Outsource Magazine Issue 28 - (Page 12)

this issue: SAP BUYS ARIBA; CGI BUYS LOGICA; PROCUREMENT OUTSOURCING; HP CUTS STAFF news PO: growth through to 2013 The number and value of global outsourced procurement deals has increased for the second year running, according to a report recently published by Everest Group. The study, ‘Procurement Outsourcing Annual Report 2012 – The PO Market: Steadily Marching Forward’, announced the cumulative value of outsourced procurement contracts at £7 billion – an increase of 17 per cent. This increase is attributed to a rise in average contract value and the adoption of PO deals by medium-sized companies (with revenues between £600 million and £3.2 billion). Saurabh Gupta, VP Everest , Group, commented: “For the second consecutive year, we’ve seen the procurement outsourcing (PO) market set record numbers for new deals, renewed contracts, and a significant rebound in mid-market adoption. Spend reduction, process optimisation and compliance remain the primary drivers for PO adoption.” The report also discovered that around 80 per cent of the total value of deals in 2011 were in companies in consumer packed goods and retail, manufacturing and financial services; with the outsourcing of accounts payable in finance and accounting (F&A) identified as an accelerating trend. In addition, the report forecast that 2013 will see further growth for PO contracts – again being led by smaller companies. procurEmEnT Bill McDermott, co-CEO of SAP sAP snaps up Ariba Enterprise software giant SAP announced in May the takeover of cloud-based commerce application provider Ariba for some $4.3bn – the second billion-dollar-plus cloud acquisition by SAP in under a year following its purchase of SuccessFactors towards the end of 2011. Although some questions remained over the Ariba purchase following the announcement – notably, the prospect that SAP’s arch-competitor Oracle could engage in a bidding war – at press time it appeared that the acquisition was going ahead, with completion predicted for some time in August. “We are taking another bold step in our strategy to achieve leadership in the cloud. With this acquisition, SAP will also become the clear leader in on-demand supplier relationship management,” said SAP coCEO Bill McDermott. The deal is being seen as something of a coup for SAP – which is nevertheless paying an approximately 20 per cent premium on Ariba’s pre-acquisition value – in that it both takes out its primary competitor and snaps up Oracle’s own leading competitor in the procurement applications space. It also creates huge disruption in the procurement ecosystem: as Peter Smith writes on Spend Matters UK/Europe, “we’re seeing the early stages of what is going to be a scramble as firms position, or in some cases re-position themselves, for the post-SAriba landscape. And the knives are coming out...” m&A Are you one of The Professionals? Take our quick Q&A http://ow.ly/b2xgv You might win an iPad and a bespoke mag cover! 12 www.outsourcemagazine.co.uk ●● http://www.ow.ly/b2xgv http://www.outsourcemagazine.co.uk

Table of Contents for the Digital Edition of Outsource Magazine Issue 28

News
Deep Thought
John Seddon
At Your Service?
Plenty To Chew On
The Power of Two
Big Data
Invested Outsourcing
Tim Cummins
NOA Round-Up
LPO
Managing Knowledge in a Partnership
A Long Way Still To Go
Recruitment Process Technology
Let’s Talk About Our Relationships
Welcome
Great Expectations
Transformative Technology
The Future of Rightshoring
Top Ten
The Legal View
HfS Round-Up
Offshoring
Online Round-Up
Inside Source
The Last Word

Outsource Magazine Issue 28