SAP Ariba - Solutions for Purchasing and Procurement

What is SAP Ariba?

SAP Ariba is the cloud-based software solution for procurement and sourcing. It supports stakeholders and buyers in all their classic tasks and drives the digital transformation of the procurement process.

In addition to various modules, the solution functions as a B2B network, where companies and their suppliers can collaborate virtually and carry out transactions.

The interfaces for the stakeholders are designed to resemble the ease of use that users are familiar with from B2C marketplaces in private online shopping. However, buyers in the background have access to far more business features. As a result, all steps of the procurement process can be digitally mapped.

The History of Ariba

Ariba was founded in 1996 in California. From the beginning, the goal was to offer users a transparent purchasing and procurement platform to optimize processes and improve supplier management.

In 1999, Ariba went public and grew significantly through acquisitions. In 2012, SAP acquired the company. This was followed by integration into the ERP area. Today, the cloud platform helps SAP customers digitally transform their entire procurement process.

From SAP SRM to Ariba

Many companies previously used SAP Supplier Relationship Management (SAP SRM) in combination with SAP ERP (ECC) to manage their supplier relationships and improve business relations.

However, with the new ERP product generation, SAP S/4HANA, SAP announced that support for SAP SRM would end in 2025.

As a successor, the Walldorf-based company is positioning the Ariba platform. It even created its own tool, "Transform SRM," to help companies migrate from SAP SRM to the Ariba Cloud.

How does SAP Ariba work?

From the perspective of end users, SAP Ariba Buying offers interfaces similar to modern online marketplaces (e.g., Amazon). Suppliers can offer their products on the platform through classic shop features. Relevant catalog features (item master data and price maintenance) are part of the Ariba standard.

For procurement, SAP Ariba provides a role management feature through which individual compliance rules and permissions can be mapped. This ensures that the processes in procurement comply with all internal regulations. Procurement users also have access to numerous tools and reports that simplify supplier selection and supplier management.

Through various customization options, the Ariba marketplace can be tailored to individual needs to improve the user experience. For example, certain suppliers or categories can be shown or hidden, so users only see the content they need for their current procurement process. Naturally, SAP Ariba also works seamlessly with SAP S/4HANA.

What features does SAP Ariba offer?

From the perspective of the procuring company, SAP Ariba’s features can be divided as follows:

• Supplier Management & Risk: Manage supplier data, initial supplier registration, qualification for additional product groups, and monitoring of the supplier lifecycle, including performance and risks.
• Strategic Sourcing: Supplier selection ("Ariba Discovery"), tenders, contract management, spend analysis.
• Supply Chain Collaboration: Linking and integrating partners and supply chain processes via the SAP Business Network.
• Procurement: Electronic procurement (E-Procurement).
• Financial Supply Chain: Strategically manage liabilities in the supply chain and optimize cash flow.
• Integration: Integrate data and processes from various applications (SAP S/4HANA and third-party systems) on a central platform.

Who is SAP Ariba suitable for?

SAP Ariba is aimed at small to medium-sized enterprises (SMEs) and large companies or corporations that wish to digitalize their procurement and purchasing processes.

The platform is equally suited for the procurement of direct and indirect materials. It can also be used for purchasing services. While Ariba can be operated as a standalone solution, the individual solutions achieve their maximum potential when integrated with SAP S/4HANA.

Who are the typical users of SAP Ariba?

The typical users of SAP Ariba can be divided into three groups:

• Stakeholders,
• Buyers, and
• Suppliers.

Stakeholders use Guided Buying and Spot Buy for efficient procurement via catalogs based on goods, suppliers, and prices already negotiated by purchasing.

For purchasing, the platform enables strategic management and operational administration of the entire purchasing process—from sourcing to ordering to reconciling supplier invoices.

Suppliers can use the SAP business network to help their customers drive the digitalization of procurement. Additionally, the platform allows them to acquire new customers, increase revenue, and improve cash flow.

What is Ariba Snap?

SAP Ariba Buying, in its standard version, is a complex tool with numerous customization options. Accordingly, the implementation effort is high, and subscription or licensing costs are more suited to large corporations.

SAP recognized this issue and created Ariba Snap, a pre-configured version for SMEs. Ariba Snap aims for a shorter implementation time to reduce project costs.

This is achieved through pre-configurations. The SME solution also comes with an adapted subscription model. Functionally, Ariba Snap focuses on operational procurement.

What is Ariba Spot Buy?

Ariba Spot Buy is an additional marketplace solution for Ariba with numerous international suppliers, helping companies with spontaneous purchases. The process can be roughly outlined as follows:

• Search for item: If an item is not listed in the catalog, the user initiates a search in SAP Ariba Spot Buy.
• Approval and authorization based on pre-configured business rules.
• Purchase: Check-out, secure payment, and shipping.
• Subscription Fee: Packages with different volumes of orders and invoices.

How do I use the SAP Business Network?

This question must be answered from two perspectives: that of the purchasing and the selling company.

The procuring organization gains access to the SAP Business Network when implementing their SAP Ariba solution.

Naturally, the company wants to encourage as many suppliers as possible to join the network after implementation. Therefore, invitations will be sent to suppliers to join the SAP Business Network.

From the supplier's perspective, there may be other reasons for joining the SAP Business Network—such as a customer's request for a tender or simply the desire to gain new customers and build business relationships through the platform.

How can a company become a member of the SAP Business Network?

To become a member of the SAP Business Network, suppliers only need to register on the Ariba platform. They can choose between two account types: the Standard account and the Enterprise account.

The Standard account is free and offers the essential operational basic functions. The Enterprise account, however, comes with additional features that enable the supplier to not only represent their existing business digitally but also expand and strengthen it.

Costs are only incurred when the supplier exceeds a threshold of 5 documents AND a turnover of €50,000.

How do suppliers and catalogs get into the Ariba Cloud?

Companies that want to see their suppliers and their catalogs in the Ariba Cloud must solve this on an organizational level.

Technically, suppliers only need basic IT know-how to provide the desired content. They can upload their entire product range via a convenient interface using "SAP Ariba Catalog."

Ariba also provides several modern content management tools that allow suppliers to define, validate, and enrich catalog content with additional information. Suppliers are also supported by automatic, policy-based quality checks.

Is there a separate contract between SAP Ariba and the supplier?

No. Contractual relationships exist only between the buyer and the seller. However, suppliers must accept the business and usage terms of the SAP business network.

What technical requirements exist for using the SAP Business Network?

Thanks to the cloud approach, the technical entry barriers for the SAP Business Network are minimal. Suppliers only need an internet-enabled device with a standard web browser to use the system.

How secure is the SAP Business Network in terms of data protection and confidentiality?

The SAP Business Network employs standard security mechanisms to appropriately protect sensitive data within the network. Uploaded documents and sensitive information are encrypted before storage and transmission. The same applies to communication channels. Servers are usually located in Europe and are designed for redundancy.

How long are data stored by SAP Ariba?

The duration of data storage is governed by legal regulations, ensuring that current retention periods are adhered to. SAP itself has no access to the data.

Does SAP Ariba support mobile devices?

Yes. There is an SAP Ariba app available for iOS and Android for mobile use. It allows users to browse catalogs, create and approve purchase requests, send reminders, and retrieve procurement-related reports.

Is SAP Ariba free for suppliers?

For up to four transactions per year and a volume under €50,000 per year, the Ariba platform via SAP Business Network is free for suppliers.

Beyond that, a pricing model is applied, based on the number of documents and transaction volume.