Ariba extends spend management suite

With the addition of three new enterprise products to its spend management suite, Ariba Inc. appears to be serving notice to the major ERP vendors that it owns the sourcing and procurement technology market.

This week the company will unveil Ariba Category Procurement, Ariba Contract Workbench, and Ariba Settlement.

Lou Unkeless, vice president of solutions at Ariba, said that the new applications sit in the middle of the process between sourcing and procurement.

"We are continuing to fill in the holes to complete the spend management process, Unkeless said.

Category Procurement is targeted at purchasing indirect goods and services that are traditionally not controlled by a purchasing department. According to Unkeless, more than 60 percent of all company purchases come out of this category. The new application will bring as much as 80 percent of total spend under management, Unkeless said.

Jim Hawkins, e-sourcing process leader at Owens Corning said that spend control tools are critical.

"You can find out how many people (within the company) are doing printing with companies that you didn't even know were doing your printing," said Hawkins.

The Category Procurement module will be deployed and used by the various departments within the enterprise. It will include pre-configured workflows that accommodate the unique ways in which these departments procure products and services. The major types of indirect spend categories templates included are for project-based, time-based, third-party, travel, and catalog purchases.

The second module, Ariba Contract Workbench, is focused on accelerating the negotiation, assembly, and collaboration around contracts, said Unkeless.

It will monitor compliance issues around contract criteria and approval cycles.

Jon Derome, a senior analyst with The Yankee Group, called Ariba's Contract Workbench "powerful."

"It will help with the contract compliance and invoice compliant issue that has plagued sourcing departments in a lot of large organizations," Derome said.

The third module, Ariba Settlement, will automate the invoicing and payment process.

Derome believes the big challenge for Ariba will be to convince the enterprise market that a best-of-breed solution -- as opposed to a solution from the big ERP vendors -- is the right choice.

"(Ariba) continues to expand the enterprise spend management footprint, and along with the acquisition of Free Markets it puts them in the driver's seat in this market. They are the standout vendor," Derome said.

Ariba Category Procurement, Workbench, and Settlement will ship in May.

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