MRO Magazine

SAP Ariba Tames Complexity of Direct Materials Sourcing

By Business Wire News   


Today’s consumers want products with the latest innovations customized to their needs. And they want them now. Procurement plays an important role in bringing these products to market quickly, but with hundreds or thousands of high quality components that need to be sourced at low cost to build them, it isn’t an easy task. SAP Ariba is helping to simplify it with Ariba® Collaborative Sourcing Professional. The latest addition to SAP Ariba’s market-leading sourcing applications, the cloud-based offering provides a single solution through which companies can drive an efficient digital source-to-contract process and procure direct materials with the same simplicity and speed as indirect goods and services.

“Direct materials sourcing carries a unique set of challenges – it is driven by production planning rather than requisitions, there are enormous variations between different industries in how it is done, it’s usually time critical, and it is executed across many different enterprise systems and processes,” said Bill McBeath, Chief Research Officer, ChainLink Research. “To do it well requires connecting the systems and processes that support procurement across the end-to-end process and dimensions of collaboration – from design, to planning and forecasting, execution, logistics/delivery, quality, and finally reconciliation/settlement – both internally and externally.”

Forging Connections

This is exactly what Ariba Collaborative Sourcing Professional is designed to do. Delivered on a powerful global platform – the Ariba Network – the solution integrates seamlessly with ERP and execution systems to connect the people, processes and information procurement needs to manage all of their sourcing activities in a simple, smart and open way.

“We continually strive to improve our procurement system to ensure that the products we purchase meet our standards of quality, cost, and delivery, as well as to build good business relationships with our suppliers for trust, cooperation, and mutual benefit,” said Julie Daugs, Director, Corporate Supply Chain Management, Yaskawa America, Inc. “Ariba Collaborative Sourcing Professional gives us one platform from which we can manage both our direct and indirect spend, driving greater simplicity and efficiency and reduce our costs while creating equal and fair opportunities for our partners.”

Accelerating Results

But procurement is about more than just efficiencies and savings. With Ariba Collaborative Sourcing Professional, global procurement organizations can:

  • Get new products to market faster by integrating Sourcing and Product Design teams
  • Model product costings at the Bill of Material (BOM) level to understand the cost impact of different assemblies and components
  • Track item costs across time, suppliers, and BOMs to negotiate more savings
  • Achieve contract compliance and stop leakage through ERP integration
  • Source and contract faster by integrating master data across systems
  • Manage suppliers at the item or plant level to enhance supplier qualification and performance

“Procurement has made great strides in indirect spend by leveraging technology to create a consumer-simple, yet compliant process to manage it,” said Tony Harris, General Manager, Direct Procurement Solutions, SAP Ariba. “With Ariba Collaborative Sourcing Professional, they can bring the same efficiency and simplicity to direct material categories and open the door to innovations that transform their business.”

Ariba Collaborative Sourcing Professional is on full display at SAP Ariba Live, the premier global commerce event taking place in Madrid this week. To learn more about the solution and the value it can deliver, visit:

About SAP Ariba

SAP® Ariba® is the marketplace for digital business, creating frictionless exchanges between millions of buyers and suppliers across the entire source-to-pay process. Our market-leading solutions enable companies to simplify collaboration with their trading partners, make smarter business decisions and extend their collaborative business processes with an open technology platform. More than two million companies use SAP Ariba solutions to connect and collaborate around nearly one trillion in commerce on an annual basis. To learn more about the company’s offerings and the transformation they are driving, visit

About SAP

As market leader in enterprise application software, SAP (NYSE: SAP) helps companies of all sizes and industries run better. From back office to boardroom, warehouse to storefront, desktop to mobile device – SAP empowers people and organizations to work together more efficiently and use business insight more effectively to stay ahead of the competition. SAP applications and services enable approximately 310,000 customers to operate profitably, adapt continuously, and grow sustainably. For more information, visit

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SAP Ariba
Karen Master


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