Ariba CMO Tim Minahan on How Networked Economy Benefits Spring From Improved Business Commerce and Cloud Processes

Transcript of a sponsored podcast on the upcoming Ariba LIVE Conference and how the networked economy is enabling business success.

Listen to the podcast. Find it on iTunes/iPod. Download the transcript. Sponsor: Ariba. Register for Arive LIVE.

Dana Gardner: Hi, this is Dana Gardner, Principal Analyst at Interarbor Solutions, and you're listening to BriefingsDirect.

Today, we present a sponsored podcast discussion in conjunction with the upcoming Ariba LIVE Conference in Las Vegas, which kicks off April 10, 2012. We're here with Ariba’s Chief Marketing Officer to discuss the networked economy and some of the major developments that Ariba will unveil at LIVE to help companies plug in.

As we consider not only the major business and IT trends of the day -- those being cloud computing, mobile, social, and big data -- we also need to examine the confluence of these developments and how together they impact businesses and business ecosystems.

We need to consider the impacts at a higher abstraction, at the business-process level, but not just inside of companies. We must factor how previously internal processes are now becoming externalized and that we need to do that in a safe and managed way across many enterprises and even service provider partners.

Cloud computing, the force behind a lot of this thinking, has let loose the imagination of businesses to consider anew how to outsource at this business-process level. Mobility advances the thinking of bringing processes to anyone, anywhere, with rich two-way interaction. [Disclosure: Ariba is a sponsor of BriefingsDirect podcasts.]

Social media is driving more participation by more people into more aspects of commerce, providing in many cases, an explosive viral value to formerly linear or closed workflows. The result is a large-scale rearrangement of the constituent parts of business processes and extended enterprise functions.

The good news is that shaking up the status quo is enabling massive efficiencies with more active market benefits, shared by more participants, as they cooperate and collaborate in entirely new ways.

A large part of this intermingling of shared business processes is enabled by data-driven decisions across advanced business networks, imbuing business decisions with ongoing, real-time visibility and analytics, and making mastery of relationships between buyers and sellers less an art and more of a science.

Register now for the April 10 conference in Las Vegas.

It may not be as romantic as hatching a business plan on a cocktail napkin, but in order to manage the scale, complexity, and required automation of these expansive new business processes, mastery of network processes with control and governance is critical.

Fly by the seat of your pants, manual, and paper-based processes simply can't keep up. As a leader in cloud-based collaborative commerce, Ariba has a unique observation of where this is going, calling it the networked economy.

Networked enterprise

Let's get a better idea of what it means to be a “networked enterprise” and how business networks will drive the future of commerce over the next few years. Let's welcome our guest, Tim Minahan, the Chief Marketing Officer at Ariba. Welcome back to BriefingsDirect, Tim.

Tim Minahan: Hi, Dana. Thanks for having me.

Gardner: Tim, it’s no longer a stretch to say that business is changing more rapidly than ever. Change is not just an exception It’s the norm, and you need to master it. I've been surprised by how dramatically this cloud-computing wave has taken off and has seemingly captured the imagination of business leaders.

How did we get here? What’s the lead up to this interesting position that you're finding yourself with your conference?

Minahan: Absolutely, Dana. You did a great job of summarizing it at the beginning of this podcast. If you look throughout history, step-change advances in productivity and business productivity have been driven by previous changes and enhancements in IT infrastructure, such as in the '80s, where you had the advent of client/server technology, desktop applications. That drove employee productivity some limited degree and allowed them to collaborate with other peers within the company.

And then in the '90s and in the 2000s, the World Wide Web spawned a slew of applications. That automated functional-specific information flows and streamlined processes for specific functions, whether it be human capital management (HCM), finance, and even purchasing, into some limited degree allowed collaboration within the enterprise.

The forces that you mentioned are conspiring with this combination of cloud computing, mobility, and collaboration through communities or social networks. We're experiencing another major shift in IT-generated productivity.

The next wave of productivity is going to allow companies to begin to extend those processes, extend that information, and extend alignment of their processes with their external partners.

Today, the next wave of productivity is going to allow companies to begin to extend those processes, extend that information, and extend alignment of their processes with their external partners, whether they be customers that they want to collaborate with more closely, or suppliers that they want to align with better and drive efficiencies with, or other partners, financial partners, logistics partners, etc., that take part in a process that the company needs to collaborate around.

We think this convergence of companies collaborating more efficiently over extended information networks is one that's going to drive this next wave of productivity.

Gardner: It seems that we're at the culmination of 30 years of IT development and advancement and maybe 100 years of business activities and advancements and they're coming together in this networked economy sense. How lofty a goal is this? Is this something that you think is years out? Is this something that we are going to always see on the horizon, but never attain, or are we on the cusp of actually doing a networked economy marketplace?

Minahan: Think about it. It’s here today. We still may be in our infancy, but you've got to think about what’s happening today. Think about it in your personal lives. That’s probably the best example. The magic of Facebook is not in its clean interface or in its news feed feature. The magic of Facebook is that it has created the world’s largest network of personal connections.

Register now for the April 10 Ariba LIVE conference in Las Vegas.

Similarly, the beauty of Amazon.com is not that it offers the best prices on books. It’s that it offers the world’s largest and most convenient network for personal shopping.

Enterprise phenomenon

This is not just a consumer phenomenon. It’s an enterprise one. More and more businesses are looking beyond the four walls of the enterprise to extend their processes and systems, to connect and collaborate more efficiently with their customers, with their suppliers, and other trading partners, whether they're across the street or around the world.

Gardner: What's fascinating to me about that, Tim, is we had Metcalfe’s Law, where the more participants on a network, the more valuable it becomes. We certainly see that with Facebook. But what’s happening in addition is that the amount of activity that these folks do, the commerce, their actions, their priorities, is all data that could be captured and analyzed, not just data individually, but collectively.

So we're not just getting value from the network on participation. We're getting insights that filters back to how we can conduct business. How important is this notion of captured analytics along the way in this networked environment?

Minahan: It’s absolutely critical. We'll go back to those models. If you look at any of the personal networks that we rely on everyday, whether it’s Facebook, Twitter, Google, Netflix, or Amazon, they have three things in common.

Number one, as you stated earlier, they're in the cloud. These are cloud-based applications. You don’t need to install hardware or custom-configure it. You don’t need to install or manage or maintain software. It is all accessible through a web browser, whether you are in Peoria or Paris.

That gives you an additional level of trust in the purchase decision you're about to make.

The second component, as we just stated, is that all of these are ultimately networks. They are large communities of individuals, and oftentimes companies, that are digitally connected.

Think about Amazon. You don’t think about connecting to each individual merchant. Whether you want to buy a book or a blender, the merchants are all connected for you. You don’t think about settling out with Visa or MasterCard and how to integrate to them. They're all connected in there for you.

And to your last part, you have cloud-based technology, communities, and then capabilities. That's where the intelligence in the community comes in.

Again, think about Amazon. You want to buy something and you get expert opinions on "folks who have bought this product have also bought this product." That's community intelligence that helps you make a more informed decision.

Secondly, you get peer opinions, other participants in the community that rate the product that you are considering buying. That gives you an additional level of trust in the purchase decision you're about to make.

These are the types of things that are only available in a network-based model. These are the types of things that are also available to businesses in a business network-type model.

Behavioral shift

Gardner: Well, we've certainly seen a behavioral shift in people’s adoption, and even enthusiasm for these sorts of activities. We're seeing it in their personal lives. When we now apply this to enterprises, to B2B activities, to commerce, we can find that the processes are uniquely actionable and automated in the cloud, even more so than in an enterprise system of record, which could be fairly brittle.

But we're also seeing -- I think it's fairly unique -- is the ability to adjust on the fly. So we have automation and governance, but we also have exception management. We have a confluence of actionable automation that's governed and managed with insight, but we also can adjust these things on the go. I think that's something also that's fairly new to this networked environment.

Minahan: Absolutely. The power of a network using Metcalfe's Law is that each new member delivers incremental value to every existing member. Part of that is it does allow you as a business to be far more responsive. It allows you to make more informed decisions, as we talked about. You're not just making decisions based on your own input, but you're making decisions based on relationship and transaction history, as well as community opinion of a particular trading partner.

In a networked environment, you can quickly find new peers or partners that can help you execute a process. You can get informed community decision on how that partner or peer has performed in the past, so you can make a educated decision as to when and how to find alternative sources of supply, for example, or find new employees or potential employees that you could be matched with through this network.

Those are the types of things that a network model allows you to do, to make more informed decisions, to be much more responsive, and ultimately, have far greater transparency and visibility into the process.

Ariba is facilitating collaborative business commerce, allowing buyers, sellers, and other parties involved in the commerce process to reach outside their four walls.

Gardner: So we have gone into at least the business level, beyond this notion of individual networks to systems of record and core business functions being networked, being loosely coupled, and therefore part of a larger business process.

Ariba has, I think, some of the critical business functions in its sights to extend further into this networked value. Tell me a little bit about some of the core themes at Ariba LIVE and why networking -- taking advantage of some of these larger trends that we have talked about -- applies to business processes and some of the core business functions that all companies share?

Register now for Ariba LIVE.

Minahan: At the end of the day, Ariba is facilitating collaborative business commerce, allowing buyers, sellers, and other parties involved in the commerce process to reach outside their four walls, to connect their systems and their processes to get greater transparency into that. That's a theme that's carrying through to Ariba LIVE.

Ariba LIVE’s theme will be around this networked enterprise, and how you enable a networked enterprise and what it means for you as a buyer, as a seller, or as a chief financial officer.

Industry leading

When you look across the agenda for Ariba LIVE, it's filled with industry-leading companies that have already embraced this network approach. Whether it's Anglo American, one of the largest mining companies, talking about how they are leveraging a networked model to identify, develop, and collaborate with sources of supply and new suppliers in the most remote regions of the world, driving a sustainable supply chain.

Whether it's Sodexo, one of the largest food-service companies that's creating some innovative ways in which they are using the network to support their highly perishable, fast-churn supply chain, and gain insight, both for them and for their trading partners. Procurement and IT have worked together to develop a networked model that allows them to be highly responsive in a very perishable supply-chain type environment.

Or whether it's GlaxoSmithKline that's leveraging a network-based environment to not only automate its invoicing process, but to help optimize cash flow, both for them and their partners.

In addition, you have a host of other companies, that are driving this network supply chain model.

We have a spotlight keynote that has driven some innovation into the federal sector. The first CIO of the United States, Vivek Kundra, is going to talk about how he developed the Cloud First Policy within the Federal Government.

You have a host of other companies, that are driving this network supply chain model.

That means, not just lowering the TCO of deploying technology to automate existing processes, but creating a new community, a new interface, a new way for the US Federal Government to connect and share information, and big data with their constituents. And that's the type of thing that's going on in the public sector, as well as in the private sector.

Gardner: That's interesting. So we are not going to just talk at the abstraction, we've got people who are putting this into practice, who have metrics of success, that can show how it's done, how this is aiding their businesses, and also supporting their supply chain and sales, marketing, and other ecosystem leveled activity. That's terrific.

Are you going to be on stage again this year, Tim. Are you the MC?

Minahan: I have the honor of being the MC this year, and it is an honor when you look out across the keynotes that we have and see what they've been able to accomplish by adopting this networked model and how it has allowed them to drive not just their supply chain strategy, but their business strategy. We think it's going to be a phenomenal show.

High-profile innovations

In addition to that content, obviously because it is Ariba LIVE, we'll be launching some very interesting and high-profile innovations, as well as partnerships that will help buyers and sellers simplify their commerce process and get more easily connected to their trading partners.

Gardner: So we will see some leading-edge adopters tell the story of what's working for them and how they got there, and some major news and announcements, as well as alliances with more network partners, right? You have to network in order to allow the network to be valuable to your clients?

Minahan: Exactly. And because it's in Las Vegas, there will be a little fun along the way as well. So we are very excited about Ariba LIVE. We encourage any of your audience members that want to attend to register at aribalive.com.

You have to network in order to allow the network to be valuable to your clients.

Gardner: You have been listening to a sponsored podcast discussion in conjunction with the upcoming Ariba LIVE Conference in Las Vegas, the week of April 9. Now, this starts April 10 right, Tim?

Minahan: Yes, it's April 10-12 at Caesars Palace in Las Vegas.

Gardner: Thanks, I enjoyed exploring some of these concepts around the networked economy.

So thank you to our guest, Tim Minahan, the Chief Marketing Officer at Ariba.

Minahan: Thank you, Dana.

Gardner: This is Dana Gardner, Principal Analyst at Interarbor Solutions. Thanks to you also, our audience, for joining, and come back next time.

Listen to the podcast. Find it on iTunes/iPod. Download the transcript. Sponsor: Ariba. Register for Arive LIVE.

Transcript of a sponsored podcast on the upcoming Ariba LIVE Conference and how the networked economy is enabling business success. Copyright Interarbor Solutions, LLC, 2005-2012. All rights reserved.

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