business workers in a meeting optimize spend management with SAP

How To Digitize and Optimize Spend Management with SAP

The acceleration of digital transformation improves business efficiencies with solutions such as SAP spend management

Companies of all sizes worldwide continue to prioritize spend management optimization operations since it is critical to maintaining cost efficiency in a post-covid economic environment.

Digitizing business processes across procurement, external workforce management, strategic sourcing, and supplier management with SAP spend management solutions allows organizations to achieve visibility and insights that can help control costs, reduce risks, and drive growth through innovation for their businesses.

What is Intelligent Spend Management?

Intelligent spend management takes traditional methods of enhancing business intelligence and transfers them to a streamlined software suite. This allows supply chain professionals to anticipate disruptions and threats, understand their markets, and deliver efficiencies that are impossible without the help of automation and digital analytics.

Organizations can use SAPs intelligent spend management tools to organize data, gain an enhanced view, shift budgets, and guide spending faster than ever before. Intelligent spend management isn’t just for large enterprises either. 80% of SAP users are small to medium-sized businesses. And with small businesses responsible for most jobs, implementing SAP spend management solutions is crucial to remain competitive with larger supply chain operations.

SAP Spend Management Solutions

The implementation of digital tools has increased the level of competition across nearly every industry as more advanced and automated tools are being brought to market. Companies that wish to compete with the top organizations in their sectors must deploy practical digital tools that increase visibility and overall cost efficiency. Digital spend management solutions from SAP can manage all categories of spend with the world’s largest business network and the market’s leading cloud solutions.

Supplier Management

Digitalization of spend management allows organizations to manage better supplier lifecycles, which leads to fewer disruptions. For example, organizations can reduce cycle time by automating supplier onboarding and integrating them with other procurement processes. SAP Ariba makes it easy to keep vendor data consistent with bidirectional synchronization between SAP ERP and SAP Ariba.

SAP Ariba also allows companies to assess their risk exposure by performing risk due diligence on their targeted suppliers. You can also enable proactive risk monitoring that will send customized risk alerts while monitoring regulatory risks and legal, environmental, financial, social, and operational risks.

It also has built-in brand reputation protection that keeps buyers away from risks so that their purchasing decisions don’t negatively affect your organization. And in case of exposures do happen, you can quickly mitigate risk with issue management, action plans, and workflow collaborations.

Strategic Sourcing

Strategic sourcing was once used interchangeably with the term procurement. However, today’s rapidly digitizing supply chain requires a source-to-contract process for intelligence to acquire direct and indirect materials. SAP spend management tools minimize contract leakage by integrating everything from product specification to contract management. It also allows organizations to improve volume pricing and predict final costs with increased accuracy.

SAP Strategic Sourcing Suite seamlessly shares data and enables demand-driven sourcing through materials and vendor management. Organizations also require advanced negotiation and supplier selection in an oversaturated market. Digitalizing spend management with SAP can increase cost savings while also selecting suppliers with highly granular insights about quality, responsiveness, and compliance.


Procurement teams need scalable and collaborative tools to help them validate, source, and approve special purchase requests as well as global procurement management. Spend management digitalization helps companies rethink the procurement experience. Moving toward a streamlined process that guides users to better options saves time, money, and resources. The SAP Ariba Catalog enables one-off purchases from previously vetted suppliers to control your custom business-to-business (B2B) marketplace.

With SAP, organizations can employ catalog capabilities such as collection, validation, enrichment, classification, and approval. Additionally, you can use rich content and application programming interface (API) integration to improve results and automate tasks like looking up data uploads and enterprise software system updates. The user-friendly interface simplifies both the purchasing process and the catalog creation process.

External Workforce and Services

SAP Fieldglass offers greater visibility and control with the ability to track all external workers by easily monitoring their activities, assessing their results, and sharing intelligence with relevant teams. Real-time data and analytics and improved asset and data security drive better decision-making with robust reporting and automated risk mitigation options.

It also comes with built-in tax and regulatory compliance capabilities that allow organizations to comply with regional and local tax and labor regulations and ensure compliance with the PCI-DSS security standards and government mandates in nearly 200 countries.

It was recently reported that 42% of the total workforce spend is on the external workforce, with more than half of that spending being focused on contingent labor. SAP offers several market-leading solutions that manage your global contingent workforce, administer services engagements efficiently, track all non-payroll workers, and assign multiple workers to one or more jobs.

Travel and Expenses

Digitizing spend management must be accessible, understandable, and compliant and drive innovation through automation to be more efficient. With SAP Concur, you can get a clear view into spending from anywhere and at any time so that you can cut costs, approve expenses, and get ahead of vendor payments.

The user-friendly interface provides a single end-to-end view of employee spending so that organizations can manage their budget, make more accurate forecasts, and make better strategic business decisions. It also comes with integrating spend data by connecting your corporate travel management ecosystem to see how much your organization is spending. This also allows companies to boost their compliance by booking travel plans and monitoring itinerary changes from a convenient mobile app.


Among their other powerful business applications, SAP offers several solutions for spend management. The digital transformation process depends on a few key components: expertise in digital systems, computational resources, and the amount of digital storage available to you.

The acceleration of digital transformation has taught us that integrating digital tools and automated resources wherever possible is crucial to improve efficiency in all business areas. To learn more about SAP, visit our SAP insights page, where you can access our SAP whitepapers, webinars, data sheets, and much more.