This morning at SAP’s annual SAPPHIRE NOW conference, SAP Ariba President, Alex Atzberger announced that his company will partner with IBM Emptoris to bring cognitive procurement to the Ariba Network of more than 2.5 million users.  Ardent Partners connected with Alex and Mike O’Leary, Director, Procurement Solutions and Supply Chain Insights, IBM Watson Customer Engagement, prior to the announcement to learn more about the complex partnership structure, the shared goals of SAP Ariba and IBM Emptoris, and what the partnership will mean for both company’s customers over the next couple of years. Ardent’s Instant Analysis of this deal will publish this afternoon.

“The future of enterprise applications,” said Alex, “is intelligence and cognitive capabilities.” To that end, SAP Ariba and IBM have begun their joint developmental push at SAP Ariba’s facilities in Palo Alto, CA to integrate SAP Leonardo, SAP’s enterprise “Internet of Things”/Big Data management platform, with the cognitive, data-driven capabilities of IBM’s Watson Analytics onto the Ariba Network. Together, the two companies want to build next-generation applications on the Network that bring cognitive, intelligent, and predictive capabilities to Ariba’s source-to-settle solution suite and add value to existing Ariba and IBM customers (and to win market share in an evolving technology space).

Alex believes that SAP Ariba partnering with IBM is a testament to each company’s capabilities not just in the procurement space, but also in the shared drive to develop truly cognitive, intelligent, and smart procurement solutions for the end user. He believes that it will be a “game-changing partnership” that will see the teams collaborating on not only the product development side, but also on go-to-market strategies and services delivery. One major highlight is that Ariba and IBM will work jointly to transition existing IBM Emptoris customers to the SAP Ariba platform while taking advantage of the solutions’ capabilities and innovations, as well was future innovations that result from this partnership.

These points were echoed by Michael O’Leary. Like Alex, Mike was excited to announce this partnership at SAPPHIRE NOW “to bring cognitive procurement to end-to-end, source-to-settle solutions on the Ariba Network.” And although IBM is not seeking additional customers for Emptoris, they are not turning the lights out tomorrow. IBM will continue to support their Emptoris customers through at least December 2019 when IBM expects to “sunset” the earliest versions of its on-premises software, May 2020 for cloud software customers, and December 2020 for on-premises customers running later versions. In the interim, they will individually assist their customers in migrating over to the Ariba Network at the right time and selecting the right solutions to meet their enterprise business needs.

Mike really believes that this is going to be beneficial and exciting for their clients. While he believes that IBM Emptoris has made strides over the last couple of years in cognitive computing and procurement, he concedes that they have been unable to deliver upon three key areas for their clients:

  • A user experience that is “elegant,” easy to use, and allows them to drive high adoption levels at scale across the globe. For this, Mike says, “there is no one better than the Ariba Platform.”
  • A full source-to-settle suite integration, rather than a hodgepodge of individual applications that are not connected or integrated.
  • Using cognitive technologies to transform procurement into a strategic enterprise player – specifically, by gaining insight from the massive amount of spend and contract data in the platform.

Mike believes that by combining SAP Leonardo and IBM Watson, the two companies will be able to satisfy their customers’ needs, as cognitive procurement applications will finally give them a path on all three.

Although this is a partnership and not a merger or acquisition, SAP Ariba and IBM will have a commercial obligation to each other. In fact, IBM will receive a royalty for every one of their customers that migrates to the Ariba Network. But from Mike’s perspective, he’s mostly concerned with doing right by their existing customers and steering them in the right direction.

The bottom line for SAP Ariba and IBM Emptoris Customers is that this partnership brings two of the largest players in the B2B technology space together to innovate on a proven business network and bring cognitive, intelligence capabilities to Ariba’s suite of source-to-settle applications. In the meantime, IBM customers will be able to migrate to Ariba solutions where it makes sense for business needs, and leverage the applications on the Ariba Network to enhance their existing standing within their organization.

Reminder: Watch for Ardent’s Instant Analysis of SAP Ariba & IBM-Emptoris’ New Partnership publishing in a few hours…. and Don’t miss Ardent’s hugely popular podcast, The Contingent Workforce Weekly.


Get Ardent’s latest market report – CPO Rising 2017: Tools of the Trade

The Cognitive Procurement “Ecosystem”

Technology Round-up – March 23, 2017 (SAP Ariba Live Edition)

Dispatch from IBM Empower 2016

Onward and Upward: IBM Procurement Leverages an Ecosystem to Drive Value

AribaLIVE 2015: Looking to the Future of Business Commerce

Instant Analysis: Acquisition in the Clouds – SAP to Acquire Ariba for $4.3 Billion

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