Ariba Supplier Network Alternatives: Basware (Background — Part 1)

This post is part of a fall 2010 series looking at Ariba Supplier Network alternatives. We will cover each Ariba supplier network alternative in a series of three-part posts starting with each provider's basic background in the area. Following this initial installment, we will then examine their solution approach and Ariba/third party systems integration. And finally, we will provide our own summary and analysis of the provider's overall capabilities.

Through its connectivity services offering, Basware provides a neutral platform that enables both suppliers and buying organizations to send and receive electronic invoices, exchange catalog messages and transfer purchase transactions in a secured environment. This offering is similar to what others might describe as a "supplier" network built to allow for interoperability, transparency and efficiency between transacting buyers and suppliers. Even though Basware's connectivity services represented less than 10% of the provider's revenue in 2009, the offering is experiencing double-digit growth. In 2009, Basware transferred 11.5 million e-invoices via its network offering and expects in 2010 to transfer "around 16.5 million e-invoices and PO transactions."

From a customer perspective, Basware has 1,600 buy-side customers currently using its P2P solutions and services. These buyers work with approximately 4.5 million suppliers, of which Basware maintains detailed information/records on 1.35 million. Of this group of suppliers, approximately 160,000 are "active in e-invoicing and/or purchase order messaging on monthly basis."

Basware has taken an opposite approach from Ariba in building a connectivity/network offering by prioritizing the importance of interoperability between providers rather than delivering a proprietary cloud solution. They currently have 100 contractual inter-operator agreements (see this link). Basware shared with Spend Matters that they add "around four new interoperability partners" per month. In addition to the signing of new buy-side customers, this helps drive the roughly 2,500 new suppliers that are becoming active in the network on a monthly basis.

Organizations can leverage Basware's connectivity solution in two ways: as an extension and fully integrated component of Basware's P2P software capabilities or on a standalone basis to complement/enhance third-party software for other providers. Basware notes that the solution supports "true straight-through-processing of purchase and invoice transactions through the P2P process," enabling "over 90% of invoices passing through the solution with no human intervention."

Stay tuned as we continue to examine Basware's connectivity/network capabilities.

Jason Busch

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