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SAP and New York City Education Partners

September 4th, 2014


SAP News: What will be new about the Ariba Network

September 2nd, 2014

What the Ariba Network Can do for You

Two years after acquiring Ariba, SAP integrated functions of SAP HANA into Ariba Spend Visibility, a spend analysis tool. Now, for the first time, Rolf Weiland, vice president of solution strategy at SAP, reveals just what the synergy between the Ariba Network and SAP can achieve.

Four months ago, SAP began running the Ariba spend analysis tool on the SAP HANA database. SAP HANA hasn’t just made query processing faster and boosted overall performance. Rolf Weiland, specialist for purchasing solutions, says that it’s the simulations themselves that give customers crucial added value. Ariba Spend Visibility’s “what if” analysis allows customers to forecast how, for example, a drop in demand will affect the supplier network or related articles. This analytic method wouldn’t have been possible without using SAP HANA as the software’s database. SAP also intends to offer new functionalities for the Ariba Network before the year is over.

“For the first time ever, customers will be able to analyze transactional data,” says Rolf Weiland, vice president of solution strategy at SAP. Image: SAP

SAP News: What will be new about the Ariba Network?

Weiland: For the first time ever, customers will be able to analyze transactional data. It also lets them compare their own reports with those of their competitors in the network. By doing so, they will also see which products are currently in high demand, and which ones aren’t.  In addition, customers can identify potential flaws in the supply chain.

The network currently comprises 1.5 million trading partners with a collective revenue of €500 billion. This must create considerable momentum…

That’s right. We will, however, also be providing access to other data sources. Customers will, for example, be able to integrate supplier ratings from Dun & Bradstreet as an additional neutral, external source. This allows supplemental information for risk assessment to be incorporated into the decision-making process of whether to do business with a new potential supplier or not. This service is particularly important for major customers.

Large companies are increasingly concerned about sustainability issues, such as their ecological footprint, but also with social engagement. You demand similarly high standards from your customers. Can you check that they actually meet them?

Yes, we can. We know that the chemical group AkzoNobel, for example, is extremely committed to achieving its sustainability goals. If a supplier makes the headlines because it dumped toxic waste into rivers, this will also damage the customer’s image. Incidentally, we have implemented a warning system for this type of situation: A so-called “listener” monitors global media, as well as tweets and posts on the Internet, and informs the company as soon as anything relevant to its supply chain crops up. If, for example, the facility of a high-volume supplier is affected by a natural disaster, less time is lost than would have been the case previously. Those valuable hours or days lost can be used to find an alternative supplier.

If the supply chain contains an element of risk, a “listener” will provide information on any potential risk factors. Image: SAP

This is another context in which external sources can help determine whether a company Web site’s proud sustainability proclamations actually reflect reality…

Yes, we would like to offer customers the option to tie in external sources such as Achilles or EcoVadis.

The special advantage that the Ariba Network will provide in the future lies in its ability to create benchmarks by drawing comparisons between competitors. Could you give a few examples?

Of course. Consider personnel services. A furniture company is looking for packers in the local area for a major upcoming order. Using the network, it can ascertain the current typical hourly rate in this market, and also how long it will presumably take to fill all required positions. We can do this even for highly-specialized and qualified SAP experts.

A company has 12 suppliers. What kind of information can the Ariba Network provide?

As the company, I would receive data on all suppliers, such as delivery times, the proportion of orders actually delivered, and a KPI for reliability and customer satisfactionI could then compare this information with my own, but also with other suppliers in the network. We are planning to visualize various KPIs using SAP Lumira graphic representations and show them in bubbles, pie charts etc.

SAP Lumira enables the creation of eye-catching visualizations, for days’ sales outstanding for instance. Image: SAP

One idea that has been floated is to reveal the payment practices of all partners in the network. What exactly would this look like in practice?

In general terms, days’ sales outstanding can be represented graphically by displaying the number of days that usually pass before bills are paid. When I compare days’ sales outstanding across all businesses in the network, I can see where I need to take a closer look. I could, for example, trace payment delays to the country, supplier, and time period they originated from. Right now, our visualizations are still mockups from current development, but they will become reality very soon.

– See more at: http://www.news-sap.com/ariba-network-can/#sthash.waoC6lDY.dpuf

IT Governance

August 25th, 2014

Impossible to Ignore: The Importance of IT Governance

Effective IT governance is a critical tool for CIOs to align their organizations and efforts to support business strategy and create shareholder value. Given the rapidly changing and evolving technology options that confront CIOs and business leaders, making sure the right decisions are being made about investments in IT is an essential priority.

There are many misconceptions about what constitutes a comprehensive IT governance model and how it is implemented. IT governance is more than just:

  • Having a steering committee that meets periodically to review and approve IT plans and budgets
  • Involving the business on an annual basis to assist in assigning IT priorities
  • Using financial metrics such as ROI to determine whether to invest in specific initiatives
  • Instituting best practices to ensure projects are completed on time and within budget
  • Measuring and reporting on user satisfaction of IT services

While all of the above are important yardsticks to assess the impact of IT, taken one by one they do not guarantee that IT is contributing to the type of business performance that provides competitive advantage and achieves  enterprise business goals. Most of all, they do not constitute an effective IT governance program.

How Best to Think About IT Governance

IT governance comprises a decision framework and set of processes that allow CIOs and management to articulate desired outcomes through programs that enable the organization to attain these results. The decision framework and the corresponding tools and processes to support them must be clearly communicated so that day-to-day activities and decisions are made within this context. In other words, IT governance needs to instill behavior and awareness that is understood at all levels in the organization, not just by senior management.

Clearly the desired outcomes that shape IT will vary between industries and organizations. For example, some enterprises may focus on product innovation and accelerated go-to-market strategies while others may strive to create operational efficiencies throughout the value chain. CIOs may also encourage management to consider new technologies such as a big data, real-time analytics initiative or social-media-based customer satisfaction programs to support business performance.

The essential success factor, regardless of the specific initiative undertaken, is the linkage to tangible, measureable top-line or bottom-line business outcomes. As tempting as the latest technology or trend might be, organizations must always calibrate their IT endeavors against this metric to ensure they are not investing financial and human capital where it will yield minimal return and offer no strategic value.

CIOs must take the lead in helping place the organization’s competitive model within the governance-making framework so that the right decisions are being made and, ultimately, institutionalized across the enterprise. From a top-down perspective this means:

  • Linking business strategy to the IT programs that will be undertaken and funded; this will be reflected and communicated within the IT planning process.
  • Aligning IT spend and investments to ensure that they reflect the appropriate strategic initiatives. This is a continual process and not just part of the annual budgeting cycle.
  • Staffing the IT organization with the necessary skills and resources to effectively execute the committed programs.
  • Implementing effective risk management processes that ensure regulatory compliance, accountability, transparency and resiliency.
  • Creating a financial scorecard that tracks approved IT investments to each desired outcome measured in delivered business benefits.

Institutionalizing IT Governance

The missing link between a well-thought-out plan endorsed by management and actualization is often the absence of tactical processes and policies both inside and outside of IT. Some critical and foundational disciplines include:

Business Integration

The emergence of enterprise architectures – solutions that support end-to-end business processes – require CIOs to advocate for far greater business involvement than was traditionally required for “siloed” applications. Prerequisites are (1) business sponsorship at an executive level to provide the sense of urgency and commitment of mind share and resources required and (2) business process owners who oversee and control the impact of new technology throughout the organization. Without these two ingredients, any strategic project will be viewed as IT-centric with little accountability from the business and, by extension, limited commitment to the desired outcomes.

Program Management

Consistent practices in managing IT projects and delivering solutions within agreed-upon parameters is a basic building block for most organizations. However, within the broader context of an IT governance framework, program management must incorporate metrics that were used within the governance framework. This would include not only the investment analysis, but also the desired outcomes that drove the decision-making process. These metrics can incorporated within dashboards that will help management view progress, benefits and the effectiveness of their decisions. As all effective management practices, IT governance needs to be continually reviewed, assessed and refined with proper measurement and transparency. Program management is essential to bridging decisions to the execution of strategic plans.

Portfolio Management

By their very nature, IT architectures consist of numerous technical layers and components, making them difficult to relate to in terms of business activities and decision making. Portfolios are useful tools for CIOs to integrate views of IT services and solutions to senior management so that they can be associated with desired outcomes. Often this will result in moving toward architecture standardization as an added dividend that will yield long-term benefits. The move to integrated solutions across the enterprise will require a restructuring of the portfolio as an overall strategy that will reduce IT costs and deliver greater operational efficiencies. The portfolio dimension is another key criteria that must be incorporated within management scorecards to guide future technology investments.

How Best to Move Forward

Developing a comprehensive IT governance program can be a daunting task even for organizations with mature management practices. The best place to start is to become familiar with the COBIT 5 framework and principles. ISACA (Information Systems Audit and Control Association) offers many valuable tools and information that will help with education and putting into place a road map for the IT governance journey.

Additionally, consider utilizing an experienced practitioner that can help implement practical and proven strategies to formulate an IT governance program and road map.  They can also assist in engaging senior management in adopting the necessary practices that will lead to acceptance across the broader organization.

It cannot be stressed enough that IT governance is an ongoing journey that will continually evolve, not a one-time destination.  It is up to CIOs to lead the way by helping their organizations think about, evaluate and adopt the “right” IT strategies for their businesses.


John Tiglias

John Tiglias headshot 7-8-14John Tiglias is an alumni of Tatum, a Randstad Company. His areas of expertise include business process optimization, ERP initiatives, IT alignment and governance, mergers and acquisitions and IT cost reduction. An adjunct professor of IT Management at the Hagan Graduate School of Business at Iona College, Tiglias holds a master’s degree in computer science from Polytechnic Institute of New York and a bachelor’s degree in economics from Fordham University.