ZDNet in their BriefingsDirect series has published a new case study. It explores how large organizations deploy cloud commerce and automated sourcing and procurement to modernize and manage their buying processes. Dana Gardner, Principal Analyst at Interarbor Solutions, interviewed Karen Sherrill, Senior Commodity Manager at The Ohio State University Medical Center.
The university is an Ariba customer and has been using Ariba Discovery, the business matchmaking service for buyers and sellers, successfully. Sherrill describes the benefits of using Ariba Discovery as follows:
"As a public entity we're required to do public notifications of our bid opportunities. With only 5,000 suppliers within our legacy base, the competition could be somewhat limited, because it's only those suppliers who knew about our site and had come there to register to receive our bid notification. When we transitioned to Discovery, there were about 350,000 suppliers on Discovery. It's grown to over a half-million at this point. So we've substantially increased the number of suppliers that are aware of our bid opportunities."
By joining Ariba Discovery, The Ohio State University was able to make more suppliers aware of their business opportunities. This resulted in more suppliers participating in their bids. As a consequence of this increased competition, Sherrill and her team were able to procure goods for less as in this high-profile project for linens:
"There was a supplier that we were aware of but we could't find their contact information. We put the public bid notification on Discovery, and the supplier popped up. They participated in our bid. They didn't win, but they were strong competition, and the incumbent felt the need to reduce their pricing by about 16 percent, which resulted in a half-million dollar savings in year one and year two of the agreement. So if we didn't have that strong competition, that saving probably would not have been generated," says Sherrill.
Sherrill also points out that for several categories, her team can now easily find suppliers of goods that the buyers may not be subject matter experts in. Prior to using Ariba Discovery, finding the right suppliers could be challenging. Now, the process is streamlined and effective:
"By just putting out a bid notification on Discovery, it makes the buyers who are more of a generalist have the tools necessary to find suppliers that can compete on categories that they're not subject matter experts in, in order to generate the competition to reduce price and get additional value from the supplier base."
Watch the video below for more information on how The Ohio State University uses Ariba to optimize their business.
Download The Ohio State University Case Study.