Community Updates

Procurement Gets More Responsible with SAP Ariba

What is the purpose of procurement? Not long ago, the answer might have been “to lower costs” or “drive process efficiencies.” But times are changing. Today, many companies are looking to procurement to make the world a better place and improve lives. And SAP Ariba can help them do it. The company today announced it is opening access to additional insights as part of its supplier risk solution, enabling companies to track more than 200 risk types and more effectively manage their costs with conscience. The news came during SAP Ariba Live, the premier business commerce conference being held this week at Caesars Palace in Las Vegas.

Published 6 years ago | About a 4 minute read

The new insights will cover factors such as social, environmental, and sustainability and will be offered in collaboration with new partners such as EcoVadis, a leading provider of sustainability, risk and performance ratings for global supply chains, and Verisk Maplecroft, a principal source of global risk analytics and research. By enabling a standard programmatic interface, SAP Ariba will equip risk managers to bring increased sophistication to their programs, using SAP Ariba’s supplier risk solution as a platform.

“Evidence is mounting that environmental, social and governance factors can create long-term performance advantages, and in opening access to additional inputs on this front, SAP Ariba can help companies gain this edge,” said Tony Harris, Vice President & General Manager, Supplier Management Solutions SAP Ariba. “Our supplier risk solutions deliver the information and transparency needed to effectively manage risk across the entire source-to-settle process and in addition to lowering costs and increasing efficiencies, enable companies to create a positive impact on the world.”

By investing in the expanded inputs, companies will gain the ability to identify and understand supplier exposure across the full spectrum of global sustainability risks and leverage performance data to determine how well they manage their operations against these issues.

“Rapid economic changes and increased regulations have combined to make business riskier than ever. And much of this risk lies in the supply chain,” said Mickey North-Rizza, Vice President of the Enterprise Applications and Digital Commerce research practice at independent research firm IDC. “To protect themselves, companies need a complete view into every supplier they work with along with real-time insights so that they can detect and mitigate potential risks before they negatively impact their operations.”

SAP Ariba enables companies to gain such insights though SAP Ariba® Supplier Risk™, a risk management platform that can be used to:

Evaluate and segment the supply chain to get a clear view into areas where risk might exist
Assess the inherent risk associated with procuring or outsourcing goods and services to third parties
Monitor suppliers for potential risks by triangulating a myriad of inputs across a broad range of risk categories including financial, legal, operational, environmental, social and regulatory threats
Highlight areas within the supply chain that could be incorporating forced labor

By enabling the option to receive supplier scorecard data from EcoVadis, companies using SAP Ariba Supplier Risk can gain an enhanced view of their exposure to key risk areas by tracking sustainability considerations, including environmental practices, labor and discrimination issues, fair business practices and sustainable procurement management.

“Market leaders drive business performance through sustainability, and the number one channel for making a measurable impact is procurement and the supply chain,” said Pierre-Francois Thaler, Co-Founder and Co-CEO of EcoVadis. “By providing SAP Ariba customers with reliable and trusted sustainability intelligence, we are equipping their procurement teams to reduce risk, drive supplier performance and uncover new business opportunities, all while enriching communities, improving CSR outcomes and making the world a better place.”

By leveraging Verisk Maplecroft’s wealth of 100+ risk indices, companies will be able to build a deep understanding of industry, commodity or locational issues; the underlying factors driving those risks and the impact issues such as heat stress, climate change and working conditions have on them and their suppliers.

“Building a holistic, data-driven understanding of the primary political, social and environmental issues can empower organizations to make risk-adjusted sustainable sourcing decisions in a world of uncertainties,” said Sondra Scott, President of Verisk Maplecroft. “In teaming up with SAP Ariba, we are providing the tools and insights global companies need to build more ethical supply chains and make positive business impacts.”

SAP Aribahas been ranked as a leader in Supplier Risk and Performance Management Platforms by independent research firm Forrester Research, Inc. in a report titled “The Forrester Wave™: Supplier Risk and Performance Management Platforms, Q1 2018: The Providers That Matter Most And How They Stack Up” (The Forrester Wave™: Supplier Risk and Performance Management Platforms, Q1 2018, Forrester Research, Inc., February 2018). To learn more about SAP Ariba’s supplier management offerings and the value they can deliver, click here.