SAP InfoNet – genuine innovation in supplier risk and information management

Everybody knows SAP. The grand-daddy of the ERP and procurement software world. Designed for manufacturing businesses initially. Solid, inflexible, a bit slow, resource intensive in implementation terms.

But even before the recent acquisition of Ariba which made everybody look again at the SAP strategy, the company was changing. I read with interest my US colleague, Jason Busch, some months ago when he highlighted that SAP was innovating with surprising pace, imagination and success in the procurement space. Jason was very impressed in particular with the new SAP product, InfoNet, and I’ve been wanting to take a look at it ever since then.

I finally had a demo a couple of weeks ago, and one of the SAP people on the demo told me that he only recently joined the InfoNet  team, and that part of his reason for doing so was reading the Jason Busch review of version 1.0 on Spend Matters US! But this is now version 2.0, and is much faster, running as it does on the new-ish SAP HANA platform, and with improved user interface. I didn’t look at 1.0 so I can’t verify that – but the UI certainly seemed clear and easy to use.

So, what is InfoNet? Basically, it is a supplier information, risk and performance management platform that helps you manage your supply base, measure and track performance of suppliers, and provides risk related information and alerts about your key suppliers.

It has two particularly innovative aspects. The first is the way it allows the user to visualise multi-tier supply chains, looking not only at first tier suppliers but then enabling a drill-down to sub-tiers to obtain information or alerts at the different levels. Tier 1 suppliers have to give permission for their data to be used, and they may choose to anonymise some sub-contractors, but InfoNet then picks up information about their suppliers and includes that in the view available to the user.

The second innovation is in terms of where the information about suppliers comes from – there are three sources. The first is the user’s own organisation. There are six standard key performance indicators (KPIs) , three delivery related and three quality. The user maintains that KPI information about as many suppliers as they wish. The second source is largely risk-related and comes from SAP itself. SAP is picking up news alerts about suppliers, often from source rather than waiting for things to hit the national press, and provides alerts back to the user on key identified suppliers – first or sub-tier.

Alerts may relate to natural events / disasters, site disruptions, patent issues etc. In fact, SAP claims that their "news feed is now the worlds’ largest database of of news that is regularly updated" with 160,000 global sources - pretty impressive!

It’s the third source of information though that makes InfoNet very interesting, innovative and perhaps even unique (at the moment). InfoNet also picks up data from prime contractors (tier one suppliers) and other  organisations in their network who are also users of any given supplier. That means you can compare how a supplier performs in terms of KPIs for you, versus their wider (aggregated and anonymised) network performance. That even has a forward looking element, where InfoNet will predict for instance a decline in supplier performance if the system sees that supplier failing more widely.

InfoNet therefore enables the user to both look at supplier performance and manage risk better not just at first tier but through the supply chain. It enables you to look at your entire supply chain and chart relationships – for example, where a key supplier at first tier may also be a critical second tier supplier to other of your primes.

So, this does appear to be a genuinely innovative product, and even as a non-technophile I found it quite exciting – not something I often say about software demos! The way it is using many participants in the supply chain to gather and analyse huge amounts of information (“big data” in action) in a networked and collaborative manner may well indicate a promising future direction for procurement and supply chain technology more generally as well.

It’s one of those things that is much easier to understand visually then it is to communicate in words. So if you’re interested, this short video shows some screen shots which help visualise what I’m talking about. And you can drop an email to stephen.terry@SAP.com if you want any further details.

 

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