E-Procurement
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This document provides an overview of e-procurement and its history and requirements. It discusses: - The evolution of e-procurement from EDI exchanges in the 1980s to B2B concepts in the 2000s. - How e-procurement aims to drive efficiency through automation, spend analysis, catalogs, approval workflows and reporting. - The key components an e-procurement system requires like segmentation, user-friendliness, integration, and coverage of the full procurement process. - The various players in the e-procurement market including ERP systems, best-of-breed specialists, and outsourcing companies.
E-Procurement
- 1. E-PE-Procurement by : Vincent Leroux Lefebvre PM MODULE
- 2. E-PE-Procurement E D I E-Sourcing E-Procurement ERP SaaS Cloud R.F.I R.F.P R.F.Q R.F.x Best of Breed KPI SLA E-Req. E-Cat P2P Cart ReportingSRM Spend Analysis E-Invoice Purchase to pay Contract Management CategoryManagement E-Auction Suppliers portals CSR One World, around corporate words Workflow E-Tendering B2B Design Cost Produce by : V.L.L for AUDENCIA PM MODULE
- 3. E-Procurement History Starting at the beginning of 80’s, EDI exchanges, recognized as a general standard, started to invade relationship between Suppliers and Clients. In 90’s the first AS 400 systems been introduced with workflows in order to provide information exchanges In 2001 experts and providers considered an evolution on inter enterprise relations and introduce B2B concept. Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement
- 4. E-Procurement History In the same time, groups, holding, and central started to organize Procurement function to allow cost reduction and efficiency. TCO (Total Cost of Ownership) is raised as a standard. For Companies, cost plays a huge impact on profit margin and start to take in account to be competitive Activities must be run and report efficiently to board in order to reduce T2M (Time to Market). Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement
- 5. Procurement Vision Drive by efficiency, the first families touch were automotive industries for direct activities. The past schema was observed as “procurement” to “E- Procurement” new scheme. Changing structure from MTS (Make To sale) to MTO (Make To Order) obliged to have an high reactivity. In the same time, Supplier Relationship was reduced to minimum actors number in order to erase "special deals" Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement
- 6. Delivery Past Procurement Vision Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Accounting Dept./ Cost Control Dept. Procurement Dept. Supplier Needs Quotation or ContractInternal Client invoice P.R P.O
- 7. Past Procurement Vision No needs anticipating and mutualizing No control on Purchasing Activities and Spend No Best Practices sharing Little or any negotiation Lack of communication Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement
- 8. Delivery E-Procurement Vision Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Accounting Dept./ Cost Control Dept. Procurement Dept. Supplier Internal Client invoice CATALOGUENeeds P.R / P.O RFx Quotation or Contract Needs Request Contract
- 9. E-PE-Procurement E-Procurement Vision Focus the use of the purchasing tool on a main CATALOGUE including specific and unused demand with user friendly application Facilitate approvals and workflows based upon B.U activities and mutualized with all needs. Ensure a collaborative approach to B.U
- 10. E-Procurement Vision P.R are P.O Order are issued on electronic way from different catalogues Workflow is placed at any level (B.U, Line, C.C,…) Easy approval system Reduce purchasing risk overlap on commodities and stocks Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Mainstream vision for Business as POWER
- 11. E-Procurement Vision No more purchase without approval and order Early knowledge for Project and activities Auto billing allowing a reduction in accounting activities Traceable activity by families, suppliers, products,… Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Mainstream vision for Purchase as NEAT
- 12. E-Procurement Vision Improvement of purchasing condition Productivity gains Overall improvement consumption Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Mainstream vision for Finance as IPO
- 13. E-Procurement Vision Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Full coverage Information processing User’s friendly Documents flow A full workflow Procurement segmentation Efficient Reporting Before any enrolment for the Full coverage: The five element's strategy
- 14. E-procurement Requirements Define a approval workflow where : Each actors (Requester, Controller, Approvers) are assigned and fixed with limits, Each roles and functions are defined, decision-makers hierarchy is in correspondence with the purchasing strategy. Hierarchy is fixed A full workflow E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE
- 15. E-procurement Requirements Procurement segmentation is : Each Purchaser is assigned to a Portfolio, Each article are defined, Each suppliers are linked to a segment, Purchasing hierarchy is fixed Procurement segmentation E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE
- 16. E-procurement Requirements IP user’s friendly : The opportunity for each employee authorized to formalize his own requisition, All request are archived, Open or restricted Catalogues are online and managed with segments, A overall overview and tracking for users Information processing User’s friendly E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE
- 17. E-procurement Requirements Documents flow : All documents are embedded in solution, Legal & GPC are linked with suppliers and segments, Assessment are directly issued Documents flow E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE
- 18. E-procurement Requirements Efficient Reporting : Integration of e-procurement tool to the enterprise information system, KPI are integrated in tool, Dashboard regularly communicated, Cross goal from Purchasing, CC, Consumption Efficient Reporting Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement
- 19. E-procurement Requirements A full coverage means a clear view of process : Macro process, Process, Sub process, Activities Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Process MappingCall :
- 20. E-procurement Requirements Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Process Mapping example for Direct & Indirect
- 21. E-procurement Requirements Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Process Mapping example for Direct & Indirect
- 22. E-procurement Requirements Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Process Mapping example for Direct & Indirect
- 23. E-procurement Requirements Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Process Mapping example for Direct & Indirect
- 24. E-procurement Requirements Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Process Mapping example for Direct & Indirect
- 25. E-procurement Requirements Produce by : V.L.L for AUDENCIA PM MODULE E-PE-Procurement Process Mapping example for Direct & Indirect
- 26. E-procurement Market’s E-Procurement ERP SaaS Cloud Best of Breed E-Req. E-Cat P2P SRM E-Invoice Contract Management E-Auction Suppliers portals E-Tendering E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE Outsource specialist
- 27. The E-Procurement market is addressed by various players of the software editors : Best of breed, ERP, Outsource Specialist, E-procurement Market’s E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE
- 28. E-procurement Market’s E-PE-Procurement eProcurement Suppliernetwork EIPP eSourcing Company Origin Cover SaaS On Premise Users Clients Baseware, Finlande France, Europe, US X X X X X 1 000 000 IKEA Grosfillex Heineken Renault Retail Proactis UK US, UK, Europe X X X X X 2 000 000 CBRE King Fischer FTSE Europecar I Valua, France France, US X X X X X ARCELOR MICHELIN SPIR ORANGE B-pack, France France, US X X X X X 30 000 AON Webhelp BUT International Bravo solution Italie Europe, Asia, US X X X X 50 000 SODEXSO AUTOGRILL AIR LIQUIDE MONSTER Hubwoo France Europe, US X Non X X X X SHELL HONEYWELL MICROSOFT Lawson's US Worldwide X X X X Esize Nthl X Non X X X X CAP GEMINI DOW COUPA US US X Non X X ADIDAS BNP PARIBAS Lawson's US Worldwide X X X X Ariba, USA Worldwide X Non X X X X 5 000 000 Purchasingnet US X Non X X X Verian US US X Non X X SciQuest US US, UK X Non X X BP DUPONT Leaders Performers * source Forester Produce by : V.L.L for AUDENCIA PM MODULE Best of Breed
- 29. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE Spend analysis K.P.I Reports Supplier Ref P.R E Bidding R.Fx Risk assess.t Contract Library Supplier Ranking E Bidding E-procurement Market’s Process & Workflow ERP E-Cat Suppliers portals ERP ERP Best of Breed
- 30. E-procurement Market’s E-PE-Procurement e-Procurement Suppliernetwork EIPP e-Sourcing e-Archiving Company Origin Cover SaaS Premise Users Clients SAP SRM7 Germany Worldwide X X X X X X X 2 000 000 Tarkett, Saint Gobain ORACLE PeopleSoft US Worldwide X X X X X X 1 500 000 ESILOR SNCF Société Generale Microsoft Dynamics US Worldwide X X X X X X Sage UK Europe, US, X X X HERAKLES France France, X X X 5 000 Comarch France Europe, US X X X X X 3 000 Printemps Company Origin Cover SaaS Premise Users Clients IBM BPO services US Worldwide X X X X X X Turner & Townsend US Worldwide X X X X X X Capgemini France Worldwide X X X X X X Fazer Produce by : V.L.L for AUDENCIA PM MODULE ERP Outsource specialist
- 31. E-procurement Market’s E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE ERP Infrastructure System Referential Documents Catalogues Suppliers Finance HR PLM SCMCRM P.M Spent Analysis Saving track Activities Dashboard Purchasing Performance MonitoringB.I RFI RFP/RFQ Timesheet management E-bidding Request For x (RFI/ RFP/RFQ)Sourcing Budget P.R P.U Good receipt Invoice Procurement FlowProcurement Supplier Portal Supplier Intelligence Risk Management Supplier Valuation Issues Supplier relationship ManagementSRM HR PLM SCMCRMFinance
- 32. Why E-procurement for indirect and non stock items No purchasing tool in place No approval procedures before something is purchased Improve invoice control This project should do the following: Implement SAP SRM and SAP ERP purchasing tools Implement an common, standardized approval procedure for purchase requests (shopping carts) in TWE division The smell, & the taste of SAP : not look like SAP E-procurement Case study : Tarkett (ERP) E-PE-Procurement
- 33. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE COMMITMENTS All purchasing process for services into sap; Provides interface with e-procurement system Better requester / approval acessability of quotation and purchase order; Enlargement to all locations with multi lingual and multimodal Administration of import process or interface with the current domestic program (microsoft access); Easier transfers of sap data to excel reports E-procurement Case study : Tarkett (ERP)
- 34. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Tarkett (ERP)
- 35. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE code Spend area code Spend family code Sourcing category Total 02 Total COGS 3.786.974 03 Indirect 02 Total Technical (included C433) 21.964.561 03 Indirect 03 Total IT & Telecoms 5.897.997 03 Indirect 05 Total Facilities management 8.273.828 03 Indirect 06 Total Marketing 11.722.334 03 Indirect 07 Total Intellectual services 7.171.012 03 Indirect 08 Total Human resource 1.920.123 03 Total INDIRECT 56.949.854 Total 60.736.828 Location Legal entity FR01 – Nanterre C433 Tarkett France FR04 – Templemars C433 Tarkett France FR01 – Nanterre C438 Fieldturf Tarkett DE01 – Frankenthal C214 Tarkett Holding GmbH NL01 – Breda C214 Tarkett Holding GmbH AT01 – Vienna C214 Tarkett Holding GmbH A multi spend categories and locations from plants to offices. E-procurement Case study : Tarkett (ERP)
- 36. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Tarkett (ERP) Diffrent purchasing process in order to respect local practice Sedan Flow Plant Nanterre – Frankenthal Flow Offices SRM Brazil office & plant SAP
- 37. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE A single portal with User inditification, A three step process, An activity overview, A central place for catalogues E-procurement Case study : Tarkett (ERP)
- 38. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE A direct acces to supplier catalogue A pick up on shopping cart E-procurement Case study : Tarkett (ERP)
- 39. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE A flow for approval based on Supplier data E-procurement Case study : Tarkett (ERP)
- 40. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Tarkett Approval workflow information through e-mail and/or application mail Application portal
- 41. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE All information are available on Approval Module E-procurement Case study : Tarkett (ERP)
- 42. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE When it’s approve information are in both system SRM Portal SAP transaction E-procurement Case study : Tarkett (ERP)
- 43. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Tarkett (ERP) Conclusion Today more than 2 000 users and used in 22 different countries More than 280 M€ in the system Indirect spend reduction from 5 to 7% Forecast are linked with expenditures and budget; Reports are used every week
- 44. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Sage (BoB)
- 45. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Sage (BoB) Why a P2P with E-procurement Develop 4 years ago by internal without Purchasing expert support, Sage ERP X3 has been turn to budget control tool with a workflow, Out « system » purchase are more than 20%, No Purchasing Dept. Validation , No families spent and product categories in place A tool not able to fulfil its function As all software editors Sage do not buy materials only indirect
- 46. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Sage (BoB) Two choices : Rebuilt Purchasing application , OR Find on market a Best of Breed (BoB) easily pluggable on Sage ERP X3
- 47. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Sage (BoB) A multi breed offer with SaaS and On premise solution FUNCTIONAL AREA RESPONSE Purchasing Performance Spend Analysis Bravosolution KPI Bravosolution Dashboard Bravosolution Procurement /Sourcing P.R / Need request Bravosol / Basware PM Suppliers database referencing Basware PM Catalogue Basware PM RFX (RFI, RFP, RFQ, RFx, …) Bravosolution Contract Legal room Bravosolution Suppliers performance Supplier qualification process Bravosolution Performance Assessment Bravosolution Risk Assessment & Issues Bravosolution E-Invoicing Invoicing Process Basware IA Capturing Invoices Readsoft Others solutions have been evaluated (b-pack, Ivalua)
- 48. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Sage (BoB) P.R or Need requests are maked and valid in Bravos/ Basware PM through Catalogue
- 49. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Sage (BoB) When it’s approved pruchase will sumit in RFx module from Baseware to Bravosolution and analyse in multi axis
- 50. E-PE-Procurement Produce by : V.L.L for AUDENCIA PM MODULE E-procurement Case study : Sage (BoB) Analyse in multi axis and send the order from Baseware as G.R (good Receipt)
- 51. Suppliers Workflow Purchase Order E-Procurement E-Procurement : What we can sum up from this E-PE-Procurement
- 52. Project Management Culture Cross Functional Approach Technical Functional Services Access to resources Strategic planning and resource allocation well define. Communication Communication Plan with all parties involvement E-Procurement : Success Factor’s E-PE-Procurement
- 53. Lexical M.T.S : Make To Stock M.T.O : Make To Order P.R : Purchasing Request P.O : Purchasing Order L.V.P : Low Value Purchases P2P : Procure to Pay K.P.I : Key Performance Indicator E-PE-Procurement R.F.I : Request For Information R.F.P : Request For Price R.F.Q: Request For Quotation R.Fx : R.F.I / R.F.P / R.F.Q B.U : Business Unit C.C : Cost Center G.P.C : General Purchasing Condition G.R : Good Receipt