My colleague Kimberly Knickle and I attended the Ariba LIVE conference in Washington, D.C. last month, where we heard the latest news and announcements from Ariba executives, partners, and customers, about where the company sees itself heading in the future. This blog shares some of the highlights of the innovation roadmap that Ariba executives laid out for conference attendees, as well as how Ariba's new role as an SAP company is evolving.
Last month, my IDC Manufacturing Insights colleague Kimberly Knickle and I attended the Ariba LIVE conference in Washington, D.C. There, we heard from Ariba executives, partners, and customers what is new with Ariba and where the company sees itself heading in the future. Ariba, now an SAP company, directly addressed the topic of its acquisition by SAP AG since the last Ariba LIVE conference in April 2012 with an assurance from Bob Calderoni, Ariba CEO, that "beyond the [SAP] name on our logo, very little has changed." Calderoni went on to explain how the company has made the transition from independent entity to part of one of the largest software companies in the world fairly smoothly. He highlighted some of the benefits of having SAP as a parent company, namely the better global support, global scale for partners, and access to world-class technology like analytics, mobile, and HANA, SAP's in-memory database technology.
The overarching goal for Ariba remains true to its pre-SAP roots, namely that the company seeks to build the world's largest business commerce network and simplify the complexities of B2B around the world. To that end, Ariba has had a busy year, growing its commerce network to more than 1 million connected companies, with annual transaction volume of $450 billion and 65 million invoices, and continuing to add a new supplier every two minutes.
In his innovation keynote address, Ariba's Chief Product Officer, Sanish Mondkar, explained that the pace of innovation at Ariba is two to three times what it was a few years ago. Mondkar shared the three-pronged strategy for innovation at the company:
- Connectivity. Ariba emphasized its focus on openness, supporting any vendor and any protocol on the Ariba Network.
- Comprehensive. Ariba wants to connect all suppliers and support all collaborative business processes from order to cash.
- Intelligence. Ariba is very focused on capturing, cleaning, and analyzing the tremendous amount of data that flows through its commerce network and turning that into intelligence for buyers and sellers.
Ariba executives spent some time at the conference further illuminating how the company benefits from its new structure. One area is SAP's vertically focused go-to-market approach, which targets 11 lines of business and 24 industries. Ariba has traditionally been oriented horizontally, so the company is benefitting from SAP's industry focus. The scope of SAP also presents significant opportunity for Ariba. Considering that $8 trillion in commerce emanates from SAP systems worldwide, there is a tremendous opportunity to capture a company's entire spend and extend it outside the company.
Ariba also plans to leverage SAP's strategy to "lead with cloud" and the continued tactic of selling Ariba as the SaaS offering while promoting SAP SRM for on-premise implementations. Ariba also continues to support its own on-premise version, Ariba Spend Management Suite, with its latest version 9r1. As for mobility, Ariba has an "adopt not build" strategy, choosing to leverage the mobile-enabled technologies that SAP is developing on its SAP Unwired Platform. And Ariba is clearly leveraging SAP's big data capabilities with HANA.
So where does SAP leverage Ariba? SAP's intentions became more clear in an announcement made after the conference. On May 24, SAP announced a simplified organizational structure including a single development organization to oversee innovation across the organization. As part of this new organizational structure, SAP will consolidate its cloud go-to-market under the leadership of Bob Calderoni, CEO of Ariba, president of Global Cloud Operations, and member of the Global Managing Board of SAP AG, who will also continue to lead the Ariba business network activities. Ariba will manage all of SAP's supplier information management capabilities under its umbrella, adding to its own core strength of supplier onboarding. Ariba will manage the product road maps for SAP and Ariba products that have to do with supplier management and information. The new business processes that will be supported over the next two years will add further supply chain depth to Ariba, including around logistics.
Overall, the theme of creating a global commerce network that makes it easier to buy and sell B2B resonated throughout Ariba LIVE. The company is committed to its role providing an open, cloud-based network for connecting suppliers with buyers and supporting the entire order-to-cash cycle. With solid backing from SAP to continue to operate as a separate brand, Ariba continues to be an important provider of supply chain collaboration and management for manufacturing companies looking to optimize their spend. For further insight, IDC Manufacturing Insights' Supply Chain Strategies clients can access the full report ( Doc# MI241442) about Ariba LIVE 2013 here.