Companies paying more attention to supply chain management

Alex atzberger

Companies in China are starting to realize that supply chain management is a more integral factor in business success, especially as the global economy becomes more interconnected, said the president of SAP Ariba, whose products help companies manage their supply chains.

"We can help a small manufacturer in China connect to a larger business-to-business marketplace where they can sell and invoice their products," said Alex Atzberger, president of SAP Ariba, a unit of German software giant SAP.

Both private and state-owned enterprises in China use SAP Ariba, he said. "Our first customers in China were the multi-nationals setting up shop in the country. Now we have companies like Lenovo and Huawei that have a global footprint."

Atzberger said that companies need to understand their supply chains much better today because they are not just about getting materials and services to make products and perform services.

"It used to be that a company was only concerned with the quality and price of a product from a supplier. Now the company needs to know about the supplier's sources for materials and its labor and environmental practices," he said in an interview Sept 21 in New York.

Besides government regulations that demand sourcing origins and labor/environmental modes, consumers, investors, and workers also want to know more about how a product or service comes together, Atzberger said.

Risk is a factor that has also taken on a bigger profile in the supply chain, he said: "Our fastest growing solution last year was our risk management module as companies face risk from natural disasters like earthquakes and hurricanes and man-made issues like IT security."

If a company has suppliers in Mexico, it may have to come up with alternates quickly after the earthquake that struck the country earlier this week, said Atzberger.

SAP has more 5,000 employees in China. SAP Ariba opened its first data center in China at the end of last year and employs about 50 people, he said.

paulwelitzkin@chinadailyusa.com