The age of collaboration — with business networks
Final blog post in a four part series.
This SAP Run Simple Approach blog series explains how businesses can benefit from major technology trends. First, the Cloud is enabling businesses to gain a competitive edge. Next, the Internet of Things (IoT) drives value through accelerated productivity and operational efficiencies. And lastly in this fourth blog in the series, SAP’s Business Network strategy provides expansion and collaboration opportunities as companies move towards the real-time, network-enabled supply chains of the future.
Business networks – the ultimate goal
Business networks are founded on an architectural and solution paradigm focused on core interactions between businesses. This paradigm emerges from SAP’s recognition that it is no longer sufficient to automate and accelerate business processes within an organization. Business performance is dependent on interactions with vendors, suppliers, partners, governments, financial institutions and other entities. SAP has laid the foundations for business networks already via inter-business processes built into our core enterprise applications and HANA computing platform. With this in place, we began looking outside of SAP to complete the picture.
The perfect fit
Some eyebrows were raised when we announced our acquisition of Ariba a couple of years ago. But, in fact, the fit is perfect. Ariba eliminates the roadblocks normally associated with complex processes such as procurement and finance, and enables businesses to trade with each other as easily as consumers buy and sell on sites such as Amazon and eBay. With $26,000 USD in spend transacted among them every second, Ariba is 1.6 million connected companies, – growing at a rate of one new company added every 13 minutes.
Ariba provides unprecedented visibility into the supply chain. As a global leader in exploration, mining, and metals recycling, Boliden Group needed better insight into its sourcing and procurement ecosystem as a prerequisite to implementing strategic sourcing initiatives. Using Ariba Spend Visibility (now HANA enabled), the company classified, aggregated, and enriched some 340,000 transactions representing approximately 2 billion euros in spending. With a fully aggregated view of spend data across the organization, they are now transforming their supply chain processes with supplier optimization and improved data quality standards.
Bringing it all together
Such stories represent only the beginning. SAP is building the world’s largest business network consolidating the broadest possible range of business processes and requirements. Hybris, for example, provides access to enterprise software and on-demand solutions for e-commerce, multi-channel commerce, master data management, and order management. It is used by more than 500 businesses, including Target, Samsung, and 3M. Fieldglass provides the leading vendor management solution around acquiring and managing temporary and contingent staff. When combined with Ariba and Fieldglass, our latest acquisition of Concur-an open network that connects the corporate travel ecosystem, including airlines, hotels and car rental companies-gives SAP the opportunity to power transactions that drive more than US$10 trillion of global spend annually.
The synergies between these various networks are powerful. Over time the Ariba Network will be migrated to HANA, not only improving speed and efficiency but enabling the ability for real time insight of business processes and trends such as proactively notifying both buyer and supplier of stock out scenarios based on knowledge of the end to end business process. Perhaps even more importantly, while the Ariba network remains open to work with any procurement or financial application, the SAP Business Suite now has Native connectivity to the Ariba network, without the need for middleware or adaptors. This not only lowers potential implementation time and costs but also opens thedoor for the significant business process optimizations mentioned above–for all Business Suite customers, irrespective of size or complexity.
Collaboration Comes of Age
Not long ago, I introduced a principle I called the power of subtraction. Where conventional database vendors seek to enter the real-time era by adding new features to existing platforms, HANA is revolutionizing enterprise computing by what it removes from the picture. This principle applies equally well to the technologies discussed in this series, and serves as a common thread that unites them. The Cloud removes costly infrastructure as well as work cycles and other resources required to maintain it. Data from the Internet of Things reveals operational inefficiencies, making it easy to isolate and eliminate them. And business networks eliminate operational inefficiencies that occur between companies as they transact business with each other.
We may not yet be at the stage some are describing as the Virtual Enterprise, but these technologies – and business networks in particular – are moving us closer. What we are seeing now is collaboration at every level: between businesses and their suppliers, between networks and applications, and ultimately between all the technologies that underpin the entire infrastructure.
The age of collaboration has arrived, and SAP is providing the platform to support it. Removing barriers, inefficiencies, and distractions enables businesses to focus on their core value propositions in whole new ways at greatly accelerated pace. Businesses that are already optimizing their operations via business networks are at a distinct advantage. Those that are slow to do so run the risk of being left behind.