Tuesday, February 18, 2014
Spend Management Software for Supply Chain Managment
The focus of my professional career was working for a tech company that offered Spend Management Software for Supply Chain Management - Ariba. I was fortunate enough to touch about every piece of the suite they offered; Supplier Network, Sourcing, Visibility, Contracts, etc. I’ve ran everything from a major Visibility implementation to several Reverse Auctions a day.
The software started off as a CD version that clients and suppliers would install locally on their servers or desktops. I think we all remember getting a CD in the mail and having to put in on our desktops. Or not, I grew up in the 1990s and could be dating myself. This piece of software simply allowed buying organizations to upload and store files they needed to use to run an event - Request for Proposals, technical drawings, and pricing temples among others. Suppliers would then download them, view, modify, bid, and upload the same way. It was one of the first times suppliers did not have to receive a paper bid package and mail the proposals back.
The next version was a bidding tool that reacted in real time. It was also installed locally, but was functional enough to allow the suppliers to update pricing as needed in real time. This was a huge step in the technology space at launch. It allowed for competitive, global markets and the advantage fell towards the buyer. Clients were realizing savings quickly and could implement a new, cheaper vendor for bottom line cost reductions. I should note that suppliers did not suffer either. It allowed them to revisit their margins to compete with an international supply base. However, most domestic suppliers lost business as outsourcing became popular globally.
As the tech boom happened around the country in the late 1990s and early 2000s many companies were popping up online and ecommerce took off. It took a while, but Ariba eventually moved away from CD versions of these tools to more advanced online versions. By the time I started working there in 2006 clients had a dedicated url to log into with a username and password (something we are all familiar with today). We could then work as a team to create processes, approvals, and online events. The suite started to expand from both ends of the sourcing process. Ariba developed a tool to analyze client spend that created a pipeline for projects to source. Then they created a couple more on the back end, Contracts Management (to get an agreement in place) and Supplier Management (to monitor activity through the contract). Now everything is in the cloud and stored on Ariba servers.
Ariba is known as the industry standard when it comes to Spend Management software for your supply chain. They acquired some competitors along the way and even sold off a services division to a large consulting firm to concentrate on the technology side. I worked for the services end and we were acquired by Accenture in the fall of 2010. It was a great run to understand all of these tools and how they fit into the traditional supply chain process of sourcing/procurement. I actually just saw a job posting the other day for a manufacturing company looking for procurement managers that had Ariba software experience.