In this session, you’ll hear about the implementation best practices and lessons learned directly from the Kaeser Kompressoren Germany customer project manager. Kaeser embarked upon their Ariba implementation in order to achieve spend compliance and reduce procurement costs. They partnered with SAP and Ariba implementation services to ensure a successful and efficient implementation and, as a result, went live on time and within budget, and are well on their way to achieving best-in-class procurement results. Learn more during this informative session.

1. #AribaLIVE
@ariba
Services Success Story: Kaeser
Kompressoren Germany
Joerg Huelsmann, Head of Strategic Purchasing Department,
KAESER KOMPRESSOREN SE
09th June 2015
© 2015 Ariba – an SAP company. All rights reserved.

2. #AribaLIVE @ariba
© 2015 Ariba – an SAP company. All rights reserved.2
at KAESER KOMPRESSOREN

3. #AribaLIVE @ariba
KAESER KOMPRESSOREN – the company
KAESER is a family-owned company in the field of machine and
plant construction
5,000 employees worldwide
Represented by subsidiaries and distribution partners in more
than 100 countries
© 2015 Ariba – an SAP company. All rights reserved.3

4. #AribaLIVE @ariba
KAESER KOMPRESSOREN - structure
© 2015 Ariba – an SAP company. All rights reserved.4
• 6 production plants, sorted by
product lines
• 1 distribution center
• 1 service center
• 2 training centers
• various central sectors
• 55 subsidiaries worldwide
(sales and service organizations)
with own operative purchaser each
• 1 stratetic purchasing department

5. #AribaLIVE @ariba
Initial Situation before Starting the
SAP/ARIBA Project
• The service contract for the previous catalog management system
(SAP SRM) expired.
• Many orders for indirect material and services were mapped in SAP MM;
this impeded getting an overview of the requirements.
• SAP reporting possibilities were strongly limited.
• Only Windows folder for depository of documents
• No IT tool for the supplier management system
• There was no approval workflow.
© 2015 Ariba – an SAP company. All rights reserved.5

6. #AribaLIVE @ariba
P2O – Procure to Order
© 2015 Ariba – an SAP company. All rights reserved.6

7. #AribaLIVE @ariba
Maverick Buying
`Maverick buying means that departments independently buy material or services without
incorporating the purchasing department.
Maverick buying is the purchasing outside of standard procurement processes.`
Especially for indirect material, it is difficult to reduce Maverick buying.
„Man spricht von Maverick-Buying, wenn Abteilungen eigenmächtig Materialien oder
Dienstleistungen kaufen, ohne den Einkauf einzubeziehen. Maverick-Buying ist die `Beschaffung
außerhalb standardisierter Beschaffungswege`“.1
1 Helmut Wannenwetsch: Erfolgreiche Verhandlungsführung in Einkauf und Logistik, Springer Verlag; Auflage: 3., neu bearbeitete Auflage.
(Oktober 2008), S. 68.
© 2015 Ariba – an SAP company. All rights reserved.7

8. #AribaLIVE @ariba
Problems/Consequences of Maverick Buying
• impossible to bundle orders  less market power
• worse purchasing prices
• increased administrative effort due to invoice assignment
and verification
• suppliers that are not checked and approved get orders as well
 no procedure agreed in case of defects
 issues related to workplace safety are not taken into account
…
© 2015 Ariba – an SAP company. All rights reserved.8

9. #AribaLIVE @ariba
Aims of KAESER KOMPRESSOREN in
Handling Indirect Material
1. selection of suppliers by stratetic purchasing department
2. negotiation of all prices, discounts and conditions before the first order
3. safety for the buyer due to correct and complete framework data
4. transparent and safe approval workflow
5. reporting for all orders of indirect material
6. creation of possibilities to control and bundle demands
7. basis for efficient negotiations
8. checking orders for indirect material that are not placed through ARIBA
© 2015 Ariba – an SAP company. All rights reserved.9

10. #AribaLIVE @ariba
Strategy for Using the SAP/ARIBA Platform
© 2015 Ariba – an SAP company. All rights reserved.10
no electronic
catalog available
supplier not
created in
SAP/ARIBA
use of electronic catalogs
requirement notification for
non-catalog-articles by ARIBA
creation and monitoring of
an order in the ERP System

11. #AribaLIVE @ariba
Procedure for the SAP/ARIBA Project
1. analysis of ALL orders for indirect material and services
2. creating a list of suppliers offering indirect material or services
3. choosing a provider of a platform for electronic catalogs (in our case SAP/ARIBA);
carrying out the common project to adjust the software
4. informing and supporting suppliers regarding the platform for electronic catalogs
♦ sending an email to suppliers asking for their cooperation in this project
♦ supplier summit to explain how to work with ARIBA
♦ support for creating electronic catalogs
5. training of own employees
6. monitoring order transactions
© 2015 Ariba – an SAP company. All rights reserved.11

12. #AribaLIVE @ariba
Challenges on the Way to Achieving
the Objectives
• Convincing all suppliers
♦ Support from SAP/ARIBA for creating catalogs (informative material, webinars and advisors)
• Convincing all employees
♦ requirements analysis
♦ The employees should get training and a service hotline should be available.
♦ After a period of familiarization, the old tools and processes must be switched off. This can be
announced already at an early stage.
• Creating a concept that doesn´t show the current situation, but will be considered
progressive in 2016 or 2020
♦ To be successful, it is indispensable to enable the project team to change processes
and to take decisions in reference to SAP/ARIBA.
© 2015 Ariba – an SAP company. All rights reserved.12

13. #AribaLIVE @ariba
Current State of Implementation
• around 100 suppliers are connected to KAESER KOMPRESSOREN
through ARIBA
• in total, 45 electronic catalogs are installed
• around 200 orders per week are placed through ARIBA
• around 200 users work with electronic catalogs on ARIBA
© 2015 Ariba – an SAP company. All rights reserved.13

14. #AribaLIVE @ariba
SIM – Supplier Information Management
CM – Contract Management
the tool for the Strategic Purchasing
Department
© 2015 Ariba – an SAP company. All rights reserved.14

15. #AribaLIVE @ariba
CM – SIM the Same Objectives – First Steps
1. What are the functions/tasks of
the purchasing department?
2. What are the methods of
operations?
3. What datas do I need to perform
my tasks?
© 2015 Ariba – an SAP company. All rights reserved.15

16. #AribaLIVE @ariba
Structure for SIM Supplier Information
Manager
Define:
1. The header fields
2. Questions for the supplier
3. Datas the own organisation
has to provide
4. Attachments directly linked
to a supplier
© 2015 Ariba – an SAP company. All rights reserved.16

17. #AribaLIVE @ariba
Structure for CM – Contract Management
Define:
1. Issue of the contract
2. What descripts a contract
3. Contract Term Attributes
4. Contract Templates
5. Attachments directly linked
to a project
© 2015 Ariba – an SAP company. All rights reserved.17

18. #AribaLIVE @ariba
What made the ARIBA project
successful?
• Creating a concept that doesn´t show the current situation, but will be
considered progressive in 2016 or 2020.
• ARIBA implementation is a project for operating department, not the
IT department.
• Choose team members, who wants to change something
• Make decisions
• Use the consultants and ask them, what they recommend
 you pay for this
© 2015 Ariba – an SAP company. All rights reserved.18

19. #AribaLIVE @ariba
What should be done better the
next time?
Take yourself more time for testing
© 2015 Ariba – an SAP company. All rights reserved.19

20. #AribaLIVE @ariba
Thank you!
© 2015 Ariba – an SAP company. All rights reserved.21