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Enterprise software developers SAP AG and Oracle Corp. are building up their respective wares to help manufacturers integrate internal design and procurement processes.

The goal of each effort is for manufacturing customers to reduce the costs associated with production by creating a seamless chain of information from conception through parts sourcing and procurement.

SAP, of Walldorf, Germany, is enhancing its MySAP SRM (Supplier Relationship Management) software with new modules for contract management, category management and public-sector-specific offerings, company officials said.

Due next year, the modules will close the gap between parts sourcing and procurement by seamlessly transferring information on commodity acquisitions into the user’s sourcing system. Over the next several years, SAP will further enhance data sharing within its suites by integrating SRM with its MySAP PLM (Product Lifecycle Management) and MySAP SCM (Supply Chain Management), officials said.

“We see enormous potential linking [SRM] into SCM, PLM,” said Manfred Heil, senior vice president of SRM at SAP. “We believe this [sourcing] interface provides the next frontier for taking out costs.”

Click here to read about Oracle’s plans integrate Grid computing and the 10g infrastructure software into its E-Business Suite.

Separately, Oracle is focused on bringing procurement and sourcing activities closer together with Version 11i.10 of its namesake E-Business Suite, which officials discussed at the Analyst Day event last week at Oracle, in Redwood Shores, Calif. The upgrade, due this summer, will offer new supplier interfaces, the ability to create complex procurement contracts, and the ability to represent complexity in pricing and negotiations.

At the same time, Oracle introduced Oracle Supplier Network, a free service that provides an interface for creating documentation that is traded between buyers and suppliers and that automates transaction flows between payables and suppliers.

Procurement professionals are demanding more-efficient handoff of engineering specifications to sourcing and procurement software.

“I haven’t seen anybody who’s linked the data that companies are exchanging with engineers and integrated that into a sourcing platform,” said James Polak, director of general purchasing at PPG Industries Inc., a diversified manufacturer in Pittsburgh. “It would be a heck of a lot easier if we could just integrate that [engineering] information into our e-sourcing [system].”

An Oracle E-Business Suite customer, Polak uses Ariba Inc. software for sourcing. Getting translation capabilities similar to Ariba’s in his enterprise software, though, could make Oracle 11i.10 more attractive, Polak said.

“If Oracle did it and did it right, the pressure internally would be to adopt whatever Oracle has,” said Polak.

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