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SAP Business Suite for Spend Management
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Automotive Industry at a Glance
The automotive industry, one of the world's most mature and sophisticated sectors, continues to evolve rapidly. With global car sales exceeding 79 million units in 2022, each vehicle requiring thousands of components, the industry faces significant procurement challenges. In APAC, countries like China, Japan, and South Korea are leading the charge in automotive innovation, with a strong focus on electric vehicles and autonomous technologies. Industry disruption is driving manufacturers to transform their business models in response to growing demands for digital experiences, new ownership models, and sustainable choices. The APAC region's emphasis on electric vehicles and mobility services aligns with these trends, pushing automakers to adopt lean, agile operations that can navigate commodity volatility and evolving customer preferences effectively. Success in this dynamic environment requires resilience, intelligence, and a forward-thinking approach to procurement and supply chain management.
Opportunities
45%
Whilst 45% of C Suite are highly confident in procurements ability to implement category management initiatives, only 14% see Category strategies as procurements primary value and only 20% are highly confident in procurements ability to deliver risk management strategies for different categories 51% identified AI and associated risks as a top risk priority for procurement, and 66% see Cyber and emerging technology as the biggest risk that will impact organizational strategy, yet only 17% see this as an issue for procurement which presents a risk for deeper supply chain if not included in due diligence.
51%
64% see Geopolitical risk as the top risk area for procurement to focus on, and 50% have identified supply chain reorganization as a top strategic priority for the next 18 months in response.
64%
57%
57% identified Gen AI as the top tech trend for the next 18 months to be piloted or implemented, but only 17% are highly confident in procurements ability to leverage AI for productivity and efficiency gains.
40% see cost savings as procurements primary value, and 72% say cost savings is the primary driver of increasing use of external workforce, with 51% identifying improving SOW management as the top priority for External workforce for the next 18 months.
40%
Source: Economist Impact study, The Resilient Edge – Procurement in an era of polycrisis
0.72 Days
Average Invoice Approval Cycle time
Best in Class Metrics*
Sourcing Savings Rate
Sourcing Cycle Time
13.3%
14 Days
*SAP Customer Benchmarking program
Spend Management Solutions
Automotive companies face distinct direct-sourcing challenges. SAP Ariba Direct Materials for Automotive & Industrial Manufacturing, in SAP S4/HANA Private Cloud transforms procurement by comprehensively addressing the nuances that surround unique sourcing requirements for highly engineered products. The solution and add on capabilities enable you to create products that not only costs less to produce but are also innovative, sustainable and high quality, accelerating time to market. Accelerate complex product launches with structured, multilevel procurement project management: Align sourcing with engineering, finance, and manufacturing milestones to ensure every part is sourced on time—before production begins. Drive innovation through deep supplier collaboration: You can collaborate securely with suppliers to co-develop components, share design files, and track material sustainability—empowering early supplier involvement and better product outcomes. Optimize costs via global demand aggregation and streamlined sourcing: The solution consolidates sourcing needs across ERPs and plants. This unified demand view gives you leverage to secure volume pricing, manage commodity volatility, and renegotiate efficiently. Ensure compliance with negotiated terms, without system complexity: Unlike disjointed S2P suites that don’t integrate to ERP, SAP Ariba enforces pricing, delivery, and index-based terms natively—without duplicating master data or relying on spreadsheets to monitor compliance. Advance sustainability goals through carbon-aware sourcing decisions: As sustainability becomes a procurement mandate, our suite enables you to evaluate carbon footprint alongside cost and quality when selecting suppliers. Seamless integration with SAP ERP—unlike traditional indirect procurement solutions The solution is purpose-built with the fundamental understanding that in the automotive and industrial manufacturing sectors, direct procurement is deeply intertwined with engineering, supply chain, and operational procurement processes—all of which are embedded in the ERP system. Unlike third-party solutions such as Ivalua or Jaggaer, which lack native integration with SAP ERP, SAP Ariba shares a common data model and codebase with SAP S/4HANA. This enables a seamless user experience, real-time visibility, and unlocks new possibilities to apply AI in the most effective and scalable way.
Spend Management Packages for SAP Business Suite
Automate spending processes and actively manage more spend for better control, greater value, and more savings
Spend Management Solutions
In today’s automotive landscape—shaped by electrification, supply chain disruption, and sustainability—procurement organizations must evolve from reactive buying to proactive, strategic sourcing. SAP Ariba Category Management delivers the tools and structure needed to make that shift. Strategic Control in a Complex Environment SAP Ariba Category Management offers automotive OEMs and Tier 1 suppliers a purpose-built platform to: 1. Build Data-Driven, Aligned Category Strategies: It provides a guided, best-practice framework for developing and managing category strategies that align with corporate priorities—such as cost reduction, risk mitigation, and sustainability. Category managers can proactively identify opportunities and plan with full transparency leveraging AI to speed up the category planning process. 2. Enable Global Collaboration Across Teams: Automotive supply chains are global and multi-tiered. SAP Ariba provides a single platform where category strategies are shared across regions, breaking down silos and ensuring consistent execution across business units and product lines. 3. Make Smarter, Faster Decisions with Embedded Intelligence: Integrated market insights, supplier performance data, and risk indicators help sourcing teams respond to changing conditions and anticipate disruptions—whether from raw material shortages, geopolitical events, or regulatory changes. Category Manager can leverage these insights along with AI generated “what if scenario” modelling to gain instant recommendations to respond to changing market conditions. 4. Embed Sustainability into Category Planning: Sustainability is no longer optional. The solution enables teams to include ESG criteria in supplier selection and strategy development, supporting compliance and reputation goals while driving long-term resilience. 5. Deliver Tangible Business Impact: Organizations using SAP Ariba Category Management have realized measurable improvements—up to 12% in cost savings, faster product launch cycles, and stronger supplier partnerships for innovation and co-development. SAP Ariba Category Management gives automotive companies the ability to manage complexity, align category strategies with business goals, and create supply chains that are agile, sustainable, and built for the future of mobility. It turns sourcing from a cost center into a strategic lever for innovation and growth.
Spend Management Packages for SAP Business Suite
Automate spending processes and actively manage more spend for better control, greater value, and more savings
Spend Management Solutions
SAP Fieldglass: Unlocking Workforce Agility for the Automotive Industry
The automotive industry is evolving faster than ever, driven by technological innovation, shifting consumer demands, and global supply chain complexities. To stay competitive, automotive companies must not only optimize their supply chains but also effectively manage a flexible and diverse workforce that includes contingent labor, contractors, and service providers. SAP Fieldglass offers a comprehensive, cloud-based Vendor Management System (VMS) designed to help automotive organizations gain full visibility, control, and agility over their external workforce.
Comprehensive Visibility and Control Across the Extended Workforce
Automotive companies operate with complex, global ecosystems involving contract workers, consultants, and service providers across manufacturing, R&D, engineering, and aftermarket services. SAP Fieldglass provides a single platform to manage all external workforce categories, ensuring real-time visibility into labor spend, supplier performance, and compliance risks—critical for managing cost and quality in automotive production cycles. Intelligent resume recommendations within the platform streamline the candidate selection process by aligning worker qualifications with role requirements, accelerating time-to-fill for technical and specialized roles.
Streamlined Compliance and Risk Management
With stringent regulatory requirements and labor laws varying across countries, compliance management is a significant challenge. SAP Fieldglass automates compliance workflows, enforces regulatory policies, and reduces risk associated with contingent labor—helping automotive companies avoid costly penalties and reputational damage while ensuring ethical labor practices. The platform also supports automated Statement of Work (SOW) translations leveraging generative AI, enabling faster localization of contracts and improved consistency across global operations.
Enhanced Workforce Agility to Meet Fluctuating Demand
The automotive sector is highly cyclical, with rapid shifts in production volumes and project needs. SAP Fieldglass enables rapid sourcing, onboarding, and management of contingent workers and services, allowing automotive firms to scale workforce capacity efficiently without compromising quality or safety standards. Joule for Fieldglass enhances responsiveness by allowing users to quickly generate or update SOWs through a conversational AI interface, reducing administrative overhead and speeding up engagement processes.
Optimized Spend and Supplier Management
Through robust analytics and reporting, SAP Fieldglass helps procurement teams identify savings opportunities, negotiate better rates, and manage supplier relationships more strategically. AI-driven insights improve supplier selection by analyzing performance history and cost metrics, helping ensure alignment with operational goals and compliance requirements.
Integration with Core Enterprise Systems for End-to-End Workforce Management
SAP Fieldglass seamlessly integrates with SAP ERP, S/4HANA, and other enterprise systems, enabling automotive organizations to unify workforce data with financials and supply chain operations. This integrated approach supports automated SOW creation workflows and improves forecasting and budgeting accuracy by aligning workforce activity with real-time project and financial data. SAP Fieldglass provides automotive companies with the technology and insights to manage their extended workforce with agility, compliance, and cost-effectiveness. By incorporating intelligent resume recommendations, AI-powered SOW creation and translation, and real-time analytics, SAP Fieldglass supports a more resilient and scalable workforce—empowering automotive firms to drive innovation and operational excellence in a highly dynamic market
SAP Spend Connect Virtual (recorded session)
Explore how direct materials procurement plays a pivotal role in sustainable growth, empowering BMW AG to bring profitable, innovative, high-quality products to market with scale and velocity. See how cross-functional collaboration and supplier integration in the design and sourcing process fuel continuous innovation and a competitive edge
Want to learn more about BMW's story, check out the recorded session from SAP Spend Connect 2024
BMW: Sustainable growth and innovation through direct materials procurement
Customer Story Maruti Suzuki
“ We are thrilled with the exceptional support provided by the support team for SAP Ariba Procurement solu- tions. Their expertise, dedication, and responsiveness have been instrumental in ensuring a seamless transi- tion nd maximizing platform adoption. Their commit- ment to our success has been truly impressive, helping us meet our objectives. We look forward to continuing our partnership. ”
Ram Garg , IT Vice President - Head of Function (IT Applications), Maruti Suzuki India Limited
Maruti Suzuki India Limited New Delhi, India www.marutisuzuki.com
Industry Automotive
Products and services Low-cost, flexible manufacturing of motor vehicles
Employees >10,000
Featured solutions SAP Ariba Procurement solutions
ThankYou
* Research documentation has been used from work commissioned by SAP Ariba and produced by Economist Impact
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