Data is the "new oil." Spend data can unlock hidden opportunities to maximize savings, improve compliance, and mitigate supply chain risks. Without proper visibility into spend, suppliers, or market information, sourcing and procurement decisions can run counter to business objectives. Comprehensive visibility is the stepping stone to effective spend management. This session shares customer success stories and best practice insights to help you get the most from spend analytics initiatives.
9. Knowledge is Power.
It controls access to opportunities and
advancement. Peter Drucker
Etihad Airways is the National Airline of the
United Arab Emirates, established by Royal
(Amiri) Decree in July 2003. It commenced
operations in November 2003 and has
developed into one of the fastest growing
airlines in the history of commercial
aviation.
OUR VISION
The airline seeks to reflect the best of
Arabian hospitality - cultured, considerate,
warm and generous - as well as enhance
the prestige of Abu Dhabi as a centre of
hospitality between East and West. Our
goal is to be a truly 21st century, global
airline, challenging and changing the
established conventions of airline
hospitality
10. What is SAP Ariba Spend Analysis ?
Drives business decisions regarding
Spend & Sourcing Opportunities
Enables Strategic Category
Management Activities
Comprehensive view of spend
Reducing Procurement Cycle Time
Transparency
Consolidation
Savings Opportunities
Spend Compliance
11. SAP Ariba Spend Analysis as a Service @ ETIHAD
1. What is this Service 2. Users 3. Business Capabilities Supported
4. What is included? 5. Cost of the service 6. Performance Expectations
7. Dependent Systems
Spend Analysis business service enabled
through public cloud platform that provides
a comprehensive spend analysis of
company wide spending, enriched with
supplier database.
The service drives ongoing spend
optimization and is available for all
companies and Equity Partners.
This service includes the following:
• Spend data extraction from 5 EY
backend legacy systems:
• EY Oracle
• EAS Oracle
• EY Engineering Oracle
• Almira
• FuelPlus
• Commodity classification
• Spend data enrichment
• Dashboard creation
• Reports creation
Run Frequency –
• Offline – Quarterly
• Online – Continuous (excl. enrichment)
• Spend management leading to support
streamlined and best in class sourcing
and procurement
• ID sourcing opportunities
• Manage maverick spend / improve contract
compliance
• Increase spend under management
• Reduce sourcing cycle times
• Manage purchase price variance
• Supplier rationalization
• Manage supplier risk
• Diversity management
Key Metric Target
Service hours 24 x 7
Spend Savings
To be quantified
quarterly on the
basis of the
sourcing projects
Data Quality
Minimum 90%
Supplier accuracy
Minimum 90%
Commodity
classification
Total number of concurrent users: 200
Total number of users defined: 82
Total number of Super users: 8
Business Owner/Administrator: Corporate
Analytics – Spend Analysis
• Usage based costing based on total
spend value
• Cost of the service: xxxxx USD per
annum for xxxx Billion USD Spend
covered
• OKTA (Single Sign On)
• Data from Source Systems
12. SAP Ariba Spend Analysis – Enabler for Delivering Benefits
Transparency
• Top spend categories
• Top suppliers in each category
• Risk management - Judgement/ Bankruptcy indicator
Consolidation
• Visibility of total spent by Supplier up to Global Parent
• Visibility of total Etihad Group Spend by Category/Supplier *
Savings Opportunities
• Improved Sourcing Pipeline
• Economies of Scale
• Analyze supply base diversity
• Supplier and category optimization
• Visibility into price indexes and discount leakages
Reducing procurement Cycle Time
• Current and detailed information available
• Focus on analysis & planning, not hunting & gathering
Contract Compliance
• Highlights out of contract spend
• Identify Maverick Spend
Dashboard
Standardized Reports
by user type
Customized Reports – Example
Spend by Supplier Region ,
Country , City
13. SAP Ariba Spend Analysis Enrichment Process
Data
Extraction
Data
Consolidation
Data
Validation
Data Upload
Data Upload
Validation
EY data
approval
Supplier
Enrichment
Commodity
Enrichment
Enriched
Data
Published
Dun & Bradstreet
+230Mio Businesses
SAP Ariba Supplier
Network
+500K Businesses
- Supplier Normalization/
Rationalization
- Parentage
- Enrichment: Judgements ,
Bankruptcy, Diversity, Green
14. Supplier Parentage
SAP Ariba Spend Analysis enables us to see how much the Etihad Group is spending with a particular Supplier Group.
Example: There are more than 10 suppliers registered in the ERP Systems that are all part of the “United Technologies”
Group.
15. Supplier Fragmentation
SAP Ariba Spend Analysis allows for easy supplier fragmentation analysis.
We can run a report to see how many suppliers are in each category of spend
We can add alerts. Example: Any category above 20 suppliers highlight in yellow , any category above 50 suppliers highlight in Red
16. Commodity Enrichment
Machinery & Equipment
Freight & Handlings
Pool Equipment Capital
Accrual for Commission
Unallocated Receivables
Schenker Logistics LLC
Schenker Deutschland AG
HM-Schenker Logistics LLC
Schenker AG
Schenker Limited Kenya
Supplier & Commodity Visibility in the financial system
Supplier listed as multiple vendors in ERP Spend type presented by GL account
SAP Ariba Spend Analysis – Providing Transparency on spend categories per supplier
Spend Correctly classified as Cargo Transport All Schenker vendors grouped under one Global Parent
17. Category Analysis
SAP Ariba Spend Analysis enables us to analyze categories to identify spend patterns, compare to
benchmarks and identify top suppliers
The Top 10 Legal Suppliers based on Spend
make up 76% of total legal fees
56% of Total Legal Fees are
for the Top Vendor
xxxxxxxxxxxx
Legal Fees Analysis
19. Etihad is
Embedding
Spend
Analytics in a
continuous
improvement
Process
Spend Vis enrichment process is ongoing
We will continue to create enrichment
rules to classify data better and more
accurate
The accuracy to more granular spend
category levels will improve over time
Active participation from Category buyers
and managers is required to ensure
maximum enrichment confidence
Super Users have the responsibility of
submitting Enrichment Rules
But the Strategic Tool delivers
immediate business value and insight,
even on legacy data