“The Top Eight SIs Are All Ariba Customers”

Keith Krach’s meteoric rise at GM from night-shift supervisor to youngest
VP is history. Before forming Ariba with five friends four years ago, Keith was
COO of a CAD software company. Manoj Chandran met up with Keith Krach in

How do you define a "marketplace"?
Just like in the real world, marketplaces are the online domains where buyers
and sellers come together. They could be vertical, such as paper and pulp, or
horizontal, such as some of our banking customers offering services to SMEs.

Are there industries that Ariba’s solutions are better suited to?
No. They are global, and span all industries. If you look at our customers,
we dominate the technology side and we dominate the financial sector. The other
area we dominate is systems integration. If you look at the eight major systems
integrators in the world, including Arthur Anderson, Anderson Consulting, IBM,
EDS and KPMG–they are all Ariba customers.

So these SIs are deploying Ariba solutions in the same way they do
enterprise apps such as ERP?
Yes, they are. We have our own professional services organization, where we
leverage our partners. In a sense, we are creating an Ariba economy, a big
league of systems partners, a kind of virtual organization. For these partners,
we provide them the methodology, in terms of what are the steps to get these
marketplaces up and running and directly in touch with our technology people.

The many B2B vendors have different marketplace solutions, while
enterprises attempt to connect all players in the supply chain through a common
business model. How do you resolve this contradiction?

Ariba is offering interoperability. We are trying to hook up different
marketplaces to each other and putting commerce services through those networks,
such as payments, sourcing, logistics, thus helping the buyers.

Is the B2B market overcrowded?
Well, I think the strong ones will survive. That is where our market share has
been really accelerating–it’s probably in excess of 50%. Our market cap is
twice that of our next two competitors’ combined.

Should there be a common place where B2B solution providers should come
together and offer their solutions?

Absolutely. Six months ago, we had the vision to bring IBM and Microsoft, two of
the biggest players, together and we made [the Ariba-Microsoft-IBM alliance]
happen. Now, you will see SAP, Commerce One, Arthur Andersen joining the
alliance. This will turbo-charge the market.

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