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Spend Management Innovations

Earlier this month, SAP hosted its Spend Connect Live event in Austria and more recently SAP shared a virtual event with contributions from SAP CEO Christian Klein and other SAP executives and guests, bringing together business leaders to discuss the latest strategies and innovations in spend management.

With procurement playing an increasingly strategic role for businesses and organizations, the event provided valuable insights on how to gain greater visibility into organizational spending and unlock more value.

Key Takeaways From The Event

Speakers emphasized the importance and value of gaining visibility into spending, not just to manage costs and supply chains, but also compliance and sustainability.

New solutions like SAP Spend Control Tower use AI and unified data to provide insights and significant advantages across procurement categories.

Generative AI is enabling new capabilities in spend areas like policy compliance, sourcing, supplier management, and more.

SAP Business Network has grown dramatically. It helps connect companies to suppliers and partners for better collaboration.

Category Management with SAP Ariba can now also help track strategic goals like sustainability.

Workforce management tools from SAP Fieldglass provide insights into external or contingent workers.

Concur solutions are automating T&E spending capture and helping control “tail spend”.

Overall themes were leveraging data, AI and networks to see the “big picture” on spending and unlock more business value.

The Christian Klein Interview

Kicking off the event, Etosha Thurman, Chief Marketing and Solutions Officer of Intelligent Spend at SAP, emphasized that spend management now touches all aspects of an organization from compliance to costs and supply chain resilience. The key is seeing the big picture and gaining real-time visibility across spending categories.

“Your expanded roles in supply chain, procurement, HR and finance? It’s now the norm. In my many conversations with spend management practitioners and professionals, what I’m hearing is that the focus is on fulfilling that expanded mandate and ensuring you are meeting and exceeding expectations today, tomorrow and into the future.”

SAP CEO Christian Klein joined Thurman in a fireside chat to discuss SAP’s strategy and roadmap for spend technology and the SAP Business Network, explaining how intelligent spend sits at the heart of SAP’s customer operations. He highlighted use cases like ensuring hardware supply for cloud customers and partnering with new suppliers for SAP’s business needs. Klein also discussed how procurement is critical for supply chain resilience, cost management, sustainability, and balancing the give and take with suppliers.

He spent some time outlining why it is crucial for businesses to harmonize data from across their IT landscape in order to make the most gains from analytics and AI technologies:

“I’m deeply convinced that our chat bot, our co-pilot Joule will not only talk one language with regard to procurement data (which is super important), but in order to do your job right you need supply chain data. You need demand data. You need sustainability data. And so for us it’s very important that we really build a foundational data model, which then actually serves the end users in a way that you can ask any kind of question and you get smart recommendations back, in order to do your day-to-day job much smarter, and the same of course applies for total workforce or travel… The process itself can self-learn, can self-optimize.”

SAP’s Muhammad Alam On Spend Innovations

Following the leadership perspectives, Muhammad Alam, President and Chief Product Officer of Intelligent Spend at SAP, provided an overview of SAP’s latest innovations. He explained how SAP Spend Control Tower consolidates data across operational systems like Ariba, Fieldglass and S/4HANA into a unified model. AI is then applied to provide insights on spend. SAP has also produced twelve new scenarios to leverage generative AI for use cases in compliance, sourcing, supplier management and more.

Diving into product categories, Alam explained how the SAP Business Network brings together millions of trading partners for supply chain collaboration and visibility. He also highlighted UX improvements in solutions like SAP Ariba Buying 360 and SAP Fieldglass for more intuitive workflows.

“We have over 5000 product managers and engineers just in the spent management application space, working day and night on our SaaS products to bring innovation to you, to all the products and the applications that you use… They are taking on challenges that we believe are top of mind for you and your board and your executives, whether these challenges are: how do I get visibility into my supply chain so I can really make them more resilient? Cause today it’s not sufficient for you to just be supply chain experts or procurement experts. You really almost have to be a foreign policy expert as well to really make your supply chains more resilient… and increasingly what we’re finding is procurement organizations are being called on more and more to look for talent to augment an organization’s employee workforce.”

Accelerating Supply Delivery With Save The Children

Delving into customer stories, Clare Richardson hosted a discussion with Jim Ridgwick (Global Head of Procurement for Save the Children), and Jeff Collier (Chief Revenue Officer for Intelligent Spend and Business Network at SAP) about using Ariba solutions to manage spending across 55 countries. By digitizing previously manual processes, Save the Children accelerated supply delivery to children who need it by 50%.

“Our procurement was very manual and very transactional. So when we started, we had about half a billion dollars of third party spend with suppliers… being transacted through paper and excel-based processes. So that meant we had a lot of Excel trackers for orders. I didn’t know who my suppliers were… we were getting our teams driving around on a motorbike in a refugee camp to get signatures from the country directors… the business impact that we felt was suddenly we had all this great data and that helped us as a leadership team to be able to make fact-based decisions around procurement and supply chains… So great visibility, great audit trails. I think the biggest impact was that we were able to get supply to children 50% faster thanks to that digitization. And when you’re in a sector which is around reaching the most number of children as quickly as possible. This was true business impact.”

Other Speakers

Clare Richardson later spoke with OMV and SAP about implementing SAP Ariba Category Management to shift from operational tasks to more strategic procurement. OMV’s Head of Procurement Martin Traxl expects enhanced creativity and sustainability tracking from the solution.

Providing an update on supply chain resilience, Tony Harris (Senior Vice President and Chief Marketing and Solutions Officer, SAP Business Network) spoke about how companies have moved from single to multi-sourced supply strategies. Transportation visibility and supply/demand collaboration on the network enable greater flexibility. Harris also explained how the network’s supplier onboarding capabilities make it easier to connect partners.

“I mentioned there’s already millions of companies on that network annually. We are transacting almost $5 trillion, and I need to say trillion, right? When was the last time you heard that word?Nearly $5 trillion in commerce is going across that network every year, and so any new companies that come along and join that, ultimately have the opportunity to be discovered, to connect and transact with some of the world’s biggest buying companies, which are the SAP customers”

Delving into sustainability, SAP’s Julia White highlighted how most carbon emissions sit deep in supply chains. She explained how innovations in AI are enabling better visibility into scope 3 emissions for more sustainable decision making.

On the workforce front, Emily James from BP and Emma Swinton from SAP Fieldglass discussed how solutions like Fieldglass provide insights into external workers to optimize total workforce management. Key benefits include simplified external talent acquisition and gaining a holistic view of the blended workforce.

“Total workforce management is very much part of board discussions now. The external workforce makes up at least 42% of that for a lot of organizations, and it’s growing year on year on year. So to be able to have strategic conversations at board level, you need to be able to report and talk about all of your workforce, not just the internal workers.”

Shifting focus to managing T&E spend, Wendy Sward from SAP Concur detailed how innovations like AI are automating invoice processing to control tail spend. Clients leveraging Concur solutions have seen 10-30% savings from reduced invoice handling while gaining spending visibility.

“80% of an organization spend runs through their supplier invoices. The other interesting fact is that post pandemic, we saw a huge increase of clients reaching out asking to automate their API…and the other piece I would tell you that’s really dramatic, that’s changed over the last four years… We’re all working from home. We’ve seen a huge increase of 40% to 60% of tail spend on employee expense reports over the last several years. That’s thousands if not millions of dollars. And that procurement, there’s no insight into.”

Massive Opportunities

Spend Connect Live highlighted the massive opportunity for companies to optimize spending by taking a data-driven approach enabled by solutions like SAP Spend Control Tower. Techniques like generative AI open new possibilities for increasing efficiency, while rapidly expanding networks like SAP Business Network facilitate supply chain transparency and agility. By seeing the big picture on spend, procurement leaders can have a much greater business impact, for all aspects of their organizations.

What we are seeing from SAP strategy on spend is a laser focus on creating new ways to harmonize data and utilize new technologies to drive that efficiency, while also helping their customers to make valuable and mutually beneficial connections with the right kind of business partners.

More on demand content from the event is available

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