Join Michael Management for an in-depth discussion in this video SAP Ariba Supply Chain (SCC) overview, part of SAP Ariba Supply Chain Collaboration Overview.
- [Instructor] Welcome back to SAP Ariba Supply Chain Collaboration. I'm your instructor, Matthew Hunt. And so, let me give you a little of the backstory on the Ariba Direct Materials solution. So most people know Ariba as an indirect solution. Ariba's been around since the early 2000s and was the number one indirect procurement solution. It still is. However, now, it is considered an all-in-one procurement solution because, in 2015, SAP decided to introduce the direct materials to the Ariba network, and so it's now an all-in-one procurement solution. Some of you may be thinking, "okay, doesn't SAP "already have a product like this?" And they did and they still do. It's the SNC Supply Network Collaboration tool. As of 2017, when I was attending SAPPHIRE, I talked to the vice president of supply chain for SAP and got his take on it. And, while SAP won't ever put these dates in writing, what he was telling me was that they will probably be looking to obsolete the SNC product in 2025. They have a number of large companies using it. However, it was never really widespread adopted. It had a lot of, I don't want to say issues, but it definitely had some limitations that the Ariba network overcomes. And so, the Ariba network is a lot better platform for them to build on. And so, as far as I know, they are not enhancing the SNC solution anymore. And like I said, I was told they were going to obsolete it by 2025. So this video, though, we will primarily focus not only on direct materials, but specifically the Supply Chain Collaboration piece which is, in this picture up here, it's the last three chevrons in here. It's the plan, the buy and the make, and the invoice and pay processes. There is a sorting and contract piece that's also part of the direct materials solution, but we will not be talking about that. There are several APIs available within the Supply Chain Collaboration tool around these blue boxes, here. So there are APIs into the S/4HANA system as well as the Leonardo solution, the IBP solution and the PLM solution. So SAPs vision for how supply chain is going to work is S/4HANA is going to be your core ECC system. All of your IOT and connected AI type things, artificial intelligence, machine learning type things are going to be in Leonardo. IBP will house all of the planning. PLM will house all of your product life cycle. And then Ariba really encompasses all these things. So image a shell around all these things, with any external collaboration that you need to do with suppliers. So if you need to collaborate with suppliers on purchase orders or forecast or vendor tooling, packaging, anything really. Their vision is any collaboration you do with a supplier is ultimately going to be done through Ariba. So you're going to this Ariba Direct Materials solution really take off in the next few years. So within Ariba Supply Chain Collaboration, what are some of the modules? And so I mentioned broadly the plan, the buy and the make, and the invoice. But specifically within the planning module there is forecast collaboration, which allows buyers to share forecasts with suppliers and then it allows to suppliers to make a commitment against those forecasts. Supplier managed inventory. So this we'll talk about a little later on. It's an alternative to buyers running their own MRP or Kanban or JIT calls, whatever you would do to send that signal to the supplier. It's an alternative way of replenishing materials. Within the buy and the make, there's the PO collaboration for all PO types. There's vendor consignment. We'll talk about scheduling agreement releases, subcontracting and third party manufacturing, and then quality, so those notifications, quality inspections, reviews. I'm probably not going to talk about quality for these videos just because that's an area I did not co-innovate with Ariba on so I'm not as strong in those areas. But self-billing in the invoice area, so ERS, vendor invoicing process and then return order collaboration. So the reverse logistics piece of things. Last slide in this video, the Ariba network connections between the buyer and supplier. So where does Ariba sit in the process and how does everybody connect? How can you get your documents? So, first of all, within the Ariba network, there is always a buyers portal and a suppliers portal. And if you want, buyers can log in to their portal through an internet browser, suppliers can log into their portal through an internet browser. And you can view all the documents, you can do some of the transactions from within the portal. But how does Ariba integrate with backend systems? And so, on the buyers side, it'll integrate with any of SAPs products. So it integrates with S/4HANA, ECC, Business Suite on HANA. It'll interface with most third party ERP systems. So if you're running Oracle or PeopleSoft or any number of ERP systems, it will integrate with that. You can use SAP PO to send documents to the Ariba network. However, I will tell you that they are obsoleting that and so the recommended approach is to use the SAP Cloud Platform integration tool to connect to the Ariba network. And so, over on the supplier side, same recommendation is to use the SAP Cloud Platform integration tool. You could use SAP PO if you wanted to. But again, it is being obsoleted, so within a few years you won't be able to get any support on that. But there are a number of standards that they have on the supplier side to receive messages. You can use EDIFACT, X12. I won't read them all. You can see them all there, on the left hand side, but a number of different ways. There's also, within the portal itself, there's a lot of reports that you can download into CSV files and open in Excel. Okay, so this is SAP overview. I'm going to end this video, and when we come back we will talk about the purchase to pay process.
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