Partners in SAP Ecosystem Prepare for Real-Time Supply Chain Analytics

by   |   May 16, 2013 11:00 am   |   0 Comments

ORLANDO – Bill McDermott, the Co-CEO of SAP, made it clear at his company’s SAPPHIRE conference that the in-memory database HANA was SAP’s future.

“Not only does HANA represent the intellectual renewal for SAP, it’s the platform that will run every single SAP product going forward,” McDermott said at the conference May 14.

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The promise of HANA is speed. The company says its in-memory processing system brings as much as a 1000x improvement to SAP’s business software. While the full vision of a HANA-supported system of real-time views into all the partners in a supply chain might be two or three years away, the potential has players in SAP’s ecosystem laying the groundwork.

For technology partners or companies recently acquired by SAP, like the procurement and spend management company Ariba, which means looking at their capabilities differently and thinking about how HANA changes their business model. SAP’s $4.3 billion purchase of Ariba was finalized in October 2012.

Ariba currently connects buyers and sellers in its procurement network cloud service that features more than 1 million companies. The company creates efficiencies by creating a single paperless platform for the transactions and provides buyers and suppliers a vast marketplace.

“Networked companies are just more successful,” said Greg Spray, Ariba’s vice president of solutions management. “More than 80 percent of the world’s commerce is done with inefficient paper, email and phone calls. All of that can go away.

“Our customers can not only see what they’re spending, with whom and how much, but they’re able to see their operational as well, to understand where their bottlenecks are, where things are being held up in the process, what’s making the process less efficient,” Spray said. “All of that data goes into making easier, more efficient collaborations across the buying and selling.”

Now as a part of SAP, Ariba can combine its network of buyers and sellers with the German software giant’s supply chain and ERP software. The result, according to SAP’s Hans Thalbauer, the senior vice president of supply chain management, will be a network where one company can run real time analytics on its entire supply chain, from “its supplier’s supplier to its customer’s customer.”

The key to that, Thalbauer said, is HANA.

“In order to realize the real time supply chain it’s necessary to bring everything into the in-memory environment,” he said.

Richard Jabbour, Tata Consultancy Services’ director of SAP enterprise performance management practice, helps companies that have chosen to use SAP software implement their new systems. On May 15 at SAPPHIRE, Jabbour talked about helping a client, document printing and scanning company Lexmark, to implement a real-time supply chain system based on SAP HANA. With the new system, Lexmark can see in real time where all of its products were around the globe and better manage distribution.

Jabbour said that a system that Thalbauer described where a company could track not just its own inventory but also view what was happening with suppliers and customers in real time would benefit businesses profitability.

“If I can look at the value stream of my supply chain, and I can start to see bottlenecks that maybe my team can help people solve. Then I can get my products in the door quicker than they’re getting in the door today,” he said. “I can push my days in inventory number down.”

SAP likely won’t be able to roll out such a system for two or three years, Jabbour said, as HANA still “needs to mature.” SAP reports there are 1,500 HANA users currently, but Jabbour said most companies are still just beginning to think about what’s possible with real time analytical systems in enterprise management systems like supply chain or spend management.

Email Staff Writer Ian B. Murphy at Follow him on Twitter .

Home page photo from SAPPHIRE exposition floor by Ian B. Murphy.

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