It's Alive -- SAP SRM 7.0 in Depth (Part 2)

In Part 2 of Spend Matters' examination of SRM 7.0, we'll turn our attention to some of the specific enhancements in this latest version, many of which fall below the top level positioning that SAP is taking to the market. But the proof of many of the benefits and enhanced capabilities tied to 7.0 is in the details that SAP tends to gloss over. From a foundational procure-to-pay perspective, SRM 7.0, like the forthcoming E-Sourcing release, brings a new user interface that not only provides a cleaner look and feel but re-architects how users interact with the application. For example, users can now manage their daily work stream (plans, activities, projects, etc.) within a more flexible portal framework than before.

With SRM 7.0 users now complete a range of tasks that take place in separate windows versus forcing clicking around multiple times to get to the same information or outcome in 5.0 and earlier versions. From a workflow and usage definition perspective, it is easier for users to transition from management activities including up-front structure/delegation/organization and ongoing planning and monitoring through to execution-based activities without feeling like they're switching applications.

SRM 7.0 also brings tighter controls and exception-based management approaches (more similar to Ariba) for managing decentralized activities as well as greater flexibility and ease of use in defining hierarchical workflows, permissions, roles, etc. Despite these core P2P enhancements, SRM 7.0 does still not provide a unified buying experience for SAP users -- at least not without also deploying a recent enhancement package. Using SRM 7.0, users must still know which application to go into based on the type of purchase they need to requisition (e.g., direct materials vs. catalog-based indirect or services).

Still, the latest enhancement pack, in SAP's words "provides a new harmonized user interface for SAP SRM and SAP ERP" that more closely integrates the buying experience between SRM and ERP, providing the ability to bring together both ERP Central components and SRM items in a single environment. A Deloitte analysis from the Fall of 2008 translates this statement from SAP-speak into English by noting that this enhancement package "will provide the ability to consolidate business documents and queries from both ERP Central Components (EPP) and SRM in a single screen, guiding users to the appropriate tool" to purchase what they are looking for without having to guess at which application to use.

This will guide users into the appropriate location to manage their "specific logons, shopping cart, requisition process and purchase order creation / management". In theory, this should provide a more tightly unified buying experience for direct and indirect materials and services relative to using separate best of breed P2P capabilities from a third-party provider such as Ariba and direct operational procurement capabilities from SAP.

On the subject of operational or "plan-driven" procurement in SAP-speak, 7.0 now provides greater integration and visibility into decentralized activities including order management and sourcing regardless of where the actual activity is taking place (either within ERP or within SRM). From a contract management perspective, the tighter ERP integration theme continues, with unified contract objects that enable organizations that have upgraded their SAP back-end environment to create a single centralized contract reflective of their SAP SRM contracts and those within their ERP environment.

Stay tuned for further analysis of SAP SRM 7.0 in the coming days, including a discussion of the services procurement, contract management, sourcing and supplier management capabilities of the application.

Interest piqued in SRM 7.0 but looking to tie together procurement and finance related working capital management initiatives? Read our latest Spend Matters Perspective: Beyond Requisitioning: Getting Past the Downstream Limitations of ERP Procurement Applications -- Identifying Savings and Working Capital Management Opportunities that SAP SRM, Oracle and other ERP Providers Alone Do Not Enable

- Jason Busch