As little as two years ago, a primary discussion around contracts at Ariba Live was how to migrate contracts into Ariba. This year, the customer priorities have matured to focus how to on augment the Ariba contracts manager to improve the contracting processes across the business and the addition of Big Data analytics to monitor the spend under management that is controlled by contracts.
Over the three days of SAP Ariba Live 2018 in Las Vegas last week, we spoke to hundreds of attendees about how Seal is like Spend Analytics, but for Contracts. For context – back in 2008 procurement professionals generally knew where all their spend was, but wanted a more in-depth understanding. Over the last ten years, millions of dollars have been spent slicing and dicing the transactional data, aggregating, analyzing it, and deriving insight from it. However, due to priorities and technology limitations, they left contracts sitting in a traditional repository and the contracts remained untapped as a feed for strategic spend analysis. That is, until now. Advances in processor speeds and availability of high-performance hardware has accelerated the adoption of AI technologies and specifically the power to harness Machine Learning to analyze unstructured text data.
Seal Technology Analyzes Contract Data – Eliminating the Blind Spot
Seal encapsulates the advances in Big Data and artificial intelligence technologies to tap into the data and intelligence found in unstructured content –specifically contracts. Do not underestimate the amount of value to be found in contracts, 70-80% of all money going out and coming into your company is on a contract. I would argue that contracts are one of the most important sources of information you have, and Seal enables you to slice and dice this information alongside your transactional data. The unified stream of contract and transactional data can be transformational for companies invested in maximizing savings opportunities through what Walter Charles, BioGen’s CPO calls Technology 4.0 – AI and machine learning based systems.
Seal contract analysis does not replace your contract management system, in the same way, that spend analytics platforms did not replace ERP and T&E systems or that Big Data apps do not replace the analyzed data’s source systems. The Seal platform complements the contract management process by augmenting its weak spots and providing the ability to slice and dice the unstructured data to drive insight and outcomes.
Example of Seal Driven Actionable Insights
A large healthcare company working with $2b in spend used Seal to find a large gap in contracted payment terms vs. actual payment performance. They identified approximately $90m in additional annual working capital opportunity translating to $4 to $5M in working capital savings.
What will contract analytics look like within your organization? It may be as hard to imagine as spend analytics were in 2008, but looking back now, no one can argue against the cost savings that were driven by the deployment of these spend analysis solutions for transactional data. If you would like to investigate the savings opportunities that you could achieve by enabling contract spend analysis contact Seal Today or attend our Procurement Webinar Series.
Register for our three-part Procurement’s Path From Backroom to Boardroom Webinar Series
Also, if you are new to Ariba, looking to clean-up an existing repository, refresh the metadata or address the challenge of using MS Word to compare, review and redline contracts, the Seal platform can help. To learn more Click here.