Describing SAP Ariba Supplier Management

SAP Ariba Supplier Management solutions work together to provide you with a 360-degree view of the supplier relationship. The capabilities enclosed in the box apply to SAP Ariba Supplier Lifecycle and Performance, which is the focus of this course.

Increase visibility of supplier information, performance, and risk

Top performers can achieve:

• 5%–6% lower cost of goods sold1
• 15%–20% higher revenue growth1
• Fewer supply chain disruptions, which cost $850K annually on average2
• 2x more tracking of supplier performance

Improve contract adherence and compliance

Top performers can achieve:

• 14%–19% higher spend under contract1
• Decreased maverick spend and increased spend driven to preferred suppliers

Improve corporate responsibility and procurement purpose

Of 200 academic studies on sustainability and corporate performance analyzed by Arabesque and University of Oxford:3

• 90% "… conclude that good ESG standards lower the cost of capital"
• 88% "… show that good ESG practices result in better operational performance
• 80% "… show that stock price performance is positively correlated with good sustainability practices"

Digitize the process and improve efficiency

Top performers can achieve:

• 12%–16% lower audit costs1
• 36%–48% fewer compliance and risk management FTEs1
• 62%–83% reduction in supplier onboarding cycle time4
• Lower cost of managing master data, data integration, and duplicate payments

1. SAP performance benchmarking
2. Allianz, Global Claims Review: Business Interruption in Focus, 2015, and Deloitte, The Ripple Effect, 2013
3. Harvard Business Review, The Comprehensive Business Case for Sustainability, 2016
4. Customer case study

SAP Ariba Supplier Management solutions increase visibility of supplier performance and reduce risk, improve contract adherence and compliance by driving spend to preferred suppliers, improve corporate responsibility and procurement purpose, and digitize the supplier management process and improve efficiency.

SAP Ariba Cloud Integration Gateway

• Includes bi-directional synchronization of supplier data with SAP ERP and SAP S/4HANA On Premise
  • With or without SAP Master Data Governance for Suppliers (MDG-S)

SAP Ariba integration toolkit

• Supports automated import of a limited set of supplier data from an ERP system
  • Does not support export of data from SAP Ariba Supplier Management solutions to the ERP system
  • Does not support import of supplier contact data

SOAP web service API integration

• Supports import of a limited set of supplier and supplier contact data from an ERP system
  • Does not support export of data from SAP Ariba Supplier Management solutions to the ERP system

For more information, consult the Quick reference guide to integration methods for sourcing, contract, and supplier data.

SAP Ariba Supplier Management solutions offer integration with SAP ERP and SAP S/4HANA On Premise Edition, with or without SAP Master Data Governance for Suppliers (MDG-S). This integration method includes bi-directional synchronization of supplier data between SAP Ariba Supplier Management solutions and the ERP system. In configurations that include MDG-S, integration options enable validation of supplier requests in MDG-S before the supplier record is created in the SAP Ariba supplier database and external approval of updates to supplier data in registration questionnaires. For details, see the SAP Ariba Cloud Integration Gateway documentation set.

The SAP Ariba integration toolkit supports automated import a limited set of supplier data from an ERP system to SAP Ariba Supplier Management solutions. It does not support export of data from SAP Ariba Supplier Management solutions to the ERP system, and does not support import of supplier contact data. You can only use it to import extended supplier profile data if you previously migrated from SAP Ariba Supplier Information and Performance Management (classic architecture) to the unified vendor model and defined mappings between your previous supplier profile questionnaire and content in registration questionnaires while in migration mode. For details, see the SAP Ariba integration toolkit guide.

SAP Ariba SOAP web service APIs support import of a limited set of supplier and supplier contact data from an ERP system to SAP Ariba Supplier Management solutions. They do not support export of data from SAP Ariba Supplier Management solutions to the ERP system. You can only use SOAP web service APIs to import extended supplier profile data if you previously migrated from SAP Ariba Supplier Information and Performance Management (classic architecture) to the unified vendor model and defined mappings between your previous supplier profile questionnaire and content in registration questionnaires while in migration mode. For details, see the SOAP web service API integration guide.

For more information, consult the Quick reference guide to integration methods for sourcing, contract, and supplier data.

Users in your company can request a new supplier by filling out and submitting an internal supplier request (1a). Alternatively, suppliers who want to do business with your company can introduce themselves by filling out and submitting an external supplier request (1b). Approvers review the request and approve or deny the request. When a supplier request is approved, the supplier is created in your site's supplier database.

After a new supplier is created, a registration manager starts a supplier registration by sending one or more external registration questionnaires to recipients. In an external registration, a supplier contact is invited to create an account or log into an existing account on Ariba Network to fill out and submit external registration questionnaires (2a). In an internal registration, people in your organization are invited to fill out and submit external registration questionnaires on behalf of the supplier (2b). Approvers review the answers and approve or deny the registration. The registration process can also include questionnaires for internal users, and supports ongoing updates to both external and internal questionnaires.

After a supplier is registered, a qualification manager can start qualifying the supplier for one or more specific combinations of commodities, regions, and (optionally) departments by sending qualification questionnaires (3). Approvers review the supplier's answers and approve or deny the qualification. The qualification process can also include questionnaires for internal users. Your organization can use either supplier qualification and disqualification projects or process projects to manage supplier qualifications. If your organization uses process qualifications, it can also use process projects to manage custom or miscellaneous supplier lifecycle processes (7).

After a supplier is qualified for a specific commodity, region, and (optionally) department combination, a category or supplier manager can designate them as a preferred supplier for that specific combination (4).

If your organization uses supplier qualification projects to manage supplier qualifications, a category or supplier manager can later disqualify a qualified or preferred supplier for specific combinations of commodities, regions, and (optionally) departments by submitting a disqualification form (5). If your site uses process projects to manage supplier qualifications, a process decision-maker can change a process qualification’s status to denied instead (3).

After a supplier either has been disqualified or had a qualification expire, they are eligible for requalification (in sites that use supplier qualification projects to manage supplier qualifications) or renewal (in sites that use process projects to manage supplier qualifications). Both requalifications and renewals are always based on the same commodities, regions, and departments as the previous qualification (6).

Anytime after a new supplier is created, a supplier contact can be sent one or more modular questionnaires to collect specific, limited sets of information about specific subjects, such as questions about supplier certificates in different areas (8). Approvers review the supplier's answers and approve or deny the questionnaires. Modular supplier management questionnaire processes can support ongoing updates.

It is important to note that not every supplier will proceed through every possible step in the supplier lifecycle process within the SAP Ariba Supplier Management interface.

In the context of this course, a persona is a representation of a user type that might use the SAP Ariba Supplier Lifecycle and Performance solution in a similar way. We can group individuals into personas based on how and when their specific job role is involved in the supplier management process.

Familiarize yourself with the personas, and the individual users who will represent these personas; they will be used to illustrate the various supplier lifecycle processes throughout this course.