Is Strategic Sourcing the Right Solution for Your Business? Discover How SAP Ariba Strategic Sourcing Can Help Your Business Grow

For businesses that source their materials from external suppliers, strategic sourcing is crucial to managing their procurement process efficiently. Strategic sourcing involves identifying and selecting the best possible suppliers who can provide materials at a competitive price, without compromising quality. This approach requires a comprehensive analysis of factors that affect suppliers' capabilities, such as pricing, quality, delivery, and risk management. If your business needs a streamlined sourcing process that maximizes savings and efficiency, strategic sourcing might be the right solution.

To back up above mentioned statement, we are proud to share that out of all SAP Solutions, SAP Ariba has started reaching its peak when it comes to winning awards. Recently, procurement magazine placed SAP Ariba as either N.1 or No.2 in the following categories:

Software rankings

• Top 10: Generative AI Platforms in Procurement
• Top 100 Companies 2023
• Top 10 Procurement Technology Companies
• SAP Ariba is named a leader in Procure-to-Pay, Strategic Sourcing, Purchasing, Contract Lifecycle Management (CLM), Contract Management, Invoice Management, Supplier Relationship Management, and AP & Spend Analysis.

In this article, we will talk about SAP Ariba’s strategic sourcing solution which is leveraged by many enterprises and our customers in the Middle East to improve supplier collaboration, reduce costs, and increase transparency. It is a cloud-based software that offers a comprehensive suite of tools to help organizations automate and optimize their sourcing processes. It provides a centralized platform for all procurement-related activities, from sourcing to contract management.

The Strategic sourcing typical steps

• Define Requirements: The first step is to identify your organization's requirements and priorities. This involves analyzing your spending data, identifying savings opportunities, and defining the products or services you need.

• Identify Potential Suppliers: Once you have defined your requirements, the next step is to identify potential suppliers. SAP Ariba offers a wide range of sourcing options, including sourcing events, requests for proposals (RFPs), and requests for quotes (RFQs).

• Shortlist Candidates: After identifying potential suppliers, the platform enables businesses to analyze supplier performance metrics, market trends, and other data to shortlist suitable candidates.

• Evaluate Proposals: SAP Ariba enables businesses to evaluate suppliers' proposals based on various criteria, such as price, quality, and service. The platform offers powerful tools for conducting negotiations, ensuring that the terms of the contract are favorable to your organization.

• Finalize Contracts: Once the supplier selection process is complete, SAP Ariba provides tools for drafting, reviewing, and finalizing contracts. The platform ensures that the contracts comply with the legal requirements and are aligned with your organization's goals.

• Manage Supplier Performance: SAP Ariba provides advanced tools for managing supplier performance, tracking deliveries, and monitoring compliance with the contract terms. The platform offers real-time visibility into supplier performance data, enabling businesses to identify areas for improvement and take corrective action.

SAP Ariba Strategic Sourcing Method

SAP Ariba Strategic Sourcing takes a data-driven approach to sourcing by providing real-time analytics and insights. This enables businesses to make informed decisions on supplier selection and contract negotiation. The solution uses supplier scorecards to evaluate supplier performance and supplier collaboration tools that help to improve supplier relationships and reduce risk.

Strategic Sourcing vs. Procurement

Strategic sourcing and procurement are often used interchangeably, but they are not the same. Procurement is a broader term that refers to the overall process of acquiring goods and services, while strategic sourcing is a specific approach to procurement that focuses on long-term supplier relationships and value creation. Strategic sourcing involves a more comprehensive analysis of supplier capabilities and market trends than traditional procurement, which tends to prioritize cost savings and transactional efficiency.

The main difference between procurement and strategic sourcing is the depth of analysis and planning conducted before making purchasing decisions. Procurement involves reacting to immediate needs and selecting suppliers based on price and availability. On the other hand, strategic sourcing employs a more proactive approach by analyzing data, identifying suppliers, and assessing costs and risks before making a purchase decision.

A successful strategic sourcing process results in the selection of a supplier who offers the best value for money by providing quality products at a reasonable price. Additionally, strategic sourcing aims to establish long-term partnerships with suppliers to ensure a consistent and stable supply of goods or services. By adopting a strategic sourcing approach, businesses can improve supplier collaboration, reduce costs, and increase transparency, while building strong and sustainable supplier relationships.

What have our customers seen in 2023 from SEIDOR procurement support?

Very few SAP partners are certified in the region and have consultants within the Middle East. In the past few years, SEIDOR has been leading in heavily investing and delivering SAP Ariba solutions to customers across the region. SEIDOR's locally based consultants have been key value in delivering tailored solutions that fit the unique needs of each customer. Whether it's providing guidance on supplier management, optimizing sourcing strategies, or streamlining procurement operations, our consultants have consistently delivered exceptional value to our customers. So, in 2023, our customers have continued to experience the full benefits of our procurement support. Whether it's in the design or the adoption of new digital technologies, we have remained committed to delivering excellence.

One of the key areas of our service is post-Go-Live support. We understand that the period following the implementation of a new system can be challenging for many clients, which is why we work closely to ensure that all client-specific system issues are resolved in a timely manner. Our team of experts is always available to provide guidance and advice on how to manage exceptional cases in the system, ensuring that their businesses continue to run smoothly without any disruptions.

What does our Ariba support team do?

Resolution of Client-Specific System Issues:

With the unique requirements of each of our clients, we understand the importance of providing timely and effective support. Our team of experts has cooperated to ensure that every client can function optimally without any troubles. This year, we have successfully resolved many system issues, ensuring that each client's procurement process runs smoothly.

Seamless Communication Between SAP Ariba & SAP S/4HANA Team:

To provide the best procurement support, we have maintained seamless communication between SAP Ariba and SAP S/4HANA teams. By doing so, we have been able to address integration-related issues promptly, reducing downtime for our clients and ensuring that the procurement workflow remains efficient.

System Maintenance:

Our commitment to providing top tier procurement support extends to performing essential system maintenance. We have ensured that our clients stay updated on new Ariba releases and enabling new functionalities that are relevant to their businesses. This way, our clients can leverage the latest technology advancements and stay ahead of the competition.

System Enhancement Projects:

At SEIDOR, we know that businesses are dynamic, and procurement workflows need to be updated continuously. We have worked on several system enhancement projects, ensuring that our clients' procurement processes keep up with the ever-changing business landscape. We have implemented changes required for procurement policy updates and approval flows, among other things.

Advice on Managing Exceptional Cases:

In any business, exceptional cases are bound to arise, requiring a unique approach. At SEIDOR, we have provided our clients with expert advice on how to handle exceptional cases in the system. Our team's vast experience has been invaluable in guiding our clients in making informed decisions whenever they are faced with exceptional cases in their procurement workflows.

Would you like to learn more about SAP Ariba’s strategic sourcing? Contact our experts!