| | By Mick James
Is procurement going
to be the buzzword for
2005? This formerly
unglamorous and
neglected function seems
to be at the front of
everyone’s mind this
year. It’s not hard to
see why: clients are at
the very least agnostic
about growth prospects,
and many feel they have
little more to achieve
in process improvements
and internal cost
efficiencies. Suddenly
procurement and
strategic sourcing are
emerging as relatively
low-risk routes to gain
much-needed headroom in
an uncertain world.
While many of the
major consultancies have
branched into sourcing,
this has also been
fertile ground for
stand-alone specialist
firms. One company
making aggressive moves
into procurement
consultancy is Ariba.
Ariba started out as a
software house providing
e-procurement software
and implementation, but
now, after some
strategic acquisitions
and organic growth over
the last few years, it
provides end-to-end
purchasing solutions
combining software,
consulting and
outsourcing on a global
basis.
| |
|
| |
“It’s a powerful
combination and a
competitive
differentiator for us to
have such a focus on
spend management on a
global basis” says Lance
Younger Strategic
Consulting Director at
Ariba.
Younger believes that
Ariba’s specialist focus
on purchasing gives it a
strong advantage over
the more generalist
approach of the bigger
consultancies. It
combines neatly with a
renewed interest in
purchasing on the client
side. With over 1,700
people focused on
nothing else but spend
management; 25 offices
in 21 countries and
counting over 25% of the
top 500 global
organisations as clients
working with them, Ariba
appear to be
well-positioned to
capitalise on this.
“CEOs and CFOs are
taking a look at the
ways they can make the
business more
profitable,” he says.
“Put simply, they can
increase market share or
reduce the cost base,
but it takes a lot less
to reduce the cost base
to have as great an
effect on profitability
as increasing sales.
People see that they can
get more return for | |
| |
| | has a wealth of
expertise and knowledge
to draw on, with 50 per
cent of the global 100
companies using its
services.
“Where a traditional
firm might put five or
ten consultants on an
engagement to do a piece
of strategic sourcing
work, we only need a
fraction of that
resource to achieve the
same results,” says
Younger. According to
Younger this means that
not only can Ariba
accelerate the sourcing
process, but it can also
offers greater, more
effective “firepower”
than a larger more
traditional consultancy.
It also enables Ariba to
offer its services in a
very flexible way, from
one-off interventions to
building an
organization’s complete
in-house capability.
Younger believes that
the focus on spend
management is set to
continue and that Ariba
can take a larger share
of the overall
procurement consulting
market. Ariba face a
similar challenge to
others operating in this
growth area – creating
innovative solutions
requires innovative
people, and there
appears to be a
shortage. To support | |
|
| | their ambitions Ariba’s
consulting team is
recruiting across
Europe, primarily for
individuals with both
purchasing and
consulting experience
with the major firms.
”We are looking for
dynamic and different
individuals,” says
Younger. “For people who
want to have a career in
purchasing, the beauty
of Ariba is that we do
everything in that space
- you could go from
being a member of the
consultancy team to
being the head of an
outsourcing team. You
could choose to be based
anywhere across the
globe, from Sydney to
San Francisco or London
to Prague.”
It appears that vast
opportunities exist for
individuals and
organisations that can
engage fully in the
procurement space.
Equally so,
organisations need to be
responsive to the
increasing needs of
their clients for
comprehensive spend
management solutions, in
much the same way as
Ariba has set itself out
to be.
Contact Mick with
your views or
suggestions at:
mick.james@top-consultan | |
|
| | every pound invested in
improving procurement
versus sales.”
The interest from a
consulting point of view
comes when you realize
that this is not simply
an exercise in cost
reduction but an
opportunity to increase
the value that can be
generated through the
supply chain, from
customer to supplier,
and procurement has
become a focal point to
make this happen. “It’s
a fundamental touch
point,” says Younger.
“The future for Ariba is
adding real value as our
clients are becoming
more and more
sophisticated.”
Ariba also has an
innovative delivery
model which they are
continually improving to
meet client needs.
“We’re moving to more of
an on-demand model, not
just for software but
consultancy as well,” he
says. Ariba’s experience
of working with clients
in activities such as
running auctions and
providing managed
services means that it | |
|
Previous Page 
