Master Supply Chain Management with Cloud and Business Networks
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Leah Knight, Sr. Director of Product Marketing, SAP Ariba / November 10, 2016
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Master Supply Chain Management with Cloud and Business Networks
- 1. Master Supply Chain Management with Cloud and Business Networks Leah Knight, Sr. Director of Product Marketing, SAP Ariba / November 10, 2016
- 2. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 2Public The changing face of manufacturing and retail business Contract manufacturing drives need for seamless working relationships Green, diverse, and global sourcing initiatives add complexity Drop ship models require “perfect order” data accuracy
- 3. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 3Public outsourcing trading partners complexity geographies technologies M O R E Complex supply chains inhibit visibility into supply Contract manufacturers Subassembly suppliers Large enterprise OEM Component suppliers Raw material suppliers Distribution centers Logistics providers
- 4. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 4Public Sourcing leaders are navigating a challenging environment
- 5. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 5Public Sourcing leaders are navigating a challenging environment Market complexity Supplier qualification Product costing
- 6. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 6Public While supply chain leaders are facing inflated costs 69% of direct materials source- to-settle processes are manual 30% of contracted direct materials spend is noncompliant 32% of manufacturing is outsourced in a typical company 65% of buyers have poor visibility into availability of supply
- 7. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 7Public “Supply chains…need visibility across multiple systems to synchronize manufacturing and procurement.”
- 8. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 8Public More collaboration is needed – but few organizations have engaged 32%13%15% 39% Minimal, transactional collaboration Informal collaboration; few suppliers Maximized collaborationSome formal collaboration; some suppliers Source: No Business Is an Island, The Economist Intelligence Unit, 2014
- 9. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 9Public The time is ripe for digital innovation “More than 60% of CEOs expect 15% to 50% of their earnings growth in the next five years to come from technology-enabled business innovations.” – McKinsey study, 2013 of all industry leaders disrupted by digitally-enabled competitors by 201833% Early engagement of sourcing opportunities New (or improved) technology Larger and/or more talented staff Better communication plan Better team execution 66% 53% 53% 48% 44% Source: CPO Rising 2015 – The Agility Agenda by Ardent Partners
- 10. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 10Public What if you could… ...collaborate with all your suppliers ...on a single network ...in real time ...across all processes …and reduce direct materials contract leakage while increasing visibility into your supply chain?
- 11. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 11Public Direct materials sourcing and supply chain processes would transform Integrated to back- end systems and suppliers All spend categories Key processes: single solution
- 12. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 12Public SAP has made significant investments in streamlining direct materials source-to-pay processes Planning collaboration Source PLM integration Design Contract Manage ERP and planning integration Execution collaboration Manufacture SAP ARIBA SOLUTIONS FOR DIRECT MATERIALS
- 13. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 13Public Customers using SAP Ariba solutions to source and collaborate with direct materials suppliers US$3.5 billion industrial manufacturer $3 billion retailer $90 billion high-tech device manufacturer Replaced homegrown portals and consolidates spend with SAP Ariba solutions Increased visibility into merchandise inventory holdings to sustain aggressive growth plans Evolved from a forecast- and-allocation-driven model to demand-driven fulfillment (pull) model
- 14. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 14Public Why now? Outdated systems limit collaboration Rekeying Standalone niche vendor solutions Highly customized on-premise systems Partial coverage with current solutions for indirect spend Supplier portals EDI VANs Direct connect Manual data entry Sourcing collaboration Supply chain collaboration
- 15. © 2016 SAP SE or an SAP affiliate company. All rights reserved. 15Public
Editor's Notes
- Here is how we tell the customer story. Globalization and outsourcing have driven up risk in supply chain management. Did you know that nearly one quarter of corporate capacity worldwide has been outsourced to external entities Manufacturing capacity Logistics capacity Warehousing capacity And in addition, nearly 80% of the world’s procurement leaders are expanding into new markets They are globalizing They are also looking for green suppliers, diverse suppliers McKinsey and Global Insight project that 55% of the world’s GDP will be accounted for by emerging economies by 2020. 55% - a huge amount. And a lot more geographic complexity Outsourcing, globalizing, and finding new sources of supply drive many aspects of risk Especially the risk of losing visibility into availability of supply The question “Where’s my stuff” looms larger when you no longer manufacture your own supply as the vertical manufacturers used to do Or when relatively new, unknown suppliers from all over the world are your new suppliers. Because of this, enterprises are losing visibility into availability of supply Or, put more simply, they don’t know “where their stuff is.” And it is important stuff we’re talking about – retail goods to stock the shelves, automotive and industrial components to keep the lines up and keep manufacturing going
- This will cover the downstream, supply chain collaboration messages that I shared in the innovation Webinars.
- Introductory comments on the vision for digital innovation in Directs
- Combined vision statement for both solutions