Bart van Beek

S/4HANA & The Intelligent Enterprise Landscape for Procurement

The latest developments in the Spend Management domain

Is there a shift happening in the SAP Spend Management landscape? We think so! Until recently, we mainly thought of SAP Ariba when it came to SAP Spend Management, but the world looks different now. 

Changes in the landscape

We’ve noticed that S/4HANA is being more commonly used as the foundation for Sourcing & Procurement in the SAP application landscape. With the latest releases, S/4HANA has matured on its own for executing and managing the entire Source-to-Pay process. Where the functionality had potential but was not mature enough until recently, the finishing touches are now being put on and new processes and functionalities are being added. In addition to the developments in procurement functionality in S/4HANA, we also see major developments in areas such as embedded reporting and integration and extension capabilities. Think of further improving the integrations with Ariba and new possibilities such as integration with Icertis. And in my opinion, perhaps the most important: more and more products and solution extensions for Spend Management on the SAP Business Technology Platform (BTP). 

In this blog, an overview of developments in the Spend Management domain. I will provide an overview of recent and upcoming developments. But before we look at BTP, let's first zoom in on some striking developments in S/4HANA and the integrations with other applications in the Spend Management domain. 

Improvements in S/4HANA and the integration with Ariba 

Self Service requisitioning received a major facelift in S/4HANA 2022. The new applications offer a clear, user-friendly, and intuitive interface. With options such as processing multiple drafts at once, working in a split-screen setup, and personalizing screen layout, a great improvement has been achieved. For occasional users who use this application together with Ariba Guided Buying, the application has made a big leap in user-friendliness.

Starting with S/4HANA 2022, long-awaited improvements for working with order confirmations have been made. Where working with order confirmations, for example with the Business Network, used to leave something to be desired due to missing functionalities, it has now been greatly improved. An example of this is the ability to update purchase orders with price changes and perform workflows to accept or reject those changes. That functionality is now available again from S/4HANA 2022.

Product Sourcing

Product Sourcing has been present since the 2021 release, but because it has had a major update in the 2022 release, it is certainly worth mentioning here. Product Sourcing provides support for strategic or "demand-driven" sourcing projects for direct procurement. Product Sourcing integrates with the S/4HANA for supplier quotation management and S/4HANA for procurement planning applications for BTP, which I will come back to later in this blog.

BTP Integration with Product Sourcing

And then there's BTP (Business Technology Platform). In recent years, various applications have been released on BTP that integrate with S/4HANA processes. With the appearance of these applications, an increasingly extensive landscape is emerging in the SAP Spend Management domain. This enables organizations to choose the tooling that best suits their needs within the portfolio of SAP products.

S/4HANA for procurement planning realizes an integrated process in which procurement projects for direct materials can be planned. Data from project planning serves as input for sourcing materials. In addition, based on input from Product Sourcing, the planning is updated with deadlines and data on the required investment.

S/4HANA for supplier quotation management provides suppliers with insight into sourcing projects and events made available to them by customers. A supplier can indicate whether he wants to participate and whether he wants to submit, modify, and track one or more quotes.

BTP Integration with Enterprise Contract Management

Enterprise Contract Management in S/4HANA (formerly Legal Content Management) supports a process for creating and managing legal documents such as contracts and NDAs. These legal documents can be linked to procurement documents such as purchase contracts or orders.

The BTP-application Enterprise Contract Assembly integrates with Enterprise Contract Management and supports the creation and assembly of legal documents based on reusable templates and clauses.

Recent and upcoming developments for procurement on BTP

If we look further ahead, we see that many beautiful innovations are still to come. With the announcement of SAP Category management (more info here) BTP brings tooling for developing, executing, and managing procurement strategies.

And lastly, recently published in the SAP Process Navigator, Scope item 4AI for the integration of S/4HANA Cloud with “Buying 360”, recently appeared in the SAP Process Navigator. This is a BTP application that supports catalog purchases for indirect procurement. The application is expected to be available in Q3 2023. Still waiting, but I am certainly very curious!

If you want to know more about the developments in the SAP Spend Management domain or want to talk about the options BTP offers for your organization, please contact Bart van Beek or Bart de Bijl.