The modernization and complexity of commercial relationships are increasing drastically with the development of information technologies. The boundaries between businesses are no longer limited by distance, borders, or any other physical barriers as they were a few decades ago. This progress has also removed multiple market entry barriers and increased competition in markets where proximity between businesses and their customers was a competitive advantage.
As a side effect of the increased competition, businesses face pressure on their profit margins, translating into thinning bottom lines. The need to change the traditional way of doing business has become a pre-requisite to remaining competitive. Companies are forced to optimize their business processes to increase their operations’ efficiency to stay profitable in the long term and compete with the new players in the markets.
In this blog post, I’d like to focus on the subject of achieving your ROI by moving to the Ariba Network correctly. The main issue will not be the deployment of the technology itself (we do have a lot on this topic in the SAP DSN Community) but mostly on the many times’ neglected change management side of supplier enablement. Solution adoption is the most critical point of any ROI math.
The leading ROI contributor from e-Procurement projects – is reduced purchase prices through aggregating your demand and creating corporate contracts. Sourcing delivers the main component of the ROI in e-Procurement. Nevertheless, bringing “all” your suppliers online, regardless of their size, is e-Procurement’s most significant shortcoming.
Supplier Enablement is a process used to connect suppliers and buyers (trading partners) on the Ariba Network. Sounds very simple, right? In a day-to-day example, we could compare it to relationships being established on social media, i.e. LinkedIn, Facebook, Instagram. People with common interests share connection requests and establish digital relationships. The same thing happens on the Ariba Network, where trading requests replace friend requests.
Supplier Enablement can be interpreted differently depending on whom you talk to about it:
- Content companies will speak about organizing catalogue content from suppliers.
- EDI or XML Integration companies will talk about routing documents between organizations.
- ERP companies will talk about having a portal for suppliers to log into.
- Sourcing companies will talk about enabling suppliers to participate in online events.
In summary, supplier enablement is the ability for suppliers to transact and work with their customers electronically. And by-the-way, it is not enough to only have an email address to be considered electronically enabled.
I often see the cloud solution implementation is concentrated mostly on technology and process optimization, mainly buyer-focused. The aspect of change management is neglected and not prioritized.
There are two main topics to be drawn out of the above:
1st – Supplier enablement needs to play a vital role in the project’s rollout
2nd – Do not overlook the change management part of your supplier enablement track
Follow the tag SAP digital supplier network membership and keep an eye on my next blog post looking into 8 steps to a successful change management plan.
Feel free to comment below or also visit the SAP Digital Supplier Network community page for more information.