From the glittering, chaotic jewel of the Nevada desert, Procurement Leaders considers the implications from the first day of a Las Vegas event that was ripe with announcements, hype and genuine excitement among the near 3000 delegates.
Guided buying is a solution to a philosophical problem
In a slick production like SAP Ariba Live, it’s no surprise to hear plenty of soundbites and lots of talk of interface and design. But it was a bold move to put some of the technical discussions front and centre (of what is a humongous auditorium in the Cosmopolitan Hotel) and try to prove to delegates that the software giant was genuinely looking to use technology to solve procurement’s biggest problems. Guided buying may not be a new concept, but the possibility of guiding users to the right vendor, using the right process, is a hugely powerful and timely one.
The interface of Ariba’s new launch looked polished and the emphasis was clearly built around the mantra of simplicity – users couldn’t be expected to read a manual, we were reminded. Making policies and compliance part of the buying experience, but combining that with a much more consumer-like purchasing feel could be a big step. Behind that, however, is the ability to link with vendor master systems in the cloud (a proposition which drew a round of applause) and the enhancement of the supplier management capabilities so that procurement activities like risk management go hand-in-hand with the purchasing process itself.
It’s a lot to ask, but the focus on making the buying process frictionless and making compliance easy and less confusing, looks to be a wise one. Where SAP Ariba, or at least its once constituent parts, struggled in the past, could prove to be the most fertile ground in the future. There are some big ’ifs’ in there, but it was received with great enthusiasm.
Adoption remains the big challenge...
That emphasis on the user experience was, in a way, the step that software vendors have found hardest to take. Excited announcements at conferences have often honed in on just how much control a system would grant a procurement user; here the examples the audience was walked through centred on busy individuals who really had not much thought to working with procurement, they just wanted access to the materials they needed in the quickest, most precise way possible. Procurement, therefore, has to be able to rely on the tool to do the work in getting users on board and making them happy. Delighted, even. One customer, from the procurement side, told the audience that she said that her business had to use SAP Ariba or they wouldn’t be able to access the suppliers – that kind of statement needs to be accompanied by an outstanding experience, or it becomes obstructive and obstinate.
...but transformation remains the big prize
If the hype is to be believed, these innovations represent a leap in how businesses interact with their purchasing tools. But what SAP Ariba need to show is not just that the purchasing process is smoother, but that this enables procurement to do its job more effectively. User adoption provides a great opportunity for procurement to empower the organisation to make purchasing and sourcing decisions that fit with the functions overall goals. Yet, whether its getting more spend under management, or addressing risk in the supply chain, the promise being made is that behind the interface is the machinery of data and compliance that allows procurement to make decisions, identify problems and get to grips with its suppliers and supplier management strategy.
The question of how much Ariba’s various innovations allow this platform to address all those needs or how much it’s necessarily a complex mesh of tools and systems still required to effectively deliver procurement strategy could be a key theme in coming months in the software space.
Platform as a service
Everyone talks about their platform – for software companies it can promise so much, but ultimately be a much more limiting concept than might be expected. But where Ariba are pushing their platform as a breeding ground for customisation, they are letting partners in to adapt and develop around their system. On one hand, it’s a familiar land grab, on the other it’s a way for partners – and there are some big names at this event already taking advantage – to plug in to the process Ariba has set up and deliver services for themselves. The platform as a service for commerce, that’s the pitch for the vendor. By the looks of the names already associated, large consultancies see the value. How other, more nimbler, vendors react and how the customers respond to having a more flexible offering in front of them, will be a telling moment in the evolution of this market.
Finally, a cultural piece and what’s crucial in the messaging from Ariba is that it’s not just proposing a process to do more procurement, but a process to give procurement a bigger lever into the business. That final piece has often been missing from the conversation between vendors and buyers in the solution space: offerings often gravitate around technical specifications and process efficiencies. Speakers in this morning sessions rubbed a few egos with their hashstag, but the point is well made: what’s at stake in the development of this technology is procurement’s ability to move beyond being a perceived pain to work with, to becoming the guardians of a reflexive system that empowers users. Procurement have a chance to be the heroes of the story, one interviewee told me - it’s rare to see such optimism when the topic is procurement tools.
This article is a piece of independent writing by a member of Procurement Leaders’ content team.