The Blockchain – Procurement Convergence

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The perks of leading the Go-To-Market Strategy on an in-depth, but extremely dynamic, SAP Portfolio at Capgemini are two-fold.

One, interesting discussions with industry think-tanks; Two, the opportunity to succeed in bringing to market the latest technology at play. As we head to Ariba Live in Amsterdam, I thought, beyond the SAP Leonardo & Digital Twins discussions, a post on Blockchain was pertinent. There’s no dearth of information or PoV’s (read this piece from Capgemini incase you missed it) around Blockchain. It’s no secret either, that Supply Chain and Procurement are witnessing fundamental shifts as we move into the digital era. It was only a matter of time before people realized the convergence of the two was imminent. It only made sense to get to the basics of Blockchain, and the Digital Transformation impact on Procurement & Supply Chain.

To oversimplify – Blockchain is what enables Bitcoin (or any other cryptocurrency) users, exchange ‘currency’ with each other while recording a full history of those transactions chronologically and publicly. It’s a digital ledger that continuously (in real-time) tracks records of every transaction taking place in a sequential order. These records are called blocks, and the linking of one to the other is what makes it a chain. How Blockchain is decentralised and records are encrypted is another story altogether. In this post I’ll focus on the Blockchain – Procurement affair.

A year ago, this report from Gartner showcased over a 130 different use-cases for blockchain across various industries! Blockchain is an internet-driven model of business. Now let’s add to this today’s Wall-Street’s pet favorites – platform driven business’s. Imagine a 2 sided platform business that has 2.5 million companies registered with 13 million users and transacting over 1 Trillion $ in commerce. The advantages are clear if they used Blockchain in their Procure To Pay processes – Higher traceability, trust, transparency and of course cheaper & easier audit of transactions! Let’s call this company SAP Ariba. Not hard to imagine anymore is it? Time to act.

While SAP Ariba figured this part and continues making partnerships with the nimbler Blockchain experts like Everledger and Hijro, the Centre of Excellence team at Capgemini is looking into how the Procurement – Blockchain – Ariba combination can digitize the entire transaction workflow with the Capgemini methodology. At Ariba Live you can see how we plug the gap on safety/security concerns while innovating the entire management of invoice payment and validation without the need of any 3rd party reconciliation. This includes executing automatically Smart Contracts, and verifying automatically the performance of suppliers against Service Level Agreements (SLA’s). Integrating the data from IoT sensors onto the SAP Cloud Platform we’re showcasing how the entire Supply Chain can be re-worked into a digital ledger to track the product lifecycle and everyone involved from source to end-user! The Fast Digital 4 Discrete Industries Play between SAP and Capgemini has resulted in newer offerings like the Smart Operations offering. Here we combine the concepts of Blockchain to IoT to Integrated Business Planning with the SAP Leonardo toolbox, bringing about end-to-end real time visibility of supply chain data and operations!

The Blockchain Procurement Supply Chain triangle goes beyond only tracking goods. Tying it together with IoT and the finance solutions to provide secure payments is the next step we will showcase! To know more, join my colleagues Guilheme PeaucelleOlivier Girerd, Valery Smague & me, Aditya, at Ariba Live 2018 in Amsterdam (April 23 to 25).

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