Microsoft 'reinventing' its supply chain alongside SAP Ariba and Intrigo Systems
Describing itself as having “one of the...
Microsoft says it is to ‘reinvent’ its supply chain in a project alongside SAP Ariba and Intrigo Systems.
Describing itself as having “one of the most complex supply chains in the world”, the tech giant said it wants to ensure supply keeps up with demand for its hottest products.
In a newly released webinar, the company discussed how it is teaming with SAP Ariba and Intrigo Systems to create a scalable, modern platform to support the efficient, cost-effective manufacturing of its most popular products, including the Xbox and Surface.
“At Microsoft, our mission is to empower every person and organization on the planet to achieve more,” said Ali Khaki, Principal PM, Supply Chain Engineering, Microsoft.
“And our strategy to achieve this is to build best-in-class systems and platforms and productivity systems.”
He added: “When we looked at our supply chain, it was clear we needed to build a flexible, scalable platform that could support the complexity of our hardware business.
“The Ariba Network is the backbone for Xbox and Surface line of products supply chain,” Khaki said.
Working with SAP Ariba, Microsoft said it has created a modern platform from which it can safely and easily collaborate with multiple tiers of contract manufacturers and suppliers across key supply chain planning and execution processes, including:
- Sharing production forecasts, orders, quality, and inventory information.
- Anticipating and resolving supply assurance problems.
- Onboarding suppliers.
Since implementing the solutions with Intrigo’s support, Microsoft has:
- Enabled multi-tier planning and collaboration with contract manufacturers and suppliers.
- Reduced the supplier commit process from three days to 30 minutes.
- Cut the time it takes to onboarding for suppliers from four months to four days.
- Standardised vendor engagement through B2B, flat files and web-user interface.
“It’s a very clear and transparent process because of all the communication that happens within the SAP Ariba system itself,” Khaki said. “And it has allowed us to create a very positive user experience for everyone involved in it.”
5 Minutes With: Jim Bureau, CEO Jaggaer
What is data analytics, and why is it important for organisations to utilise?
Data analytics is the process of collecting, cleansing, transforming and analysing an organisation’s information to identify trends and extract meaningful insights to solve problems.
The main benefit for procurement teams that adopt analytics is that they’re equipped to make faster, more proactive and effective decisions. Spend analysis and other advanced statistical analyses eliminate the guesswork and reactivity common with spreadsheets and other manual approaches and drive greater efficiency and value.
As procurement continues to play a central role in organisational success, adopting analytics is critical for improving operations, meeting and achieving key performance indicators, reducing staff burnout, gaining valuable market intelligence and protecting the bottom line.
How can organisations use procurement analytics to benefit their operations?
Teams can leverage data analytics to tangibly improve performance across all procurement activities - identifying new savings opportunities, getting a consolidated view of spend, understanding the right time for contract re-negotiations, and which suppliers to tap when prioritising and segmenting suppliers, assessing and addressing supply chain risk and more.
Procurement can ultimately create a more comprehensive sourcing process that invites more suppliers to the table and gets even more granular about cost drivers and other criteria.
"The main benefit for procurement teams that adopt analytics is that they’re equipped to make faster, more proactive and effective decisions"
Procurement analytics can provide critical insight for spend management, category management, supplier contracts and negotiations, strategic sourcing, spend forecasting and more. Unilever, for example, used actionable insight from spend analysis to optimise spending, sourcing, and contract negotiations for an especially unpredictable industry such as transport and logistics.
Whether a team needs to figure out ways to retain cash, further diversify its supply base, or deliver value on sustainability, innovation or diversity initiatives, analytics can help procurement deliver on organisational needs.
How is data analytics used in supply chain and procurement?
Data analytics encompasses descriptive, diagnostic, predictive and prescriptive data.
Descriptive shows what’s happened in the past, while diagnostic analytics surface answers to ‘why’ those previous events happened.
This clear view into procurement operations and trends lays the groundwork for predictive analytics, which forecasts future events, and prescriptive analytics, which recommends the best actions for teams to take based on those predictions.
Teams can leverage all four types of analytics to gain visibility across the supply chain and identify optimisation and value generating opportunities.
Take on-time delivery (OTD) as an example. Predictive analytics are identifying the probability of whether an order will be delivered on time even before its placed, based on previous events. Combined with recommendation engines that suggest improvement actions, the analytics enable teams to proactively mitigate risk of late deliveries, such as through spreading an order over a second or third source of supply.
Advanced analytics is a research and development focus for JAGGAER, and we expect procurement’s ability to leverage AI to become even stronger and more impactful.