Afternoon Coffee: SAP’s chief steps down; FAA didn’t properly review 737 MAX jet, regulators say; SpaceX, 7 competitors get contract

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SAP announced that its CEO, Bill McDermott, 58, is stepping down after more than nine years running the business software company, reports CNBC, which said he will be succeeded by two people: board members Jennifer Morgan and Christian Klein.

“Under McDermott’s leadership, key metrics including market value, revenue, profits, employee engagement and environmental sustainability have all strengthened substantially since 2010,” SAP said in a statement, which also said McDermott oversaw expanding SAP’s portfolio and initiating a major shift to cloud computing.

For years, Spend Matters has covered SAP’s individual procurement software units: Ariba, Fieldglass, Concur. Those three were recently merged to form the SAP Intelligent Spend Group, and we examined the road ahead for the new group.

After news broke about McDermott’s departure, Spend Matters’ Chief Research Officer Pierre Mitchell offered an assessment of what SAP faces as the procurement technology market evolves.

“Digital growth is being fueled by four major inter-related factors: apps, platforms, ecosystems and networks. SAP has been acquiring lots of apps and building a massive ecosystem with partners, while also using its SAP Ariba network as instrumental for growth in the procurement market, specifically,” Mitchell said. “And this latest quarter's performance reflects this trend. However, the world is moving toward open platforms, and businesses want choice, flexibility, and innovation built into the platforms that build the apps and connect through different networks,” he said.

“SAP has announced some good intentions toward this platform approach, but it still has a long way to go to enable its customers to ‘run simple’ — but also run agile, open and at reasonable costs.”

Committee on 737 MAX faults FAA, Boeing

Reuters reports that an international committee of air safety regulators has castigated the U.S. Federal Aviation Administration’s (FAA) review of a safety system on Boeing’s 737 MAX jet. The anti-stall system was later tied to two crashes that killed 346 people, and the MAX aircrafts have been grounded for months. The Joint Authorities Technical Review (JATR) was commissioned by the FAA to examine the agency’s oversight and approval of the MCAS anti-stall system. In addition, Reuters said “the report also faulted Boeing for assumptions it made in designing the airplane and found areas where Boeing could improve processes.”

8 space launch providers get Air Force contract

The U.S Air Force has selected SpaceX, Xbow Launch Systems, Northrop Grumman, Firefly Aerospace, United Launch Alliance, Aevum, Vox Space and Rocket Lab to provide launch services in the Orbital Services Program-4. The latter is a $986 million procurement of launch services to be given over nine years, according to

OSP-4 is designed to accommodate small and medium payloads greater than 400 pounds. Providers have to be able to deliver these payloads to orbit within 12 to 24 months after receiving an order.

“The OSP-4 multi-vendor deal is known as a ‘multiple-award, indefinite-delivery/indefinite-quantity’ contract,” the article states. “The eight companies will be awarded $50,000 as the contract’s minimum guarantee.”

Deploying AI in supply chain analytics

Applying machine learning and other subsets of artificial intelligence to transactional and sensor data obtained from supply chains can make supply chain analytics more autonomous and effective, and eventually a more responsive supply chain, according to a TechTarget article. ML becomes almost indispensable to IoT sensors that carry more data than ever into SCM platforms, making “analytics simultaneously more complicated and effective,” the article states.

Kenco Logistics opens supply chain test lab

Kenco Logistics inaugurated its supply chain innovation test lab in Chattanooga, Tennessee, according to the website Supply & Demand Chain Executive.

The 10,000-square-foot space will be a lab for Kenco's team of innovation specialists to assess technologies and provide insights about these solutions.

“In the logistics industry, experience is the new differentiator, and the expansion of the Kenco Innovation Test Lab facility will only heighten our industry expertise,” says Kristi Montgomery, vice president of innovation at Kenco.

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