Earlier in the week, Ariba announced it was partnering with Wipro Consulting Services in a licensing deal. Ariba’s goal is to get the outsourcing firm’s consulting arm up and running on its sourcing application. Taken alone, the deal is unremarkable; Wipro Consulting is a rather small player on the global procurement-services stage. However, this deal might signal a change in strategy for Ariba, a provider that has struggled, in comparison to its competitors, to build a strong relationship with consulting providers. In light of this, it’s useful to note that in its announcement Ariba declares that “Wipro joins a growing number of companies that are teaming with Ariba to deliver spend management solutions to companies around the world.”
Clearly, rebuilding channel and consultant relationships is something that matters to Ariba going forward. Moreover, the global angle of this new deal is noteworthy, given that a growing number of companies appear to be considering non-local options for both consulting and outsourcing services. But before exploring that, let’s begin this analysis by exploring how channel business models work, and how Ariba and other services providers have treated this area.
Following the announcement, I traded emails with a handful of Ariba’s competitors to inquire about the specific number of active consultant/channel partner relationships under their belts. Now, this number is a bit fuzzy for a number of reasons, regardless of the vendor. In most cases, consultants become paid customers of the product. This is especially true when it comes to tools like sourcing and spend analysis that the consulting firm uses to drive its own revenue, versus implementing the solution for a client…
