SAP acquired procurement software vendor Ariba in 2011, but the company's history dates back two decades. This week, SAP Ariba executives briefed analysts in Boston, giving an overview of recent roadmap milestones as well as a look ahead at what's yet to come. Here's a rundown.
Growth markers: There are now 2.4 million suppliers on Ariba's business network, with more than $1 trillion in commerce transactions each year. In addition, Ariba has a presence in 190 countries.
Yet Ariba has set some lofty goals for additional growth. By 2020, it expects to have $5 trillion in commerce moving through the system on an annual basis, and up to 10 million suppliers on the network, said Chris Haydon, chief strategy officer.
“We want to make the network synonymous with the vendor master," he said. Ariba plans to get there in a few ways, including its increasingly global footprint. When SAP first acquired Ariba, 80 percent of its revenue was U.S.-based, but now that has shrunk to 50 percent.
Ariba also has high hopes for China. It's built a dedicated data center inside the country in order to offer customers a local option. Many enterprises in China are state-owned; for starters, Ariba plans to focus its sales efforts on privately held Chinese companies.
Alibaba is China's dominant force in B2B commerce. Ariba hopes to be able to work with the giant enterprise in a similar manner to its existing relationship with eBay, said Ariba president Alex Atzberger.
While a significant go-to-market opportunity remains with the SAP ERP installed base, Ariba will continue to be agnostic from the standpoint of working with third-party ERP systems, Atzberger said. In addition, many Ariba deals have come about when a customer decides to move its on-premise SRM systems to the cloud, and on that basis Ariba can be a wedge into non-SAP accounts, he added.
Cloud Push Gains Traction: This year, Ariba announced that it would stop creating new versions of the on-premises version of its software. From the sound of it, most customers were already favorable to cloud deployments. Fewer than 100 customers remain on the on-premises version, executives said.
Ariba has managed to sharply increase its release cadence compared to the on-premises era, with application refreshes coming at minimum on a quarterly basis and as often as monthly, Haydon said. One way it's accomplished this is through platform-level changes, including a modernized architecture that leverages microservices. It's also moving all aspects of the Ariba apps to SAP's HANA database; currently, all Ariba analytics are powered by HANA.
Earlier this year, Ariba announced moves aimed at providing extensibility for the underlying platform. One aspect is a self-service tool that business users can use to create new forms without the need to code. The other gives partners APIs that can be used to tap Ariba at the data, logic and UX levels.
AI for Ariba: Executives shared a sneak preview of Ariba's planned AI capabilities, demonstrating a "supplier assistant" intelligent chat bot emedded in the Ariba UI. Ariba CTO Dinesh Shahane walked through a scenario in which an employee shopped for an oil rig.
After they selected a vendor, the supplier assistant first provided basic information about the vendor's history, saying it had a five-star rating with a track record of on-time delivery.
But then the employee began to interact with the chat bot, asking questions such as wether the rig could be delivered within two weeks. The system replied that it likely could, but may also be delayed by a week due to weather. Then, as a follow-up question, the hypothetical employee asked what other options existed for buying the rig.
In turn, Ariba is developing an "approver assistant" aimed at managers. In this case, the chat bot told the hypothetical manager that buying the desired oil rig purchase would exceed his annual budget by $10,000. The manager asked for alternative oil rig purchases and was able to attach the information in a message back to the employee.
The chat bot's NLP (natural language processing) capabilities will only increase over time as companies work with it and help the algorithms get smarter, executives said. While no precise release date was available, Ariba plans to discuss the assistants at next year's Ariba Live conference, with a goal of releasing them by year-end.
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