Bold vision for SAP Business Network not yet a reality

Victoria D. Doty

ERP is evolving as much more businesses extend devices past the business, involving suppliers, associates and prospects, in sophisticated processes like source chain.

SAP is hoping its SAP Business Network, unveiled in June at the SAP Sapphire convention and described as the “community of networks,” can unify processes and businesses. A much more interconnected economic system has distinct positive aspects these kinds of as enhanced collaboration, much more economical processes and better visibility, but there are queries about no matter if SAP Business Network, which brings together three present SAP networks, will be the 1 community to realize the eyesight.

The notion powering the SAP Business Network is seem, in accordance to analysts, but SAP may be acquiring a minimal ahead of by itself. The items that make up the community have yet to be completely knitted collectively, and it is unclear if the SAP Business Network will combine with non-SAP business enterprise networks.

The SAP Business Network explained

SAP Business Network is not a new merchandise supplying, but a bundling of three present SAP networks under 1 umbrella. They are as follows:

Richard HowellsRichard Howells

The business enterprise case for business enterprise networks is the two distinct and escalating, explained Richard Howells, SAP vice president of alternative management for electronic source chain.

“It truly is evident that there’s a require for networked answers, simply because the reality is that each and every enterprise is dealing with a lot of other businesses at the moment,” Howells explained. “The [COVID-19] pandemic is highlighting the deficiency of visibility and the deficiency of collaboration, so we see business enterprise networks as a enormous driver of enhancing business enterprise processes in this networked economic system.”

Processes don’t cease at the walls of an business — they typically extend past it, he explained. For illustration, when an order is placed in procurement, the business enterprise method can touch on inventory setting up, logistics and shipping and delivery, and payments.

“It truly is about unifying all the facts from all the investing associates on to 1 community, which we’re perfectly on the way to,” Howells explained. “Then we’re speaking about cross-community business enterprise processes. Finally, it is about obtaining the business enterprise info in 1 spot.”

Suppliers on the SAP Ariba Network, which currently variety around 6.7 million, have been moved to the SAP Business Network portal, he explained. There is some overlap concerning businesses that are on the two the SAP Ariba Network and the SAP LBN (fewer so with the SAP Asset Intelligence Network), but how the businesses are applying the community is transforming.

“It truly is no for a longer time just the obtaining or buying department, but you also require the maintenance department and the distribution department as part of the community,” Howells explained. “There are distinct persons inside your enterprise that may possibly require to access the community now as we proceed to broaden the scope of the community.”

Lacking items of a genuine business enterprise community

Whilst the three present networks now share a widespread interface, the get the job done of integrating the networks collectively continue to lies ahead. Suitable now, the three networks continue being siloed, but the roadmap is to have all three networks on 1 database and share the exact same vendor record, in accordance to Howells.

Christian TitzeChristian Titze

For the reason that the three networks don’t share the exact same system, the SAP Business Network does not meet up with the definition of a genuine community yet, explained Christian Titze, exploration vice president at Gartner.

A business enterprise community has three interconnected levels, in accordance to Titze. The initially layer is the community by itself, which connects three sub-ecosystems: upstream these kinds of as suppliers, contract manufacturers and co-packers downstream these kinds of as distributors, retailers and prospects and expert services, these kinds of as 3rd-celebration logistics, carriers and info from IoT equipment.

The next layer is the apps layer, which contains ERP, setting up and procurement. They are usually built-in with workflow in concerning. The 3rd layer is intelligence, which includes business enterprise intelligence, analytics and AI, which provide investigation, insights, and predictions.

“[A business enterprise community] wants to have these three levels in 1 system and the benefit will come with the much more you leverage your apps — the two business-centric and multi-business — not only for you, but your business enterprise associates, as perfectly,” he explained. “SAP has every little thing, but in a portfolio, not on a system.”

SAP has Elastic Cloud Compute or S/4HANA for ERP, Built-in Business Planning or Advanced Planning and Optimizer for setting up, SAP Ariba for sourcing and the LBN for logistics — but they are not built-in collectively, in accordance to Titze.

“When SAP tells you they are executing on the eyesight, it is PowerPoint, it is not reality. It will acquire some time,” he explained. “The apps are continue to supplier collaboration on the Ariba stack, carrier collaboration on the LBN stack, so it is continue to not distinct yet. This is like a transformation journey, simply because they realize they have every little thing, but every little thing is disconnected.”

Joshua GreenbaumJoshua Greenbaum

ERP evolving into community resource setting up

The technique powering SAP Business Network is stable, but it will call for a ton of get the job done from SAP and its business enterprise associates to be completely realized, in accordance to Joshua Greenbaum, founder and principal at Organization Applications Consulting. However, it represents the foreseeable future of business community processes.

“All the useful processes in an business are likely to start out requiring that they traverse associates and prospects, source chains, logistics chains,” he explained. “There is certainly a enormous amount of money of complexity to the world-wide business enterprise environment and the finest way to offer with it is in some form of a business enterprise community, in which you leverage the many-to-many connections that can be afforded by that.”

Of the business application distributors, SAP is finest positioned to pull off the business enterprise community eyesight, Greenbaum explained. This begins with the SAP Ariba, which is at present the premier business application business enterprise community, and contains the other goods in its portfolio which can build a genuine business enterprise community.

The significant detail is that widespread ERP features are extending past the 4 walls of the business and, now, should include outside the house entities like suppliers and prospects, he explained. “There are a ton of ways in which what we made use of to assume of as business resource setting up really becomes community resource setting up.”

There are also other business enterprise networks, and SAP will also require to adopt a heterogeneous method for the SAP Business Network, Greenbaum explained.

“SAP won’t be able to succeed as a business enterprise community vendor if it calls for wall-to-wall SAP,” he explained. “If you might be working Coupa or Kinaxis, you need to be welcomed into the SAP Business Network — that wants to be quite explicitly mentioned. There is certainly a particular amount of money of normal maturity in the heterogeneity product that wants to be achieved in order for this to really get the job done.”

The notion of composability, or fitting items collectively from many distributors to form a community, can make perception, Titze explained.

“This may possibly be the way to go for some businesses: You can use a business enterprise community for the community connectivity, then you may use source chain collaboration from SAP Ariba, and with composability, you could use transportation from Descartes Global Logistics Network or Oracle Cloud Logistics,” he explained. “The concept is that you will have these expert services. Which is not reality currently, but it is the path it is likely.”

Jim O’Donnell is a TechTarget information writer who addresses ERP and other business apps for SearchSAP and SearchERP.

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