This post is not intended for Ariba investors. If you're one of them, please feel free to read on, but rest assured I don't want to get into any investment advice one way or the other. Rather, this post is aimed specifically at Ariba customers and prospects that may have seen their vendor's share price rocket and decline in the past few weeks, in part based on the market's view about how much they think you might spend -- and your suppliers might spend -- with Ariba in the coming quarters and years. In times of appreciating currency, it's quite common for vendors to develop a bit of cockiness in their overall customer engagement philosophy based on the view that a rise in stock price equates with a self-fulfilling vision of leading the market and beating others. Trust me, I've seen it before within organizations that I've worked both for and with.
But in reality, nothing has changed. Ariba continues to win its share of competitive deals. They lose their fair share as well (even when they're the low-priced option for buyers -- but not necessarily suppliers, mind you). If you're a customer or prospect, the key thing to remember is that a rising stock price has nothing to do with whether or not Ariba is the best provider suited to serve you. You should never prioritize Ariba -- or any other vendor, for that matter -- over others because of the financial news they're making in the market. In fact, Ariba's success will no doubt make it easier for Ariba's current and future competitors to raise capital and go public as well, potentially providing you with more very low (from a supplier financial) risk options to choose from.
Companies considering solutions should be more concerned with evaluating the overall stability (balance sheet and growth) of any vendors they consider. Yes, a rising stock price can give Ariba some benefits that it could potentially pass on (e.g., more easily acquiring and integrating acquisitions that could benefit customers, such as contingent / services procurement technology that can stand on its own). But alone, the market's barometer of Ariba -- or any other vendor -- should have nothing to do with your own. Rest assured, the worst decision a company could make right now would be to not consider a range of solution providers because they think the market has made a decision on who will thrive over the long-term.