With the addition of Ariba in 2012, SAP acquired the leader in cloud-based collaborative business commerce. At the time, Ariba’s cloud-based global trading network automated more than $319 billion in commercial transactions and connected more than 730,000 suppliers, and SAP pegged the market for cloud-based enterprise network and procurement services at $5 billion in revenue.
As reported by the Wall Street Journal, SAP then Co-CEO (now sole CEO) Bill McDermott predicted that SAP would double the number of Ariba customers by 2015. A prediction that struck many as bold.
Today, however, McDermott’s prediction seems more realistic, understated even.
Ariba completes a vital cloud trifecta
SuccessFactors, which SAP acquired in 2012, provides a leading cloud-based Human Capital Management (HCM) Suite, and is widely acknowledged as catapulting SAP into a cloud-leadership position. With approximately 25 million subscription seats globally, SuccessFactors serves 3,900 customers across more than 60 industries in more than 177 countries using 35 languages, according to the company.
In 2014, SAP completed its acquisition of Fieldglass, the leading technology provider for procuring and managing contingent labor and services. The company’s cloud-based Vendor Management System (VMS) helps organizations better manage their non-employee workforces, including temporary staff, independent contractors and services arranged through statements of work.
SAP acquired Ariba in 2012, the leader in cloud-based collaborative commerce applications and the second-largest cloud vendor by revenue. According to SAP, with 1.2 million companies connected and approximately half a trillion dollars transacted, Ariba is the world’s largest business network.
In essence, with SuccessFactors, Fieldglass and Ariba, SAP’s cloud offerings encapsulate a vital cloud trifecta of permanent workers, contingent workforces, and the ever-growing business network of partners — in other words, the complete spectrum of internal and external resources that make businesses hum in today’s highly connected, fiercely competitive, increasingly global business climate.
Using the cloud to transform business networks
The benefits of the cloud are clear and compelling, with lower costs (opex vs. capex), greater agility, and faster innovation topping the list.
Another key consideration for strategic cloud adoption is how to use the cloud to transform today’s increasingly vital business networks.
As reported in the Strategist, among many other sources, SAP’s commitment to both the cloud and the networked economy is well established and steadfast.
McDermott states: “SAP is at the core of this network economy. We have the world’s largest business network, connecting approximately 1.5 million businesses and driving an annualised transaction volume of $540 billion. That is two times the size of Amazon and eBay combined. If it were a country, the Ariba Network would be in the top 25 by measure of GDP.”
How to model and automate the terms of a business network so as to extend business models and value chains with optimum speed and transparency?
Do business network dynamics evolve as markets emerge, scale, mature, and decline, or does one size fit all?
What implications do these networked business models have for managing investments in information and communication technologies (ICT) systems?
How to orchestrate one’s business network partners as “one company” to deliver reliably on business commitments?
How to manage risk and compliance exposure across the entire business network?
Who will own the customer relationship, and how to capture value in a distributed ownership?
How does one become a business network ‘concentrator’ — a member of the network who has gained greater bargaining power than the others and who drives the performance of the whole to its own greater benefit?