Will Ariba and SAP Increasingly Abandon “Upstream” Innovation in 2015? Jason Busch - January 19, 2015 6:48 AM | Categories: Ariba, Innovation, SAP | Tags: L1, Technology In 2015, Ariba and SAP will continue to put a lot of stock at the intersection of building a broad P2P (finally inclusive of the final P: “Pay”) capability with increased network power and services. This will include native integration to the capabilities from Fieldglass and Concur (especially to generate a positive ROI on nearly $10 billion of investment in buying these 2 firms) into their general procurement value proposition and solution set. If Ariba and SAP get 50% of their activities in these areas right in the next 24 months, momentum alone will carry the day from a commercial perspective (provided they can preserve the talent and expertise from Fieldglass and Concur). FREE Research Report: How to Chose Procurement Technology That “Grows With You” But nearly all of these realms of investment and innovation fall in what Ariba itself once coined as the “downstream” procurement area centered on enabling and managing transactions and non-strategic interactions with suppliers. The “upstream” piece of the source-to-pay (including analytics, sourcing, contract management and supplier management) equation has generally not seen similar areas of investment in recent years. Increasingly, especially in the sourcing and contract management areas, Ariba and SAP are not often invited to the RFP table outside of broader suite deals (unless they are the incumbent and HAVE to be invited). Moreover, the general knowledge of these capabilities inside Ariba and SAP is taking a backseat to the focus on P2P, network, services procurement and other areas. This is too bad in areas like contract management in which Ariba and SAP provide varying levels of authoring/drafting capability, clause scoring/libraries, analytics, negotiation, approvals, repository, administration, compliance monitoring and broader compliance systems integration capabilities. Ariba’s own cloud solutions in the area even bring a competent authoring environment that enables technical and organizational integration and collaboration (e.g., clause libraries, sell-side/legal integration). While not best of breed anymore in these areas, the older Ariba product lines still bring certain capabilities that often do not get as much credit as they maybe should. And, SAP has not yet sunsetted its own “upstream” on-premise solutions it acquired over the years (e.g., SAP Sourcing/SRM – the old “Frictionless” solution set), even though we believe these are pretty much "dead apps walking" that are supported only because of large vocal customers looking to realize value from previous investments. During 2015, Ariba and SAP together have some important decisions to make regarding such topics. Incremental investment is likely to no longer suffice in these spaces, and from a strategy perspective, Ariba and SAP need to figure out the commitment to innovation (or not) they want to make in the upstream areas. If you are planning your next moves with any of these providers and want to learn more, check out our PRO coverage below, or please reach out to me. Related ArticlesAriba and SAP: How We Would Play For Keeps in the SMB Market With Enhanced Network StrategiesSAP and Ariba: A Playbook for Creating SME (and Large Company) Network ValueConcur and SAP/Ariba: Customer and Partner/Ecosystem Analysis and RecommendationsBeware Ariba's Patent Treasure Chest (Part 6): Dynamic Data Access and StorageBeware Ariba's Patent Treasure Chest (Part 5): Analysis of a Recently Awarded PatentBeware Ariba's Patent Treasure Chest (Part 4): Supplier Approval and Activation in a NetworkBeware Ariba's Patent Treasure Chest: Spot Market and Importable TemplateBeware Ariba's Patent Treasure Chest: Sourcing and eProcurement (Part 2)Beware Ariba's Patent Treasure Chest: An Arsenal of Intellectual Property (Part 1)Amazon.com vs. Ariba: The B2B Merchant Experience to Procurement is in for a Storm of ChangeAnalyzing the 2014 Forrester eProcurement Wave – SAP, Ariba, Coupa, Oracle, and MoreSAP and Ariba: Examining Cloud and On-Premise Choices and Product-Line Competition Discuss this: Cancel reply Your email address will not be published. Required fields are marked *Comment Name * Email * Website Notify me of follow-up comments by email. Notify me of new posts by email.