SAP / Ariba – the competitors hover, searching for signs of weakness…

Over the last few days, I’ve been receiving various communications, and reading public messages from competitors of SAP and Ariba, wishing them well and offering them sincere congratulations and good wishes for the future following the announcement of the SAP acquisition.

Rewind...   Not quite!

Rather, we’re seeing the early stages of what is going to be a scramble as firms position, or in some cases re-position themselves, for the post-SAriba landscape.  And the knives are coming out – here’s Rob Bernshtyn of Coupa  (my italics).

We are 100% cloud. Unlike companies who try to cobble together different legacy and hosted applications through acquisitions, Coupa provides a distinct advantage with one unified, organically-built, cloud solution that enables rapid innovation cycles, unmatched reliability, and unparalleled time to value.

Coupa Software is “open for business”. We provide you with flexibility and choices, not an ERP agenda.

David Bush of Iasta was slightly more generous – “I congratulate Ariba and its shareholders on their well-earned, well-deserved success” -  but perhaps his more analytical approach was actually more pointed.

To others, this acquisition will mean turbulence and friction. This latter group understands that change management is a difficult undertaking when an organization adopts enterprise software under any circumstance. The coming cross-platform integration activities, coupled with the inevitable process and workflow disruptions, will only create additional headaches. The material impact a troubled change management program will have on strategic business planning cannot be easily measured or quantified.

Meanwhile, Proactis, the UK (Yorkshire) based e-sourcing and P2P software firm have made a cheeky / interesting "part-exchange" offer: organisations will receive a 50% credit towards first year subscription fees when they license PROACTIS applications equivalent to Ariba applications they are using today.

Whilst I haven’t spoken to all the firms I’ll mention here, only a sample, the happiest competitors seem to be those smaller firms who go up against SAP and Ariba in a broad P2P product offering - Coupa, Sci-Quest, Wax Digital, Proactis come to mind. For these firms, they see a number of positives:

  • one less competitor on the buyer’s long-list;
  • uncertainty in the buyer’s mind about future direction, product strategy for the SAriba offerings;
  • twice as much chance that the buyer is someone who just “doesn’t like SAP / doesn’t like Ariba”; and
  • perhaps a less aggressive pricing stance than Ariba have been taking.

There are negatives of course as well, and for some buyers the new combination will be irresistible. But it’s fair to say more than one of the firms I’ve mentioned above seemed genuinely delighted when I spoke to them last week.

Then we come to the firms who are competing principally in the sourcing market rather than P2P, perhaps with spend analytics, contract management etc. in their suite - Iasta, BravoSolution, CombineNet, Trade Extensions  - and Emptoris pre-IBM. For them, the same positives apply as above, but there is probably a little more concern in that the combined capabilities of SAP and Ariba across this sort of functionality is potentially stronger than each individual firm could offer.

Meanwhile, those who play strongly in the supplier network area are looking at the future with a little more trepidation.  (The Oracle dimension is another interesting angle, but we won’t cover that now).

So interesting times ahead – and do keep up with my colleagues in the US, who are deeply into  SAP / Ariba issues, and our new PRO service (much more on that soon), to get more insight into the future provider landscape.

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Voices (3)

  1. Daniele Brione:

    The Proactis offer seems laughable when you consider their entire market cap is now hovering just beneath the £2m mark. Presumably SAP have spent more on legal fees buying Ariba than the entire worth of this “competitor”. The other firms you mention – Coupa and Wax Digital – don’t publish too many informations but those they do don’t suggest that Ariba or SAP should hold out too much concern. My only question is why these firms are given so much credit in these pages given the numerical realities? I have seen similar comments to this effect before but no real answer.

  2. Romu Gaboriau:

    Interesting times ahead, I agree!
    Julien Nadaud also posted something on b-pack’s blog. I invite you to read it to learn why b-pack is happy about SAP’s acquisition of Ariba

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