Could SAP, Ariba Build a New ‘Services Network’ with Fieldglass?

There are multiple perspectives on SAP’s announced acquisition of Fieldglass in the Spend Matters office – all generally very positive. One thing that many of us are curious about is what SAP and Ariba could build with Fieldglass by extending the application capability of the Fieldglass VMS to a network-based model targeting new types of value not only for procurement, HR and IT organizations consuming services (and external talent), but the suppliers themselves.

I believe there are some useful archetypes in the market to follow in creating not just a talent marketplace (Elance, oDesk, Blur, etc.), but in delivering a true set of services to different types of services suppliers (outside of those working for larger staffing firms or services providers as contingent workers or on a project basis). The growing market for independent contractors and consultants, for example, as well as retired workers (something that Fieldglass has actually enabled through its VMS), also has a supply side to it that could benefit from new services.

MBO Partners is one of the classic examples of a provider which is not just a traditional VMS or MSP, but that provides services which begin to look very much like a personal employment organization (PEO) for the independent contractors and consultants it works with. For example, it offers a range of insurance products (e.g., general liability, E&O, medical, etc.) as well as broader employee benefits to the individuals and small firms who work with it. They even offer metrics-centric reporting tools to help these individuals and firms run their business as an adjunct to QuickBooks and other small business accounting packages.

It’s also worth paying attention to what ZeroChaos is up to as well as an archetype (incidentally, we’re looking forward to digging into not just their standard VMS/MSP capabilities, but also some of their talent/contingent crowdsourcing and supplier diversity approaches this spring as well). They’ve also focused on other areas of value on the supplier side, including insurance products.

It’s not too far-fetched to think of an expanded Ariba and Fieldglass network designed to enable new capabilities and services for suppliers that has elements of Elance, MBO Partners or ZeroChaos, but delivered in a network-based manner. One can also imagine new types of financing capabilities, skills networks/virtual teaming, training, risk management, benchmarking and many other services layered on top of the services procurement and VMS applications themselves.

Heck, maybe the VMS just becomes an “app” on top of the network – and the real value resides in the intelligence of the network itself. Think about it: perhaps a future network could parse SOWs and job reqs to the right supplier sources – firms, ICs, staffing organizations – based on embedded intelligence. Maybe it ties into internal HR and human capital management tools to decide a blending talent outcome of internal and external resources.

OK, enough future casting. But the networked potential for services procurement is fascinating indeed!

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  1. Greg Lindsay:

    Yes Jason. SAP and Ariba could do services better and the the FieldGlass buyout may help….But here’s the thing.

    Ariba when it bought Quadrem back in March 2011 knew it had acquired through the buyout a proven and active cloud based Service Order Management solution that was working very well and implemented with BHP Petroleum, Olympic Dam and other large miners and suppliers globally. At the end of FY09, 66% of the service entry sheets were entered by vendors directly into BHPB’s Olympic Dam’s back-end SAP system as outlined in the pponline report below.

    I don’t know if its still live. But is was a great solution and really advanced for its time.

    Whatever the commercial or strategic is reason for the buy out of FieldGlass it signals that SAP are looking to manage this area of business process better for their customers. As its a huge market. Which is great! As having seen hundreds of large companies struggle with service order claim request (both planned and unplanned) over the years it seems a very obvious area to attack, as it could be a transaction fee gold mine for whoever sets the business process standard for this area of order management.

    The Quadrem solution connected directly to BHP Billiton enterprise resource planning system, SAP, and enabled the buyers and AP teams to: rapidly and accurately pay invoices, analyze line level expenditure data, identify price discrepancies and promote purchasing that complies with corporate contracts.

    As the Quadrem site and brand has been nuked, you can check out some coverage on this solution at the following sites.

    Great Site.

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