Few announcements at this year’s SAP Spend Connect Live conference in Las Vegas drove as much excitement among attendees as those relevant to SAP Business Network.
Since its launch in 2021, SAP Business Network has aimed to address the need for organizations to collaborate with their most critical trading partners and see into their supply chains. SAP Business Network integrated SAP’s leading business networks—including SAP Ariba Network—to create a B2B procurement and supply chain collaboration hub that provides its users with unprecedented supply chain visibility. It automates the procurement process for buyers and helps suppliers strengthen their relationships and unlock new business opportunities.
With millions of companies conducting over $6 trillion in commerce annually on the platform, compared to about $4 trillion annually in 2020, SAP Business Network is already growing rapidly as a digital marketplace of choice for millions of buyers and suppliers worldwide. At SAP Spend Connect Live, the company announced another leap forward for the network, putting it in a position to expand even further.
In the first quarter of 2025, a “promote” subscription for suppliers on SAP Business Network will become available. This subscription will allow suppliers to improve their visibility on the network, attract new buyers, and grow their businesses. According to SAP, through the “promote” subscription, suppliers will receive recommendations to improve discoverability, explore advanced search results, verify their supplier profiles, and make use of network catalog APIs.
Joule, the SAP generative AI copilot, will also be integrated to help automate logistics and asset management processes within SAP Business Network. Through its natural language interface, users can address and navigate status requests and queries, invoice disputes, work orders, freight orders, and more. Joule’s ability to identify errors while analyzing, categorizing, and providing insights into invoice rejections will reduce the cost of resolving exceptions.
With SAP Business Network gaining more generative AI capabilities, suppliers can also speed up the highly manual work of filling out RFPs and related spend paperwork, loading all their available offerings into the network catalog, and optimizing product descriptions and summaries.
Suppliers can gain insights into how they appear in searches, update keywords to reflect trending topics, evaluate their geographical reach, apply sustainability ratings via EcoVadis, and track their overall visibility in the platform. Meanwhile, buyers can view supplier profiles and filter by various criteria, including how active suppliers are on SAP Business Network, to bring up those best matched to their needs.
Additionally, SAP Business Network will allow businesses to capture carbon emissions and trace their shipments across the entire supply chain, from the point of origin to the point of delivery. Through SAP’s partnership with Shippeo, which provides real-time transportation visibility, the carbon associated with shipments can also be tracked.
To discuss the recent announcements, ASUG sat down with Tony Harris, SVP & Head of Marketing & Solutions for SAP Business Network, who discussed the challenges and opportunities informing the global supply chain and why this collaboration network represents a significant transformation for SAP.
This interview has been edited and condensed.
Across the past couple of years, what challenges and opportunities have been top-of-mind for SAP customers in the global supply chain space, and how does the SAP Business Network address them?
We’re still seeing the post-pandemic effect of constant disruption. For the most part, our customers are still very much focused on achieving better supply chain visibility, so they can become more resilient in their supply chain operations and meet their customers’ needs: to get the right product at the right price in the right place at the right time. Anything that we can do to help customers along that particular journey is what we are focused on, and that's what we're seeing customers want from us.
One of the beauties of SAP Business Network is these are exactly the kind of scenarios that the network is built to support. If you think about the purpose of the network, we essentially modernize how procurement and supply chain processes are connected across companies, effectively eliminating the breakpoint between buyer and supplier systems that exist today.
In the process of doing that, we enable our customers to achieve better supply chain visibility, drive better operational efficiency within their business, and in many different ways help them achieve full compliance, whether that’s internal compliance or regulatory compliance. Efficiency, visibility, and compliance are the three tenets, if you will, of what the network sets out to achieve. I’m happy to say we're delivering on all fronts, especially given the fact that we connect to so many SAP applications in the supply chain area.
SAP Business Network also supports transaction collaboration. If the buyer-side system doesn’t have a good way of enabling an external party to be involved in a process or transaction, it’s because there’s no user interface for them to log into. It could be an ERP system, which does not support external parties coming in; it’s designed for processes within the four walls of the formal business. The network is in the middle, facilitating that connection between buyer and supplier. We extend SAP Transportation Management with our logistics capabilities for freight; global track and trace capabilities; logistics for dock appointment scheduling; supply chain planning; and SAP Integrated Business Planning integration. How do you get your demand forecast to the supplier? You do it via the network. The supplier’s user interface shows—row-by-row, column-by-column—the demand that you're asking of them. They can confirm, or otherwise assess, their ability to meet that demand.
Throughout our supply-chain applications, we also support asset management, with work order collaboration. The engineer receives the work order via the network, and then they can confirm what they've done and how many hours they spent performing the work, and that information goes back into the ERP system. SAP Business Network has proven extremely popular with our supply chain customers because it helps solve that challenge of collaboration with external parties. Without the network, it tends to be done via spreadsheets, email, phone calls, and even snail mail in some cases.
To your point, historically fragmented and highly manual processes limit the ability of individuals in networks, in areas such as freight, to communicate and collaborate. Even a global supply chain inevitably breaks down to an individual level, which makes individual adoption of solutions and a collective understanding of the need for digital transformation both essential. What strategies is SAP employing, such as improving integration between SAP and non-SAP systems, to encourage buyers and suppliers to go through SAP Business Network?
On the trucking side of the business, there are millions of one-off, mom-and-pop shops that have one or two trucks around the world. For us to try to work with all of them directly wasn’t the right route. Instead, we facilitate direct integration with the biggest carriers, which is their preference, and work with some of the largest logistics service providers (LSPs) who connect to these smaller carriers themselves.
The smaller carriers tend to go through the LSPs, who encourage the smaller carriers to use the SAP Business Network portal to pick up an order. We’ve already achieved this with a lot of the larger carriers, and for the majority of the customers, 80% of their carrier needs are served by the biggest carriers.
What’s also great about this aspect of the network is that we’re tapping into real-time transportation information, data on the whereabouts in the world of a container. That’s previously unheard of. The extent of visibility has exploded over the last few years. Customers today say, “I don’t know how we ever lived without this.” As an example, a container of goods coming from China to Los Angeles is expected to be a six-week journey; but, because there are storms or there was damage to a ship so it had to dock elsewhere for repairs, you can see it’ll take an extra three weeks. With SAP Business Network, you can see the knock-on effects, replan the manufacturing processes you were going to use those components for, and inform customers so they’re aware of the delays. Alternatively, you can see if you have those goods in another container elsewhere that you can fly into your location to minimize disruption to the manufacturing plan, and the delayed container can ultimately be used to replenish the stock. SAP Business Network gives you more visibility and enables better planning when disruptions occur.
That improved visibility and strategic planning capability also benefit businesses from a sustainability perspective, helping them cut down on scope-three emissions.
With a number of our solutions, we’ve started to build out sustainability capabilities via carbon credentials. For example, supplier profiles on SAP Business Network can include a company’s sustainability certifications. Buyers can see suppliers’ EcoVadis ratings, which is helpful to understand if a supplier meets sustainability criteria. Suppliers also can load their entire product catalog into the network catalog, so buyers can assess which suppliers to shortlist directly through the network.
Customers expect end products to be delivered with as small a carbon footprint as possible, so they want access to that data in a supplier profile. For more detailed calculations of carbon, SAP Sustainability Data Exchange allows buyers to send requests to suppliers for a carbon breakdown of the products or the bill of materials they want to purchase.
According to an industry-standard template, there are about 70 fields in the calculation of carbon. Suppliers can send their calculations to their suppliers and ask for carbon data to be captured there as well. This helps to build a highly accurate calculation of what the carbon figure is for a given product or sub-assembly, and that data can be shared with the SAP Sustainability Footprint Manager solution and SAP Sustainability Control Tower.
We’re going right down to the source as far as we can, letting all that data roll up to these control-tower solutions SAP offers, so a company can see overall what impacts they are having on the planet. Another example: with Shippeo, an SAP partner that brings real-time transportation visibility, you can calculate the carbon footprint of a shipment, based on whether a container is full or not, what the route is, and so on. So, not only can you obtain the carbon data related to the goods within a container but also the journey from origin to destination.
And just think about where we can take this. We’re not there yet, but with the data available to us now, taking advantage of all this new AI capability that our product engineering teams are developing, you could have the system tell you what you should buy—this product, from this supplier, in this country, using this freight method—to cut your carbon impact in half while reducing transportation time. The possibilities are exciting!
Another core achievement of the SAP Business Network is enabling buyers to operate with verifiable data around supplier performance. Please discuss this aspect, especially in light of the “promote” subscription announced at SAP Spend Connect Live this year.
With the “promote” subscription that we announced, the supplier will have a verified profile, and the buyer will also see the number of relationships that supplier has. We’re exploring what other data elements we’re allowed to share whilst adhering to data privacy regulations. But from a buyer perspective, it would give the buyer so much more assurance when they’re considering a new supplier to see:
- Profile verification
- EcoVadis rating, so they know other humans have engaged with that company to assess them.
- The number of transacting relationships the supplier has on the network already, which means they’re receiving or sending goods and invoices with other companies, giving the buyer reassurance that this is a real supplier.
On the supplier side, the more business they can generate through the network, the more they can start tapping into preferred finance rates. We have supplier financing capabilities on the network via our Taulia solutions. Taulia offers supplier financing, supply chain financing, and discount management capabilities. As an example, a supplier could request their outstanding receivables be financed through Taulia.
A supplier might say, “I’ve got $200,000 worth of invoices. They're due to be paid in 30 days’ time; I’m happy to take a 2% cut to get the money tomorrow.” The more history that is available on that supplier, on the network, the more assured the lender is, the more trustworthy the transaction is. We’ve had feedback from very small suppliers that they love this capability because when you're a small company, cash flow is the lifeblood of your business. You could be doing a great job of manufacturing your products, or delivering whatever service you provide, but you can be out of business very quickly if a customer decides to pay you two months late. The fact that they can tap into this finance capability very easily, just giving up a few basis points, is another great benefit to the supplier.
As you can see, we’re constantly looking to see how we can balance the value proposition on the business network between the buyer and the supplier. This started a long time ago, on the Ariba Network, when the value proposition was much more favorable for buyers; it was more procurement-centric and all indirect. It was all about the buyer. Over time, we’ve rebalanced that value proposition. That’s what the “promote” subscription is all about: giving powerful capabilities to suppliers.
With the addition of this “promote” subscription, SAP Business Network—as a global B2B network—signifies a real shift from SAP, in terms of the types of in-application offerings it delivers to customers. It’s also a new go-to-market model for SAP. Tell me about laying the groundwork for that.
A few years back, my team was looking at how to deliver more value for suppliers. Ultimately, we wanted input from companies’ sales and marketing teams. The question was how we could reach them and convince them of the value of joining a network where they aren’t currently doing business.
Engaging with our supplier advisory board members, we started asking, “If there was anything you would want from the network, what kind of capabilities would you be looking for?”
Together with that analysis, we also ran a comprehensive research study through a third-party firm, and we got fantastic feedback on what suppliers would want from a B2B commerce platform: “We want to have a verified profile so anyone looking at us knows we are the real deal. We'd love to tap into data and analytics to understand what market opportunities there might be on this platform for us. For example, which industries, which part of the world, and which size of company is buying these categories of goods? And we want to receive leads. We want to be matched to buyer postings that are relevant to where we are in the world, to the goods and services that we offer.”
We began to model out what that could look like, what capabilities would be best to build into the market, how we could roll that out to suppliers, what price point was appropriate to charge for that set of capabilities, and how we could even reach those suppliers to offer this solution to them. The supplier side is not like the buyer side of our business, where you have a global sales team engaging with prospects and customers to position our solutions. We needed a low-price-point solution for our end-customers in the supplier space and the ability for them to self-serve through a pure digital click-to-buy approach.
We’ve implemented new marketing technology that enables us to directly engage with a supplier whilst they’re using our portal to assist them with common tasks such as completing their profile. We can also provide offers such as our new “promote” subscription, and they can subscribe directly within the system and start to benefit from the new capabilities straight away.