Thousands of procurement professionals converged at SAP Ariba Live in Austin, Texas, this week to question the status quo and disrupt before being disrupted.
The keynote opened with a kaleidoscope display of colorful dancers symbolizing the connected Ariba Network, now $3 trillion strong in annual spend. A parade of customers and senior leaders inspired and mentored the audience with the event’s three main themes of innovation, business outcomes, and sustainability.
“We’re solving your business challenges and problems. It’s less about products and technologies and more about how we have an impact on the companies we serve,” said Barry Padgett, president of SAP Ariba and SAP Fieldglass. “We’re on a journey to the Intelligent Enterprise, and it’s powered by intelligent spend. Intelligent spend is intelligence in terms of machine learning, robotics, and neural networks. But intelligence is also about knowledge… how to take experiential information ─ knowledge ─ and marry it up to all the operational data being managed.”
Intelligent Spend in Action
Case in point was the fascinating presentation from Norbert Riezler, senior vice president and chief procurement and sustainability officer at Las Vegas Sands Corporation. He explained how the company’s employees and suppliers, totaling about 12,000, used SAP Ariba solutions to manage approximately $2.4 billion of annual procurement spend across the company’s global, world-class resorts.
“We launched SAP Ariba for two main reasons: control and spend visibility,” said Riezler. “Other than local regulations, we made no changes to the system. Technology has really helped us to drive our business and be a disruptor and challenger of the norm in our industry.”
To succeed, Riezler advised the audience to secure company-wide senior leadership commitment, make sure procurement is heavily involved during and post-launch, and align processes to the software.
As a 24-hour, 365-days-a-year business, the Las Vegas Sands Corporation purchases a mind-boggling array of products and services, from construction materials for buildings through chips, slot machines, and resort furnishings, to security and land, air, and sea transportation services. Riezler said the company was A-listed for climate change and water conservation.
“We buy everything through SAP Ariba,” he said. “We also use SAP Ariba to drive our sustainability efforts. We use it to classify the products and services we buy, whether that’s sustainable seafood, FCS-certified paper, green cleaning chemicals, or NLB lighting.”
Is AI Friend or Foe? Yes
The power of artificial intelligence (AI) was among the enlightening conversations that morning between Tifenn Dano Kwan, chief marketing officer at SAP Ariba, Tamara McCleary, CEO at Thulium, and Kathy Hinton, founder and president of Agilitology. All three agreed AI is already everywhere, woven into the fabric of human existence, including purchasing.
Acknowledging that machine learning was a key trend in supply chain management, along with the value of trusted partners, these leaders also candidly talked about the challenges. Hinton said customers want a better understanding of how to innovate while running their daily business that might be disrupted. “That’s the digital transformation process,” said McCleary. “Innovation something that takes risks… doing things totally differently than in the past.”
Hinton said that internal issues related to people are the biggest force stopping innovation. She called AI the buzzword of the year, but when McCleary pressed her if AI was friend or foe, she answered “yes.”
“How do you gain consensus? How do you build C-suite support for the supply chain function and… how do you convince them there’s a business case to fund these initiatives and help people through change?” asked Hinton. “Within supply chain management, we have to foster and reward innovation, and allow people to take risks.”
McCleary said that if a company’s procurement processes were ready for digital, they were ready for AI. “IoT asset tracking, Big Data benchmarking, supplier risk identification, AI chat bots supporting sourcing, …and machine learning spend classification [are] already advancing the long tail spend management. Human workers need to be fully educated… and a strong data foundation is critical for machine learning. You need your CRM and financial systems fully integrated to access all the data required to make strategic decisions.”
Seamless Buying Vision, User Experience
Darren Koch, chief product officer at SAP Ariba, demonstrated in real time how the company is using data and AI-based pattern recognition to realize the vision of the autonomous network. His example — ordering from his mobile app a replacement microphone for his broken one — brought home the new user experience for enterprises.
“We help companies… get the same consumer-grade frictionless experience in the workplace,” said Koch. “With the world’s biggest business network…we’re bringing together buyers and suppliers to power intelligent commerce. At SAP we have tremendous assets — whether it’s ERP with SAP S/4HANA and SAP Ariba plus SAP Concur plus SAP Fieldglass — coming together to deliver intelligent spend.”
Ken Male, founder and CEO of CXO Nexus, an SAP Ariba partner, joined Koch to show how his company’s intuitive, visual platform gave decision-makers across the C-suite deep visibility into vendor spend.
“We’re enabling companies to be more efficient, applying AI and machine learning to [their] vendor spend to clean and classify data,” said Male. “They can negotiate better with vendors, collaborating on a common platform from a whole view of their spend.”
Give People What They Want and Dream Bigger
Padgett closed the keynote noting that business procurement needed to satisfy the same expectations people have as consumers.
“It may not be starships and robots and androids walking around the hall. It could be as simple as making sure the user gets what they requested. It’s the same experience we have as consumers,” said Padgett. “Intelligence is based on knowledge. We’ve made a huge investment in making sure we bring knowledge into every single application built and delivered by SAP.”
Alluding to last year’s SAP Ariba Live theme of purpose, as well as the $3 trillion of spend transacted annually on Ariba Network, Padgett told the audience that there was even more power in procurement 12 months later.
“We have a responsibility as a community to not just dream, but to execute,” he said. “We want to drive environmental sustainability and ethical business practices. We want to stamp out forced labor from our supply chains. We want to drive indigenously owned businesses and female-owned businesses. We need to dream a little bigger… to harness the creative genius outside of these four walls, the suppliers and partners… We’re not in it to just drive volume, we’re in it to drive value.”
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