I spent a few minutes this morning reviewing Ariba’s website. It shows that the services they offer are the following:
- Spend Management
- Contract Management
- Invoicing and payment
- Supplier Management
- Working Capital Management
- Supplier Network
- Order Collaboration
I was very intrigued by this list. The services offered are quite similar to many offered by SAP. Here are a few of SAP’s offerings:
- Supplier Network Collaboration
- Sales Order Management
- Invoice Management
- Financial Supply Chain
- Orders to Cash
- Procure to Pay
SAP recently became a co-owner of an EDI, e-Invoicing and B2B exchange that is SAP-centric and utilizes SAP technologies such as NetWeaver PI to make the integration with SAP users simple and efficient. Ariba also promotes itself as an e-Invoicing and EDI/B2B hub. It appears that SAP and Ariba are on a collision course. It will be interesting to see the results.
When SAP invested in and became a co-owner of their own EDI, B2B and e-Invoicing exchange, it clearly demonstrated a desire to provide SAP users with these services in an SAP-centric environment and to eliminate the need for external third party hubs like Ariba.
Companies that I have spoken with over the past few months are increasingly recognizing a need to choose between SAP and Ariba. This is an interesting dilemma for companies that like some of the features Ariba offers, but are wanting to reduce the number of third party applications used in favor of a simplified and consolidated environment.
I wrote an article recently that posed the question, “What is your core system?” Is it a third party exchange or is it your internal SAP ERP? This is an important question as software vendors continue to expand their offerings so there is more and more overlap. Your IT strategist must determine what is the core system and expand from there. In the case of Ariba, companies must determine if Ariba is going to be their core system or is SAP since both parties are offering many of the same features and functionality. It is highly likely that both SAP and Ariba will continue to extend and expand features for years, so the choices companies make today about where to invest will have significant long term impacts on their business.