely complicated. Even the companies that are leaning into implementing sustainability initiatives and goals into their supply chains are struggling.

We consider supply chain resiliency, diversity, and sustainability as complementary capabilities.

Some interesting takeaways:

Chief supply chain officer (CSCO) (9%) is now more responsible for sustainability than chief sustainability officer (4%) or chief financial officer (CFO) (6%) – CEO overall is primarily responsible (32%)

Today, only one-quarter are focusing on Scope 3 emissions, which account for 80% of total emissions whereas 38% are focussing in recycling.

Many are not prepared for new regulations coming, as they fall in the bottom half of the drivers (operational improvement and cost reduction are at the top)

Reflecting the economic situation, Cost is king: Cost reduction drives supply chain investment and KPIs for environmental performance.

World Commerce & Contracting – AI In Contracting

In this over 400 organisation survey World CC sought to uncover the status of AI adoption in contracting, to reveal the benefits realized for those who have already implemented the technology, to expose the barriers to adoption and unveil the true nature of attitudes.

“I believe that most of the short-term claims being made about the impact of ChatGPT and generative AI hugely overstate its likely impact. More significantly, I think that most of the long-term claims hugely understate its impact.”

Richard Susskind, President, Society for Computers and Law

The survey through up some interesting findings. 31% had or were planning to implement AI, 61% had not, and 17% had banned its use! Biggest barriers of use were Security (25%) and low priority (18%), as well as many others awaiting policies to be developed (which is high up in the usage charts).

In terms of where the value was, Metadata extraction led with a 44% implementation rate underscoring the value that can come from streamlining data collection. Clause extraction follows closely at 39%, indicating a focus on leveraging AI for more efficient contract review and understanding. Contract analytics and automation, adopted by 38% of respondents, shows the burgeoning interest in capitalizing on AI’s predictive and automation capabilities.

The economist survey identified improving efficiency as a major benefit of deploying emerging tech (like AI) and the report concurs with 68% identifying time reduction of contracting lifecycle being the biggest benefit and 38% identifying cost savings.

Everest Supplier Management

This was an interesting webinar and report about the future of supplier management and identified that organisations are wanting to transform not only the relationships with suppliers themselves but also the way they measure and manage them. SAP identified this in the Economist Impact survey (and there is a separate soon to be released supplier management paper coming) but this webinar also revealed some interesting research points.

Technology has not been uniformly deployed across all parts of supplier management, notable more frequently deployed on Onboarding, Supplier information and supplier data, but missing largely on performance, relationships, and risk. In fact, according to their research, 85% of respondents use spreadsheets or nothing for relationships, and 77% the same for performance. The report goes onto say that many organisations use ratings providers (69%) to manage supplier financials, but 2/3 don’t use a tool to gather environmental or diversity information.

The main reason for this, apart from budget (69%) are lack of integration with ERP.

Procurement Leaders – Speed and Agility

In this report from procurement leaders, it looks at how can procurement functions operate with agility and speed, what would stop it, and what are leaders planning to do to overcome. One of the knocks on procurement is how long activities take, which can lead to a reluctance from the business to engage. According to the report the 3 main activities that can cause bottlenecks, include onboarding all respondents identified this,) Contracting (93%) and P2P (89%).

During onboarding, the research identified that for strategic suppliers 60% took upto 30 days, and 40% took more than 30 days.

We find that with contracting, there are somewhere between 10 and 15 associated parties that need to be involved in the process,”

William Porter – CPO Mass Mutual

The report identifies that missing data (59%), organisation silos (43%) and technology gaps (37%) are the top 3 drivers of these blockages and unsurprisingly automation (68%) is the biggest strategy for alleviating this.

If you require more info or want to discuss further, please reach out!

The Procurement Monthly - October 2023

2023-10-24T02:35:26+02:00

Each month ill be taking a look through the published reports, articles and whitepapers written about procurement and external workforce and drawing out the key parts and general themes.

Proxima Supply Chain Barometer

This is a 2000-person survey of CEO from the US & UK reflecting on decisions they have made and what th4ey see ahead. The context, of course, is the huge changes wrought from inflation and the decisions that have been made. But with markets stabilizing what lies ahead?

Some key takeaways:

51% of CEO said they expect to spend more time on supply chain issues in the next 12 months. 64% of them said that would be between 5-20% of their time.

34% stated that they had a formal plan for decarbonising their supply chains, 32% have begun strategic conversations with their suppliers. 33% of linked exec pay to sustainability targets. Main barriers are complexity (25%0 and cost (23%)

90% stated that supply chain resilience is a challenge and 43% have begun on/nearshoring parts of their supply chain. 69% stated they have concerns about potential for human rights issues in their supply chains.

Overall, a worthwhile read, its interesting that its CEO’s as well, this links well to the NC state research previously covered that identified the its CEO that “owned sustainability”

AQPC Procure to Pay Governance & AQPC Sourcing Transparency

Couple of reports from AQPC this month. In the first blog, APQC has gathered insight into how organizations are governing and managing their procure-to-pay (P2P) processes. A quick look at how P2P is being governed reveals a lack of integration between procurement and accounts payable (AP) in 70 percent of organizations.

Key Data Points from Organizations that Lack Procurement and Accounts Payable Integration

In 28 percent of organizations, Procurement and AP are separate teams with separate reporting lines.

In 42 percent of organizations, the two functions are separate teams that at least report to the same c-suite executive.

Only 30 percent of organizations report having an integrated procure-to-pay team reporting to one executive.

When the P2P process is disconnected it can have a negative impact on suppliers (as well as internal cashflow). The impact of supplier risk for organisations has risen to the surface more prominently in the last 12 months than before, and this blog suggests that one solution is to implement a global process owner. The owner should have an end-to-end view of the whole process. The main takeaway being that to focus on effectively managing the end-to-end process, organizations need to shift from thinking of procurement and AP as separate processes and implement governance that enables them to become an integrated, seamless end-to-end process.

In the second AQPC report this was a survey of 185 participants done with BCG discussing transparency into suppliers, locations and the risk management strategies being followed. Some interesting points made included:

37% Deploy multi-sourcing across all categories and recovery strategies for single-sourced categories.

25% Identify critical sub-categories to deploy multi-sourcing strategy and rapid recovery for single-sourced items.

20%-Tiered, multi-sourcing strategies for different sub-categories and well-defined recovery strategies for single-sourced items across the full bill-of-materials

Whilst only 18% didn’t have ,multi-source strategies in place, its clear that these strategies are gaining traction.

It was interesting that from a supplier selection perspective, how much was location of supplier a factor. Its pretty evenly split, 26% pure cost focussed, 29% focuses on high-risk locations, ad hoc, 24% it’s a key factor, & 21% cross functional strategic approach.

MIT Automated Negotiations

In many ways this article and the Scanmarket E-Auction report could be read together. The MIT papers, details the benefits organizations have derived from automated negotiations, what it takes to persuade stakeholders to use the technology, and how to incorporate automation into your procurement processes.

The article is well researched and written and cites a number of examples of how organisations such as Google, Maersk and Walmart have been using automated negotiations (or E auctions) in their process, and details the categories that they have used them for, both goods and services (including media and marketing agency) An example given was of Walmart having upto 150 suppliers participating simultaneously conducting multiple rounds of negotiation….. in 2 hours

The paper in summarising this stated that automating negotiations dramatically increases the number of suppliers and negotiation rounds that a company can include in a significantly shorter period of time.

“It’s the speed of e-auction execution that drives value,”

Kees Bressers, head of procurement at Walker’s Shortbread.

Companies that have scaled their automated negotiations have matched the procurement strategy for a particular spending category and market conditions with the best automation processes and tools.

The paper then defines 6 key practices to overcome resistance and deliver value.

Mandate consideration not use.

Make Success visible.

Prequalify suppliers.

Treat non incumbent suppliers fairly.

Unleash AI to improve deals with tail suppliers.

Create a formal support structure.

Scanmarket E- Auction

Hot on the heals of the above research paper, here’s what’s been delivered by Scanmarket! This is a quarterly paper that looks at the numbers and results of auctions held. The report stated that he number of executed e-Auction events in Q2 increased to a significant 39.18% when compared to Q1. This rise suggests e-Auction adoption is trending favourably as a recognized reliable and effective means to save across various categories. Q2 2023 presented a staggering 11.32% in average savings, moving just slightly higher than that of Q1’s 11.31%.

Interestingly the most auctioned category was services.

State of Supplier Diversity 2023

The annual report from Supplier .IO is out, there was a webinar which was co delivered with Chris Sawchuk of the Hackett group.

Of the information that was included, 60% of respondents (216) have a formal program, with 44% being under 2 years old. The main drivers of diversity are alignment and to improve competitiveness within the supply chain. Interestingly compliance ranked as the lowest quoted driver, which conflicts with other reports recently released (Deloitte CPO report for one)

Data quality saw the biggest improvements this year, closely followed by program processes with workload, accuracy of data and proving accuracy to leadership as the three top barriers.

2/3 use 3^rd parties’ data to monitor diversity status of suppliers which moved it up 2 spots to the top way that companies track status and over half (57% integrate diversity metrics into their S2P systems.

Standard and Poors PMI Index

Last month I reviewed the supply chain volatility index, this month it’s a Purchasing Manager Index(PMI) ! S&P put out a monthly bulletin that tracks the changes in PMI, which is a measure of confidence in the global economies. Over 50 is good, under 50 is bad!

This month its 50.6 but the trend is downwards, for the last quarter, suggesting some economic headwinds ahead. In fact this is the lowest level since February (when it went back above 50). Its always useful to look at these types of indices to see how the global markets are trending, to consider when thinking of strategies.

The key takeaways from the PMI are:

1) Convergence observed in August with a slower fall in manufacturing output paired with weaker services activity growth, leading to a weaker overall global growth momentum.

2) Selling price inflation eased, albeit only slightly, suggesting that inflation remains sticky.

3) Softening demand conditions and falling backlogs bodes ill for output in the coming months, though overall sentiment improved, driven by improved services optimism.

McKinsey How Medium size business can better manage sourcing

While large companies can usually drive procurement cost savings with relative ease, small and medium-size enterprises (SMEs) typically lack the necessary scale despite being the backbone of many economies around the world. The article suggests the following are typically what prevents SME from achieving value in procurement:

A lack of spending transparency

A myopic focus on the short term

Talent gaps

Underused digital tools and automation.

Exclusion of procurement and supply chain in business decisions

The article suggests that an interconnected series of 5 strategies will help SME achieve value. It states that only all 5 (ie not one alone) will be needed to drive the value that larger enterprises achieve.

Establishing a CoE

Improving forecasting

Expanding use of digital procurement tools

Gaining greater market intelligence

Incorporating supplier-driven product improvements

McKinsey – New ERA for procurement

And my read of the month is this one!

The world has experienced significant turmoil over the last 3 years, and whilst the results of this turmoil have shifted where and how people work and live a new volatile environment faces many businesses. To succeed companies, need to embed agility, technology and innovation, but above all, according to the article, their long-term success depends on a much less obvious action: changing what the organization buys, whether it’s raw materials that meet new environmental standards or analytics talent who can identify what consumers most value.

These days, to perform well, companies need a different end-to-end view on the business. Procurement is absolutely critical.

CEO Chemicals Business

The article states that 4 megatrends will shape the future of procurement.

An increasingly multipolar world that challenges the interconnectedness of global value chains. Procurement leaders are therefore shifting focus from cost improvement alone toward resiliency and assistance to businesses that are adapting to volatile market conditions.

Advances in AI and machine learning that can quickly extract deep insights from previously unstructured data. Procurement can make a crucial contribution by enhancing spend transparency and capitalizing on movements in supply markets.

Demographic shifts, including shrinking workforces and rising skill gaps, that intensify competition for digital talent. The task for procurement departments is to attract and nurture candidates with the analytical skills and data competence needed to unlock value from agile ways of working and digital operating models.

The transition to low-carbon energy, upending resource and energy systems. Procurement can take the lead in minimizing value chain emissions, securing high-demand green materials, and managing the capital expenditure required to achieve net zero.

For procurement to remain as essential as they are, new “currencies of procurement” beyond traditional cost savings can help position procurement as a strategic function, in fact these should serve as the guide for procurement to 2030.

Improving net margin by outperforming the market: In a more volatile era, value creation increasingly depends on offsetting market increases and swiftly capturing downward trends. Collaboration between procurement and sales, along with other functions, becomes vital for protecting and increasing margins while managing risk.

Ensuring volume and enhancing growth: Procurement can surpass mere order fulfillment and instead provide a more durable competitive advantage, strategically securing critical and scarce materials while maintaining supply chain flexibility.

Leading value-chain emissions reduction: Procurement can contribute critical support for net-zero objectives by securing green materials and decarbonizing the supply base through localization efforts and enhanced supplier co-innovation.

The full paper is worthy of your time to read fully, I particularly liked the evolution of operating models, to agile teams (or I have also heard them called sourcing squads) as opposed to static category managers, which goes to some of the points above, about breaking out of the silo of categories. Whether 2030 is realistic, well I guess we will find that out in the next 7 years!

If you require more info or want to discuss further, please reach out!

Where can I get an understanding of SAP Ariba's cross-solution features and functionalities?

2023-11-08T18:34:54.302000+01:00

You can build the skills you need, for free and at your own pace with our Digital Learning Journey.
on our SAP Learning Site

I recommend to access our Discovering SAP Ariba Cross-Solution Functionality learning journey

Overview
Discovering SAP Ariba Cross Solution Functionality is a learning journey designed to provide learners with a broad understanding of SAP Ariba's cross-solution features and functionalities. This curriculum explores general skills, best practices, and valuable resources, offering a well-rounded perspective on SAP Ariba's capabilities.

Learning objectives

Explore the cross-solution features and functionalities within SAP Ariba.
Practice general skills required for effective utilization of SAP Ariba solutions.
Identify and apply best practices in various SAP Ariba solutions.
Utilize available resources for troubleshooting and enhancing SAP Ariba operations.

Pass all the quizzes and receive a digital badge

Please ask a question related to the digital learning journey in the Q&A area

Our SAP Learning Experts will get back to you as soon as possible! We are here to support you.

We appreciate your feedback and we will make sure to continue sharing interesting topics.

Kind regards
Margit

The Procurement Monthly - November 2023

2023-11-24T02:28:10+01:00

Each month i'll review the procurement research reports, articles, and webinars and summarise here

Supply Chains for Mid-Market – IDC

In this IDC brief (sponsored by open text) the paper uses data from its supply chain survey earlier in the year and focusses on mid-market responses (being defined as under $1billion). The paper looks to the differences between large enterprises and Mid-market companies identifying that they are held to the same business process standards by their customers as large enterprises, but they lack broad resources.

In the near term, efficiency, and resiliency (both visibility and agility to see it and respond) are top two priorities, as both are ways to ensure margin improvements and more reliable operations. IT modernization is on the radar as an important driver of performance but takes a back seat for now.

Responding more quickly to supply disruptions or changes remains top of mind in the shadow of recent global supply chain disruptions. Notably, collaboration is a bigger priority for larger mid-market organizations.

In the medium term, efficiency remains a top priority as mid-market companies see margin erosion and input cost pressure continuing. IT modernization increases in importance to drive better business performance, while operationalizing sustainability joins the list of top priorities.

Whilst over the next decade, almost 40% of mid-market companies view labor availability as a persistent problem, the top priority for these companies in 2023-25 is to reduce cost/eliminate waste to mitigate the effects of persistent inflation.

Attempting to predict major disruptions, the black swan events, if you will, have proven to be an almost complete waste of time for us. What we need is the visibility and integrated systems to be able to respond more quickly than our competitors.

Risk and speed of response are big issues for all but are more keenly felt in mid-market. Supply diversification is a strategy that many are following, but according to the paper, that brings more suppliers, more documents, more exchanged information, and therefore more things which can go wrong.

AQPC Benchmarks & Procurement is changing.

In the first report from AQPC they have published their benchmarks for procurement FTE to perform procurement activities. Where they exist, I’ve put the SAP Benchmarks in.

MEASURE	Metric	SAP
Number of FTEs that perform the process group “Procure materials and services” per $1 billion revenue	36	29
Number of FTEs that perform the process “Develop sourcing strategies” per $1 billion revenue	4.1	11
Number of FTEs that perform the process “Order materials and services” per $1 billion revenue	18.8	10.6
Number of FTEs that perform the process “Manage suppliers” per $1 billion revenue	5.5	NA

An interesting piece here, in the previously covered Hackett world class digital procurement report, it mentions that there is a reduction in total procurement FTE the more digitally enabled functions were, but more strategic procurement people within this.

The second report covers how procurement has been changing over the last few years with over 71% of respondents, (from 1,181) stating they have seen significant transformation of their processes and systems. The report states that Procurement’s strategic objectives have been shifting in line with broader changes in the business environment. In the past, cost reduction and maintaining or improving margin would have been the two most important objectives for procurement. However, the study found that avoiding supply disruption is now the most common strategic objective, followed by reducing procurement costs (there’s about a 2% differential) with increased emphasis on sustainability and improving supplier relationships (though there is a clear distance between the top 2 and next few)

Within supplier relationships, the key areas identified were supplier’s ability to deliver (25 percent of respondents), supplier capabilities (22 percent), and sustainability (16 percent)

The report concludes that whilst cost is always important, the ability to collaborate with suppliers, and better measure and manage suppliers to both avoid disruption and improve relationships are becoming more critical.

World Commerce & Contracting - Implementation

This report looks back at the impacts of contract management technology, some of the pitfalls of implementations (and indeed technology) and suggests some actions for organisations to take. The report makes the point that here is so little usable data associated with the contracting process. In a typical midsize organization, contract-related data sits in 24 different systems,3 spread across multiple business functions. Often, even today, there is no single repository where contracts are stored. Therefore, data analysis, to the extent it occurs, is largely manual and reactive.

“The risk landscape has changed dramatically over the last decade, especially since the COVID-19 pandemic. All these aspects – digitalization; innovation of new products and services; technology; market competition; environmental, social, and governance (ESG); geopolitical conflicts; and more – not only represent new risks but also require a completely new perspective and, therefore, a change of mind in our approach.”

The report then goes on to identify the benefits, and good practices for implementation of contract lifecycle management technology. The secret is to understand the foundations for success and select a system that is adaptable, easy to use and supports a wider set of use cases, allowing a reduction in the overall number of systems deployed.

Deloitte Reshoring

This month’s read of the month!

Lots has been written about reshoring since the start of the pandemic, and generally it has taken longer for organisations to achieve this than was first thought. Lots of reasons as to why, but this paper goes into the decision-making process. This is going to become more important, as the wave of “friend shoring” may well increase over the next few years if the current geopolitical issues continue.

According to the report,. In a Deloitte database3 review of 98 major reshoring events over the past four years, 19% of companies involved in reshoring events used some form of an M&A transaction, including joint ventures or partnership, to execute in the new supply chain strategy.

Before tackling the analysis of total costs involved in a reshoring decision, it’s important to consider the full range of factors that may come into play. The drivers of supply chain disruptions seem to fall into three broad groups: quantitative, qualitative, and risk-related.

Quantitative drivers include labour costs; transportation costs; lead time; working capital requirements; taxes and duties; and defect rates.

Qualitative drivers include intellectual property management; environmental, social and governance (ESG) improvement; cross-functional complexity; and brand reputation.

Risks can include regulatory changes; geopolitical developments; natural disasters; and financial and economic volatility. These are issues mostly out of a company’s control and difficult to quantify.

Whilst this paper looks in depth at 4 categories (of which they identified in 3 of them the factors around the decision to reshore or not, have made reshoring more attractive) the factors identified, and calculations made can be applied to any category.

The report identifies the following questions of consideration in making decisions around reshoring.

How long and complex is my global supply chain (geographically and logistically)?

What competitive advantages or disadvantages does my supply chain confer in the marketplace?

How does the total cost of goods sold change by shrinking the supply chain closer to the end consumer?

How is my supply chain a result of price elasticity, and how does customer price elasticity impact decisions?

What are the risks to my supply chain, and how can I control or mitigate them?

Is there unpredictability in my supply chain that could affect business continuity?

What’s the impact of regulations or the potential arc of future regulations (e.g., EU’s Carbon Border Adjustment Mechanism [CBAM], Corporate Sustainability Reporting Directive [CSRD])?

CEO Briefing

2 recent CEO briefings, one on AI stated that the majority of CEOs polled (53 percent) said they are now finding business uses in the new capabilities of generative AI—a whopping 130 percent increase from those who were considering using AI just eight months prior. considering using AI just eight months prior.

CEOs in industries like advertising, marketing, media and PR, tech and professional services all have the highest rates of positive responses when asked if they are finding business use out of generative AI.

In the other briefing, Chief Executive’s October CEO Confidence Index finds CEOs outlook for 2024 at lowest level in a year, with 87 percent of the 240 chiefs polled saying they expect business conditions to either remain flat (29 percent) or turn negative (58 percent). The growing probability of a recession, many said, will lead to further increases in unemployment, sticky inflation, and a prolonged high-rate environment.

Thomson Reuters – Global Trade

Similar to the above, the Reuters report stated that an environment of almost constant disruption continues to hinder global-trade efforts, and these disruptions come from familiar sources — inflation, rising costs, supply chain shortages, international conflicts, regulatory changes, transportation troubles, and compliance challenges.

Not surprisingly, these sources of disruption and uncertainty also comprise the global trade profession’s top strategic priorities over the next 12 months.

Some key points from this study stated that:

46% of companies say they are impacted by retaliatory tariffs between the United States and China

28% of companies say they are affected by Russian sanctions — down from 39% in 2022.

88% of businesses collect information for ESG purposes from their suppliers at least once a year.

The decision to collect ESG data is driven by three main factors:
- i) to comply with local laws.
- ii) to support the company’s or owner’s values and ethics; and
- iii) to mitigate reputational risk.

More than two-thirds of businesses take ESG considerations into account in their decision to use a supplier.

62% of survey respondents rated “supply chain security and data protection” as their top technology priority, up from 54% in 2022.

Ardent Partners – State of Payables 2023

In addition to the state of procurement report, Ardent also delivers a state of e payables report aimed at AP. I think we forget sometimes, the second P in P2P is all about payments, so this is critical for procurement leaders, not just because an increasing amount (see the previous AQPC report last month) of AP and procurement, are now reporting through the same lines, if not to the same person.

In fact, an early part of this report calls that out in terms of strategic priorities. Efficient collaboration between finance and procurement is key to optimising spend management and supplier relationships. 50% of Ap teams leverage data and intelligence to improve collaboration.

Some other key takeaways, a focus on eliminating paper invoicing and enabling more suppliers to submit invoices electronically, driving greater automation and reducing processing costs. Hurdles include payments taking too long, and a high percentage (47%) of exceptions. Clearly these two are linked with each other. Late supplier payments (as a result of the above 2) are the consequence and also does not help in improving supplier relationships which was called out earlier, as a key part of collaboration between AP and procurement.

Whilst adoption rates haven’t improved much since last years report, the section on adoption is interesting for a couple of reasons.

The inclusion of travel and expense management solution for the first time, and

Network more adopted than portals!

University of Mannheim – State of procurement profession

In this annual survey of around 400 procurement professionals, some interesting points emerge.

Cost & uncertainty are the two top priorities of procurement. Cost is more dominant, and procurement are focussing more on cost (than top management) in their evaluation criteria. This also shows up in procurement involvement in top level discussion, when cost, delivery and quality are the points procurement is involved, when talk turns to innovation, flexibility and (worryingly though this is consistent with many reports) sustainability, procurement are involved less.

Strategies are evolving, with localisation of supply increasing, as well as more dual/multi sourcing outcomes becoming the norm. A focus on driving better relationships as well as increasing inventory to combat the uncertainty are also being implemented.

The Cost-Plus World of supply chains

If I could have 2 reads of the month, then this would be the other one!

This report derives form a survey of 400 executives earlier this year and is written by Economist Impact (sponsored by GEP)

Fifty-nine per cent of survey respondents believe that they will have to make changes to their supply chain to manage challenges in the coming year.

Some of the changes include adopting technology to increase supply chain visibility (63%), followed closely by digitally transforming supply chains (57%).

As stated by a couple of other reports, the biggest impact on supply chains is geopolitical events, (ahead of trade protectionism)

Responses highlight the importance executives are placing on inventories in 2023, with 68% stating increasing inventories are a moderate or high priority, and 55% stating decreasing inventories as a low priority. Yet, although inventories can decrease certain risks, they require more capital investment. Sixty-eight per cent of respondents confirm there are additional costs associated with increasing inventories. This shows that executives are focused on factors beyond cost.

Managing cost is critical to offset, these actions, and benchmarking pricing, supplier consolidation (though in the risk mitigation, it talks about increasing number of suppliers, so this is a category v category approach). External supply chain financing, is another way to offset cost, identified by 34% of respondents as a top 3 approach.

Substitutability is another supply chain strategy being adopted by businesses to weather short-term disruptions. Eighty-four per cent of respondents rated substitutability of moderate to high importance in managing procurement and supply chains disruptions in 2023. By employing input substitution, certain firms will be able to minimise inventory holdings whilst preserving output levels, as versatile inputs can be utilised across different products.

As always reach out to discuss more, copies of the reports mentioned are linked above,

Enhancing Field Configuration UI: A Chrome Extension for Field Searching

2023-12-08T22:28:08+01:00

Introduction:

As an SAP Ariba technical lead specializing in Buying and Invoicing, I encountered a recurring challenge: the cumbersome task of manually searching through field labels, leading to inefficiency and time consumption. Fueled by the need for a more streamlined solution, I developed a Chrome extension to simplify field searches, saving time and enhancing accuracy in the SAP Ariba SM environment.

Problem Facing:

When customizing Ariba Sourcing or Buying and Invoicing, identifying the right field is crucial. However, the current design relies on a time-consuming manual process of scrolling and checking individual field names.

Tool Introduction:

Chrome extension [Search Field Configuration] - an automatic Chrome extension solution for swiftly locating the right field in the Field Configuration UI by simply inputting relevant keywords.

Installation Guide:

Download link: Download from here

Download the extension and unzip the file to your local PC:

Launch the Chrome browser on your computer.

In the top-right corner, click on "More" (represented by three dots), then navigate to "Extensions."

Click on "Load unpacked" and choose the local folder where you unzipped the extension files.

How to Use:

Step 1:Access the Desired Service Manager and Navigate to Field Configuration

Begin by navigating to a specific service manager, searching within a particular realm, and accessing the site. From there, click on the link "Field Configuration" under the Menu Customization Manager. Open the class you wish to search for fields. Refer to the image below:

Step 2: Load the Extension and Refresh the opened Service Manager UI

Once the extension is loaded, refresh the opened Service Manager UI.

Step 3: Access the Extension in Chrome

On the upper right of the Chrome browser, click below the highlighted mark:

Step 4: Open the Search Field Configuration Extension

Click the button and select the installed extension - "Search Field Configuration" and the below pop-up will show on the UI.

Step 5:Refresh Page and Input Search Keys

Click the "Refresh Page" button(The search button becomes clickable only after this), then enter the search keys.

Step 6:Initiate Search and Confirm

Click search and click ok after this pop-up shows.

Step 7:Wait for Results

Wait for the tool to find the right label, and a pop-up will appear below.

Step 8:Decide Next Steps

As per the message, you can click ok to carry on the search by clicking ok, or you can copy the field name, click cancel, and search it on the page as below. (Ctrl + F, paste and search) The field is highlighted with green color.

Step 9: Handle No Results

In case no fields are found, an alert message will appear. Click "OK" to close it.

By following these steps, you'll efficiently navigate and utilize the Search Field Configuration extension to streamline your field searches.

Additional Tips:

If the tool pop-up appears, and you wish to discontinue the search, simply press the "ESC" key to cancel it.

Supported Solutions:

SAP Ariba Sourcing

SAP Ariba Buying and Invoicing

The Procurement Monthly - December 2023

2023-12-19T21:29:27+01:00

Each month i review all the procurement research reports and articles and summarise the best of them, drawing out the key points.

World Commerce & Contracting – CCM Benchmarking

In this report, (756 responses) sponsored by Icertis, World CC looks at the differences that’s happened over contract management over the last couple of years and there are some interesting takeaways.

Increase in both Agile (25% and relational (14%) contract types. Reflecting the changing shape of the world economy

On average contract data sits in 24 different systems in typical organisations, which will present a “challenge” to ensure that you have a complete picture.

The top 5 most measured areas are:
1. Cost reduction achieved (rather than just identified)
2. Compliance to contract
3. Cycle times
4. Contribution to revenue
5. Customer (external) satisfaction

Post signature monitoring of compliance to terms is the top area of interest (also grown by 15%) in technology (mirrors earlier Economist Impact report), followed by obligation extraction.

Contract repository is the top deployed technology at 62% of respondents.

Visibility into (76%) and finding contracts and data (70%) are the top drivers of new technology.

An interesting nougat that appeared was linked to the spread of contract management being no longer siloed in procurement (if in fact it ever really was). The survey tells us that on average 29% of the workforce is in some way involved in the contracting process.

MIT State of Supply Chain Sustainability

The fourth instalment (2300 responses) shows that commitment to supply chain sustainability appears to be resilient to certain types of crises, but vulnerable to others. Large-scale network disruptions, like those precipitated by the Covid-19 crisis and Russia’s invasion of Ukraine in 2022 are shown to result in increased commitment to supply chain sustainability among many firms. On the other hand, in 2023 many firms’ sustainability efforts appear to have been especially sensitive to this year’s negative economic forecasts.

The gap is narrowing between the goals that are being set, and the investment needed to achieve those goals (though investment is not at the level where the set goals will be achieved). What is interesting is that each year there is a differing priority of importance. Diversity for example appears to be in ascendancy over the last few years whereas circularity has stayed stagnant.

When looking at the current actual practices, Supplier codes of conduct (80%) supplier audits, supply chain mapping and company codes of conduct lead the way and the report calls these table stakes for global sustainability programs.

This year’s report had a section devoted to Net Zero goals and almost half of the respondents who had net-zero goals report that their firm will not begin measuring or reducing Scope 3 emissions for five years or more. At the same time, roughly half of responses show net-zero deadlines of 2040 or earlier. Scope 3 reporting appears to be especially vexing, and how to collect reliable data across firm boundaries is still tricky.

Gartner Incentives Suppliers for Sustainability

On the subject of sustainability, Gartner released a paper looking at the actions that can be taken to incentivise suppliers to achieve sustainability goals, and at the top of the list (linking nicely to the world cc and MIT reports are to include sustainability goals in contracts, and to ensure those goals are measured in performance scorecards.

The list is largely as you’d expect, (linking business to performance etc, but an area I thought was very low was the access to better payment terms for improved sustainability performance (65). Not clear if this is linked to organisations ability to offer those terms, but it does seem like an opportunity missed.

In a nod to the MIT Study earlier, only 16% of organizations are actively reducing Scope 3 greenhouse gas (GHG) emissions, and another 27% state that conflicting priorities hinder suppliers from prioritizing efforts to reduce their emissions.

CIPS Professional Challenges

A couple of interesting articles from the revamped CIPS communication platform this month. First Dr John Glen discusses the forces shaping procurement and supply in 2024, including:

Geopolitical Flashpoints (Mid East, Taiwan, Russia/Ukraine

Supply Chain Changes – Logistics falling, reshoring increasing.

Inflation & Interest rates

Slow growth

In the second article, a survey of the CIPS member base identified the challenges keeping procurement up at night. Apart from the above there was also

Sustainability

Workload

SRM & Contract Management

Procurement Leaders Compass 2024

My read of the month for this month.

This report looks ahead to the challenges and opportunities procurement could encounter not just next year, but over the next five years and beyond. It’s a little bit of a future focussed report that poses several what if questions…

What if Gen AI becomes as used as spreadsheets are – Report suggests that Gen AI market value could be $36Bn by 2028 and that market intelligence is recognised as having the biggest impact from AI

What if regulators clamp down on AI – See the recent issues surrounding open AI!

What if globalisation goes in reverse (ie will reshoring/nearshoring/regionalisation continue the current trends). Global trade has basically plateaued (and in fact shown a decline) since 2008. The biggest barrier to the reshaping of supply chains is cost (45%) but as other reports have noted (Deloitte reshoring article last month) these cost prohibitors are shrinking to almost nothing.

What if Economic turbulence erodes enthusiasm for ESG – As discussed in the MIT report earlier, the one area that did slow down the ESG impetus was the Economic realities of 2023.

All in all, a great report one that asks some great questions, and gets you thinking about future strategies and the impacts on procurement.

State of Flux Annual Survey 2023

This is the 14^th iteration of the Supplier Relationship Management (SRM) study, and it paints an interesting picture. The report starts of by stating that many organisations haven’t progressed in the maturity of their SRM programs (if in fact they have them) which is an issue as according to the report 50% of their workforce isn’t employed by them, but by their suppliers.

There’s lots of good case studies and thought leadership in the report, and for those wanting to know more the first half of the paper is dedicated to those studies and thought leadership.

“Feedback received during and immediately after the COVID-19 pandemic revealed that many organisations who believed they were a customer of choice found out they were mistaken.”

The second half looks at the actual data from the study, segmented into the 6 pillars of SRM. Headline stats include:

Value: 87% believe improved risk management is a key deliverable from SRM programs with 75% reporting measurable (non-financial) benefits. 42% have seen measurable financial benefits of cost reduction programs through SRM.

Engagement¨55% of organisations gather supplier feedback by ad hoc conversations.

Governance: 22% of companies use 3^rd party supplier due diligence services. 89% segment their suppliers on business criticality.

People: 69% of leaders have a dedicated supplier management role and 83% of leaders have developed specific competencies for supplier management. 52% identified that SRM sits in centralised procurement functions.

Technology: 80% of leaders have dedicated contract management system. 76% identified improved supplier performance as a benefit from using technology with 62% identify the centralise supplier information as a key problem they are looking for technology to solve.

Collaboration: 92% of leaders use 360 collaboration assessments, and 72% of leaders report improved levels of trust from collaborative relationships.

SSON Accounts Payable

This report which echoes in many stats the findings from the ardent partners state of AP report from last month, in detailing the opportunity for greater efficiency from AP. The lens is slightly different with a shared services context but shares a similar output that the automation and maturity within many could be improved.

59% do not have a designated owner for end to end P2P

78% identified increased speed of processing and cycle time reduction as a top benefit of automation and 56% cited exception handling as the biggest barrier from AP delivering on their brief. (This was also identified as the activity that will be prioritising in terms of automation next).

Suppliers identified PDF as preferred method of invoice submission (though how automated this allows the process to be is interesting and the report makes the point that this will be due to the low levels of automation.

40% identified E invoicing as a technology planned to be implemented in the next 2 years, with budget (56% and competing priorities (54%) being the biggest barrier.

Amazon State of Procurement 2024

A pretty comprehensive study. Pulling out some interesting stats:

95% stated that their org has to outsource procurement activities to third parties. With 72% stating that strategic activities are the ones they outsource

53% state their procurement budgets will increase in 2024.

Top internal challenge is complexity in process/systems and external is costs.

86% cite retaining and developing talent is a top priority with 84% stating attracting new talent.

36% want to invest in tools or tech to increase efficiency.

Beroe – Digital Procurement Survey

Beroe conducted a survey on the digital procurement landscape within its community of members.

53% identified that the demand for cost reduction and greater efficiency is the main driver of innovation in procurement, with technology being 2^nd at 22%, which is supported by recent technological innovations in the procurement sector are perceived to have most significantly improved the efficiency of processes, as reported by 44% of respondents.

28% expressing concerns about the integration of new technologies with existing systems and training and change management pose challenges for 24% of respondents, highlighting the importance of addressing the human factor in technology adoption.

The survey reveals diverse interests within the procurement community regarding the exploration of new digital solutions., AI-enabled Market/Supplier/Commodity Intelligence, Supplier Relationship Management (SRM), and Spend Analysis each garnered the interest of 10% of respondents. AI-driven insights and data-driven decision-making are evidently key areas of focus.

Additionally, Tendering/RFP and Contracting attract 9% and 7%, respectively, showcasing the importance placed on optimizing procurement processes.

PWC CEO Survey

In this the 26^th (wow!) annual global CEO Survey, over 4000 respondents identified some top areas for organisations to consider.

Surprising no one, Inflation and macro uncertainty is the biggest threat over next 12 months but recedes over next 5 years (40/31 to 29/28)

Cost cutting is the order of the day with 52% stating cutting operating costs, but only 16% stating reducing workforce.

48% identified increasing investments in cyber security and 46% identified adjusting supply chains (reshoring/nearshoring) in response to global conflicts.

76% investing in automation of processes and systems, 69% deploying cloud and AI and other advanced tech.

As always reach out to discuss more, links to the reports are included and always happy to hear your thoughts!

New enablement content for SAP Ariba, SAP Concur and SAP Fieldglass

2023-12-20T00:04:24+01:00

In July 2023, we unveiled the SAP Enterprise Support value map for Spend Management and Business Network, which included dedicated learning content for SAP Ariba. We are excited to share that we have recently expanded the value map to incorporate additional content for SAP Fieldglass and SAP Concur. This enhancement ensures a holistic and integrated approach for SAP Enterprise Support customers across spend management solutions.

Value maps provide self-paced learnings, expert-led live sessions, collaborative forums, and access to SAP experts; all included as part of your SAP Cloud subscription contract.

In this updated version you will find new enablement material for SAP Ariba, SAP Concur and SAP Fieldglass, not to mention additional resources such as topic specific value accelerators and links to the most up-to-date release information, which can be found in the Release Navigator.

What’s New?

Redesigned home page layout

The addition of SAP Concur and SAP Fieldglass

Enablement material including new learning journeys, additional resources and value accelerators across solutions

Where to access

3 Easy Steps:

One-time sign-up for SAP Learning Hub, edition for SAP Enterprise Support, is required

Access value maps

Navigate to the SAP Enterprise Support value map for Spend Management and Business Network

Once in the value map, we welcome you to collaborate in our forums, ask questions or “Request a Call” to speak with one of our experts for further help. Value maps are easy to navigate but an on-boarding call allows us to tailor the conversation to suit your needs and highlight specific content for you.

Explore the new value map to unlock the full potential of SAP's intelligent spend management solutions. Dive in to discover what's new and make the most of our offerings tailored just for you. Your journey to optimized spend management begins here!

Got a question about the value maps, or our content? Leverage the “ask questions” feature in the value map or contact us:sapesvaluemaps@sap.com

SAP Ariba — What do Upstream and Downstream Terms Refer to?

2024-01-26T16:50:00.639000+01:00

Have you involved in any SAP Ariba implementation projects? If yes, you might have immediately heard about “upstream” and “downstream” terms. We know SAP Ariba is a cloud-based source-to-pay procurement solution that helps companies manage their procurement processes more effectively. It’s procurement, sourcing, supply chain solution; cloud app; brings suppliers and buyers together. Okay, but what are SAP Ariba products / modules / solutions? What do “upstream” and “downstream” terms refer to? Don’t try to guess! Let’s find out!

Photo by Jéan Béller on Unsplash

SAP Ariba — Upstream

It refers to collaborative sourcing — finding suppliers for a given need — collaborative contract management, supplier information and performance management, and spend analysis. Solutions as follow:

SAP Ariba Contracts — combines the contract creation, negotiation, and amendment process, authoring, approval using e-signatures, and execution.
SAP Ariba Sourcing — provides sourcing and negotiation; basically finding the right suppliers and negotiating the price to provide goods and services.
SAP Ariba Spend Analysis — process of analyzing historical spend by collecting, categorizing, cleansing, and evaluating data on spend from all business units across the organization to address more complex reporting requirements.
SAP Ariba Strategic Sourcing Suite — manages bill of materials (BOMs) and integrates your PLM (Product Lifecycle Management) and ERP systems.
SAP Ariba Supplier Information and Performance Management — its older solution of SAP Ariba Supplier Lifecycle and Performance, just look into the next.
SAP Ariba Supplier Lifecycle and Performance — process of managing suppliers throughout their lifecycle from initial registration and onboarding to qualification to performance management and development.
SAP Ariba Supplier Risk — proactive process of identifying and mitigating risks cost effectively across the buyer organization’s supply chain.

Photo by Artem Darkov on Unsplash

SAP Ariba — Downstream

It refers to operational procurement process which includes managing buyer catalogs, creation and approval of purchase requisitions, creating and sending purchase orders, receiving items, and invoice reconciliation and approval. Solutions as follow:

SAP Ariba Buying — ordering in Ariba and integrating S/4HANA for goods and services receipts and invoicing and payment.
SAP Ariba Buying and Invoicing — supports end-to-end procurement processes through payments.
SAP Ariba Catalog — managed in the Ariba Network. Some catalogs can be internal to your company, containing items such as material/product master from S/4HANA.
SAP Ariba Contract Invoicing — are associated with one or more contracts that you have with a supplier, and must use contract pricing terms.
SAP Ariba Invoice Management — five invoice (e-invoice) solutions including cloud-based electronic invoice, invoice management, contract and service invoicing, global invoicing and compliance, and supplier enablement services.

Photo by Daniel Lee on Unsplash

RFx — SAP Ariba Sourcing

You may also hear about some acronyms like as follow, they all below are collectively known as RFx

RFI (Request for Information) — to determine whether a supplier meets basic requirements that are required by your organization and whether the supplier can provide the goods and services needed within the timeline you may set.
RFP (Request for Proposal) — an event that collects both information about suppliers’ qualifications as well as pricing information. It serves to gather competitive market and pricing information by specifying what the customer is looking for and describes each evaluation criterion on which a vendor’s proposal will be assessed.
RFQ (Request for Quotes) — would be the preferred way to connect with suppliers on providing pricing that can be used for new orders.

Conclusion

There are a lot of things to learn if you are a newbie in SAP Ariba ecosystem. Enjoy reading and learning!

References

Colin Glazier. Nov 6, 2023. What is SAP Ariba Used For? ZIP
Abhijit Shinde. Oct 10, 2023. Invoicing in SAP Ariba. SAP Community
Rachith Srinivas, Matthew Cauthen. 2021. SAP Ariba. Rheinwerk Publishing
SAP Ariba Procurement Solutions v2311. SAP Help
2016. BHP RFQ Quote Automation Guide v1.1. SAP Ariba Support

* Published SAP Ariba — What do Upstream and Downstream Terms Refer to? at https://medium.com/@tncykarc

2402 Early Release Series for SAP Procurement and SAP Business Network releases

2024-01-26T19:21:48.669000+01:00

SAP strives to equip our customers and partners with valuable release readiness resources for each SAP Procurement and SAP Business Network quarterly release.

Early Release Series

The SAP Procurement and SAP Business Network Early Release series of webcasts cover features planned for the upcoming quarterly release. This platform, available to customers and partners, has a clear mission: deliver an interactive forum to engage with SAP product experts providing simple, direct answers to your most pressing questions. There is a different session for each product area with content tailored for the specific audience:

Source-to-Contract
Procure-to-Pay
Supplier Management & Risk
Business Network

If you want to learn more and actively engage with SAP subject matter experts, we encourage you to participate in these informative sessions. Register now!

Quarterly Release Communications

The release calendar for SAP Business Network and release calendar SAP Ariba Applications, on SAP Ariba Connect, identify release timing several quarters in advance.

Notice of upcoming quarterly releases will be communicated to Buyer customers three weeks prior to the release date. Suppliers receive notice two weeks prior. Releases are communicated via email notification (look for subject line starting with: Advance Release Notice).

Designated Support Contacts (DSC) and anyone from your organization that have chosen to subscribe to product notifications will receive these announcements.

Where to find out more details?

On demand replays of webcasts from completed quarterly releases can be consumed from SAP Ariba Connect.

SAP Ariba Source to Contract 2402 Release Key Innovations

2024-01-29T08:12:39.302000+01:00

Please take a couple of minutes to review and enjoy the highlights!

Accelerating Enterprise Category Strategy Development with Generative AI-Enhanced Content Recommendations

Introducing Dynamic Content Recommendations: a game-changer within our Category Management Application. Empowering category managers, this Large Language Model-integrated feature fills the Market Dynamics, Category Segmentation, and Cost Structures tools with context-aware insights. Say goodbye to laborious research as these tools can now be kick-started with preloaded content, revolutionizing strategy planning in SAP Category Management.

A new button, “Generate with AI” is now available within the tools Category Segmentation, Market Dynamics, and Cost Structure. Category managers can click the Generate with AI button to generate data for the segmentation scores, Porters Five Forces scores or cost structure component percentages within the respective tools. Furthermore the content within Notes, Summary and Additional Resources are prefilled based on content retrieved via artificial intelligence.

This feature will help you to accelerate category strategy management instantly.

Video: https://support.ariba.com/item/view/204707

Feature description: https://support.ariba.com/item/view/208421

Built-In Support in SAP Ariba Category Management for Easy Access to Support Resources

We understand that quick and easy access to support is paramount. That's why we've integrated a built-in support capability within our Category Management solution. Users with SAP S-user accounts can now access our support knowledge base and log support incidents without ever having to leave the application.

Support for Approved Manufacturer Facilities Data in Guided Sourcing
We've addressed a key issue specific to guided sourcing. This feature adds support for retrieving the Approved Manufacturer Facilities (AMF) data for suppliers participating in guided sourcing events created to get material quotes from product sourcing. Buyers can use this information to review the factory details of suppliers before publishing the event. Suppliers bidding for line items in the event can selection the suitable AMF for each line item before placing their bids. This enhancement addresses the need for uniformity and provides a seamless experience for users in Guided sourcing. UI Option to Enable the European Single Procurement Document (ESPD) for Public Sector Sourcing

To simplify processes for our public sector users, we've introduced a UI option to enable the European Single Procurement Document (ESPD). ETendering Administrators can now enable ESPD with just a few clicks.

Disable User Group Creation in Contract Workspaces and Guided Sourcing Projects

In response to compliance issues raised by customers, we've introduced a feature that enables template administrators to prevent event owners from creating new user groups in contract workspaces and in sourcing requests, events, and projects in guided sourcing.

Ability to Create SAP Business Network Discovery Postings for Guided Sourcing

This new feature empowers buyers using guided sourcing to create and publish SAP Business Network Discovery postings for public- and private-sector events directly from the guided sourcing experience. This enhancement opens up opportunities for new suppliers to find posting details and express intent to participate.

Feature description: https://support.ariba.com/item/view/208427

Scoutbee Supplier Discovery™ Integration with Guided Sourcing

We're excited to announce the integration of Scoutbee Supplier Discovery™ with guided sourcing. With this feature, customers can discover new suppliers by publishing the supplier discovery demand request to Scoutbee Supplier Discovery™, boosting the effectiveness of their sourcing processes.

Dynamic Sourcing Library Lot Definition Enhancements
Our Dynamic Sourcing Library now allows customers to automatically add lot definitions to sourcing events when specific rule conditions are met. This feature eliminates manual effort and enhances the flexibility of the sourcing process.

We're thrilled about these new features and improvements and can't wait for you to start using them! We believe that these enhancements will bring about a significant positive impact on your category management, strategic sourcing and contracting processes.

Stay tuned for more updates!

For more information on SAP Procurement efforts, please visit:

Register for our 2402 early release series webcasts Early Release Series - 2402 release
Feature information portal (SAP Ariba Connect) available here
Help Portal Product Page for Procurement and Network
SAP Procurement Community: here
What’s New here
Revisit prior release blogs from 2023: Q2 – 2305 / Q3 – 2308 / Q4 - 2311

Why Procurement (still) matters

2024-02-01T15:59:05.196000+01:00

Within every B2B structure, procurement is far more than just a business necessity. It's a strategic function that holds much sway on the performance, profitability, and competitiveness of both buyers and suppliers.

As someone who's been deeply involved in the procurement landscape, I've resonated with several key aspects that underline its importance. In this blog, I share five of these, coalescing my insights with real-world examples. I also go beyond these to encompass some additional elements that make procurement indispensable in B2B operations.

Procurement as a Tool for Cost Reduction and Savings Maximization

If you've been following discussions on procurement strategy in recent years, you'll know that cost reduction and savings maximization are never far from the conversation. This point has been reiterated so frequently that, for many of us in the field, it's become something of an adage. It's not new, but it remains, undeniably, crucial.

Through its ability to source goods and services from suitable and cost-effective suppliers, procurement has proven its worth in achieving these timeless business objectives.

An informative study by the Aberdeen Group throwing more light on this: top-run procurement organizations, it says, can save as much as 12% on their capital spend, amounting to thrice the savings of their average counterparts (Aberdeen Group, 2014).

Procurement: The Stimulus for Innovation and Value Creation

In today's fast-paced, competitive world, innovation and value creation serve as the lifeblood for business success. Procurement functions can collaborate intricately with suppliers, fostering an environment of innovation and co-creation in B2B transactions.

This concept is exemplified by a case study by the Chartered Institute of Procurement and Supply (CIPS) showcasing Rolls-Royce's partnership with its suppliers. Their collective procurement strategies co-created value, leading to improved engine performance, reduced emissions and, consequently, increased customer satisfaction (CIPS, 2016).

Mitigating Risk through Proactive Procurement Strategies

In light of the prominent conflicts and political uncertainties we see in many parts of the world today, risk mitigation has risen to be an utmost crucial factor to consider. The global business environment harbors numerous unpredictable risks. These potential issues could be anything - from environmental, social, and governance issues to cyber threats and geopolitical uncertainties. Smart procurement functions help businesses identify, assess and manage these potential threats.

The World Economic Forum (WEF) has emphasized the role procurement can play, citing how it helps address the complex risks and challenges prevalent in global supply chains. These risks include widely-discussed environmental, social, and governance issues, cyber threats, and geopolitical uncertainties (WEF, 2020).

Fostering Long-Term Relationships and Trust: A Key Procurement Function

Strong, trust-based relationships serve as pillars for B2B transactions. Procurement can foster these relationships, facilitating communication, aligning goals and expectations, and amicably resolving conflicts or disputes.

The Institute for Supply Management (ISM) survey substantiates this, indicating that 83% of procurement professionals consider supplier relationship management (SRM) a strategic priority, attributing positive outcomes such as increased efficiency, quality, and product innovation to effective SRM implementation (ISM, 2017).

Procurement’s Role in Supporting Sustainability and Social Responsibility

In a world grappling with climate change and social justice issues, the role of procurement in tackling these challenges cannot be overstated. On a personal level, the possibility that procurement can genuinely contribute towards better environmental policies, climate initiatives, and social justice not only gives me hope, but also strengthens my own engagement in this field.

I believe that businesses can make a significant societal and environmental impact by integrating their procurement functions with sustainable practices and social responsibility initiatives.

This is further backed by an International Trade Centre (ITC) study showing that over 90% of consumers prefer companies that take their social and environmental responsibilities seriously (ITC, 2019).

It's clear that far from being a mere business necessity, procurement has power and purpose. The potential to influence change is not just a reason for businesses to align their procurement strategies with sustainability and social justice, but a compelling cause for all of us in this industry to commit passionately to what we do. It's a fight worth fighting and an endeavor worth every ounce of our efforts.

Beyond these reasons, procurement further uplifts B2B transactions by granting diversity, inclusion, and fostering digital transformation and data-driven decision making. It also aligns with the strategic goals and priorities of organizations, acting as a catalyst for growth and competitiveness.

To conclude, procurement's role extends far beyond conventional business operations, impacting performance, profitability, and competitiveness. Moreover, well-executed procurement strategies have the potential to contribute positively to society and the environment.

Considering these insights, any modern B2B environment must acknowledge procurement’s potential and realign its strategies to unlock further value. It is more than a process - procurement can be a game-changer in business-to-business transactions.

Have a wonderful day, I hope you find this useful, and if you have any thoughts about it, please don't hesitate to share in the comment section.

Lars

How can I gain advanced deployment capabilities of SAP Ariba applications?

2024-02-14T16:34:28.981000+01:00

We recommend to access our Configuring SAP Ariba Application learning journey

Overview

This learning journey will guide you through the advanced deployment capabilities of SAP Ariba applications. This include applying a configuration baseline, realize field configurations, and perform go-live migration.

NOTE: The feature this learning journey covers has limited availability and is not available to anyone outside the early access group

Learning objectives

Upon completion of this course, consultants and administrators will be able to prepare, share, and apply best practice configurations with customer test sites, extend the solution with complex field configurations, and efficiently manage the deployment and go-live migration.

Prerequisites

Hands-on experience with SAP Ariba projects
Knowledge of the SAP Activate methodology
One or more of the following certifications:

SAP Certified Application Associate for SAP Ariba Procurement
SAP Certified Application Associate for SAP Ariba Sourcing
SAP Certified Application Associate for SAP Ariba Supplier Management
SAP Certified Application Associate for SAP Ariba Contracts

Please ask a question related to the digital learning Journey in the Q&A area

Our SAP Learning Experts will get back to you as soon as possible! We are here to support you.

We appreciate your feedback and we will make sure to continue sharing interesting topics.

Generative AI-powered Contract document processing with Large Language Models

2024-02-19T03:54:18.101000+01:00

Introduction

Contract Document Processing Use Case

Automate the extraction of relevant information from contract documents with Document Information Extraction with Generative AI (premium edition) by leveraging the capabilities of Large Language Models, ensuring faster, more accurate document processing with significantly reduced processing costs.

Process Supply Contract using Generative AI

Document Information Extraction Service does not come pre-configured with support for custom document type - Contract. So, let us create a custom schema utilising Large Language Models (LLMs) to specify the fields we wish to extract from the supply contract document.

Schema Creation for Supply Contract

Access Document Information Extraction Application as described in the tutorial Use Trial to Set Up Account for Document Information Extraction and Go to Application and create new schema.

Create Supply Contract Schema

Supply Contract Schema

Addition of Fields

Access the supply contract schema and add fields at header and line item level.

Add Data Field

Note:

LLMs are used to extract the data from the document when you use setup type auto.

Added Fields

Tip:

When adding field names and descriptions, consider yourself explaining what you want to extract to someone who doesn't know anything about it already.

The better you describe the information that you want to extract using generative AI, the better your results will be.

Similarly, fields can be added at line item level.

Schema Activation

Now, activate the supply contract schema.

Activated Schema

Obtaining Extraction Results

Upload the contract document (sample below) using the newly created supply contract schema.

Sample Supply Contract

Supply Contract Schema associated Document Upload

Extraction Results

Conclusion

With the Schema Configuration feature from Document Information Extraction and LLMs, we have now successfully extracted information from a supply contract document without the need to create any templates.

Similarly, Document Information Extraction with Generative AI can be utilised for extracting structured information from other types of contracts.

Further Information

Please feel free to add a comment, should you have any queries.

Best Regards,
Anuradha Dhingan

SAP Ariba Integration scenarios with SAP S/4HANA Public Cloud system

2024-04-10T16:45:32.818000+02:00

Introduction

SAP Ariba solutions extend the core operational processes, providing full source-to-settle functionality with both S/4HANA Private cloud and S/4HANA Public cloud systems.

In this blog, we will see the Ariba technical scenarios which can integrate into S/4HANA Public cloud. Considering the restriction of leveraging the Ariba standard integration method, we will also see what integration method can be used to connect Ariba and S/4HANA Public cloud system.

S/4 HANA public cloud integration with SAP Ariba includes guided buying, collaborative sourcing, and networked-based, end-to-end supplier collaboration to deliver a new and simplified user experience and a seamlessly integrated working model with suppliers using SAP Business Network.

We can extend the core capabilities of SAP S/4HANA Cloud with SAP Ariba solutions in a single-instance deployment. This enables you to receive business documents from SAP Ariba solutions in SAP S/4HANA Cloud and to execute end-to-end processes. Ariba FPC can not be integrated with S/4HANA public cloud.

Available Integration scenarios between Ariba and S/4HANA Public cloud system:

Below mentioned technical scenarios can be integrated from Ariba to S/4 HANA using SOAP APIs using Managed Gateways Passthrough integration. Integration method for below scenarios is different than integrating on-prem S/4 system, So no managed gateway add-on required to connect these systems

Sl #	Technical scenario number	SAP Ariba Technical Scenarios name	S/4HANA Public cloud Integration
1		Supplier Management (SLP) – Bi-directional sync	yes
2	4BL	Sourcing with SAP Ariba Sourcing	yes
3	4AZ	Contract Management with SAP Ariba Contracts	yes
4	2NV	Guided Buying Capability with SAP Ariba Buying	yes
5	42K	Source-to-pay with SAP Business Network (Commerce Automation)	yes

SAP S/4HANA public Cloud in connection with SAP Ariba applications allows you to largely benefit in streamlining your procurement processes:

1. Integrating Supplier Data from SAP S/4HANA Cloud with SAP Ariba Solutions Using SAP Master Data Integration

We can use SAP Master Data Integration (MDI) to replicate supplier data from SAP S/4HANA Cloud to SAP Ariba solutions.

SAP MDI replicates supplier data to SAP Ariba applications through SAP Integration Suite, managed gateway for spend management and SAP Business Network. The following diagram illustrates this process:

Supplier data integration using SAP MDI supports the following Source to Pay business processes for the SAP S/4HANA Cloud integration solutions:

SAP Documentation link: About Supplier Data Integration with SAP S/4HANA Cloud Using SAP Master Data Integration | SAP Help Portal

3087667 - Connecting from SAP S/4HANA Cloud to SAP Master Data Integration service - SAP for Me

Reference link for Bi-directional update:

SM-31650: Support for Bidirectional Integration of Supplier Data with SAP S/4HANA Cloud Using SAP Master Data Integration (MDI) | SAP Help Portal

2. Sourcing with SAP Ariba Sourcing

Sourcing with SAP Ariba Sourcing (4BL) enables to identify sources of supply for purchase requisitions in SAP S/4HANA public Cloud, using the community of suppliers in SAP Business Network and the SAP Ariba Sourcing solution. Note that this scenario is the successor of Sourcing with SAP Ariba Sourcing (1A0).

You can find more information about feature overview in the below SAP help documentation link: Sourcing with SAP Ariba Sourcing (4BL) | SAP Help Portal

3. Contract Management with SAP Ariba Contracts

Contract Management with SAP Ariba Contracts" (scope item 4AZ) enables you to perform strategic sourcing activities and to integrate prices from SAP Ariba Contracts into operational systems, that is, SAP S/4HANA Cloud.

You can find more information about feature overview in the below SAP help documentation link: Contract Management with SAP Ariba Contracts (4AZ) | SAP Help Portal

4. Guided Buying Capability with SAP Ariba Buying

The guided buying capabilities of SAP Ariba are designed for employees who order goods using a self-service. Guided Buying Capability with SAP Ariba Buying allows procurement organizations to scale self-service procurement across spend categories while enforcing compliance.

Note: Procure to pay with SAP Ariba Buying & Invoicing with S/4 HANA integration scenario is deprecated

For more detail about 2NV can be referred in the below link: Guided Buying Capability with SAP Ariba Buying (2NV) | SAP Help Portal

5. Automation of Source-to-Pay with SAP Business Network (42K)

The scope item Automation of Source-to-Pay with SAP Business Network (42K) enables you to seamlessly connect from SAP S/4HANA Cloud to your suppliers in SAP Business Network. You can send them requests for quotations, asking for price and quantity information as well as for shipping costs. You can also send electronic purchase orders and goods receipts to your suppliers using SAP Business Network, and you can receive electronic order confirmations for materials, advanced shipping notifications, and invoices in SAP S/4HANA Cloud from your suppliers. You can also send payment advices in electronic form to your suppliers in SAP Business Network. All data is routed through SAP Integration Suite, managed gateway for spend management and SAP Business Network.

SAP Documentation link : Automation of Source-to-Pay with SAP Business Network (42K) | SAP Help Portal

Hope this blog help you to understand in the possible scenarios can be integrated between Ariba and SAP S/4HANA public cloud.