A wise man once said Spend Management is a journey not a destination. Achieving sustained year-on-year benefits in your spend management initiative calls for a balancing act across multiple fronts – analytics, sourcing, contracts, suppliers and operational procurement. Your company may have achieved some early returns in sourcing savings or procurement compliance. But how do you keep the momentum going? In this session, we will explore how a truly integrated source-to-settle process offers a tremendous ROI, with spend analysis driving effective sourcing, well-managed suppliers, and contracts compliantly purchased off of. You’ll learn how a successful journey begins with the vision and a solid business case, and continues through effective deployment of technology and the necessary process change management.

1. Driving Continuous Improvement and Value
in Your Spend Management Initiative
Speakers
• Joe Fox – Ariba, an SAP company
• Lionel Jellins – ExxonMobil
• Tom Moore – Sears Holdings Corporation
• Scott Gray – Mastercard
Moderator
• Sundar Kamakshisundaram – Ariba, an SAP Company
#AribaLIVE
@ariba

2. Agenda
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Introduction
Panel Presentations
Key Takeaways
Q&A
© 2014 Ariba – an SAP company. All rights reserved.

3. The Panel Team
Speakers:
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Joe Fox – Ariba
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Lionel Jellins – ExxonMobil
•
Tom Moore – Sears Holdings
Corporation
•
Scott Gray - Mastercard
Moderator:
Sundar Kamakshisundaram
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© 2014 Ariba – an SAP company. All rights reserved.

4. Driving Continuous Improvement and
Value in Your Spend Management Initiative
Joe Fox – Vice President
Ariba – an SAP Company
#AribaLIVE
@ariba

5. Top Challenges
for Organizations
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Reduce overhead cost
Increase operational
agility and flexibility
Improve customer
service satisfaction
Source: Hackett Group - 2013 Procurement Issues Study
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© 2014 Ariba – an SAP company. All rights reserved.

6. The Reality of
Procurement 2013:
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Pressure on margins
Expand complex indirect
spend categories spend
Focus on risk
2012
2013
Source: Hackett Group - 2013 Procurement Issues Study
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© 2014 Ariba – an SAP company. All rights reserved.

7. According to CFO Research…
52% of you are focused on
improve process
efficiency
40% feel it is important to
focus on greater
collaboration &
automation
All are top priority for CFOs
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© 2014 Ariba – an SAP company. All rights reserved.
Source: CFO Magazine survey of 263 senior finance executives

8. The Networked Enterprise
Collaboration is improving productivity and profits
77%
55%
41%
Increased access
to knowledge
Better information
sharing
Improved collaboration across silos
24%
increased
revenue
63%
Increased marketing effectiveness
“Increasingly companies
are embracing
collaboration as part of
their strategy to grow.”
43%
Greater market
share
8%
Higher margins
“Networked enterprises were 50% more likely than their peers to have increased
sales, higher profit margins, gain market share, and be a market leader.”
*Source: McKinsey on Business Technology, Spring 2011 – “The Rise of the Networked Enterprise”
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© 2014 Ariba – an SAP company. All rights reserved.

9. Digitized and Intelligent Collaboration
Inter-Enterprise Collaboration is the New Competitive Competency
“Tighter collaboration with
customers, suppliers, and
partners, achieved by having a techsavvy supply chain is key to steering
through unpredictable economic
environment.”
“Increasingly companies are
embracing collaboration as part
of their strategy to grow.”
“The underlying benefit of cloud computing is improved collaboration, both within
the organization and externally… trading partners benefit from being able to
collaborate using a common platform.”
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© 2014 Ariba – an SAP company. All rights reserved.

10. Spend Management Evolution
…from Visibility to Collaboration
Last 15 Years
Next 15 Years
Procurement Management
Cross Process/LoB Value
Sourcing Management
Inter-Enterprise Value
Contract Management
Innovation Continues
B2B Collaboration
Invoice Management
Process on Mobile
Payment Management
Commerce Insights
Business Network
Community Commerce
Buyers Save – Sellers Grow – Both Manage Cash
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© 2014 Ariba – an SAP company. All rights reserved.

11. Specialize and Synchronize and Coordinate
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© 2014 Ariba – an SAP company. All rights reserved.

12. LoB Collaboration and Coordination
…My process helps your process helps my process
CPO as the Conductor/Facilitator of Cross Process
and Cross LoB & Network Spend Management Value
Inventory
Processes
CPO
Contracts
Payment
Purchasing
Payment
Receiving
LoB’s
Legal
Supply Chain
Procurement
Suppliers
Accounts
Payable
Warehousing
Treasury
Government
Buyers Save – Sellers Grow – Both Manage Cash
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© 2014 Ariba – an SAP company. All rights reserved.
Supply
Chain
Services

13. Cross-Process Value = New Value Creation
… Key to a Successful Spend Management Strategy
Analyze
Spend
Source
Contracts
Procure
Identifying Value
Process Improvements
Price Optimization
Upstream Need
• Line Level Invoice Paid Data for Sourcing
• Supplier Performance Data for Analysis
Gives
• Contract Pricing for Compliance/Inv Match
• Supplier Information for Vendor Master Management
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© 2014 Ariba – an SAP company. All rights reserved.
Invoice
Pay
Realizing Value
Spend Compliance
Cash Management
Downstream Need
• Contract Terms, Pricing and Payment Terms
• Supplier Contracted Pricing and Content
Gives
• Receipt Date, Paid Invoices, Vendor Master
• Demand Actuals, Realized Savings, Discounts Collected

14. Driving Continuous Improvement
and Value in Your Spend
Management Initiative
Lionel Jellins – Global IT Ventures and
Operations Manager for Procurement
ExxonMobil
#AribaLIVE
@ariba

15. ExxonMobil – an Introduction
The world’s largest publicly held oil and
gas company
$45 billion in earnings
Return on average capital
employed of 25%
77,000 employees worldwide
$40 billion capital and
exploration expenditure
Source : ExxonMobil Annual Report 2012

16. ExxonMobil – a Global Operator
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Upstream presence in
40 countries
Refining or Chemicals
manufacturing facilities
in 17 countries
100,000 suppliers in
52 countries
Global Procurement
organisation managing
sourcing to payment
Over $50 billion
annually in
procurement-managed
spend
As of December 2012

17. ExxonMobil – a Procurement Timeline
with SAP
Most
procurement
executed at
affiliate level
1990
SAP R/3
introduced
regionally with
Procurement
capability
Ariba and
Ariba Network
introduced
SAP BW
analytics
available
2000
SAP Vendor
Invoice
Management
introduced
HANA-based advanced
analytics
MDG for materials
and vendors
2010
2020
All ERP systems
upgraded to
ECC 6.0
Exxon and
Mobil merge
Increasing:
Supplier connectivity, automated
approvals and LVPOs, use of purchase
orders and 3-way matching

18. Procurement Cycle
Field managed
Procurement managed

19. Use of Ariba - Some Statistics
Pre-commitment
Post-commitment
 Category Management
 T&E and Purchasing Card
100K+ Active Projects
 Agreement Management
~20K Active Agreements
 Analysis

Reports – Audit Requests
eRFX
4K+ Events
2K+ Reverse Auctions
Over 75K Users
 Ariba Network Connectivity
1,400 Suppliers since 2007
SAP Fax Connectivity
Over 200K POs annually
 Requisitioning
18 Punch-out Catalogs
 Category Procurement
 Contract Wizard
 eForms

20. Drivers for the Future
A shifting technology market impacts Procurement IT choices
Influences
Impact
User Expectations
impact client satisfaction
Mobility
Big Data Analytics
will provide new efficiencies
will help identify new commercial opportunities
Monolithic ERP Systems
Cloud Computing
devolving into more Cloud and Hub applications
can minimize costs and increase functionalities
Vendor Consolidation
reduces competition / increases costs
Government Monitoring
Web Security Challenges
will address Capital Flight and Tax Avoidance
adds risk to Supplier Connectivity
Rising cost of Software
limits expansion of new technologies

21. Where next…
Touch-less
Touch-less and Paper-less Transactions
Connected
Simple
Simple and Intuitive User Interfaces
Data
Transparency
Supplier
Dependent
Fully Integrated and Supplier Connected Systems
Broad Market and Transaction Visibility
Suppliers manage Supplier Data
Lowest Cost
Lowest Cost Transactions

22. Driving Continuous Improvement and
Value in your Spend Management
Initiative
Tom Moore – Director of Procurement
Sears Holdings Corporation
#AribaLIVE
@ariba

23. SHC Spend Management Journey
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Goals
Business case
Plans
Issues/Challenges
Solutions
Change Management
Accomplishments
Keys to Success
© 2014 Ariba – an SAP company. All rights reserved.

24. Sears Holdings Corporation
Who we are:
• An integrated retailer operating through its subsidiaries Sears Roebuck & Co., Kmart
and Lands’ End with almost 2,500 full-line and specialty retail stores in the United States
and Canada.
• Leading home appliance retailer as well as a leader in tools, lawn and garden, fitness
equipment and automotive repair and maintenance
• Key proprietary brands include Kenmore, Craftsman and DieHard, with a broad apparel
offering, including such well-known labels as Lands' End, the Kardashian Kollection, Jaclyn
Smith and Joe Boxer, as well as The Country Living Home Collection, Sofia by Sofia
Vergara, Adam Levin and Nicki Manaj Collections
•
The nation's largest provider of home services, with more than 14 million service and
installation calls made annually
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© 2014 Ariba – an SAP company. All rights reserved.

25. Spend Management Goals
Sears Holdings’ goals at the onset of the journey included:
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Price Compliance: Source  Contract  PO  Invoice
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Policy Compliance: Replace manual processes with automated, rule-based,
policy-compliant processes
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Improve Analytic Capabilities: Provide analytic tools to foster strategic management
of spend
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© 2014 Ariba – an SAP company. All rights reserved.

26. Business Case
Develop a Strong Business case
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ID and define the end state (best in class) and the benefits of being there
ID and define where you are today
Quantify the theoretical gap and the financials associated with the gap
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Keep it simple
Use concrete examples
Develop the realistic ROI
Cut the RIO by a fraction and highlight that you have done so
Get financial stakeholder to participate in the development of the business case
Update and expand the business case as you go based on what you learn along the
way………you’ll need to defend it
© 2014 Ariba – an SAP company. All rights reserved.

27. Plans
Development and management of multiple plans is essential based on where you currently are
relative to process maturity and tool set capabilities
• Strategic plan
• Master project plan
• Multiple detailed sub-project plan complete with task/resources and durations
• Continuous tracking and re-planning
Have a route picked out but be willing to continuously re-route. You will take wrong turns and
some of these will lead to new discoveries.
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© 2014 Ariba – an SAP company. All rights reserved.

28. Issues/Challenges
(aka “opportunities”)
Anticipate issues in the following areas:
• Business Process – Standardization and reengineering effort depends upon maturity of
your organization
• Policy – Only develop policies you can enforce – tools allow expansion of policies
• Technology – Be honest and assess your points of integration, data cleanliness, technology
resources and bandwidth
• People – Assemble a team with a mix of:
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Internal & external
Dedicated and part-time
Subject matter experts from business as well as solution experts
© 2014 Ariba – an SAP company. All rights reserved.

29. Solutions
Understand that there are a number of variables which can be altered when searching for
solutions to challenges encountered along the way. These variables can be classified into:
tools, people, processes, environment.
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Develop Alternatives – be open minded and creative in developing alternatives
Operate within the theoretical limits of the tool (vs. the published limits)
Push the envelope
Willingness for continuous improvements
© 2014 Ariba – an SAP company. All rights reserved.

30. Change Management
Simply stated, Change Management is: Getting people to do what you want them to do!
It’s a psychological campaign:
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Teaching – Provide readily available help through teaching (not just training)
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Be a master at making change their idea whenever possible…
Communication – Demonstrate value and elevate practices while bringing others with you
© 2014 Ariba – an SAP company. All rights reserved.

31. Accomplishments
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Category business process standardization across internal organizations
Rate Compliance – Compliance to Pricing and Terms
Vendor Compliance – Channeling spend to preferred suppliers
Change Management – Converting naysayers, turning our biggest skeptics into
our leading allies
Product & Service Standardization – Channeling spend to specific products and services
Maverick Spend – Eliminating the practice and associated risk
Policy Compliance – Mechanically controlling to align with, and insure policy compliance
Efficiency Gained – Variety of efficiencies were achieved
© 2014 Ariba – an SAP company. All rights reserved.

32. Keys to Success
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Right-size the team along with having a strong experienced skill-set
Know your spend (Analytics)
Proactively engage all cross-functional members before beginning
(Procurement, Finance/AP, Business/functional organization and IT)
Assess the maturity level of the Buying/Sourcing organization
Know the level of process standardization across the organization
Make the system easy to use while making it hard to use an alternate purchasing route
Develop solid business case that is logical and strait forward
Create, maintain and manage your plans
Be flexible and willing to change the way you (and your organization) are doing things
Supplier Enablement – engage Ariba to help
© 2014 Ariba – an SAP company. All rights reserved.

33. Driving Continuous Improvement and
Value in Your Spend Management Initiative
Scott Gray – Senior Director
Mastercard
#AribaLIVE
@ariba

34. Summary - Wrap Up
Align Results to Objectives
Build Collaborative Relationships and
Obtain Executive Sponsorships
Be Flexible
ACCELERATE SAVINGS, IMPROVE COMPLIANCE & MITIGATE RISK!
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© 2014 Ariba – an SAP company. All rights reserved.

35. Thank you
Q&
A
Contact information:
Sundar Kamakshisundaram
Sr. Director – Global Solutions Marketing
E: sundar.kamak@sap.com
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© 2014 Ariba – an SAP company. All rights reserved.