The Value of E-Commerce
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Seventy-five percent of buyers and suppliers agree: Online business commerce networks are beneficial for both parties. In this session, Ardent Partners, a buyer, and an Ariba Network seller will speak about the 360-degree view of value received from e-commerce networks. This session takes the discussion of value beyond the tactical to the more strategic topics of business innovation and transformation.
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The Value of E-Commerce
- 1. The Value of E-Commerce Andrew Bartolini, Chief Research Officer, Ardent Partners Pamela Harris, Ariba Business Analyst, Corinthian College Brock Hirschman, Director ePro Operations, W.W. Grainger Sue Wolper, President and CEO, Wolper Information Services March 18, 2014 #AribaLIVE @ariba © 2014 Ariba – an SAP company. All rights reserved.
- 2. THE TOTAL VALUE OF ECOMMERCE Andrew Bartolini, Chief Research Officer, Ardent Partners AN ANALYST’S PERSPECTIVE 2 © 2014 Ariba – an SAP company. All rights reserved.
- 3. Andrew Bartolini • • • Chief Research Officer, Ardent Partners Publisher, CPO Rising – www.cporising.com Summary: • Experience: • Leadership roles in sales, marketing, and services in eCommerce sector. Rich experience in strategic sourcing, business process transformation, and software implementation. Background also includes consulting and investment banking Education: 3 Recognized expert in sourcing, procurement, AP and supply management Named a “Pro to Know” by Supply and Demand Chain Executive three times Former VP of Global Supply Mgmt. research at Aberdeen Group; Benchmarked thousands of enterprises across all facets of their supply management operations MBA – Indiana University BA – College of the Holy Cross © 2014 Ariba – an SAP company. All rights reserved.
- 4. Ardent Partners Ardent Partners is a research and advisory firm focused on defining, advancing, and promoting the supply management strategies, processes, and technologies that drive business value and accelerate organizational transformation within the enterprise. 4 © 2014 Ariba – an SAP company. All rights reserved.
- 5. BUSINESS NETWORKS: TODAY & TOMORROW 5 © 2014 Ariba – an SAP company. All rights reserved.
- 6. BUSINESS NETWORKS – TODAY Organizing Principle: “Business process collaboration AND value” BROAD business process focus Value extended to ALL participants Paradigm shift in the way trading partners communicate, interact, transact, & create, find, share, & use information
- 7. THE OVERALL IMPACT OF BUSINESS NETWORKS ON OUR BUSINESS IS: 42%
- 8. THE OVERALL IMPACT OF BUSINESS NETWORKS ON OUR BUSINESS IS: 75%
- 9. BUSINESS NETWORKS’ IMPACT ON TRANSACTIONS
- 10. BUSINESS NETWORKS’ IMPACT ON SUPPLIER COMMUNICATION/COLLABORATION
- 11. THE VIEW OF BUSINESS NETWORKS TODAY
- 12. BUSINESS NETWORKS – TOMORROW Organizing Principle: “True Network Effect” Complementary and new business processes Deeper, more robust analytics including predictive Ecosystem of third-party services More social networking capabilities
- 13. UNDERSTANDING THE NETWORK MARKETPLACE 13 © 2014 Ariba – an SAP company. All rights reserved.
- 14. ALL NETWORKS ARE NOT LIKE THE OTHER (PART I) Network Types Global Business (or B2B) Network Payment Network Data Standards Network Industry Network Category Network Country/Regional Network
- 15. ALL NETWORKS ARE NOT LIKE THE OTHER (PART II) Network Characteristics Number of existing and active suppliers Geographic reach Vertical focus Capabilities and information availability Business processes and documents
- 16. ALL NETWORKS ARE NOT LIKE THE OTHER (PART III) Network Characteristics Business model Associated services Related technologies/solutions System integration capabilities Network vision and roadmap
- 17. USING TOTAL COST OF OWNERSHIP TO SELECT THE RIGHT NETWORK 17 © 2014 Ariba – an SAP company. All rights reserved.
- 19. ARDENT PARTNERS’ TOTAL COST AND VALUE FRAMEWORK FOR NETWORK SELECTION Network Value Factors Efficiency and effectiveness gains Network characteristics Internal stakeholder value Trading partner (supplier) value © Ardent Partners - 2013 Network Cost Factors Network access (buy side) Network ongoing usage (buy side) Network access and ongoing usage (supplier's direct costs) Network access and ongoing usage (supplier's indirect costs) Opportunity costs
- 20. RECOMMENDATIONS 20 © 2014 Ariba – an SAP company. All rights reserved.
- 21. RECOMMENDATIONS • • • • Invest time researching and tracking the network marketplace Engage potential stakeholders early and often Identify near-term and long-term opportunities with business networks Take a comprehensive and holistic approach to network selection and usage • Utilize a TCO Approach for business network selection
- 22. THE TOTAL VALUE OF ECOMMERCE Pamela Harris, Ariba Business Analyst, Corinthian College A BUYER PERSPECTIVE 22 © 2014 Ariba – an SAP company. All rights reserved.
- 23. Company Background 23 © 2014 Ariba – an SAP company. All rights reserved.
- 24. Our Problem Campuses used to purchase the same things from different vendors 25 © 2014 Ariba – an SAP company. All rights reserved. Campuses were not aware of costs ‘upfront’ AP was overloaded with paper invoices
- 25. Our Problem Campuses used to purchase the same things from different vendors 26 © 2014 Ariba – an SAP company. All rights reserved. Campuses were not aware of costs ‘upfront’ AP was overloaded with paper invoices
- 26. The Plan Implement a system that: • Could be used company-wide • Would make us more efficient • Give us visibility into what the campuses are purchasing • Allow approvals to happen upfront 27 © 2014 Ariba – an SAP company. All rights reserved.
- 27. Why eCommerce? • • • 28 Wanted a ‘readyto-use’ solution Needed something user-friendly Wanted to reduce manual and paper invoice processing © 2014 Ariba – an SAP company. All rights reserved.
- 28. Challenges Internal Involving AP, IT, Purchasing, Audit, Management External Cooperation of suppliers, willingness to change processes 29 © 2014 Ariba – an SAP company. All rights reserved.
- 29. How We Did It • • • 30 Enlisted support and blessing of upper management Communicated benefits to user base Encouraged suppliers to onboard and become “Preferred” © 2014 Ariba – an SAP company. All rights reserved.
- 30. Where We Are Today >45% transactions go through Ariba 31 © 2014 Ariba – an SAP company. All rights reserved.
- 31. Where We Are Today Cost to process an invoice went from ~$16 down to ~$2 33 © 2014 Ariba – an SAP company. All rights reserved.
- 32. Lessons Learned 34 © 2014 Ariba – an SAP company. All rights reserved.
- 33. What’s Next • • • 35 Ongoing Vendor Enablement Budget Check Invoice Conversion © 2014 Ariba – an SAP company. All rights reserved.
- 34. THE TOTAL VALUE OF ECOMMERCE Brock Hirschman, Director ePro Operations, W.W. Grainger A SUPPLIER PERSPECTIVE 36 © 2014 Ariba – an SAP company. All rights reserved.
- 35. eCommerce Solutions Grainger.com Fast & Easy 37 © 2014 Ariba – an SAP company. All rights reserved. Grainger OMS Control & Visibility Grainger ePRO Integrated & Customized
- 36. Evolution of eCommerce Motor Book 1st Catalog Produced (41-Items) Motor Book Dumb Terminal Microfiche Readers Customer Specific Pricing Microfiche Price Files Grainger Website ePRO Integration with Ariba Punchout Catalogs 38 © 2014 Ariba – an SAP company. All rights reserved. Web & Inventory Mgmt. 1st Website Orders Integrated Commerce CMI / VMI Mobile Web & Apps 1st Industry iPhone/Android Dumb Terminals Branches Enter Orders Customer & Vendor Managed Inventory
- 37. eCommerce Takes Costs out While Managing Your Facility 39 © 2014 Ariba – an SAP company. All rights reserved.
- 38. Customer Challenges Our purchasing is out of control I have a hard time keeping track of all online purchases Our stock room is a mess and I can’t find what I need I have a new corporate agreement and need a plan for adoption We use a ton of gloves and I spend half my day reordering I need to integrate my vendors with an internal purchasing system Our employees don’t follow the process End-User / Buyer My field techs spend time running around town for repair parts
- 39. eCommerce Solutions Our Custom is purchasing Catalogs out of control I have a hard Usage time keeping Reporting & track of all Analysis online purchases Our stock room KeepStock is a mess and I Label and Scan can’t find what I need I have a new Email corporate Campaigns/ agreement and need Training a plan for adoption We use a ton of Personaland I / gloves Lists Auto-Reorder spend half my day reordering I need to integrate Grainger my vendors with an ePRO internal purchasing system Our Require employees Data on All don’t follow PO’s the process End-User / Buyer My field techs Mobile Apps ID spend time Supplier & running around Inventory town for repair parts
- 40. Value of eCommerce Engagement Utilize Fewer Resources Lower Reduce Errors Costs Web/Mobile Prevent Unauthorized Spend Phone/Fax Branch/ Store Up to 80% Reduction Up to 83% Fewer Errors Integrated Up to 75% Reduction in Processing Costs Up to 50% Fewer Resources
- 41. Grainger (Supplier) Best Practices in eSolutions • Leverage eCommerce to save time and money • Align eCommerce solutions to customer procurement processes • • • Apply features and functions to customer benefits Train all sellers Deploy SMEs to drive adoption and deliver C-Level engagement • Utilize reporting tools to identify prospects and opportunities • Start slow with Grainger.com and target phone and fax customers • Register all customers on Grainger.com • Introduce mobile solutions • Introduce OMS to replicate • Connect customers approval processes via ePRO • Leverage Personal Lists • Leverage Punch-Out and Account Customization verses Hosted Files • Drive compliance with order history and reporting tools • Implement CMI and VMI applications • Develop adoption plans early • Integrate POs and Invoices to drive efficiency • Integrated CMI/VMI • Obtain C-Level Support
- 42. THE TOTAL VALUE OF ECOMMERCE Sue Wolper, President and CEO, Wolper Information Services A SELLER PERSPECTIVE The eVolution of Information in eCommerce 44 © 2014 Ariba – an SAP company. All rights reserved. Susan Wolper President & CEO swolper@wolper.com @WolperInfoSvcs
- 43. Introduction to Wolper Evolved from traditional print background to all things “eContent” Serving corporate and other markets, including medical and academic, government, public library 45 Full-service content resources and information services provider First in our industry to introduce cloud-based self-management tools for customers’ purchasing and total lifecycle and workflow management of content resources © 2014 Ariba – an SAP company. All rights reserved. EContent magazine “100 companies that matter most in the digital content industry”
- 44. The Value of Information and Info Management in the Marketplace Today Information is powerful currency in today’s competitive marketplace Data Information Knowledge Better Business Decisions 46 © 2014 Ariba – an SAP company. All rights reserved.
- 45. The Data Is Overwhelming In 5 years, eCommerce will be absorbed into all areas of business* Businesses are ready for web-based platforms that connect buyers and sellers for commerce 75% agree that these networks are beneficial 73% agree that they enhance buyer-seller collaboration 64% say that they are part of a successful eInvoicing initiative** * Supply & Demand Chain Executive ** Ardent Partners 47 © 2014 Ariba – an SAP company. All rights reserved.
- 46. eCommerce: the Broad View It’s about more than just buying and selling 48 eCommerce ≠ transactions exclusively It’s also more broadly about exchange – the availability, exchange and use of information that immediately or eventually supports Commerce © 2014 Ariba – an SAP company. All rights reserved.
- 47. The Impact of eContent on eCommerce • When building or enhancing an eprocurement system, consider these eContent-related criteria: What content would be helpful? Where does it currently exist? Who will be using the content? For what purposes? What do users expect about interface, experience? How/where should the content be made available? In what formats? 49 What about social community/social media/workflows? Are there possibilities for integrated solutions? © 2014 Ariba – an SAP company. All rights reserved.
- 48. eVolution of Wolper’s Business 50 WOLPERweb® – cloud-based, account self-management – launched in 2001 Intuitive, dashboard-like interface, point-and-click ease, “real-time” reporting, online check-in with automatic claiming, easily configurable for use across multiple office locations, library branches, etc., including global Enhancements, add-ons and/or integration with third-party solutions to address evolving management challenges related to subscriptions and other information resources © 2014 Ariba – an SAP company. All rights reserved.
- 49. 51 Sustainability benefits through electronic payments, electronic invoicing and eContent Enhanced organizational efficiency and effectiveness resulting from 24/7/365 online access to self-manage all subscriptions, paper-free – including ordering, renewing, editing, canceling, claiming and customer service © 2014 Ariba – an SAP company. All rights reserved.
- 50. But Technology Is Not 100% of the Solution! Content resources are often unique, complex – not simple “commodity” offerings 52 Even with rich contextual information and robust functionality, people want a personal touch The ideal blend: Online services and functionality complement the interpersonal, offline © 2014 Ariba – an SAP company. All rights reserved.
- 51. Wolper & Ariba “Win-win” Buyer “win” Ability to include content/information spend in enterprise-wide effort to gain visibility and control over procurement Seller “win” 53 Using Ariba platform standardizes order data and eliminates ambiguity and/or potential errors Ariba brings customers to our fully featured customer-facing eCommerce site and provides access to all the service related tools we offer. © 2014 Ariba – an SAP company. All rights reserved.
- 52. Bringing Us Back to the eVolving Corporate Environment Need for transparency and control over procurement process Need for decision-support capabilities (purchasing options, ROI) 54 Day-to-day need for critical business and competitive information, all the time, from anywhere Seeking an integrated, end-to-end supply chain, with a multitude of systems “shaking hands,” including vendor and partner solutions © 2014 Ariba – an SAP company. All rights reserved.
- 53. The eVolution of Information in eCommerce Thank you very much! Susan Wolper President & CEO swolper@wolper.com @WolperInfoSvcs 55 © 2014 Ariba – an SAP company. All rights reserved.
Editor's Notes
- One of the largest Career Education Companies in the USOwn and operate over 100 colleges across the US and Canada100,000 students and 8,000 employeesBrands include Wyotech, Heald, Everest and Quickstart
- What are we buying?Who are we buying from?How much are we spending?We could not leverage buying power
- What are we buying?Who are we buying from?How much are we spending?We could not leverage buying power
- What are we buying?Who are we buying from?How much are we spending?We could not leverage buying power
- Implementations and deployments are costly and time consumingWould be going from 30 users to 13,000, so something easy to use and uncomplicated
- INTERNAL:Shift in responsibility Campus places order vs Corporate places orderCoordination between internal teamsInvolving AP, IT, Purchasing, Audit, ManagementEXTERNAL:Vendor EnablementCooperation of suppliers, willingness to change processes
- THIS SLIDE NEEDS TO BE UPDATEDGood support from campuses/internal teams Cost of invoice processing went from $16 to $2
- Ongoing vendor enablementOngoing improvementsNew projects: Budget Check, Invoice Conversion
- It’s an honor to be a part of this panel today. As the President and CEO of Wolper Information Services for more than 20 years, I’ve become quite involved in the world of eCommerce and I’m thrilled to be able to share my perspective with you today.Oftentimes when people talk about eCommerce they are referring to eprocurement – or online transactions. Today, I would like to suggest that eCommerce is a much bigger topic that offers expansive and robust opportunities in commerce, generally, and in the use and dissemination of information critical to an organization’s success in this world of global eCommerce. Because of our experience in eCommerce and eprocurement, and because of what we do and the nature of our business, I’m going to be talking about the evolution of information in eCommerce and how your company can participate more broadly in this interesting and fast-changing world.
- By way of background, let me explain a little bit about what we do and where our experience with ecommerce comes from.We provide acquisition and management services for magazine, journal and newspaper subscriptions, books and ebooks, in addition to other media and related information management tools. We handle content in all formats -- print, electronic and digital. For corporations, academic institutions and hospitals, government agencies and public libraries. We are bascially behind the scenes – the engine that provides those resources – whether they arrive directly to the end user or to a librarian or an administrator. We’re an outsourcing solution specializing in the management of company-paid subscriptions and other content resources. We have a cloud-based platform, WOLPERweb®, that allows self-management of those resources by our customers. That system also gives us the ability to integrate with Ariba, other e-procurement, accounting and library system platforms. Our work was recently recognized for the second time by EContent magazine, who included us in their EContent 100 “list of companies that matter most in the digital content industry.”
- The value of information today is more essential than it has ever been.In today’s knowledge economy, it’s what makes workers effective; it helps identify opportunities; it helps formulate strategy and plans; it helps research evolve and it helps organizations and their customers make more informed decisions that eliminate or manage dissonance.
- I’m sure none of this data is news to you…What may be new is how I’d like to broaden the conversation about eCommerce.
- Many people and organizations think of eCommerce as primarily transactional; that it’s exclusively about buying and selling.We associate eCommerce with some action in the marketplace. But my point is that that action doesn’t have to be a sales transaction. eCommerce is also about the availability and use and exchange of information:To support decision makingTo foster the exchange of ideasTo encourage serendipitous discoveryIt might exist within our own own closed systems.It might exist in connected social media and community networks.It can involve integration of data and information from multiple sources – towards many other uses and outcomes besides strictly buying-selling transactions.For example, if our eCommerce environment also provides information to a researcher, we hope certainly that eventually that information – and the work that happens around it – will lead to a new product or service. And certainly that involves commerce in the traditional sense, buying and selling.Another example might be very simply providing decision-support information to a customer in the eCommerce setting – perhaps reviews by other customers; that broader set of information or information services helps facilitate further sales transactions.
- As we think about the broader eCommerce universe – including buying and selling transactions but also involving lots of other potential for information exchange – we recognize that information is only relevant if something happens with it. We want to think about all those other potential actions. Especially if we want to incorporate the broader view of eCommerce into our own initiatives.Consider these questions (on the slide).Also, consider the influence that the likes of Amazon and Google have had on our world. These powerhouses have set the bar for us by training people – users, customers – to expect simple, clean interfaces, powerful search capabilities, the ready availability of community and ancillary content – reviews, recommendations, tools such as shopping carts and Wish Lists.Also, rapid advances in technology and the internet itself have created certain expectations about connectivity and speed.So, from an eContent standpoint, an eCommerce audience expects information to be available, findable, linkable, maybe printable, email-able, etc. They will expect access to not only recognized aggregated “published” formats such as those we find under established brands (the Wall Street Journal, Supply & Demand Chain Executive, etc.) but also to the “micro,” widely dispersed but relevant information that might live in online reviews, blog posts, Tweets, Facebook comments. In your eCommerce platform, you might even want information to be available via live chat.And once we’ve imagined the nature and scope of our basic eCommerce platform, we also need to ask ourselves what other functionality, tools and information might add value. You needn’t build it all yourself. In fact, often it’s better to rely on other experts or existing repositories or systems. So your platform needs to allow integration with potential partner solutions.
- As an intermediary in the content delivery supply chain, all of this has created significant changes in the way we conduct business.As the publishing industry changed from print to digital, we redesigned our internal systems to handle online services and we developed strategic partnerships with third party vendors to be able to offer a complete suite of information management solutions to meet the needs of the digital age.We created WOLPERweb, the first online cloud-based subscription management system in our industry.WOLPERweb supports the basic transactional functions our customers need, but it’s so much more than that. It provides our customers with access to the information they need to make their purchasing decisions. They can search for new serials, review pricing and place their orders. They can generate real-time reports to help them manage their total spend and they can communicate directly with our customer service team with any claiming or service needs they may have. And WOLPERweb integrates with the third party systems from our partners, to bring added value and more information to our customers.
- From an environmental perspective, another benefit of ecommerce is that it can greatly reduce the amount of paper and natural resources used by a company. As an example, one of our customers saved over 2,000 pages per year by transitioning to electronic payments and electronic invoicing. And when we transition customers to digital or online editions of the content they purchase, the savings both in hard dollars and environmental resources are even greater.But big picture, all of this evolution contributes to enhanced organizational effectiveness and efficiency - around information management but also and around unleashing the power of information for better business decisions and an improved online customer experience.
- Successful integration of eContent and eCommerce cannot contain the entire customer experience.Even with rich and ready availability of ancillary information and exchanges beyond the sales transaction, there will continue to be a need for personal, human involvement.Because it’s not possible to automate everything. It is not possible to anticipate every question.In our experience, specifically, content resources often defy too much automated service. Offerings are often unique, pricing is complex, and products have a lifecycle that needs to be managed well beyond the point-of-purchase. So, we at Wolper blend technology and personalized, human-to-human service. What we refer to as High Tech, High Touch.It’s a model that works well beyond our walls. Personalized service is the perfect match for excellent technology. For example, if a customer goes to a retail site and wants more information, they may want to speak to a person before making their decision. If there is a problem with an order they previously placed, they want to be able to interact with a person to get the issue resolved. Which site do they go to? I suggest that most of us would choose the site with easy access to knowledgeable and helpful people on the other end and multiple ways to access that assistance, including phone, email and online chats.
- But going back to eprocurement as an important component of ecommerce, I want to address the value of working with Ariba, both to our company and to our customers. It’s a win/win solution for both the buyer and the seller.Using the Ariba platform allows for standardization of order data and eliminates ambiguity and/or potential errorsIt’s a “Win” for buyers/customers whose companies are looking to consolidate and expedite purchasing and to capture and track spend, including matching allocations back to cost centersAnd, Ariba punchout facilitates customer access into our fully featured customer-facing e-commerce site – so that they can engage in our services beyond simply the transactional, for example, while in WOLPERweb®, they can generate and analyze reports, edit information about subscriptions or subscribers, communicate questions or issues directly to us and access strategic partners products and services as well.
- As we said at the beginning of this presentation, information is more essential than ever in this fast-moving, competitive business environment.Economic pressures are great, too, meaning that cost controls and ROI are also of paramount importance – thus the need for systems that expedite, enhance and expose our eCommerce activities. That includes both transactional eCommerce – eprocurement – as well as the broader view of eCommerce that supports other types of exchange with contextual, decision-support information, etc.And all of these things – the essential need for information, the economic pressures, as well as the opportunities we might take advantage of – to add greater value through partner integration – are just waiting to be corralled into a single, unified ecosystem that enables eCommerce in the broadest sense.