The web fosters collaboration between B2B sellers and buyers

That was a key theme today as the 15th annual Ariba Live conference hosted by Ariba, an SAP company that provides B2B Internet network services, kicked off in Las Vegas with more than 2200 attendees. And there were more than twice as many attending online, Ariba officials say.

Paul Demery

As more than 2,200 business buyers and sellers settled into their seats to learn what’s new in online procurement and collaboration at the Ariba Live 2014 conference in Las Vegas today, the cavernous amphitheater filled with something many had probably not expected: the sound of rock violinist Lindsey Stirling, who pranced around the stage as she belted out music that has made her a star of the music world.

The lively entertainment wasn’t just to temporarily amuse procurement experts preparing for serious discussions about how to better manage purchase orders, invoices and payments with hundreds or even thousands of suppliers through the Ariba Network, an Internet portal designed to help buyers and suppliers meet and transact.

The conference kicked off with Stirling’s own story of how she failed to make the top grade on the “American Idol” TV competition show for aspiring performers, but then went on to build her own following through YouTube and other social media outlets. “My world just opened up,” she said in a video played for the Ariba audience. “Hundreds of thousands of people proved I was marketable.”

The lesson for Ariba’s audience: Engaging with prospective customers in online networks can open up huge business  opportunities. Rachel Spasser, senior vice president and chief marketing officer for Ariba, a subsidiary of business software company SAP AG, urged the audience afterward to use online networks to expand and enhance their relationships. Real-time response to customers’ needs is no longer enough, she said. Companies, including buyers and sellers, must collaborate and communicate with trading partners to better anticipate demand for products.

Chakib Bouhdary, SAP’s executive vice president for industry business solutions, added that SAP is committed to continuing investing in such technology areas as Internet- or cloud-based software and mobile applications to provide more ways for companies to connect and share information on the Ariba Network.

Also speaking was Erik Gershwind, president and CEO of MSC Industrial Supply Co., a provider of MRO products (maintenance, repair and operations) which has been a supplier to other companies through the Ariba Network for more than a decade. He told the audience that too many companies are wasteful in their procurement of MRO and other types of “indirect” goods, or products that are not components of the products they sell but crucial to building and repairing them, and maintaining corporate facilities. For example, one of MSC’s major product lines is industrial cutting tools that manufacturers use to forge metal products like machinery and aircraft components.

Gershwind noted that many companies have formalized how they purchase “direct” products, or components that go into the finished products they sell, with systems that automatically update back-end accounting and inventory systems as purchases are made online or through sales reps.

But for indirect goods, which many companies buy outside of organized and electronic methods of procurement, companies often wind up buying too much of one item, not enough of another, and are often unsure of what they have on hand and need to replenish, Gershwind said. Collaborating with trading partners through an Internet portal, he added, enables them to take advantage of software applications that automatically update back-end accounts as purchases are made.

“We can’t be successful without each other,” Gershwind said. He gave as an example a customer that MSC worked with through the Ariba Network to slash some $200,000 in the client company’s expenses related to procuring cutting tools while it increased production by 20%.

In addition to the 2200 in attendance at Ariba Live, there were twice as many participating online today, Ariba says.

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Ariba Live, Ariba Network, B2B, Chakib Bouhdary, Erick Gershwind, Lindsey Stirling, MSC Industrial Supply, Procurement, Rachel Spasser, SAP