1. Ariba Knowledge Nuggets
Success for $1000.00, please!
What is a
KPI or
Key
Performance
Indicator?
Key performance indicators (KPI) are high-level snapshots of a business or organization based on
specific predefined measures. KPIs typically consist of any combination of reports, spreadsheets, or
charts. They may include global or regional sales figures and trends over time, personnel stats and
trends, real-time supply chain information, or anything else that is deemed critical to a corporation's
success.
The key indicators are agreed upon by an organization and are indicators which can be measured
that will reflect success factors. The KPIs selected must reflect the organization's goals, they must
be key to its success, and they must be measurable. Key performance indicators usually are long-
term considerations for an organization.
For KPI’s to be most effective, follow these suggestions:
• KPI must be actionable
• Measure against a goal or best practice
• Monitor frequently so that issues can be identified and corrected quickly
• Assign to an owner.

2. Why Measure?
During times of economic uncertainty, it is a
competitive necessity to ensure market
effectiveness and business efficiency. This requires
the continuous improvement of operational
performance across all key business processes and
value streams. Before improvements can be made,
all decision makers need a comprehensive
understanding of current performance as well as
the leverage points that can be used to positively
impact future performance.
By definition, KPI metrics measure aspects of the
business process or value stream that directly
affect results or outcomes. If KPIs are actionable
and monitored in a timely‐enough manner, they can be used to make operational decisions and
drive actions that can positively impact business outcomes in the current reporting period.
Spend Visibility Metrics
User Related Ariba Spend Visibility
# of trained users is your first step toward
# of addressees on scheduled reports identifying and eliminating
Spend Related maverick spending, fraud,
% Spend Coverage and other noncompliance
factors. Complete, accurate,
Data Processing Related
and continually up-to-date
Timely upload of new spend data
spend records help you
# of quality feedback issues submitted launch and maintain
Timely validation of enriched spend data compliance initiatives with
Timely validation of uploaded raw data both internal and external
% of Enrichment parties. Dashboards and
% of Targeted Data Sources covered reports keep all
stakeholders informed
Output Related
about contracts and
# of reports created
progress toward
# of Dashboard templates (role related) strengthening
# of reports run the bottom line.
# of sourcing opportunities uncovered

3. With Ariba Sourcing, you Sourcing Metrics
can make smarter sourcing
User Related
decisions and drive better
# of Active Suppliers
results. Manage supply
volatility and capacity # of registered Supplier
constraints. Minimize # of registered Buyers
supply risk with better # of trained users
supplier visibility. And build # active users
your sourcing pipeline with Project Related
tools that achieve early ROI
# of new projects per month
and long-term cost savings.
# of projects (cumulative)
Ariba Sourcing is
embedded with best # of Sourcing Projects per month
practices to give your team # of events per month per Type
an edge. Intuitive wizards Spend Related
guide users through project # of Categories Sourced
creation. Built-in tools and Spend volume processed per month
intelligence facilitate
Spend volume cumulative
collaboration and
Process Related
negotiation. Advanced
workflow and approval # of Sourcing Process Templates
routing streamline project # of custom RFx Templates
management and # of category specific items (cost breakdown tem-
compliance initiatives. plates)
Once you have good Key Performance Indicators defined,
ones that reflect your organization's goals, one that you can
measure, what do you do with them?
You use Key Performance Indicators as a performance
management tool, but also as a carrot. KPIs give everyone in the
organization a clear picture of what is important, of what they
need to make happen. You use that to manage performance.
You make sure that everything the people in your organization
do is focused on meeting or exceeding those Key Performance
Indicators. You also use the KPIs as a carrot. Post the KPIs
everywhere: in the lunch room, on the walls of every conference
room, on the company intranet, even on the company web site
for some of them. Show what the target for each KPI is and
show the progress toward that target for each of them.
People will be motivated to reach those KPI targets.

4. P2P Metrics Ariba P2P is the only SaaS solution
Process Efficiency Related that offers world-wide visibility and
Cost per Invoice complete control to manage both
FTE per Billion $ direct and indirect spend, for all
# Invoices per FTE goods and services. Optimizing
services procurement is one of the
PO utilization
quickest ways you can deliver more
Processing cycle time (hours)
savings to the bottom line. Along with
On time payment rates goods, Ariba customers save on
Process Effectiveness Related services like contingent labor,
First Pass match rate consulting, print, creative, legal,
# Invoices rejected direct mail, ATM installations, and
more. From source to settle, you can
% Contract compliance
manage it all with an automated and
% of suppliers representing 80% of Spend
integrated user-friendly system.
Standardization of payment terms
Contract Management Metrics
User Related
It's the paper that blocks your view. It # trained users
can be created in countless ways and # active users
filed in a myriad of places. But when # of registered users per user group
you make the move to electronic # active users per Ariba User Group
contracts, every contract is housed in Project Related
a centralized repository and retrieved
# new contracts per month
on demand with powerful search
# of contracts (cumulative)
tools. Integrated collaboration,
negotiation, and execution tools keep Spend Related
you posted as the agreement takes % of spend under contract
shape and becomes finalized. And # contracts versus # suppliers
with expiration dates and other # evergreen contracts
milestone events easily flagged, you'll average contract duration
stay alert to renewals and avoid
Process Related
supply chain interruptions.
# clauses in the library
# contract templates
# approval tasks completed per month