Oracle Launches a New Approach to Supplier Management (Part 1)

At ISM this week, Oracle officially launched its new Supplier Lifecycle Management and Supplier Hub solutions. These products, built on Oracle's Master Data Management suite, officially went GA in December of last year (yet are not able to be referenced at this point). While both solutions appear similar to other supplier information management tools on the surface, their overall technology architecture and model underneath the functional layer is what separates them. In Spend Matters' view, if Oracle gets the coming iterations and releases of this solution right and can successfully leverage its own customer data integration (CDI) technology that provides real-time visibility, alerting and updating into multiple systems of record, third party data sources and supplier systems, they'll have a SIM killer on their hands. And the only players that could theoretically catch them in a short term horizon would be IBM and D&B, both of whom have acquired similar technology in recent years as well, yet are not yet deploying it in a buy-side supply chain context.

In Part 1 of this post, I'll cover the basics about what's included in these solutions. In Part 2, I'll offer a look at how the enabling master data management provides a differentiated approach to enabling a supplier information management solution. From a functional perspective, Oracle's supplier lifecycle management tool provides similar base capabilities to AECsoft, Aravo, Ariba, Emptoris and many others offering supplier management capabilities. It enables, as Oracle suggests, the ability to manage the supplier registration process for prospective suppliers. Key to this capability are automated processes and workflows that automatically request information from suppliers when it's not current or required, and then route this information to the correct set of stakeholders for vetting and approval when exceptions occur.

Their capability here appears rather unremarkable -- though useful -- compared to other tools. For example, the "cross-functional performance evaluation" that Oracle supports through "templatized questionnaires, flexible feedback mechanisms, and visibility into archived supplier appraisals" appears similar to many others. As does Oracle's ways to "promote effective governance and risk mitigation with extensible profile management, risk driven supplier segmentation, and ability to integrate with third-party supplier information services." But what really separates out Oracle's approach is their Supplier Hub concept that, in their words, "consolidates & maintains complete, accurate and authoritative master data across the enterprise."

And Oracle really means it. Regardless of whether a company is running a consolidated Oracle back-end or a wildly heterogeneous systems environment based on multiple ERPs, versions and instances, Oracle Supplier Hub lets organizations push and pull data in real-time from multiple systems. Overall, Oracle provides the only supplier management approach I've seen that includes the ability to consolidate information from dozens of internal and potentially external source systems (and third-party enrichment data), create master-level supplier classification and mapping relationships, access, synchronize and publish data and apply data stewardship and governance approaches across hierarchies, tasks and overall classification -- all in a real-time manner.

After a relative quick initial glance, it does appear to be the "single system of governance" that Oracle positions. Theoretically, based on the underlying MDM/CDI architecture, the system can provid alerting based on underlying data elements -- or as combinations of data elements -- changes based on thresholds, defined relationships and hierarchies. Moreover, you don't need to be an Oracle shop to take advantage of these capabilities. With Oracle's Supplier Hub, companies can either run a version tied to their current R12.1 deployment or opt for a stand-alone instance of the application if they're running earlier eBusiness Suite releases or aren't Oracle customers.

Stay tuned for further analysis of this new release in the coming week on Spend Matters. I'll be looking at the product more closely this week and will share additional insights.

Jason Busch

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