SAP SRM — A Long Way to Go?

Just like the owners of "Sofa King", SAP appears serious about listening to the needs of their customers. Incidentally, if you've not seen the above linked Saturday Night Live skit, carve out a few minutes to watch it -- you won’t be sorry. But whether it turns out that SAP is able to build an SRM suite that is "Sofa King" good remains to be seen, despite the efforts of a bunch of its largest German customers. CPO Agenda recently ran a column penned by Ulrich Piepel, CPO of German utilities provider RWE, who notes that "Over the past year I have led a group of German CPOs from companies such as Bayer, ThyssenKrupp, Siemens, RAG, E.on, Deutsche Post, Deutsche Telekom and Henkel in a campaign to improve the procurement functionality in SAP's enterprise resource planning software."

What is there beef with SAP SRM? According to Piepel, "The world of procurement is changing ... We need to work out who is demanding what from within our company and our subsidiaries, so we can pool our resources and have just one person responsible for buying stationery, IT hardware or power cables, for example. We also want to know who's likely to need, say, new cleaning services in the next 12 months. At the moment that's not possible with SAP SRM. The system is excellent transactionally, but it has no way of telling us how much we've saved and there's nothing that allows us to automatically reduce a department's budget as a result of a procurement saving. While there are indicators for almost every tool and machine in SAP, there's no indicator for the biggest cost group of a company -- procurement performance.”

When confronted by Piepel, SAP originally denied the need to move quickly on these areas since they said these needs were "two years ahead of the market." The rest of the article includes a description of what happened next and how SAP is now at least listening to their local, German-based procurement executive customers (even if they’re moving along at a slow pace at implementing the suggestions). What's my advice to this group of CPO's? Quite simply, it's to look beyond SAP SRM for everything non-transactional -- especially on the reporting, performance management and visualization side. There are a number of vendors and solutions providers who would love to take your call -- and they could teach you rather than you teaching them. Now that's what I'd call "Sofa King" good ...

Jason Busch

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