ALOAUG Oct-2005

iProcurement Key to speedy processing

An implementation Case Study

- Seema Sharma

(Seema.Sharma@Patni.com)

Agenda
Overview of Patni Computer Systems Overview of Oracle iProcurement Implementation of iProcurement An Overview Implementation of iProcurement An Approach Implementation of iProcurement Final Results Whats new
Oct 2005

OAUG Fusion Council Member

Overview of Patni Computer Systems

Sustained Growth
27 years of consistent growth, 34% CAGR 4 years 181 active customers across 15 countries; 46 million dollar clients 24 sales offices, 10 global development centers Public listed company in India soon to be listed in the US Ranked amongst the 10 Best Companies to work for in India* Expertise in Verticals like Manufacturing, Insurance, Financial services, Telecom Packaged Solutions
Baan i2 JDE Oracle PeopleSoft SAP Siebel
* HR Study by Mercer and Business Today : December 2004

OAUG Fusion Council Member

Provide full life cycle solutions to customers adopting and working with Enterprise Applications packages
Delivering Business Value Comprehensive end-to-end solutions Mature delivery model Committed service levels Continuous process improvement Optimized customer ROI

Oct 2005

Partnerships and Associations

OAUG Fusion Council Member

i2 Solutions Partner - MDM

EPC Global Inc. Consulting Partner

Oracle CSP Member

OATSystems
Consulting Partner

SAP Consulting Services Partner

Manhattan Associates
Systems Integrator

Scanology BV

Siebel Consulting Partner

Systems Integrator

Power Paper Ltd

Consulting Partner

SSA Global
SSA Global Alliance Partner, SSA Source Code Partner

Lowry Computer Products

Hardware Partner

Oct 2005

Enterprise Value Chain Patnis Role

Business Processes

OAUG Fusion Council Member

Partners & Suppliers

Shop Floor Assembly line

Sales and Distribution

Stocking, Retailing

Business transactions

Channel partner collaboration, seamless integration

Procurement Mgt., Service Mgt., VMI

Shop Floor Mgmt., Procurement, Finance

ERP

Sales, Marketing and Distribution

Demand Planning & Logistics

Inventory Management
Inventory Planning & velocity

Performance and Scalability

Assessment, upgrade & support

BI, CDH, CRM, DW, Portals, SCM

Single View of the Customer Across the Organization

Oct 2005

Overview of Oracle iProcurement

Overview of Oracle iProcurement

Automates and centralized sourcing

OAUG Fusion Council Member

Paperless requisition generation and approval process - Key to speedier sourcing Extends requisition & receiving to a web front face Provides workflow based configurable approval and document creation processes Provides powerful catalog search engine Simplifies catalog loading XML or XLS Templates to capture additional information for purchase by item / code / category Allows usage as a shared service Simplifies system administration
Improve Service through Reduced Costs and Faster Cycle Times
Oct 2005

Implementation of iProcurement
An Overview

Business Objectives
Reduce procurement cycle time and transaction costs Enhance reporting and hence decision making Better contract management and spend analysis

OAUG Fusion Council Member

Provide an easy to use application for users and purchasing professionals Streamline order placement and tracking on a real-time basis Create a standardized procurement process across business units Identify preferred sources for materials and services Simplify procurement processes to ensure compliance Integrate with Oracle Financials
Streamline Business Procurement Process for Better Compliance

Oct 2005

As-Is Business Process

Ad hoc, non-streamlined procurement process
Many manual processes involved

OAUG Fusion Council Member

Purchasing department not in control Different departments ordering items/services from same vendor at different prices No traceability or audit Spend Analysis not possible, resulting in loss of savings Retroactive purchasing & maverick buying No control on charge account assignment No PO process for certain kinds of services No Control, Errors , Long Cycle Time
Oct 2005

As-Is Business Process

Start

OAUG Fusion Council Member

PO 1.0.0 Requestor creates Requisition

Capital Requisition? No PO 4.0.0 Operating Expense Approval Process

Yes

PO 2.0.0 Capital Approval Process

PO 3.0.0 Obtain Approval

PO 5.0.0 Forward to Materials Control

PO 6.0.0 Material Control Clerk tracks Requisition

PO 7.0.0 PO Agent determines sourcing

PO 14.0.0 Distribute copies to appropriate areas

PO 13.0.0 Material Clerk matches PO with Req.

PO 12.0.0 Material Control Clerk generates PO Purchase Order Copies PO 11.0.0 PO Reviewed by Manager of Materials Control

PO 8.0.0 Material Clerk creates Vendor and enters PO

PO 15.0.0 Material Clerk informs Receiving Department of PO

PO 9.0.0 Returned to Purchasing Agent for QA

PO 16.0.0 Receiving Department prints PO / Receiving Report

No

PO 19.0.0 Goods delivered to Requestor

PO 10.0.0 PO Approved by Agent of Materials Control

PO 17.0.0 Vendor Delivers Good

Delivered to Receiving?

Yes

PO 18.0.0 Receiving Department Receives Goods

20.0.0 Requestor verifies Goods and signs Receiving Report

21.0.0 Receiving Department Records Receipt

22.0.0 Receiving Dept. forwards Receiving Report to AP Department

End

Oct 2005

Implementation Fast Facts

Oracle iProcurement 11.5.9

OAUG Fusion Council Member

6 Months end-to-end implementation, 8-10 Consultants Executive management involvement Water Fall Method Dedicated PMO Dedicated customer team of business and IT users Weekly reviews by Steering Committee

Oct 2005

To-Be Business Process

Requestor
S ta r t

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2 .0 .0 C r e a te R e q u is itio n in e P ro c u re m e n t

3 .0 .0 A p p ro v e R e q u is itio n

S ta r t

1 3 .0 .0 E xpense P r o c e s s in g

No

Procurement

S ta r t

1 .0 .0 C r e a te R e q u is itio n

Am ount > 5000

Yes

4 .0 .0 C r e a te R F Q a n d C hoose V endor

5 .0 .0 P O C r e a tio n a n d P r o c e s s in g

Vendor

7 .0 .0 Vendor Sends In v o ic e

6 .0 .0 S h ip m e n t o f G oods

Accounts

Payable

1 0 .0 .0 In v o ic in g

1 1 .0 .0 3 - W a y M a tc h in g

1 2 .0 .0 P aym ent

2 - W a y M a tc h ?

No

Receiving

8 .0 .0 R e c e iv in g o f G oods

Yes

9 .0 .0 N o S y s te m R e c e ip t P ro c e s s e d

End

Oct 2005

To-Be Business Process - Requisitions

Start
Step 2 Login into iProcurement as Preparer/ Requester
Item found in Internal Catalog ?
NO

OAUG Fusion Council Member

Item found in External Catalog ?

NO

Enter Details on Non-Catalog Request

YES YES

Step 3 Add to iProcurement Shopping Cart

Step 3 Select required items from catalog. Add to cart

Step 4 Checkout Process (Enter Delivery Information)

Step 4 Check out from Vendor's site

Step 5 Checkout Process (Verify/ Modify Billing Information)

Step 6 Checkout Process (Enter Notes/Add Attachments)

Step 7 Checkout Process (Add ad-hoc Approver if required)

Make Changes & resubmit

Step 8 Review and Submit

Custom Workflow builds Requester's hierarchy and adds Special Approvers (Purchasing and Commodity Managers wherever applicable)

Approval Cycle begins

YES

Approved

Proceed to PO creation

NO

Oct 2005

Implementation of iProcurement
The Approach

Implementation Approach
Analyze As-Is &To-Be Analyze As-Is &To-Be Processes Processes Determine High Level Determine High Level Strategy & Approach Strategy & Approach Determine Catalog Presentation & hosting strategies Evaluate & Finalize Catalog Options Work out Punch-out Guidelines Hold Supplier meetings

OAUG Fusion Council Member

Plan Categories & Catalogs

Oct 2005

Implementation Approach
Define Define Setup & Supporting elements Setup & Supporting elements Define & Load Catalogs Conduct CRP 1 Freeze Workflow Modification Designs Develop Extensions & Workflow Solutions

OAUG Fusion Council Member

Test run on all Supplier Catalogs & P/O sites Training + UAT Deployment

Oct 2005

Implementation Details Customizations

Requisition approval workflow PO approval workflow PO auto create workflow Invoice approval integration with iProcurement PO email transmission to vendor Online funds check

OAUG Fusion Council Member

Oct 2005

Requisition Approval Workflow

Customized to include special approvers Approvers based on requisition type Approvers based on line type goods Vs services

OAUG Fusion Council Member

Adding cost center managers cost center editable on Charge Account Adding purchasing approvers and commodity managers (based on requisition amount) Implement timeout without supervisor escalation

Oct 2005

PO Approval Workflow
Integrate email solution Does not use 3rd-Party tool to e-mail PO PO as PDF attachment Sends copy of PO to buyers for information - automatically Sends attachments to suppliers along with PO

OAUG Fusion Council Member

Oct 2005

Auto Create Workflow

Auto create PO only for punch-out requisitions Populate suggested buyer based on the category
Each buyer mapped to multiple categories

OAUG Fusion Council Member

Oct 2005

Invoice Approval integration with iProcurement

Payables
Start

OAUG Fusion Council Member

Enter Invoice in AP

3 way matching on the PO ?

Yes

Match the Invoice QTY with PO QTY and Receipts QTY

Matching Successful?

Yes

Process the invoice for Payment (No Approval Required)

End

No

Payables

No

Release the HOLD with proper justification

No

Payables

2 way matching on the PO?

Yes

Match the Invoice QTY with PO QTY

Matching Successful?

Yes

Is the PO for Services?

No

Process the invoice for Payment

No

Yes

Payables

Process the invoice for Payment (No PO)

End

Notification to Requestor for Approval

Requestor & Requestor's Supervisor

Approve the Invoice

Oct 2005

Implementation of iProcurement
Final Results

Easy to Use Procurement Front-End

OAUG Fusion Council Member

Oct 2005

Browse Internal catalog

OAUG Fusion Council Member

Oct 2005

Punch Out to an External Catalog

OAUG Fusion Council Member

Oct 2005

Add a Non-Catalog item

OAUG Fusion Council Member

Oct 2005

Select and add item to Cart

OAUG Fusion Council Member

Oct 2005

Review and Submit

OAUG Fusion Council Member

Oct 2005

Process Comparison
Pre Implementation Ad hoc, not streamlined No Controls Cycle time 20 days De-centralized Purchasing No Matching on Invoices Long Payment cycles Error Prone- Paper based Processes Post Implementation

OAUG Fusion Council Member

Streamlined a/c organization Controls on Spend, Prices Cycle time 30 minutes to 3 hrs Centralized Purchasing Invoices Matched to POs & Receipts Fast payments, Vendor Discounts Paperless Processes

Oct 2005

Best Practices
Use of AIM Methodology Greater user involvement through multiple CRPs

OAUG Fusion Council Member

Detailed bulk loader guidelines for vendors with Item Price template Use of Workflow templates Addition of FAQ , help demo, handy information on home page Well defined Change Management Process Well established Tar Review Process Extensive QA dedicated teams for QA Use of Lotus Notes based Issue Tracking System Effective use of existing Intranet Portal to communicate with the users Go-Live Checklist, Dry run & Planning for Production rollout Planning, Processes, Methodologies: Key To Success
Oct 2005

Business Benefits
Reduced procurement cycle time from 20 days to 3 Hrs Avoid duplication of requisitions Eliminate need for paper based requisitions Speed up payments to suppliers better supplier relationships

OAUG Fusion Council Member

Better discounts from suppliers combined purchase across all business units Participate in transactions with web stores and marketplaces Consistent business practices across organization

Streamline Business Procurement Process for Better Compliance

Oct 2005

Challenges
Managing non-contract items from punch-out sites Integrate suppliers into the procurement process Customization Approval functionality Approver list displayed at checkout different from actual list Preparers hierarchy different than requestors hierarchy Approval hierarchy modifications made by preparer Delegation of approval to terminated employee Downward delegation to an approver

OAUG Fusion Council Member

Modification of Forward-To functionality to include just the F/T person in requestors hierarchy Content Management - Getting categories and catalogs right Email notifications in development environments Adoption of UNSPC categories structure to current needs

User Adoption To New Procurement Processes

Oct 2005

Whats New

Whats New - iProcurement 11.5.10

Integration with AME Reset password functionality Single / Express checkout process Save requisition during checkout process Smart Forms handy for non-catalog requests Procure to Pay lifecycle tracking Re-punch out capability

OAUG Fusion Council Member

Oct 2005

Whats New - iProcurement 11.5.10

OAUG Fusion Council Member

Services Procurement Control and automate your services spend Single point of entry for services requests using Smart Forms
Enforce usage of preferred suppliers, pre-negotiated rates, job skills Employees confirm services rendered / approve contractor timecards and can track to budget Self-billing to reduce invoicing costs

Complete supplier collaboration from negotiation through payment Maintain contractor performance repository

Oct 2005

Whats New - iProcurement 11.5.10

Procurement Contracts Embedded in procurement processes
Sourcing: negotiate best prices based on documented Ts and Cs Purchasing: require contract signatures prior to PO execution Access contract details from sourcing and purchasing documents

OAUG Fusion Council Member

Standardization and compliance

Simplified templates with pre-approved articles and standardized language Automated revision control and workflow-driven approvals Monitor buyer and supplier deliverables

Oct 2005

Q&A

Thank You
Contact : Patni Computer Systems, Inc.
E-Mail : eas@patni.com