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Author's profile photo Susan Galer

Why Business Networks are Irresistible to B2B Companies

/wp-content/uploads/2015/07/irresistablescnblog_748378.jpgOwning a car or booking a room at a hotel chain is so last century. I get it. But while consumer-facing companies like Airbnb and Uber grab headlines, a much bigger digital economy revolution is quietly simmering behind the scenes of virtually (pun intended) every business-to-business (B2B) industry today from aerospace and apparel to food, healthcare and utilities. The business network has emerged as the modern marketplace, value chain, and ecommerce platform, opening up unprecedented opportunities within and beyond corporate walls. Seamless connectivity is fueling large-scale industry disruption, the likes of which haven’t been seen probably since the dawn of the industrial revolution over a century ago. And it’s all made possible by the same cloud computing and mobile technologies.

I recently heared Dinesh Sharma, Vice President of Digital Economy at SAP,speak during a broadcast of Transforming Your Business with SAP Game-Changers Radio entitled, “Collaborative Economy: It’s Real and It’s Disrupting Enterprises.” Sharma talked about how the rise of the digital economy impacts people and business.

“Why do we need to own so many assets? They could be managed by somebody else, it changes our capital acquisition strategy, freeing up cash so companies can concentrate on what’s differentiating.”

After listening to  the radio broadcast and talking with Sharma, my conclusion is simple. Consumers are used to getting the goods and services they want where and when they want them. Business networks bring a similar power to companies, translated to the B2B realm.

What’s particularly heartening is that in a potentially more complex world, Sharma thinks the business network actually simplifies things. “When you don’t own everything, the integrated model is challenged, and the only way to make that work is when these companies can be on-boarded quickly via the business network. This gives you the visibility to exchange documents, bring people on board, and do the appropriate check-ins. The business network has the benefits of a ready pool of resources available when you need them. You can change suppliers easily with your evolving requirements. The business network gives people the greatest flexibility.”

The business network fits right into how businesses operate today. For example, Sharma said the contingent workforce represents 28 percent of the current Global 2000 spend on labor, but demand is growing for more complex skill sets. “The types of people companies need will become more complex, whether it’s for marketing, finance or other areas. Companies have to be incredibly nimble and lean with only core full-time assets, able to source that level of talent from collaborative networks when and where they need it.”

As the world moves rapidly towards a more data-driven society, Sharma said the level of connections between people, devices and businesses changes everything we think we know about how products are consumed and businesses run today. It’s happening at a faster pace than anything we’ve ever seen before. As always, business results matter most. In my interview with Sharma, he talked about how SAP’s business network fosters an Amazon-like experience in business-to-business collaboration, powered by acquisitions like Ariba, SuccessFactors and Concur. Here’s how he sees the value of business networks for companies of every industry.

“Providing companies with the nimbleness and agility to source people from anywhere in the world when they need them is really SAP’s role. We’ve been making these acquisitions and also changes internally because this is where our customers are going. They may not know it yet, but the opportunities for them to have a much more nimble, lean workforce is too great a benefit from them to resist.”

The sharing economy is already changing how people approach basic things like owning a car or booking accommodations. If it’s not there already, sooner or later, there’s a business network in in every company’s future.

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