Business is Better in the Ariba Commerce Cloud: Stories of Success from the World’s Leading Companies

©Copyright 2010 Ariba, Inc. All rights reserved.

ARIBA, Inc.807 11th Avenue

Sunnyvale, CA 94089

www.ariba.com

Buying. Selling. Managing trading partners and cash. On the surface, it seems pretty simple. But business commerce is anything but. Each year, companies like yours spend millions streamlining and automating processes within their four walls. But when it comes to collaborating with other companies, you’re probably still hampered by inefficient processes. And it’s costing you—and your trading partners—big money.

There is a better way. For more than 15 years, Ariba has helped companies drive more productive, effective, and collaborative commerce. Whether you’re looking to control supply chain costs, increase sales, minimize risk, or enhance cash flow and operations, Ariba delivers the technology, capabilities, and global community of trading partners you need to do it better than ever before.

More than 300,000 companies, including more than 80 percent of the Fortune 500, use the Ariba® Commerce Cloud to manage their commerce activities and optimize their operations. In the pages that follow, you can read many of their stories and learn how the Ariba Commerce Cloud can help you transform your results by controlling and optimizing your business relationships for maximum efficiency and effective financial performance.

Comprehensive Approach Yields £80M in Savings

CompanyBritish Airways

ProfileEurope’s largest airline

Ariba Commerce Cloud FeaturesAriba sourcing solutions

Ariba contract management solutions

Ariba procurement solutions

Challenges

• 10 percent operating margin goal

• Phased cost reduction of £650M, then £450M, then £300M

• £4B annual spending (350,000 orders/500,000 invoices)

Results

• Savings of more than £80M

- Average annual savings per procurement MPE of £380,000

• 80 percent of purchases processed electronically

- 4X increase in order capacity

- Transaction costs reduced by 40 percent

- Employee productivity improved by 48 percent

• Reduction in suppliers from 14,000 to 2,000

• Reduction in inventory by over £200M

Solutions

• Deployed Ariba sourcing technology to close the loop from sourcing to procurement

• Deployed Ariba contract management technology to link negotiated agreements with purchases

• Deployed Ariba procurement technology to automate purchasing of £1B indirect spend

“Working with Ariba has been instrumental in helping us realise our cost saving objectives, and demonstrating the critical role procurement can play when industry revenues are down. Moving forward, we plan to expand our use of Ariba Spend Management™ to ensure the whole company benefits from the new procurement process.”

Silla Maizey, Procurement Director, British Airways

Complete Savings Approach Cuts Sourcing Cycles to Six Weeks; Automates Compliance on $100M in Spending in Four Months

CompanySaks Incorporated

ProfileA leading retailer

Ariba Commerce Cloud FeaturesAriba sourcing solutions

Ariba contract management solutions

Ariba procurement solutions

Challenges

• $500M in spending on non- merchandise goods and services

• Reducing costs and increasing procurementefficiencies

• Manual, paper-based processes unable to scale

• Wanted uniform and visible spending processes

Results

• Six-week sourcing cycle times enable broader commodity coverage

• 10 to 20 percent savings on private label purchases

• $100M in non-merchandise goods orderedthroughAribainfirst four months

• Managing $6M in employee expenses

• Achievedfive-yearpayback projection in just two years

Solutions

• Deployed Ariba sourcing technology to streamline sourcing processes

- Find new suppliers, negotiate better contracts, lower costs

- Used a total landed cost model to include shipping fees, taxes, foreign tariffs

• Deployed Ariba contract management technology to electronically manage agreements

• Deployed Ariba procurement technology to automate purchase requisition and approval

- Integration with back-end systems

- Paperless invoice processing

“With Ariba Sourcing™, we accelerated our negotiating cycle time from an average of four months to six weeks, and saved millions of dollars during the first six months of use, realizing a unit saving of 10 to 20 percent off baseline prices. Online sourcing has positively influenced our private label margins. In addition, our eProcurement solution represents a centralized, compliance tool to help us realize those negotiated savings—directly affecting our bottom line.”

Management at Saks Incorporated

$166M in Savings Opens Door to New Marketplace Leadership

CompanyTata Motors Limited

ProfileThe largest manufacturer of commercial and passenger vehicles in India

Ariba Commerce Cloud FeaturesAriba sourcing solutions

Ariba sourcing services

Challenges

• Profitpressures

- Cyclical and shrinking consumer demand

- Increased competition as a result of reduced tariff barriers

• Achieving internal targets for

- Cost reduction

- Quality levels

- Delivery metrics

Results

• $166M in savings

• 3,000 sourcing projects that address $2B+ of annual spend

- Negotiation transparency supports the Tata Motors corporate code of conduct

- Reduced negotiation times and purchasing staff required

• Lower costs allowed creativity in pricing strategy for new model truck introduction, which resulted in immediate segment leadership

Solutions

• Deployed Ariba sourcing technology to execute online supplier negotiations

- Mandated most categories, including direct/indirect materials, be sourced online

• Utilized sourcing technology to create cost advantages for planned new vehicle

- 50 to 60 percent of new vehicle costs negotiated online

• Engaged Ariba services to understand buying patterns, constraints, and savings potential

- Focused on direct vehicle costs (75 percent of total costs)

- Identified project pipeline, schedule, and execution teams

- Category experts facilitated market-specific activities

Integrated Solutions and Standardized Processes Automate Payment Approvals and Cycles for $1.2B in Global Spending

CompanyIndustrial manufacturing company

ProfileGlobal specialty gas and chemical company

Ariba Commerce Cloud FeaturesAriba procurement solutions

Ariba invoicing solutions

Ariba Network for business collaboration

Ariba working capital management solutions

Ariba discount management services

Challenges

• Optimization of global procure-to-pay process

- Paper reduction

- Prompt supplier payment

- Recovering lost discount opportunities

• Interoperability with global single instance of SAP

Results

• Global spending under automated management increased from $708M to $1.182B

• Reduced internal approval time for invoice payment from 14 to < four days

• Reduced number of blocked invoices > seven days from ninepercenttofivepercent

• Increased payment discounts from < 50 percent to 79 percent ($300K savings)

• Improved days past terms from nine days to two days

• Inquiry calls dropped from 700/week to 285/week

Solutions

• Deployed Ariba technology to automate procurement of indirect materials

- Integration with SAP

• Implemented paperless invoicing

- Automated exception handling and approval workflow

• Implemented paperless supplier interaction through the Ariba Network with thousands of suppliers

End-to-end Online Commerce Process Reduces Service Calls by 40 Percent

CompanyStaples

ProfileWorld’slargestofficeproductscompany

Ariba Commerce Cloud FeaturesAriba Network for business collaboration

Ariba online catalog solutions

Challenges

• Large customer base of 66,000 companies (5M+ users)

• Desire to streamline the online order-to-cash cycle

- Create a superior shopping experience

- Increase program adoption rates

- Reduce manual intervention throughout the order process

Results

• 40 percent reduction in customer service calls

• 94 percent electronic and program compliance

• Online catalogs resulted in 10 percent reduction (200,000 books) in printed catalogs

• Processing costs reduced from $8 to $2 per purchase

• 99percentaveragefillrate

• 98 percent on-time delivery rate

Solutions

• Deployed Ariba technology to optimize electronic purchasing in combination with StaplesLink.com®

- Provided online catalog integration

- Now able to quickly update content and increase product variety

• Standardized customer integration methods

- New customer implementation in 30 days or less

• Implemented electronic invoicing for quick invoice delivery, routing, and approval “The Ariba Network is a dependable platform that gives Staples flexibility

to meet our customer requirements and allows us to continue to make the customer experience easy.”

Denis Kudriashov, Senior Manager, eProcurement, Staples

Global Network Fuels New Business While Saving 10 Percent in Marketing Expenses

CompanySupport Services of America (SSA)

ProfileLarge facilities maintenance corporation

Ariba Commerce Cloud FeaturesAriba business discovery

Ariba Network for business collaboration

Challenges

• Generating leads with Fortune 1000 companies

• Costly and time-consuming traditional lead generation methods

- Low response rate using direct mail, email, and telemarketing

- Mid-range company with finite resources

Results

• $50K savings in labor, travel, and marketing expense (10 percent of overall budget)

Solutions

• Deployed Ariba technology for more-effective lead generation

- Set-up time < 10 minutes

- Immediate access to numerous potential customers

• Quicklyidentifiednew opportunities

- Automatic notification of relevant high-quality RFPs

- Exposure to previously un-accessed market niches

• Used“AdvantageProfile” to differentiate against other suppliers

- Preferential search placement and expanded profile listing

“As a mid-range company with finite resources, it’s difficult to get our arms around a national audience and canvas Fortune 1000 companies. Ariba Discovery maximizes our resources. SSA anticipates that in two years we could bid on several times the amount of business we do today utilizing Ariba.”

Greg Bosserman, Vice President, Business/Program Development, SSA

Visibility Solutions Consolidate Disparate Data and Lead to £600,000 in Identified Savings

CompanyRexam

ProfileWorld’s second-largest consumer packaging group

Ariba Commerce Cloud FeaturesAriba visibility and analysis solutions

Ariba analysis services

Challenges

• Nearly £3 billion in annual spending

- More than 20 disparate IT systems world-wide

- Difficulty correlating and consolidating reporting and sourcing data

• No standardized data format

• Limited IT resources

Results

• £600,000intotalsavingsidentified:

- £100,000 office supplies

- £100,000 mobile telecommunications

• £400,000insavingsidentified within six months

• £200,000 in cash savings by managing payment terms

• Global dashboards

- Eliminated business unit finger pointing

- Source of trusted data

Solutions

• Deployed Ariba visibility and analysis technology

• Enrichedandclassified96percent of spending

• Custom taxonomy created to classify direct and indirect categories

- Aluminum, logistics, resin, capital equipment, utilities, packaging and freight

• Ariba services used to accelerate initial opportunity assessment

• SaaS technology deployment key to accelerating adoption of new product functionality

- Price indexes

- Embedded market knowledge to prioritize sourcing opportunities

“We are now leveraging Ariba Spend Visibility™ to collaborate better and to identify more opportunities for 2010. We expect to realize even-more savings going forward. Renegotiating and extending payment terms has provided significant cash savings as well.”

James Mortimer, Group Supply Chain Manager, Rexam

Automated Sourcing and Procurement Drive Savings throughout Entire Commerce Cycle

CompanyCVS Caremark

ProfileLargest prescription drug provider in the U.S.

Ariba Commerce Cloud FeaturesAriba sourcing solutions

Ariba contract management solutions

Ariba procurement solutions

Challenges

• Control spending associated with building new stores

- Required more-efficient purchasing processes

- Lengthy seven-day to 10-day cycle for supplier receipt

• Negotiating agreements for goods and services

• Creating and managing contracts

Results

• Users receive orders within four days

• Improvements in billing accuracy

• Reduction in reconciliation cycle time and processing costs

• Enterprise-wide compliance ensures negotiated savings reach the bottom line

Solutions

• Deployed Ariba procurement technology to streamline procurement

- New store construction

- Non-resale goods and services

• Suppliers receive orders within hours

- Productivity gains from using the kitting capability to bundle multiple catalog items into one line item

• Paperless invoicing eliminates re-work

• Deployed Ariba sourcing technology to capture savings opportunities

• Deployed Ariba contract management technology to foster cross-function collaboration (sales,finance,marketing,real estate, legal, procurement and IT)

“At CVS Caremark, we continue to look for ways to improve our sourcing and procurement capabilities and drive savings. Ariba’s on-demand solutions will help us accomplish this by providing technology, capabilities and best-practice processes that we can use to create a standard, automated process for sourcing from bid to contract, manage content and workflow and ensure compliance with our agreements.”

Anna Umberto, Vice President, Strategic Procurement, CVS Caremark

Automated Payment Processes Increase Discount Capture to > 90 Percent

CompanySports equipment manufacturer

ProfileOne of the world’s largest sports equipment manufacturers with global direct and channel retail outlets

Ariba Commerce Cloud FeaturesAriba working capital management solutions

Ariba discount management services

Challenges

• $600 million in spending across 260 suppliers

• Very complex services spending (marketing, retail stores, etc.)

• Broad inability to take advantage of early payment discounts

- Few negotiated agreements

- Low capture rate (35 percent)

- No opportunity for discount after initial discount day (i.e. day 15 for a 2 percent/ 15 net-45 term)

• Unable to capture ad-hoc discounts

Results

• Increased early payment discount capture to greater than 90 percent

• Increased early payment discount agreements by 20 percent

• Increased average discount to 1.5 percent (24 percent APR)

• Capturing discounts for four percent of targeted spend

• Over $1M in annual savings

Solutions

• Deployed Ariba technology to automate manual processes and capture discount opportunities

• Utilized Ariba services to speed implementation, optimize processes, and improve ability to act on discount capture

• Automated discount-related supplier interactions

- “Always Accelerate” and ad-hoc features

- Accelerate terms to every supplier

- Pro-rated term sliding scale to maximize capture

Network + Ecosystem Increase Sales by 20 Percent

CompanyMarkMaster, Inc.

ProfileManufacturer of marking and identificationproductsfor Fortune 500 companies

Ariba Commerce Cloud FeaturesAriba Network for business collaboration

Ariba online catalog solutions

Challenges

• Manual, paper-based transactions wereinefficientandcostly

• Gaining market share with limited budget

• No IT resources to develop electronic transaction capabilities

Results

• 20 percent year-over-year growth without incurring additional cost of sales or order management costs

• Gained national sales exposure although sales organization regionally focused

• 65 percent new client growth directly from Ariba Supplier Programs

• 50 percent increase in product line expansion with current clients

• 95 percent paperless transactions

Solutions

• Deployed Ariba technology to enable prospects to buy electronically

- Online catalogs

- Paperless invoicing, status updates and automated ship notices

• Obtained Ariba Ready silver-level certificationtovalidateMarkMaster’s online commerce capabilities

• Used Ariba Network to solidify existing relationships and develop new opportunities

“Being an online commerce expert has solidified our existing customer relationships, enhanced trust, and opened up many opportunities for new business. As an Ariba Ready Silver member, we have been able to expand our marketing opportunities to include events and exposure opportunities, regularly participate in Ariba LIVE, and last year alone picked up three new high-profile clients that total $1 million in sales over a 12-month period.”

Craig Moore, Customer Relations Manager, MarkMaster, Inc.

Web-based Supplier Discovery Service Delivers 22 Percent Savings

CompanyAeon Nexus

ProfilePublic sector management consultingfirm

Ariba Commerce Cloud FeaturesAriba business discovery

Ariba Network for business collaboration

Challenges

• Manual and lengthy supplier identificationprocess

- Reliance on searches using Hoover’s, Internet, or referrals

- Took two weeks for follow-up phone calls/emails

• Wanted to shift resources from identifying suppliers to qualifying them

- Desire to extend sourcing globally, including low-cost countries

- Need support for multi-language/currency projects

Results

• Price reductions of 22 percent to 30 percent

• Reduced time for supplier identificationfromtwoweeks to one day

• Using Ariba is a required step in the sourcing process

Solutions

• Deployed Ariba technology to improvesourcingteamefficiency

- Quickly identify global suppliers

- Access to deep information on capabilities

- Easily obtain bids from qualified suppliers

• Paperless communication via the Ariba Network to expedite supplier interaction and easily review contract terms and conditions

• Used for a broad range of goods and services

- Steel, chemicals, janitorial supplies, polyresins, IT, and gas cylinders

- School buses, police cars, and ambulances

“Ariba Discovery™ is a major time saver, and allows us to focus on delivering maximum value to our customers by quickly finding the best supplier that meets the requirements of any sourcing event. It’s transformed our business and I think every company can benefit by using Ariba Discovery.”

Thomas Pandola, Managing Director, Aeon Nexus

Receivables Auctioning Yields 50 Percent Better Financing Rate; Staves Off Cash Crisis

CompanySmedberg Machine Corporation

ProfileSupplier of equipment and solutions to improve metal stamping production

Ariba Commerce Cloud FeaturesAribareceivablesfinancing

Challenges

• An unexpected change in payment date put cash needed for holiday payroll at risk

• Small company without access to“largecompany”financial resources

Results

• Prevailing rates were less than half versus alternatives (example: factoring rates of 36 to 42 percent APR at the time)

• Payment within a day after auction closure

• Trustworthy solution with little risk and increased control

Solutions

• Engaged Ariba Receivables Financing to auction receivables for cash

- Fair and diligent application process

• Self-initiated process when cash needs arise

- Able to dictate auction time frames and acceptable discounts

- Flexibility to manage cash as payment terms stretch to net 45, 60, or more

- Able to avoid dependency on bank line of credit

“There are many suppliers who are in the same jam we were in; they’ve had nowhere to turn and no trusted source to help them with cash flow. And with all the drastic economic changes going on—which will continue happening in this industry—now there’s a place to go where you can feel comfortable, especially if you’re familiar with Ariba.”

Ken Smedberg, President, Smedberg Machine Corporation

Closed-loop System Shortens Contract Cycle Times

CompanyMedbuy Corporation

ProfileGroup Purchasing Organization (GPO) that negotiates agreements for healthcare providers

Ariba Commerce Cloud FeaturesAriba contract management solutions

Ariba sourcing solutions

Ariba procurement solutions

Challenges

• Disparate systems used across the purchase process for RFIs, contracts, renewals and reporting

• Lack of resources to maintain and grow a decade-old in-house application

• Savingsleakageduetodifficulty in tracking supplier rebates

Results

• Achieved targeted results within one year of implementation

• Contracting cycle times significantlyshortened

Solutions

• Deployed Ariba sourcing, contract and purchasing technologies as a single, closed-loop system

• Implemented paperless buyer- supplier transactions

• Developed customized tracking for rebate dollars against anticipated volume

“Having everything reside in one system, when it used to be in several different systems, makes the process significantly more efficient for us.”

Bill Bouwmeester, Vice President and Chief Financial Officer, Medbuy Corporation

“The contracting process, which might have taken six months before, has now been greatly reduced. What used to take two weeks now takes only 20 minutes with the push of a button.”

Cyndy Donnell, Chief Contracting Officer, Medbuy Corporation

Automation Increases On-time Payments to 85 Percent

CompanyFinancial Services Provider

ProfileGloballeaderinfinancialprotectionproducts such as life insurance and pensions

Ariba Commerce Cloud FeaturesAriba invoicing solutions

Ariba Network for business collaboration

Challenges

• Streamliningfinancialsettlement operations (procurement, invoice approval, payment)

• Needed improved collaboration between procurement and accounts payable

- Eliminate non-preferred suppliers appearing without approval

- Problems with supplier invoice accuracy

- Failure to meet on-time invoice payment objectives

Results

• Eliminatedfinger-pointing between procurement and accounts payable

• Enabled volume of paperless invoices to increase from fivepercentto40percent

• Increased spend under management from £1.5M to £180M

• Improved on-time payments from 50 percent to 85 percent

• Realized lower costs from improved compliance to contracts and preferred supplier policies

Solutions

• Deployed Ariba technology to automate payment operations

- Paperless invoice processing

- Standardized payment terms

- Improved efficiency and controls

- Best practices for supplier enablement and management

• Integration to the Ariba Network for paperless supplier transactions

- Mandated usage of new electronic process

- Ongoing training and communications for employees and suppliers to foster adoption

Advanced Order-to-Cash Capabilities Reduces DSO by 27 Days

CompanyFastenal

ProfileNorth America’s largest fastener distributor

Ariba Commerce Cloud FeaturesAriba Network for business collaboration

Ariba online catalog solutions

Challenges

• 2,300 stores worldwide (825,000 products each)

• Individual stores responsible for order accuracy, line item number, PO entry, and other aspects of electronicfulfillment

• Lack of integration of broad commerce practices with individual store transactions

Results

• Reduced days outstanding to 9.5 days (versus 37 days for paper invoices)

• Purchase order error rate reduced by 83 percent

• Real-time purchase order and acknowledgement delivery

Solutions

• Deployed Ariba technology to enable prospects to buy electronically

- Online catalogs

- Off-Catalog ordering and ‘Quote to Order’ functionality

- Electronic purchase orders, change orders, order cancellations, order acknowledgment

- Paperless PO-Flip™ and cXML invoicing

• Obtained Ariba Ready platinum- levelcertification,validating Fastenal’s best-in-class supplier capabilities

- New customer implementation in minutes

• Automated order-to-cash processes toreduceinvoice“daysout”and maximize discounts

“Ariba has received Fastenal’s highest ranking in terms of functionality, adaptation, and supplier on-boarding—a true benchmarked win-win for the customer and the electronically enabled supplier base.”

Keith Klos, E-Business Sales Manager, Fastenal

Online Procurement Reduces “Maverick” Purchasing from 80 Percent to 20 Percent

CompanyAvaya, Inc.

ProfileCommunications equipment and software provider for voice and data service integration

Ariba Commerce Cloud FeaturesAriba procurement solutions

Ariba procurement services

Ariba commodity services

Challenges

• Maximizing savings on indirect purchases

• Paper-based purchasing processes

• High amount (80 percent) of purchasesconsidered“maverick” (off-contract or non-compliant)

Results

• Maverick purchases reduced from 80 percent to 20 percent

• Company-wide adoption of paperless purchasing

Solutions

• Deployed Ariba technology to 17,000 employees for use in purchasing most commodities, primarily telecom, software and hardware

• Developed change management approaches to guide implementation and train employees

• Worked with Ariba to develop best practices for ensuring compliance and adoption

• Utilized Ariba Services to understand market trends for key commodities

“Ariba has always been ahead of Avaya in terms of what solutions or programs we need. What we do in our team is to try to keep pace with the changes Ariba makes to take advantage of their knowledge and experience.”

Joe Siciliano, Senior Manager of Procurement, Avaya, Inc.

Global Source-to-Settle Approach Yields Sourcing Savings of 15 Percent

CompanyAir Products and Chemicals, Inc.

ProfileWorldwide supplier of industrial gases, chemicals, and environmental systems

Ariba Commerce Cloud FeaturesAriba sourcing solutions

Ariba procurement solutions

Challenges

• Operations in more than 30 countries

• Sourcing tools lacked state-of-the- art capabilities

• Remote employees can’t easily buy what they need at the best prices

• Compliance with centralized contracts challenged by local relationships

Results

• Sourcing savings of 15 to 40 percent

• Decreased sourcing cycle times

• Compliance with national and ` global contracts

Solutions

• Deployed Ariba sourcing technology to manage supplier negotiations globally

• Deployed Ariba technology to enable employees to purchase using online catalogs

- One-click access to catalogs from the corporate website

- 40 unique catalogs covering business cards to cranes

- Catalogs based on centrally negotiated contracts

“With Ariba Sourcing, we have achieved savings from 15 to 40 percent. But one of the things that is most important to us is how the tool allows us to do business on a global scale for global projects, executed with global offices with global suppliers. With the advantages of speed, visibility and collaboration, what used to take four weeks now only takes two.”

Jeff Hoover, Strategic Sourcing Manager, Air Products and Chemicals, Inc.

Ariba, Inc. is the leading provider of collaborative business commerce solutions. Ariba combines industry-leading software as a service (SaaS) technology to optimize the complete commerce lifecycle with the world’s largest web-based community to discover, connect and collaborate with a global network of trading partners and expert capabilities to augment internal resources and skills, delivering everything needed to control costs, minimize risk, improve profits and enhance cash flow and operations—all in a cloud-based environment. Whether you’re buying, selling or managing cash, you can do it more efficiently and effectively in the Ariba® Commerce Cloud. More than 300,000 companies, including more than 80 percent of the Fortune 500, use Ariba’s solutions to drive more efficient inter-enterprise commerce. Why not join them? For more information on Ariba commerce solutions and the results they deliver, visit www.ariba.com.

Business is Better in the Ariba Commerce Cloud: Stories of Success from the World’s Leading Companies

©Copyright 2010 Ariba, Inc. All rights reserved.

ARIBA, Inc.807 11th Avenue

Sunnyvale, CA 94089

www.ariba.com