SAP prescribes Ariba software for government’s procurement market

by Jochelle Mendonca

MUMBAI: Germany’s SAP is counting on its Ariba software to make a breakthrough into the government procurement market where it believes automation will be an effective anti-corruption tool.
“We are seeing that scams are driving people towards compliance and transparency. There’s no one person taking a discretionary call on who gets the business,” said Amit Bhatia, Ariba’s group director and head of sales for the Indian subcontinent.


Ariba, a cloud-based software which helps organisations buy and sell goods, was acquired by SAP last year for $4.3 billion (Rs 27,000 crore).


The company competes with IBM in this space. The company has more than 2,000 customers globally, of which about 200 are based in India.


The company’s cloud-based platform that connects suppliers with the customer over the internet, is being used by some 54 customers in India. “Our technology is still not used by the government in India. But that I think it will happen shortly. In the next one year, that’s our goal to ensure that companies that talk to the government and within the government, they begin to use Ariba. Those conversations have already begun,” Bhatia said.


A large portion of government process is still done through traditional paper-intensive tender system.


The Director General of Supplies and Disposals — central government’s procurement body — bought merchandise worth Rs 8,100 crore in the year to March 2013.


Bhatia declined to give further details about the talks as they were still in early stages.


Even without the government business on board, Ariba has bullish growth targets for the next year. At present, about $10-15 billion (Rs 63,000-94,500 crore) worth of procurement is routed through its software in India, an amount that the company aims to double in the next year.


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