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Hope all of you are settled now after a great Ariba Live, Amsterdam. After talking to lot of customers and partners at Ariba Live in Las Vegas and Amsterdam, and after understanding that there is a lot of interest among the community about how they can build extension applications on SAP Ariba using SAP CLoud Platform, I thought of writing this blog to explain – “How you can extend your SAP Ariba solutions and bring out more value using SAP Cloud Platform” 

In this blog, I explained about the current trends in Procurement, Introduction to SAP Cloud Platform, why customers want to build extension applications using SAP Cloud Platform and what are the ways to extend SAP Ariba solutions using SAP Cloud Platform.

Introduction

“B2B companies that are digital leaders generate 8 percent more shareholder returns and revenue growth that is five times greater than the rest of the field”

—McKinsey, October 2016

Today’s world is digital and networked. The world has migrated away from manual processes to technology-led business collaboration with minimal human involvement. The world is witnessing unprecedented pace of change. The key business drivers in this digital transformation are big data, social media, Internet of Things (IoT), mobile, omni-channel presence, better customer experience, performance management, risk management, globalization, new open standards and so on.

 

Impact of Digital Economy on Procurement

Over the next few years, businesses will connect in the same way people have been connected on social networks. Currently, more than 80% of the purchase orders and invoices and other transactions still take place offline, involving lots of paper and people and inefficiency that causes missed sales opportunities and higher operating and supply chain costs, slower cash management and cash flows. With digital transformation, digital networks allow companies to do new things and to reimagine their business by adding new services. Over the next 2 years, there will be a 40% growth in the adoption of business networks. In fact, SAP Ariba is already delivering on it, connecting buyers and suppliers to a digital marketplace through which they can discover, connect, and collaborate better than ever before. Thus, with digital transformation, procurement has evolved from a cost-saving function within the organization to a more strategic relationship both internally and with suppliers.

Understanding Procurement

Supply Chain Management

There are three main scenarios in supply chain management: Plan, Buy, Pay.

  1. Plan: Analyze based on past events and purchase requirements and decide what to put on internal catalog for employees to order. Then, plan the budget. Source the right vendor with the best quality and price. Register those suppliers to comply with company quality, budget and pricing. The prices are agreed based on volume discount. Finally, buyers sign a contract with the suppliers. All this planning is normally done prior to beginning of the year.
  2. Buy: The buyer goes to internal catalog website, searches for the product and places the order. The manager then approves the order if everything looks good. Then, the supplier receives the order and provides a status update. The buyer receives the goods.
  3. Pay: The supplier issues the invoice and the buyer processes the payment.

As the leader in cloud-based procurement and invoice solutions and business networks, SAP Ariba provides everything to digitize company’s commerce activities and simplify the way it operates. SAP Ariba is the world’s largest B2B network where nearly 2M buyers and sellers conduct over a trillion USD in business commerce annually. It helps facilitate or eliminate all the hassles of paper, the phone calls, the manual acts someone performs each day to find new suppliers or business opportunities. It provides a place to manage orders, collaborate with customers or partners. Ariba Network makes it easy for buyers and suppliers to collaborate on transactions, strengthen their relationships, and discover new business opportunities. It provides benefits such as lower costs, greater efficiency, and transparency into the order process with better data accuracy to both sides of the buy-sell organization.

SAP Ariba Solutions Portfolio

SAP Ariba offers a portfolio that enables source-to-settle digital transformation for buyers and sell-to-settle digital transformation for suppliers. Here are the main portfolios (you can find the corresponding solutions for the buyers and suppliers over here):

  • Supplier Management
  • Strategic Sourcing
  • Direct Spend Solutions
  • Procurement
  • Financial Supply Chain
  • Platform solutions
  • Integration Solutions
  • Services for Buyers

SAP Cloud Platform

With the emergence of digital transformation era, in order to help companies succeed in their digital transformation journey and to make them more agile and optimized, SAP came up with the enterprise Platform-as-a-Service offering: SAP Cloud Platform. SAP Cloud Platform provides a comprehensive and steadily-growing set of platform services and capabilities, and it also provides higher-level business services infused with machine learning and artificial intelligence. But what truly sets it apart is that it provides extension capabilities that help customers extend Line of Business Software-as-a-Service (SaaS) solutions such as SAP Ariba, SAP SuccessFactors, Concur , SAP Hybris and SAP S/4HANA. In this blog, we will focus on the extension aspects of SAP Cloud Platform, and mainly on SAP Ariba extensions.

For more information on SAP Cloud Platform, follow a blog by Bjoern Goerke, CTO of SAP and President, SAP Cloud Platform and another blog by Matthias Steiner, SAP Cloud Platform Evangelist.

Why Do Customers Extend Using SAP Cloud Platform?

 SaaS solutions provide the features for standard, generic use-cases, but if customers are looking for some customized and specific scenarios in order to apply some local regulations or industry or business specific requirements that are not part of SAP Ariba solutions, they need to customize the existing SaaS solutions they have purchased. By extending their SaaS solutions, customers can enhance existing business processes and expand their capabilities. They can build In-App Extensions or Side-by-Side Extensions. In-App Extensions run within the context of SaaS solution whereas Side-by-Side Extensions are stand-alone applications developed using SAP Cloud Platform.

Extensibility Concept

SAP cloud products are delivered highly configurable in order to help companies from different industries all over the world to adjust the solutions easily to fit their company needs, to comply with legal requirements, to follow industry or corporate standards, and so on. There are also options for customers to extend the standard solutions further with implementing specific or advanced custom scenarios and complex integrations in order to become more agile and more competitive on their market segments.

The extensibility options available for the SAP cloud products can be broadly classified as In-App Extensions and Side-by-Side Extensions.

We talk about In-App Extensions when the changes and the new objects are created within the context of the extended SaaS solution. In the case of SAP Ariba, Forms Builder that is part of the Extensions Studio allows customers to rapidly build new customized forms using drag and drop interface. This allows customers to automate or create new business processes like payment request, CAPEX request and so on. Furthermore, it allows customers to incorporate new datatypes, add custom fields and also collect information required for the business.

Side-by-Side Extensions are stand-alone applications that are hosted and executed on SAP Cloud Platform. They run outside the context of the SaaS solutions. Typically, they interface with the SaaS solution using APIs programmatically. In the case of SAP Ariba, REST APIs as well as SOAP APIs allow customers to extend and improve their procurement processes. Complex scenarios can be implemented using this approach leveraging various services offered by SAP Cloud Platform. In addition, customers can use Side-by-Side Extensions on the SAP Cloud Platform to integrate the SAP Ariba solution with third-party data and services.

Extensibility Foundation

The main differentiator of SAP Cloud Platform extension capabilities is that it provides seamless, secure and consistent integration between the extension solutions developed and running on the platform and the extended SAP business solution.

SAP Cloud Platform Extensibility Integration layers

 

SAP cloud solutions such as SAP Ariba, SAP SuccessFactors, SAP Fieldglass, and Concur have their own separate technology stack, security components, data model (with SOAP or REST APIs) and different UI paradigms. The challenge when building Side-by-Side Extensions is to provide a seamless experience across all these layers and to simplify the development and operation processes for the extension solutions running outside of the SAP SaaS solution.

SAP Cloud Platform provides already such seamless experience on these layers for many of the SAP cloud business solutions and with every new SAP Cloud Platform release, the SAP development team brings new capabilities, automation and simplification that help SAP customers and partners to develop and deliver their extension solutions easily with focus on the business logic and benefiting from the technical integration available out-of-the box.

Extending SAP Ariba on SAP Cloud Platform

Once the customers have their SAP Ariba solutions in place, they want to create tailored experiences for these solutions based on their own requirements. Some of the examples of these tailored solutions include:

  • Provide option to select their own tax engine for tax calculations
  • Support region-specific governmental or industry requirements within the solution
  • Integrate Internet of Things (IoT) in business processes to automate remote replenishment and reduce facility downtime risks
  • Enrich supplier information with additional document attachments in the normal business process
  • Publish SAP Ariba sourcing opportunities on third-party marketplaces
  • Develop enterprise grade applications that integrate SAP Ariba with other SAP and non-SAP solutions
  • Create a tailored experience for interacting with suppliers, delivering personalized content, and processes
  • Provide real time operational insights

All these extension applications can be developed using SAP Cloud Platform with SAP Ariba. Customers can develop these extension applications on SAP Cloud Platform and they can use either SOAP and/or REST API calls to communicate and perform certain tasks on SAP Ariba solutions. In addition, SAP Cloud Platform provides different enablement services using which customers can develop their own extension applications.

Here are some of the ways to extend SAP Ariba solutions:

Using SAP Ariba APIs

SAP Ariba APIs allow customers to quickly extend, integrate, and optimize SAP Ariba applications and Ariba Network to meet unique domain- or region-specific business requirements. By providing an open, secure, and scalable way to build new or extended functionality, they deliver a significantly higher level of data sharing and functionality for customer’s SAP Ariba procurement solutions. The ever-expanding array of available APIs combined with easy-to-use tools and developer resources for rapid prototyping enables them to create tailor-made solutions without paying for costly development projects. With APIs, customers can enhance and extend the value of their procurement processes and gain access to cloud-based data. APIs can help them to:

  • Customize and enhance procurement solutions adding process, industry, or geography and region-specific information to meet their unique business needs
  • Easily access business data for approval, reporting, or analytics purposes using existing tools and applications
  • Create new applications on any cloud development platform. SAP Cloud Platform is a preferred platform for building these extension applications as it provides seamless development experience for the developers
  • Rapidly innovate and scale with other enterprise cloud self-service models

Some of the main features are:

  • SAP Ariba Developer Portal, a central repository where developers can discover and learn about available APIs
  • Single, secure pipeline with verified, authorized access through OAuth server for validating calls
  • Developer resources such as API guides, an API catalog, and Sandbox, a mocked business environment for rapid development
  • Tools to manage developer onboarding, application registration, and other administrative functions

This is a list of the currently available Ariba APIs:

  1. Document Approval API: Enables customers to create and use an external application to obtain approval, denial, and comments on requisitions and invoices generated in an SAP Ariba procurement solution, either systematically or by presenting the approval task to one or more approvers. You can build applications on top of SAP Cloud Platform that call these APIs which will simplify the requisitions that will help companies make procurement process faster and convenient for them.

          Example use-case: Purchase requisition and approval using Amazon Echo:

Using the SAP Cloud Platform, shop floor person can order stuff from the past order history or            favorites list or product catalog using Amazon Echo by integrating SAP Ariba APIs with SAP                Cloud Platform application. Also, a manager can easily approve/reject the purchase orders                using Amazon Echo or he/she can pin some orders for further follow-up. This application                    provides a lot of convenience and saves time and efforts on both sides.

 

  1. Custom Forms API: Enables application to get custom forms document information or data for reporting or sending to an external ERP system for data processing. Thus, it eliminates the headache of manual steps that were previously required. Custom Forms API allows the developer to gather information about the forms and retrieves data submitted in the forms. For example, after the CAPEX custom form is fully approved, this CAPEX data is integrated to an asset system to create the assets or to a project system to automatically create the project. Another example is a developer can retrieve all the information submitted in the CAPEX request form that was designed in Forms Builder.

 

  1. Flow Extension API: Enables customers to enrich processes and documents (including purchase orders, order confirmations, advance shipment notifications, goods receipts, and invoices) in Ariba Network with information external to SAP Ariba. Customers can build applications on SAP Cloud Platform that can call this API which helps to enhance interaction between buyers and suppliers in terms of document exchange and it reduces errors in manual document exchange and eventually, it saves lot of costs in terms of time and money for both sides.

          Example use-case: India Localization Application

In India, when goods are shipped across state lines, a document issued by the government of            India called ‘Waybill’ needs to be carried by the driver of the shipment. This ‘Waybill’ document            needs to be provided by the buyer to the supplier. When supplier is ready to ship the goods,              the buyer is notified by means of an Advance Ship Notice. The extension application hosted                and executed on the SAP Cloud Platform utilizes the Flow Extension APIs offered by SAP                  Ariba to suspend the flow of the Advance Ship Notice. It also allows the buyer to upload the                ‘Waybill’ document and resume the flow of the Advance Ship Notice and the supplier is now                able to download the document from SAP Ariba. This extension model can be used to                        intercept documents at specific points within its normal flow. The integrity of the original                      document is retained. During this interception, you can access data associated with the                      document, post attachments to the document and so on.

  1. Tax API: Enables customers to use third-party tax data providers to obtain tax calculations for purchases and invoices in the SAP Ariba Buying, SAP Ariba Buying and Invoicing, and SAP Ariba Invoice Management solutions.

      5. SAP Ariba Discovery RFx Publish to External Marketplace API: Enables customers to                  publish SAP Ariba Discovery postings or events into other portals, websites, and                                  marketplaces which helps them to increase the number of potential bidders so that they get                best rates and best quality in a competitive market.

          Example use-case: SAP Ariba Public Sourcing

The main goal of this extension application is to enable third-party tendering sites to tender                offers when buyer company publishes the sourcing events on the public tendering site. The                application collects public sourcing events from SAP Ariba Discovery via SAP Ariba APIs and              displays them in an application running on SAP Cloud Platform.

Once the buyer creates a sourcing project in SAP Ariba Sourcing, the extension application                created on SAP Cloud Platform fetches the sourcing events via polling Public RFx API and                posts those events to the public site specified by the buyer while creating the sourcing project.

The third-party suppliers who check out these events on the third-party website/marketplace              can respond to these events by submitting their offers. They must go through SAP Ariba                      Network for submitting these offers.

  1. SAP Ariba Discovery RFX Publish from External Marketplace API: Enables other marketplaces to push leads from their interested buyers to SAP Ariba Discovery, allowing them to check responses and award suppliers with single-sign on. This helps suppliers in Ariba network to get more visibility and they can get more business from these external marketplaces. 
  1. Transaction Monitoring for Tracking Supply Chain Collaboration API: Enables you to quickly and reliably monitor supply chain collaboration transactions across Ariba Network and gain high visibility and traceability into associated business processes and documents.

 

  1. Procurement Operational Reporting API: Enables you to retrieve header, line item, and other details for transactions (such as purchase requisitions, purchase orders, receipts, invoices, and invoice reconciliations) through REST API calls and then load the data into your preferred data warehouse or application, combine it with other organizational data, and build reports to fit your needs.

 

  1. Supplier Reporting API: Enables you to access supplier data on a read-only basis for integration to a third-party tool; for example, to get a list of all suppliers with registered, qualified, or preferred status for a specific category, region, and business unit.

To learn more about how APIs deliver the speed and flexibility you need to extend and integrate your SAP Ariba solutions and Ariba Network, visit ‘SAP ARiba APIs page’

Using SAP Ariba SOAP Web Service APIs

SAP Ariba SOAP Web Service APIs enable customers to exchange data between SAP Ariba Strategic Sourcing solutions and other systems, such as ERP systems, for real-time data integration. Customers can use the SOAP Web Service APIs to extend and integrate SAP Ariba solutions to meet their unique domain specific needs.

Examples of some SOAP Web Service APIs:

  1. Import Requisition(s): It imports requisitions from the external system, using the file channel or Web services channel. For file channel, this task uses three CSV files for importing requisition data.

      2. Catalog Item Search: To search an item in the product catalog

          Example use-case: SAP Ariba QR Code Application:

SAP Ariba QR Code Application is a sample extension application that shows how to search              for catalog items and submit requisitions using the SAP Ariba Procure-to-Pay API. It uses                    SAP Ariba SOAP Web Service APIs – Catalog Item Search and Import Requisitions.

There are two usage scenarios for this application:

  • Scan a QR Code to show details about a specified item and submit a requisition through the application UI
  • Scan a QR Code to submit requisition without starting the application UI.

      3. Services Requisitions from an External Application: It provides requisition information                  from an external application in order to create high-level requisitions for approval

      4. Services Requisition Status for External Applications: It receives requisition status                        requests from an external application and responds with the requisition status and, if                          applicable, the purchase order ID. It is applicable to service requisitions from an external                    application.

There are many more SOAP APIs available today. The list of available SOAP APIs depends upon the SAP Ariba solution to which customer has subscribed for and you can find that list once you log into that solution.

Using SAP Ariba Cloud Integration Gateway

SAP Ariba Cloud Integration Gateway enabled by SAP Cloud Platform Integration offers Integration-as-a-Service, for buyers as well as suppliers. For buyers, it provides pre-built integration with add-ons for SAP ERP and SAP S/4HANA back-ends as well as with other SAP cloud solutions. For suppliers, it has many innovative features that provide suppliers a simple and efficient way to integrate with Ariba Network using standards, other than cXML. It supports integration with major industry formats including ANSI X12, EDIfact, PIDX, OAGIS.

To integrate SAP ERP and SAP S/4HANA on-premise with Ariba Network, there is CIG Add-On for SAP Ariba Cloud Integration Gateway. It consists of the following two components:

  • An SAP Add-on available from the SAP Service Marketplace for all customers who currently have a support contract with SAP. This add-on contains the necessary data extract/import programs and needed configuration programs.
  • The cXML Adapter in the cloud hosted in SAP CIP landscape on the SAP NetWeaver PI component, which allows for all standard and custom mappings, connections and conversions.

Some of the typical scenarios for this integration are:

Commerce Automation: One of the most typical processes is document automation for purchase order (PO) and invoice automation. In this scenario, users create POs in their SAP ERP or SAP S/4HANA on-premise system, which sends them to the suppliers on the Ariba Network for processing. Suppliers confirm orders or let their customers know if items are backordered, they can notify them that items have shipped, and send a PO invoice for payment. Business rules enforce process and document compliance. For example, you can require that a supplier must confirm an order, create a ship notice, or wait for a goods receipt notice before they can send an invoice.

SAP Ariba Collaborative Supply Chain (CSC): Ariba Network provides enhanced supply chain visibility for direct materials for discrete and process manufacturing, consumer products and life sciences and for merchandise spend in the retail industry.

To improve poor supply chain visibility, communication, and collaboration among supply chain partners, CSC was developed to be comprehensive direct material and supply chain collaboration tools with industry specific aspects and a single access point and collaboration platform for all partners across different supply chains. These scenarios include processes for subcontracting, consignment, forecasting and supplier managed inventory as well as returns.

Using SAP Cloud Platform services

  1. SAP Cloud Platform Portal provides an easy way for creating appealing business sites to engage with customers, partners and employees. Users benefit from central, role-based point of access to information and services.

          Example use-case: Supplier portal

The main goal of this portal is to provide a single point of entry for the suppliers where they                get a unified view of information about the buyer company and access point for connecting to            SAP Ariba supplier network or any third-party network.

The buyer company information includes company’s offerings such as different product                      categories, products and services under those categories, how to onboard new suppliers,                  company’s terms and conditions for the suppliers, general information about company’s                      stocks, finances and investor related resources, careers and so on.

If the supplier wants to login to SAP Ariba supplier network or any third-party supplier network,            the portal also provides this functionality. Suppliers can register/login to SAP Ariba network or            any third-party network and perform different tasks such as checking invoice status, tracking              payments, checking the contracts and so on.

  1. SAP Cloud Platform Internet of Things allows to securely connect with a magnitude of devices over a broad variety of protocols to derive business relevant data. The IoT service provides full flexibility in where and how to process IoT data – either at the edge of your network or on SAP Cloud Platform.

          Example use-case: Predictive maintenance using IoT

The main goal of this extension application is to enable manufacturing industry buyers to                    predict beforehand if the machine is going to get failed in near future by using sensors                        attached to the machine and then order the necessary parts beforehand on SAP Ariba and                place the work order for part replacement. This will help them avoid further machine downtime            and losses in terms of time and money.

You can find more samples for SAP Ariba extension applications using SAP Cloud Platform at            Sample Ariba APIs Extension Applications and Sample Web Services Extension Applications.

Summary

You can expand the value of existing SAP Ariba solutions by adding SAP Cloud Platform based extensions. You can customize and enhance procurement solutions through extension applications using SAP Ariba APIs, SOAP APIs and the services from the SAP Cloud Platform, such as Portal, Fiori, Integration, Internet of Things and so on. You will discover new ways to simplify the requisition process using modern innovation such as voice activated digital assistants or match invoices quicker using prebuilt partner products. Also, with extension applications, you will enrich procurement processes and documents exchanged in those procurement processes, automate supplier management tasks and securely share and access business data for approval, reporting, or analytics purposes.

Let’s Get Started Today

As a starting point, you can check out more information about SAP Ariba APIs and start exploring these APIs. Also check out SAP Ariba extension guide that guides you through the configuration tasks that you need to perform to enable the use of the extension capabilities of SAP Cloud Platform for your SAP Ariba solution. You can find more information about different services offered by SAP Cloud Platform at http://cloudplatform.sap.com. Also, you can explore SAP Ariba extension applications developed by some of our partners and learn about the scenarios your enterprise may be missing out on at the SAP App Center.

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