uc what’s new, what’s coming and best practices – spend visibility, sourcing, contract...

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What’s New, What’s Coming and Best Practices – Spend Visibility, Sourcing, Contract Management and Supplier Information and Performance Management

Alex Saric, Director EMEA Marketing, Solutions Management Liaison

© 2011 Ariba, Inc. All rights reserved.

Related Track Overview

Deep dive sessions on Thursday:• Contract Mgmt/SIPM - 9:00 - 10:15• Sourcing - 10:30 - 11:45

© 2011 Ariba, Inc. All rights reserved. 2

Ariba Snapshot

• The leading provider of Collaborative Business Commerce solutions• $360M revenues in FY 2010• 4.5M+ paying subscribers from >25,000 global companies

¨ Incl. 98% of the Fortune 100 • The World’s Largest Web-based global trading community

¨ Incl. >500,000 buyers, sellers, service providers• Global services and expertise

Ariba: Leading Market Productivity

1996 2010 and beyond

Procurement

Supplier Network

Spend Management

SaaS

CollaborativeBusiness

Commerce

3 © 2011 Ariba, Inc. All rights reserved.

+ Average number of trading partners: 134,500(Source: Forbes Global 2000)

+ Transactions completed manually: 80%(Source: Celent Communications)

+ Paper-based invoices and payments: 85%(Aite Group: Global Cash Management: Going Green. 2009)

• Costs of ineffective collaboration: $650 Billion(Source: Basex Research- “Information Overload” Feb, 2008)

¨ Inefficient Commerce Collaboration is Costing G2000 $338 Billion(Source: Ariba Benchmarking)

Source Procure Pay

Sell FulfillInvoice &

Collect

Wastedtime andresource

Lostnegotiation

history

Poorvisibility intocompliance

Manualad hoc

collaboration

Delayedpayment;

Cash“mis-mgmt”

Limitedvisibilityand risk

Buyer

Seller

ERP or Niche ERP

CRM ERPOrder Mgmt.

The Business Commerce Problem…Investments Inefficiencies Remain Between Companies


5

• Expand sales alliances and channels

We Have Already Started Solving Them…


• Market and sell to sellers

• Be the world’s business commerce network• “Consumerize” business commerce• Acquire sellers and buyers in mass

• 10K, 2M, 1T

• Develop more ways for sellers, buyers, and partners to collaborate• Expand partner ecosystem and open network• Transition to scalable, community-based operating model

Sellers Buyers

Collaborations

Discovery

Quadrem

SFDC

Buyer SellerMatching

AMEX

Broader Markets

Ariba Exchange

Self Service

Cloud Mgmt

Unified SellerExperience

SMS Divest

Service ProcAlliances

Interesting Facts Looking Back• Did you know?

¨ Nearly all Procuri customers have completed migration¨ 521 Sourcing OnD¨ 268 Contract Mgt OnD¨ 171 Supplier Mgt OnD¨ 146 Spend Vis¨ 43 Savings Pipeline and Tracking

• Redefined Sourcing to be much more “Collaborative”• Seeing traction in joint partner solutions


Consumer Technology Trends Are Changing the Way Business Is Done

Then

Now

• Broader access to data• Social networking going mainstream• Increased collaboration between companies • Information provided contextually

Matching Services

Access to Content

Mobile Computing

CommunicationNetworking


Ariba Continues to Revolutionize the Way Sourcing Customers Go to Market…


• Paper and spreadsheets• Ad hoc projects• No processes

Manual Sourcing

eSourcing

Strategic Sourcing

Collaborative Sourcing

• Automation • eAuctions• Pipeline management

• Broader spend coverage• Strategic orientation• Best value business

intelligence

• Proactive notice of new sources of supply

• Peer Collaboration on best practices

• Networked community – supplier driven advice

• Sustainable savings• Robust project pipeline• Enhanced value

Benefits

Next generation Sourcing

…with an Industry-pioneering Approach


+

Using world’s leading Ariba Sourcing SolutionAriba Discovery and eIntros

Innovations included as part of subscription to Ariba Sourcing

10

Partner Ecosystem Accelerates Innovation

• Important note:¨ We will create a partner ecosystem to deliver more capabilities faster

• Examples:¨ IBM Lotus Live (Discovery collaboration)¨ Hubspan (integration)¨ The Receivables Exchange (receivables financing)¨ Demica (supply chain financing)¨ Descartes (logistics)

– Logistics visibility and planning. Network to network interoperability.¨ D&B (intelligence)

– Financial risks scores to further trading partner qualification/confidence on Ariba Discovery



eSignature• Tightly integrated with DocuSign, the leading

electronic contract execution (ECE) provider• Signature/initial block• Sequence• Assemble Signature Task & Route• Sign

• Leverages PDF generation/concatenation

Salesforce.com integration• First “Commerce Connector”• OOTB sample implementation/SOW of SFA to

Ariba Contract Mgt On-Demand• Create Workspace• Edit Header of Workspace• Push Terms file from Workspace

• Ariba Contracts for Force.com

11

Partnering: Ariba Contract Management

Looking Forward


Functionality and usability testing

Early access programs and design partnerships

Feature surveys

connect.ariba.comOn-site customer visits

Advisory councils and user groups

Common Code Line

On-Demand Releases

9s5 10s1 10s2 Future Releases

Disciplined Innovation ApproachCombining all customer experience into the journey

© 2011 Ariba, Inc. All rights reserved. 1311s1

Ariba’s New Release ModelGuiding Principles


Decouple App releases

•Allows focused engineering execution by solution area

Independent Platform Development

•Minimizes quality risk of simultaneously changing all layers in the architecture

Focus on Readiness •Explicit focus on readiness tailored by solution

Quarterly Drumbeat •Predictable schedule for bringing innovation to the market

“Cloud Cadence”

11s1 (Spend Vis, Supplier

Mngmt, Sourcing, Contract)

11s1 (Spend Vis, Supplier


11s2 (Procurement & Ariba

Invoice Pro )

11s2 (Procurement & Ariba

Invoice Pro )

11s3 (Ariba Network)

11s3 (Ariba Network)

12s1(Spend Vis, Supplier




12s2(Procurement & Ariba

Invoice Pro)


Invoice Pro)

12s3(Ariba Network)

12s3(Ariba Network)


Mngmt, Sourcing Contract)


Mngmt, Sourcing Contract)


Invoice Pro)


Invoice Pro)

13s3(Ariba Network)

13s3(Ariba Network)

14s114s1

14s214s2

14s314s3

2011 (calendar year) 2012 20132Q11 3Q11 4Q111Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13

Ariba’s Future Release CadenceImproving Predictability, Quality and Innovation Rate


• Extend leadership in spend management ¨ Increase the usability and adoption of Ariba Solutions¨ Provide easier ways to manage cash and faster access to liquidity

• Expand participation of inter-enterprise collaboration¨ Increase the number of business opportunities¨ Simplify supplier’s ability to do business across companies¨ Reduce the number of methods that you use to connect to the cloud to cut cost

and improve efficiency¨ Stimulate organic growth without Ariba involvement

• Converge integrated, network-centric offerings ¨ Centralize the way you do business across companies¨ Increase the number of reasons for Suppliers to participate in the Cloud¨ Provide centralized supplier information for distribution and collection

• Simplify on-boarding of participants and reduce cycle time¨ Reduce administration, configuration, and deployment costs with self-service capabilities¨ Faster and easier to do business with Ariba Partners using a partner framework¨ Reduce the cycle time for businesses to on-board their partners into the Cloud

Ariba Solutions Innovation Focus


Release: 11s1


FEATURE DESCRIPTIONEnhanced Multi-Fact Reporting Enhanced multi-fact reporting enables you to

create reports that include data from up to three facts without mapping common dimension fields for aggregation.

BENEFITS EXAMPLES• True join of data across fact tables based on

defined key fields. • Ability to generate better operational and detail

level reports.• Provides ability to specify on single report detailed

data fields and correct aggregation of joined detail from multiple fact tables.

• Join data from three facts tables on single report.• Left outer fact table join support (purchase orders

without invoice payments).• Creation of user-defined formulas using measure

fields from multiple fact tables.• New UI to support creation of multi-fact reports.

• Track actual invoice spend against purchase orders.

• Compare receipt quantity to purchase order quantity.

• Show project header and project task data on the same report.

• Track savings form header data with savings form detail and project data.

• Report on sourcing event data with project header and task details.

• Track approvers and task due dates by project type.

11s1 - Reporting for All Solutions


FEATURE DESCRIPTIONTask and dForm Document Process Improvements This set of features allows more control over the

processing of dForms in projects. For example, you can force an approval before Publish, set a prototype to be used for ad hoc form creation, control whether or not Draft versions of forms are sent to reporting, and control how many forms of a given type can be created per workspace.

BENEFITS EXAMPLES• Much better control of when data is available

for reports.• Guided and forced approvals on dForms.• The ability to define and templatize, in advance,

the forms allowable for ad hoc creation in a project.

The ability to force approvals before a dForm in a Supplier Workspace can be Published, guide you to the approval that needs to be done, and make sure that the data from that form is not reportable until that form gets published.

11s1 – Upstream Platform dForms


FEATURE DESCRIPTIONSupplier Enrichment Information Enhancements Spend Visibility Field Updates will allow Sales

Revenue and Employee Count fields to be more useful in aggregate reporting by making them ranges of values instead of showing the specific number. In addition, the Credit Rating field will be replaced with payment trends, which is content from D&B and provides trending information on when suppliers are making payments to their creditors.

BENEFITS Examples• Allows users to filter, search, and report on

suppliers that fall into specific ranges of Sales Revenue and Employee Count fields.

• Payment Trend data provides better accuracy around credit information though insight into how suppliers are paying their creditors.

• Employee count will be aggregated into 5 range groups such as 501-1000 and 1,001-5,000.

• Sales revenue will be aggregated into 10 range groups such as $1M to $5M USD and $10M to $50M USD.

• Payment Trends will be aggregated into 11 categories such as 15 days late, 30 days late, and Prompt.


11s1 – Ariba Spend Visibility

FEATURE DESCRIPTION

Savings Form Allocation Improvements Improves the usability of Savings Forms by automating the breakdown of savings across commodity, regions, departments and custom created dimensions. Also, adds the ability for details to be edited in excel and imported back into the savings form.

BENEFITS EXAMPLES

• Allows users to get more value out of Savings Forms because they can allocate savings at a more refined level in a much more efficient manner.

• Also, adding support for custom vector fields enables organizations to extend the forms to accommodate custom dimensions that they can allocate savings across.

• Support for custom vector fields• Ability to automatically distribute savings detail

across time periods and dimensions like Commodity, Regions, Departments, and Custom Vector fields

• Excel export and import of allocation details• New Savings Allocation Summary table


11s1 – Ariba Sourcing

FEATURE DESCRIPTION

Enhanced Integration with Ariba Discovery* Increased the value of Discovery for Ariba Sourcing buyers by making it easier to find, evaluate, and include Discovery suppliers as a part of their Sourcing events

BENEFITS EXAMPLES• Buyers can spend less time and effort

discovering new suppliers to increase the competitive nature of their Sourcing event

• Buyers can conduct posts within their Sourcing events making them more effective and efficient in a solution they are already familiar with.

• Moved where buyers are prompted to create a Discovery Post, earlier in the event build process

• In event monitoring of Discovery posts and supplier responses

• New ability for suppliers and buyers to network based upon current sourcing activity, eIntros

* Delivered prior to 11s1


11s1 – Ariba Sourcing

Ariba Solution RoadmapStatement of Direction for

all Solutions


TODAY: CURRENT FEATURES

BENEFITS

Ariba Spend Visibility


• 3-Dimensional visibility for true spend intelligence

• Consolidated data from multiple systems, source types and categories

• Flexible data schema to address industry-specific needs and fact customization

• Extensive, custom services to drive ROI and adoption

• Pre-packaged best-practice reports and customized taxonomies

• Accelerated savings via improved sourcing decisions and contract terms

• Focus on efficient analysis and planning, not gathering and processing data

• Reduced maverick spending through effective monitoring

• Greater intelligence delivered by internal and external market visibility

• Embed all critical information in Spend Visibility

• Expert services

• Improve usability

• Integrate data across suite

• Continue enhancing enrichment

• Cross Business Commerce Reporting

STATEMENT OF DIRECTION


BENEFITS• Accelerates bottom-line results and rapid total cost savings through:

¨ Efficient negotiation of lowest-total-cost and best-value supply relationships ¨ Integrated Supplier Discovery drives additional savings through improved bid

competitiveness

• Sustainable organizational knowledge through embedded in-context intelligence

• Improved Sourcing Program visibility and compliance

• Collaboration with commerce partners and community

• RFX Creation and Management • Sourcing Optimization, Analysis and Reporting

• Supplier Discovery using Ariba Supplier Network

• Online and offline process, project workflow and knowledge mgt

• Global, Multi-Lingual and Multi-Currency Capabilities

• 3rd Party Integration, Community Exchange and Strategic User Access

• Savings Pipeline and Tracking

Ariba Sourcing


• Ubiquitous adoption of best practices and processes

• Sophisticated optimization: Large line item volumes

• Complement forecasting, budgeting, and planning systems

• Leverage user network for knowledge gain-share via Online community, Template exchange, eIntros



BENEFITS


• Addresses all aspects of Contract Management Compliance

• MS Word integration and 3rd-party paper mgt; Electronic signatures with PDF gen

• Contract risk and performance management

• Third party integration of data and process flows via Webservices (CRM, ERP)

• Advanced and self-service workflows, permissions, and approvals

• Pre-approved clause libraries and contract template

• Ad hoc and advanced reporting

• Capture offline emails and Business contacts

• Enhanced intelligence visibility and control of all contracts and amendments (buy and sell side)• Improved supplier, operational, and regulatory compliance • Improved negotiation effectiveness

• Realization of negotiated cost savings

• Increased revenue through optimized value with customers• Efficiency through Faster contracting cycle times and external integration• Improved customer and supplier performance

• Collaboration through communications and community support

• Enterprise system of record with high fidelity data export/import: Legal, Finance Procurement, Sales Channel

• Full contract and forms process and sophisticated workflow automation

• Integrated best-practice expertise

• Compliance mgt with External Systems

• Streamlined and mobile UI for the casual/field users

Ariba Contract Management



BENEFITS


• Collaborative and automated corrective action planning and execution • Mitigated risk by proactively monitoring supplier certifications and performance • Efficient supplier assessment and qualification through community access• Scorecard supplier performance on quantitative and qualitative measures • Intelligence through 360-degree and up-to-date view of all suppliers

• Accurate diversity certification

• Information Management¨ Supplier Self-registration ¨ Collaborative Supplier Process Lifecycle Management with self service approval flows and one to many template management

• Performance Management¨ Online surveys with reminders and Scorecards ¨ Advanced 360-degree supplier reporting

including custom fact for 3rd party info¨ Actionable alerts enable proactive monitoring of

performance issues

• Supply Risk Assessment Services – Identify, manage and mitigate Supply Risk

• Vendor master integration and Supplier Information Enrichment

• Integrate supplier info from 3rd part sources, customers, Ariba experience and network

• Unify Ariba supplier information and data collection

• Customer/organization management

• 3rd Party supplier information validation

• One to Many Supplier Management

• Network-centric supplier information management

Ariba Supplier Management


Typical Business Requirements for Supplier Management


Supplier Portals

Vendor MasterManagement

Risk Management

Diversity/Green/Corporate

Responsibility

Registration &On-boardingProcess

PerformanceManagement

Supplier Management

Supplier Discovery

“Supplier Management” is multi- faceted and touches many aspects of Business Commerce

• Supplier Information Management that unifies platform, process and supplier profiles across the company and keeps it current, complete and correct.

• Highly usable web-based portal for suppliers to register and manage information collaboratively with customers

• Supplier Performance Management capabilities

including Process Workflow and approvals, Surveys

and scorecards, flexible role based dashboards and

customizable reports

• A robust technology platform that seamlessly integrates in-context Supplier info such as Parentage, Financials, Diversity and Sustainability to manage and mitigate

Supply Risk• A unified Supplier Record merging data and process

flows to third party systems and data sources

Supplier - Buyer Info Collection & MgmtMaximize the alignment with industry peers and eliminate waste

Suppliers BuyersThe Problem

CommonApproach

&System

Suppliers BuyersThe Solution

• Collect information once and sharing it several fold

• Enhanced credibility as externally recognized set of standards

• Maximize impact by aligning efforts to encourage buyer and supplier participation

• Use a governance framework to ensure quality, standards, and fairness

• Provides the catalyst to accumulate and share info, knowledge and best practices with others

The benefits

29

Solution Definition: Problem Statement

• Customer Problems (Buyer and Seller)• Supplier Experience

¨ Disconnect supplier user experience creates concerns by suppliers and buyers¨ Registration and ramp of suppliers different¨ Navigation problem for suppliers to go in and out of customer domains¨ Usability problem for suppliers to do reporting, dash boarding, workflow across customer domains¨ Usability problem for suppliers when they cross Ariba module domains¨ Usability barrier for supplier users in same organizations to collaborate, share information

• Supplier Data¨ Many sources for supplier profile data creates confusion, waste of time, data synch issues, and re-entry of data in multiple

Ariba systems¨ Our ability to define different supplier data types and business organization attributes is limited and not coordinated

across solutions¨ Business Contacts are different and may be based on how they use Ariba systems

• Integration¨ Integration with buyer and seller is reported issues and not consistent from product to product¨ Multiple Integration paths when customer buys upstream and downstream¨ Different integration technologies creates IT problems during sales

• Many Supplier Personas across product¨ Actual targeted groups of supplier very different but can converge at some level, causing duplication of functionality

• Buyer experience¨ Many locations buyers


Strategic Sourcing and Contract Mgmt.


Ariba “Upstream”

HR / ERP

ERP / MRP

ERP / PLM / PDM / SRM / Legacy / Material Master

eProcurement / Contract / Data warehouse

EAI / Middleware / Integration Toolkit

Customer

Web Services (XML / SOAP)

Internet

MasterData

MasterData Project * RFx

Auction Event

Award Contract

* Applies to Sourcing & SPM Projectsand Contract & Supplier Workspaces

Custom Facts

Export Event results / Contract Terms

Send Contract Info

Create Event with Items / Suppliers / Rules

Add Attachment

Users /Suppliers

UOM’s/ Forex RatesCommodity Codes Regions/Depts

Integration Toolkit or Open Protocol (CSV / HTTPS)

Legacy Data for Analysis

Create/edit Workspace/dForm

31

Open Webservices Vision

Examples of 1• Read realm X for all projects/workspaces with this

search criteria, and return ids, names• Read project/workspace for ids, names and type of

dForm, <any document type>• Read dForm• Create, Update, Read dForm line items• Read Sourcing Project header: fields,

field values• Read Supplier Workspace header: fields,

field values• Read Contract Workspace header: fields,

field values• Read Customer object• Create, Update, Read Savings Form• Create, Update, Read Savings Form line items• Read Supplier object• Create, Update, Read Task

Examples of 2• Contract workspace send/post <selected>

metadata, fields, field values, and documents based on any condition

• Supplier workspace send/post <selected> metadata, fields, field values, and documents based on any condition

• Supplier/customer object send/post <selected> metadata and excel report based on any condition

• Analysis report send/post <selected> metadata and excel report based on any condition

• dForm send/post <selected> metadata, fields, field values, and documents based on any condition

• Sourcing project send/post <selected> metadata, fields, field values, and documents based on any condition


1. Every upstream object is accessible via a webservice call with CRUD action2. Ariba can create a soap message/outbound message which can contain data and

metadata from objects in 13. Robust exception management/error handling around 1 and 2

Forecasting ModuleChallenges Today

• Users can:¨ SV-Slice and dice historical spend with great ease and

even see movement relative to indices¨ Savings Tracker: Enter and track savings realization

• However, unable to:¨ Project spend patterns into future¨ Assess potential impact of various events (commodity

spikes, planned price reductions, etc.)¨ Track progress against forecasts¨ Collaborate with divisional/financial planning


Budget/Planning Process – Pain Points

• Identified savings don’t go to the bottom line (spent by departments on new/more items)

• No mechanism to feedback already established budget• No “Spend/Savings” planning system which ties Procurement, Finance and

Divisions


• Overestimation or no estimation of savings

• Overestimation of demand/volume• Inflation• Wage Rates• Raw material price changes

• Too late to account for savings• Missing compliance system• Budget spent elsewhere• Compare PR to Budget for approval• Contracts not flexible on pricing terms

Bottoms-UpBudget/Plan

LockBudget

Execute &Comply

Reiterate

ForecastBudgetTargets

Forecasting Module Vision

Spend Forecasting for Planning and Estimation• Part/SKU level and Hierarchy• Multi-inputs (e.g. Vol, unit price)• Decision support on any data at any time in the

sourcing process• Ex/internal integration (eg. Commodity index, PLM systems)• Process workflow for multiple stakeholder adjustments• Dynamic generation of pipeline, project creation, data

input/course corrections and savings tracking• Buyer workbench proactively pooling demand• Rich analysis of planned vs. actual spend


Forecasting ModuleVision – Customers Enabled to:

• Consolidate forecast data in one location• Integrate with historical spend and savings plans

¨ More accurately forecast based on accurate historical data¨ Enable effective procurement/finance/divisional coordination

and planning


Reduce Costs Manage Risk

Increased Levels and Predictability of Profits

• Capture savings• Coordinate planning and sourcing• Leverage better forecasts to

increase sourcing leverage

• Assess exposure to cost drivers• Coordinate financial hedging• Assess global/regional risk

• Get involved on ariba.exchange.com

• In addition to User Groups, other forums include venues such as our Advisory Council, customer surveys, beta programs and design partnerships, and functionality and usability testing

• Get involved in the early access program before each release

• Volunteer to provide feedback to the Solution Manager for your product

How to Get Involved and Influence Direction


http://exchange.ariba.com/community/solutions

Questions



“Safe Harbor” and Confidential Information Statement

This information reflects the status of Ariba solution planning as of January 2011. All such information is the Confidential Information of Ariba (per the contract between our companies), and must not be further disclosed, as stated in the confidentiality clause of that contract. This presentation contains only intended guidance and is not binding upon Ariba to any particular course of business, product strategy, and/or development. Its content is subject to change without notice. Ariba assumes no responsibility for errors or omissions in this document. Ariba shall have no liability for damages of any kind including without limitation direct, special, indirect, or consequential damages that may result from the use of these materials.

UC

What’s New, What’s Coming and Best Practices – Spend Visibility, Sourcing, Contract Management and Supplier Information and Performance Management

Alex Saric, Director EMEA Marketing, Solutions Management Liaison


uc what’s new, what’s coming and best practices – spend visibility, sourcing, contract...

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