Innovate to align your Supply Chain with your Corporate Strategy
So what is so ‘Disruptive’ about this new innovation?
Talking about adopting Disruptive Innovation, a significant Facilities Management
(FM) company in Australia has recently implemented a transformational change across both
the Marketing and Procurement functions.
While relatively new to SAP Ariba, they have been a strong SAP run business for many years. In
fact, the Facilities Management (FM) company are now live with SAP Ariba Strategic
Sourcing, SAP Ariba Supplier Lifecycle & Performance and SAP Ariba Contracts.
They are soon to be live with full end–to–end SAP Ariba Procurement.
What’s so ‘Disruptive’ I hear you ask? Well I failed to mention that (FM) are also an
Integrated Supplier with a large entity who are pushing significant Purchase Orders
over the SAP Ariba Network, straight into the (FM)’s ERP.
So guess what…(FM) are able to covert the Large Entities Inbound Sales Order into
an Outbound Purchase Order using, wait for it…insert drum roll here… you guessed
it, SAP Ariba Procurement.
Let’s unpack what the “AS-IS” and “TO-BE” will look like once they are live…
“AS-IS” – The Large Entity historically emailed (FM) Sales Orders after multiple rounds of
Contract / RFP type negotiations to uncover the best price and then award the
business. (FM) had multiple Sales Professionals available to receive and tender for
the opportunity to perform the work required. (FM) then received the Sales Orders,
keyed them into the ERP and created multiple Purchase Orders to the various 3rd
Parties involved in delivering the work.
The future (which starts now)…
“TO-BE” – The Large Entity has now integrated into the (FM) ERP via the SAP Ariba
Network after negotiating a multi-year Contract to deliver Goods and Services
(based on predefined win-win terms and conditions).
(FM) has connected their ERP to the Large Entities ERP and now receive the Sales
Orders directly into the system, without having to re-key the request.
Pre-defined prices, quantities and scopes or work save any manual intervention.
(FM) now take the Large Entity’s Sales Order and convert it into a new Purchase
Order (based on predefined win-win terms and conditions) and transacts with their
Suppliers via the SAP Ariba Network. (see Diagram insert below)
The Suppliers are delivering the Goods and executing the Services which are recorded via a Goods Receipt and/or Service Entry Sheet.
So the end-to-end Sales to Procurement to Pay cycle is occurring with the SAP Ariba as the Enabler.
If you would like to know more, please engage with your CEx.