Author Archives: thedoctor

Even Forbes is Falling for the the Gen-AI Garbage!

This recent article in Forbes on the Supply Chain Shift to Intelligent Technology is what inspired last week’s and this week’s rant because, while supply chains should be shifting to intelligent technology, the situations in which that is Gen-AI are still extremely rare (to the point that a blue moon is much more common). But what really got the doctor‘s goat is the ridiculous claims as to what Gen-AI can do. Claims with are simultaneously maddening and saddening because, if they just left out Gen-AI, then everything they claimed is not only doable, but doable with fantastic results.

Of the first three claims, Gen-AI can only be used to solve one — and only partially.

Procurement and Regulatory Compliance
This is one example where a Closed Private Gen-AI LLM is half the battle — it can process, summarize, and highlight key areas of hundred page texts faster and better than prior NLP tech. But it can’t tell you if your current contracts, processes, efforts, or plans will meet the requirements. Not even close. In fact, no AI can — the best AI can just indicate the presence or absence of data, processes, or tech that are most likely to be relevant and then an intelligent human needs to make the decision, possibly only after obtaining appropriate expert Legal advice.
Manufacturing Efficiency
streamline production workflows? optimize processes? reduce errors? No, Hell No, and even the Joker wouldn’t make that joke! You want streamlining? You first have to do a deep process cycle time analysis, compare it to whatever benchmarks you can get, identify the inefficiencies, identify potential processes and tech for improvement, and implement them. Optimize processes? Detailed step by step analysis, identification of opportunities, expert process redesign, training, implementation, and monitoring. Reduce errors? No! People and tech do the processes, not Gen-AI — implement better monitoring, rules, and safeguards.
Virtual Supply Collaboration
A super-charged chatbot on steroids is NOT a virtual assistant. Now, properly sandwiched between classical AI and rules-based intelligence it can deal with 80% of routine inquiries, but not on its own, and it’s arguable if it’s even worth it when a well designed app can get the user to the info they need 10 times faster with just a couple of clicks. Supply chain communicating? People HATE getting a “robot” on a support line as much as you do, to the point some of us start screaming profanities at it if we don’t get a real operator within 10 seconds. Based on this, do you really think your supplier wants to talk to a dumb bot that has NO authority to make a decision (or, at least, should NEVER have the authority — though the doctor is sure someone’s going to be dumb enough to give the bot the authority … let’s just hope they can live with the inevitable consequences)?

And maybe if the article had stopped there the doctor would let it pass, but
first of all, it went on to state the following for “AI”, without clarifying that Gen-AI doesn’t fit in the process, leading us to conclude that, since the first part of the article is about Gen-AI, this part is too, and thus is totally wrong when it claims that:

“AI” understands dirty data
with about 70% accuracy where it counts IF you’re lucky; that’s about how accurate it is at identifying a supplier from your ERP/AP transaction records; an admin assistant will get about 98% accuracy by comparison
it can “confirm” inventories
all it can do is regurgitate what’s in the inventory system — that’s not confirmation!
it can identify duplicate materials
first it has to identify two records that are actually duplicates;
and how likely do you think this is with a supplier mapping accuracy of 70%?
it can identify materials to be shared among facilities
well, okay, it can identify materials that are used across facilities and could be located in a central location — but how useful is that? it’s not because, first of all, YOU ALREADY KNOW THIS, and, second, IT CAN’T DO SUPPLY CHAIN OPTIMIZATION — THAT’S WHAT A SUPPLY CHAIN OPTIMIZATION SOLUTION IS FOR! OPTIMIZATION!!! We’ll break it down syllabically for you so you know what to ask for. OP – TUH – MY – ZAY – SHUN!
it can recommend ideal storage locations
again, NO! This requires solving a very sophisticated optimization model it doesn’t have the data for, doesn’t know how to build, and definitely doesn’t know how to solve.
it can revamp outdated stocking policies
well, only the solution of a proper Inventory OPTIMIZATION Model that identifies the appropriate locations and safety stock levels can identify how these should be revamped
it can recommend order patterns by consumption and lead time
that’s classical curve fitting and tend projection

And, secondly, as the doctor just explained, most of what they were saying AI could do CAN’T be done with AI, and instead can only be done with analytics, optimization, and advanced mathematical models! (You know, the advanced tech (that works) that you’ve been ignoring for over two decades!)

The Gen-AI garbage is getting out of control. It’s time to stop putting up with it and start pushing back against any provider who’s trying to sell you this miracle cure silicon snake oil and show them the door. There are real solutions that work, and have worked, for two decades that will revolutionize your supply chain. You don’t need false promises and tech that isn’t ready for prime time.

Somedays the doctor just wishes he was the Scarecrow. Only someone without a brain can deal with this constant level of Gen-AI bullsh!t and not be stressed about the deluge of misinformation being spread on a daily basis! But then again, without a brain, he might be fooled by the slick salespeople that Gen-AI could give him one, instead of remembering the wise words of the True Scarecrow.

Interrupt that Risk Event with Interos and Sustain Stable Supply Chains

Supply Chain risks are on the rise, as are disruptive events, and an event anywhere in your supply chain, even four levels down, can bring your operations to a halt if you can’t detect it, respond quickly, and take active mitigations. To this end, as chronicled in Part X of our Source-to-Pay+ Series that discussed Supply Chain Risk, a number of vendors have cropped up in the last few years around Supply Chain risks, but not all players are equal.

One of the first of the new breed of integrated supplier and supply chain risk players, and one of the most differentiated, is Interos. Interos was founded in 2005 by Jennifer Bisceglie as a consultancy focussed on helping organizations map out, understand, and get a handle on supply chain risk. Jennifer realized near the end of last decade that, with supply chains becoming so long, so complex, and so interconnected across the digital, financial, and physical realms, that technology would be needed to support organizations in this effort.

The core team knew that in order to do this, they’d need a completely new type of technology, so they sought out a new team to build one of the first outside-in business relationship graphs using trade data, third-party data sources and artifacts (such as ownership data, executive data, etc.), and even press releases. Then, on top of this relationship data, they’d need to layer risk data to help an organization identify risks in the supply chain. This would involve capturing risk events as well in order to help them understand which clients may need to be notified and/or use the Interos platform to gauge the extent that a risk event may impact them. So that’s what they built — at a global scale.

Interos has built a business relationship (knowledge) graph that connects 11 Billion relationships across 410 Million companies. These companies are then risk scored against 230+ attributes across six (6) different categories of risk: Finance, Geo-political, Restrictions/Sanctions, ESG, Cyber, and Catastrophic, depending on the extent of information available. At a minimum, they track country/industry level risks and will use that when there is insufficient data to assess the specific company risk against a specific attribute. Based on the assessment of each risk, Interos will compute an overall i-ScoreTM from 1 to 999, with lower scores being higher risk. It will then scan your entire network, from sink to source, and identify all high risk suppliers for you.

The Interos Resilience platform, which processes tens of thousands of sources and over 3 Terrabytes of raw data daily, constantly monitors for new relationships, information, and (related) events that could pose a change in an entity’s risk status, as well as indicate the presence of a (potentially) catastrophic event, including a natural disaster or a cyber-attack. For each of the six risk domains, the platform scans for a number of factors, sub-factors, and individual attributes. We’ll cover the primary factors in this post, and if you have a particular area of interest, you can always drill in during a demo or discussion with Interos.

With respect to Finance, the platform looks for the following:

  • Liquidity: Cash, Working Capital
  • Solvency: Assets, Capital Efficiency, Credit Rating, Debt Coverage, & Leverage
  • Profitability, Debt Coverage, & Valuation

With respect to Geo-Politcal risk, the platform looks at the following:

  • Political Instability
  • State Capacity
  • Political Process
  • Economic Rights
  • Socio-Economic Development

With respect to Restrictions/Sanctions, the platform looks at the following:

  • Sanctions (USA, UK, EU, etc.)
  • Associated Sanctioned Individuals
  • Import/Export Embargos
  • Associated Regulations

With respect to ESG, the platform looks at the following:

  • Environmental Performance
  • Social Commitment
  • Governance Strategy

With respect to Cyber, the platform looks at the following:

  • System Attacks (compromised accounts, cyber-attacks, data spills, etc.)
  • System Vulnerabilities
  • Supply Chain Cyber Events
  • Cyber Compliance
  • Cyber Threat Activity

With respect to Catastrophic risk, the platform looks at the following:

  • Localized Natural Hazard and Disaster Risk
  • Communication Capacity
  • Healthcare Capacity
  • Infrastructure Capacity
  • Burden of Disease Risk

Based on all of this, the platform is very useful for companies that need to perform

  1. Supplier due diligence
  2. Continuous related party monitoring
  3. Real-time catastrophic event detection

Interos is one of the most complete supply chain risk intelligence platforms for supplier due diligence. The ability to quickly screen a supplier on six highly relevant domains can give an organization confidence that the organization understands the risk profile of a supplier before onboarding it, which is not something you can get from a traditional credit score or an empty search on sanction lists.

Interos is one of the few platforms that can be counted on for continuous related party monitoring as it processes over 3 TB (Terrabytes) of data a day, constantly updates risk scores and related events for affected entities in the system, and can propagate updates through the business relationship graph in real time.

Interos is also one of the few platforms that can be used to do real-time catastrophic event detection where the event is not limited to a single event type, as the platform monitors for natural disasters, man-made disasters, bankruptcies, and cyber incidents — some of which Interos can detect before anything is reported due to a change in organizational behaviour — and it can immediately propagate news of events or risks to one of the 410M+ business entities it tracks to all impacted clients who can use their relationship explorer to identify all the links it has to the company.

For example, if there’s a fire in a raw material or component factory (which seems to happen in one of the few major RAM suppliers every decade — just do a few historical Google Searches if you don’t believe me) two (or three) tiers down the chain under your tier 1 supplier, you can immediately map out all of your tier 1 suppliers that trace down to that factory and make sure they have enough stock on hand to continue producing your products until you expect that factory to come back online (by either instructing them to immediately secure additional stock on your behalf or doing so for them) well before your competition realizes there’s going to be a disruption a week down the road when the plant is announced shut down and it finally trickles down to local news half a world away.

The platform monitors and tracks natural disasters globally down to a gird of 10 km squares, as well as potential paths of storms, waves, and fires, and can thus immediately identify each business entity that is likely to have been impacted as well as each business entity that is likely to be impacted if a natural disaster (such as a storm) continues its course. Thus, if a tsunami hits the coast of Japan, it can allow an organization’s incident response teams to immediately identify just those organizations in Japan in the area the wave hit and allow it to focus its efforts on just those suppliers, vs. having to reach out to and assess every supplier in Japan, of which it may have hundreds if it is in electronics when only ten were in the immediate area. The time savings alone is incalculable. (And, of course, if an earthquake hit a province in China, it would take an army of consultants months to figure out precisely what suppliers were close enough to the fault line to likely have suffered [significant] damage vs those far enough away to only feel minor shaking whereas the Interos platform will calculate all of this in just a few minutes.)

However, one of the most unique risk monitoring capabilities lies in its proprietary digital behavioural modelling that can often detect when an organization has experienced a potential cyber-attack, breach, or data theft and alert customers to that potential cyber-incursion days, or weeks, before the organization announces a breach and/or it makes the news. Using the business relationship graph, this immediately allows an organization to determine every first-tier supplier that relies on that organization. The organization then has to determine if any of those suppliers has access to the organization’s financial account information, personnel data, or confidential intellectual property. Those tier 1 suppliers that do need to be immediately approached and asked if any of that data was shared with, or accessible by, the sub-tier supplier that was breached, or affected by. If so, the organization can immediately start taking mitigation actions before they themselves are the target of a cyber attack.

The platform is very easy to use. When a user logs in, they see a summary of their full supply base and multiple sub-tier relationships (which for a multi-national with tens of thousands [10k+] of tier 1 suppliers can be hundreds of thousands of tier-3 suppliers). The user can see the number of suppliers by tier who are high risk, medium risk, low risk, and, possibly, unknown (as it’s a brand new supplier where there is little to no information on that supplier). Note that the number of “unknown” suppliers will typically be really small, and for most truly global companies with 500K global suppliers in their extended supply chain, the unknown will be significantly less than 5K (usually 0.5% or less).

(Note: If more than 1% of your extended supply chain falls into high risk, you have some serious problems. In a good supply chain, the vast majority of suppliers should be low risk (> 95%) with a small percentage medium risk, preferably no high risk, and preferably no unknown.)

You also see a breakdown of risk by

  • each of the six (6) risk domains, which lets you see if there is a particular risk concentration,
  • average risk by groups of interest (which could be country, product line based, strategic suppliers, etc.),
  • a summary of natural hazards and disasters currently being tracked, both visually and textually (which shows the number of potential tier 1, 2, 3+ suppliers that are potentially impacted)
  • a visual summary of the most relevant current events being reported on (with links to full articles in third party sources), and
  • a quick link to the relationship explorer tool that will let you find all of your connections to an entity of interest

When you select a category of high-risk suppliers (overall or by category), it will bring up a list of companies with their individual i-Scores that you can select to to bring up their complete risk scorecard (if you have unlocked their scorecard; depending on your subscription level, you have so many credits that allows you to unlock that many scorecards; you can buy more if you need, but most since most companies don’t need to evaluate more than a small percentage of tier 2+ suppliers, their packages are usually sufficient). The scorecard summary will summarize the score in each of the six areas, and will allow you to drill down into the factors, sub-factors, and individual attributes that are known and scored (and contribute to the overall score), which include those discussed above.

The scorecard will also summarize company corporate data (industry registrations and codes, locations, etc.), its tier 2 and tier 3 relationships and risks, which can be filtered to all known relationships (in your extended supply chain), as well as all events (and related sources) that have been detected that are relevant to that supplier entity. If a risk score is low (or suddenly drops), you will have access to all of the data that contributed to that score to make your own judgement (and jump-start your investigation).

The platform also has a geographic view of natural disasters that is interactive and allows a user to drill into a region, filter on natural disaster type (earthquake, tropical storm, volcanic eruption, etc.), and even project a few days in the future (if the disaster is a tropical storm, cyclone, tsunami, etc. and there is forecast data available from Interos‘ 3rd party, or public, sources). In addition, it can be used to look at historical natural disaster and weather event data, which goes back between 50 and 200 years, depending on how much historical data is available for the region, as well as the risk of each natural disaster type (wildfire, drought, earthquake, flood, etc.) in the region base on all of this historical data.

And the relationship explorer is likely the most useful part of the platform because, if a risk event is detected, such as a natural disaster or a cyber breach, you can instantly trace all of your active relationships to that company, and immediately start the process to determine if these tier 1 (and tier 2) suppliers will be impacted, and, if so, the degree to which you’ll be impacted. Not only will you know about an event days, or weeks, sooner than you would know without this platform (and by then it may have been too late to find an alternate source of supply or protect your data), but you can limit your discovery and mitigation efforts only to suppliers that might be affected, versus doing massive surveys and reach-outs (that can take days or weeks) to find out who might be impacted in the first place.

Interos is a one of the most powerful, and complete, risk intelligence platforms out there and one that should definitely be on your shortlist if you’re looking to get 360-degree visibility into your supplier, and supply chain, risk.

The Supply Chain is Full of Hidden Risks

A recent article in the Supply Chain Management Review by Avetta provided Insights for Procurement Leaders on tackling hidden risks in the supply chain. As per the article, supply chains are full of:

  • Geographic Vulnerabilities
  • Cybersecurity Threats
  • Ethical and Compliance Issues
  • Financial Instability
  • Environmental Recklessness

… and all of this poses a major risk to your supply chain. Avetta‘s baker’s dozen of recommendations are to:

  • conduct due diligence on all level of suppliers
  • identify alternate sources
  • monitor geographical developments
  • prioritize cybersecurity measures
  • conduct regular risk assessments
  • foster a culture of cyber awareness
  • establish clear codes of conduct
  • regularly audit supply chain partners
  • prioritize transparency and accountability
  • rigourous financial due diligence
  • monitor key financial indicators
  • prioritize sustainability initiatives
  • establish robust contingency plans

And these are all good, but most of the risk results from one thing:

  • lack of timely, accurate data on
    • the physical supply chain (people, plants, product, vehicles, etc.)
    • the financial supply chain (the financial state of suppliers, contractors, employees, etc.)
    • the information supply chain (completeness, accuracy, security, etc.)

This says that if you really want to tackle the hidden risks, you need to start with the following as you can’t tackle anything you can’t identify:

  • supply chain visibility — map every entity in your supply chain
  • external risk monitoring — whenever a geographical, political, environmental, or cyber disruption happens anywhere, and is reported, you need to detect that, identify all entities that may be affected, confirm which entities in your supply chain are affected, and take an appropriate mitigating action
  • cyber network monitoring — you need to monitor your entire network, every server, every client (desktop, laptop, tablet, AND cell phone), every router, every API end point, and every wire … your weakest link is your effective security
  • cross-system and account financial monitoring — money disappears when there are holes for it to fall into; holes exist when you have disconnected P-Card, e-Procurement, and AP systems, especially across divisions and you aren’t correlating balances between transfers, bank accounts, and investments on at least a daily basis
  • activity monitoring — all waste, loss, and fraud is the result of a bad actor, whether or not the bad acting was intentional (hint: if the loss is significant, it usually is intentional; incompetence often only results in minor loss); but you can’t monitor everyone, even if you wholly operate in a jurisdiction where doing so is legal; but, when everything is digitized, you can monitor every action, whether or not is in accordance with policy, flag everything that isn’t, and escalate any actions that are against policy that should be investigated

As you detect issues and disruptions, you can start with standard mitigation actions, and as you identify patterns of commonality, you can identify additional contingency plans, which you should already have for every product or service that is critical to your operation.

Note that Sourcing Innovation has published a list of 55+ Supply Chain Risk Vendors that already have solutions that do a lot of this monitoring. There’s no excuse for your organization not to have at least an 80% solution in place today.

Vroozi: Address the Bluesy of your Procurement Problems With a Solution That’s Doozy and Approved by the Choosy! Part 2

Our last post began our discussion of Vroozi, a modern P2P solution that is usable by all organizations of al sizes regardless of where they are, what devices their people use, and where they are in the Procurement journey. Vroozi offers an extensive P2P++ solution that is enterprise grade (and used by some of the largest companies in the world) but that is also priced for the mid-market (that they started out to serve). Yesterday we covered the core e-Procurement and Invoice Management capabilities. Today we’ll cover Payments, the Supplier Directory, Analytics, Platform Administration, and the Supplier Portal.

Payments

Unlike many P2P vendors who stop at okay to pay, Vroozi integrates with NvoicePay and CorePay, can push payments into those platforms, actively monitor status, and then pull out changes to payment status as they occur so a buyer, and supplier, can always see the status of any payment.

Cheques, ACH, Wires, and/or V-Cards

Depending on your payment system, Vroozi gives you multiple options for payments and allows you to specify which payment method is to be used by the payment system.

Taxes

The platform is capable of verifying taxes, as it integrates with Avalara and Vertex out of the box. Thus, if the customer buys a subscription to one of these platforms, Vroozi will use them to automatically maintain up-to-date global tax rates, as well as track any tax exceptions and waivers (as overrides) that you have based upon your global status. It can also track all of the taxes that you owe and simplify your tax management. Alternatively, if you don’t have these subscriptions, you can set up your standard rates in the Taxes area under Master Data Management. but if you do a lot of global business at a lot of different locations, this is not recommended. (Also, if you purchase a subscription to Avalara or Vertex after Vroozi installation, you just need to provide your access details in the Vroozi Connectors Manager.)

Supplier Directory

Supplier Management maintains a copy of all suppliers being transacted with by the organization and the records contain basic company info (name, address, primary contact channels), business information (business and tax ids, company attributes [for catalog/search enhancement], categories, payment terms, geographic service area, sustainability notes, description), insurance info (by insurance type with policy numbers and expiry dates), supplier contacts, PO submission method (platform, email, etc.), and related contracts.

Vroozi is not designed to be a supplier master — as most organizations use their ERP or a specialist SXM platform with deep supplier relationship, performance, compliance, or risk — functionality, but is designed to maintain all of the relevant information on active suppliers for purchasing in the P2P tool, and can push updates back to the source system, as most updates will come in during Procurement efforts.

One of the unique capabilities of the platform is the ability to configure all of the electronic supplier interactions through the supplier management screen — where the buyer can define how to send POs, confirmations, and RFQs to the supplier; (whether or not and how it will) receive PO acknowledgements, change requests, (advance) shipping notices, invoices, etc. from the suppliers; how m-way matches will be made; how payments will be made, etc. The electronic interaction with every supplier can be configured to a very fine-grained level, as well as the control a supplier has in their portal.

Contract (Meta) Data Management

Contract (Meta) Data Management in Vroozi is on a category and item basis, as each catalog, or item, can have an associated contract. Vroozi is not a CLM system and makes no claim to be such, but understands the importance of tracking relevant contract terms in the P2P system, as well as the source documents in case the need arises.

Analytics

Analytics in Vroozi is powered by Looker that provides out-of-the-box reporting dashboards on spend, suppliers, documents, catalogs, user, and master data as well as a dashboard custom designed for AP Managers that provides easy access to invoice, memo, and PO data. Vroozi is not a full spend analysis platform, nor is it claiming to be one. If you need help with historical spend classification and categorization, or a standalone spend analytics platform, they work with Spendata, which we have covered here on Sourcing Innovation in 2018 (Don’t Throw Away That Old Spend Cube! Spendata Will Recover It For You) and this year (The Power Tool for The Power Spend Analyst, Now Usable By Apprentices As Well!).

Vroozi also supports report subscriptions and most users choose to get their pre-configured reports through email on a regular basis. The platform comes with a large number of basic reports where the user can define the data subset and fields they want to see and the report will be generated and sent to them.

Administration

The self-service administration capability in the platform is quite extensive.

Catalog Management

The company can define as many catalogs as it wishes, including multiple catalogs for the same supplier if they want to customize catalogs for sub-companies, departments, regions, or some combination thereof. Catalogs can be created and updated from CSV files or manual on-screen definition (on a product by product, or service by service, basis). When a new catalog (update) is being worked on, it is in a working state. Once the updates are completed, if the user has catalog manager authority, it can go into an approved state, and, if not, it goes into an approval queue. (Suppliers can be given permission to manage their catalogs, but all of their updates automatically go into an approval queue.) Once approved, the catalog can be pushed to live, scheduled to go live at a certain date and time, or held until the organization is ready to publish. All data and meta data regarding catalogs and items can be accessed and maintained in the Vroozi Content Manager.

Workflow & Rules

The rules for email submission, document submission, and approval can be organization defined and maintained quite easily. It’s very easy to define email aliases and user group targets for communication and refined rules for structured document submission (invoice, shipping notice, etc.) which can be routed based on company codes, plant codes, cost centers, and other organizational details enabled in the Accounting section. Similarly, purchasing requests can be routed to the right approver group based on company codes, plant codes, cost centers, etc.

When it comes to purchase requests, the rules support the financial approval workflow or the sourcing approval workflow. Unlike many last-generation tactical e-Procurement / tail-spend platforms, Vroozi understands that even tactical and tail-spend purchases will require organizational approvals beyond Finance / Budget Owners. IT will have to approve software and hardware purchases. MRO will have to approve replacement components (as being sufficiently compatible with existing systems and products). Risk and Compliance will have to approve services. And so on. For Finance, workflows can be spend limit or staircase based, auto-forward to the next group or approver if the first group or approver is not available or does not respond within a time period, and define a global fallback approver (who can have single-approver override status). Sourcing approvals can be defined by request type, supplier, category, or product type.

ERP & Connection Management

As noted above, Vroozi integrates with a number of applications for Tax, ERP, AP and other Master Data Management solutions out of the box. Connecting to these is simply a matter of providing id and connection keys. For example, there are out of the box connectors for Quickbooks, NetSuite, and Xero.

Vroozi also supports an extensive API which can be used to configure connections to (custom) ERP instances and other master data systems for suppliers and products. The API calls and keys can be updated through the connector manager.

Budgets

Vroozi can maintain budgets natively in the platform or pull them in from the system you use for Budgeting. This allows every request to automatically be checked against available budget.

Organizations

The Vroozi platform can support multiple purchasing units, plants, approval groups, and projects as well as supporting full definition of the chart of accounts, company codes, cost centers etc. Each purchasing organization and plant can have its own code that can be used in budgets and routing rules. Approval Groups group approvers into a group with a similar function that can be used for routing inquiries and documents for approval (versus routing to individuals, allowing for faster processing and workload distribution). Projects are associated with a company, a unique code, a time period, possibly a parent project, and, in addition to this information, only needs a name. Quick to setup and easy to track spending against a project. The chart of accounts captures the companies GL codes and related information and the cost centers captures the cost center hierarchy of the organization.

Accounting

From a Finance/Accounting perspective, the Vroozi platform is very configurable. The organization can decide whether or not they want to support multiple purchasing units or plants, profit centers, cost centers, classes, locations, location types, projects, customers, WBS elements, and even GL accounts within the platform.

Company Profile, Locations, Users, Currencies, UoMs, Categories, and other Standard P2P Data

All of the master data can be maintained by the customer organization administrators through the Master Data Module of the Vroozi platform.

Help Portal

Vroozi ships with an extensive help portal that covers the entire system functionality. In addition, for every customer, they can insert custom documents, videos, application links (to appropriate screens), and even searches as desired by the customer to help their users.

Supplier Portal

The Vroozi Supplier Portal is where suppliers access their orders, notify the buyer of shipments, flip POs to invoices, and check their invoice (and payment) status.

On the home screen, the supplier sees a summary of their orders, ASNs, pending invoices, and payments and can quick click into their profile (for maintenance), users (for maintenance), purchase orders (to see historical, with new at the top), shipping notices, invoices (to see historical, new at the top), and their payment status.

With respect to invoice submission in the Vroozi platform, a vendor can:

  1. flip a purchase order (PO) to an invoice, simply by selecting the PO, verifying the quantity shipped, and submitting the invoice (and they can override the price or tax fields, but that will result in a failed match and there will be no straight through processing)
  2. submit an invoice in a standard encoding, including CXML or EDI, through an API
  3. submit a PDF invoice through the platform or a well-defined e-mail address

In these scenarios:

  1. the invoice goes into the queue for processing
  2. the invoice goes into the queue for processing
  3. the invoice gets sent to the the AI invoice processor that auto-extracts the information for the buying organization (and then, when the buyer AP manager logs in, presents the PDF invoice side-by-side with the processed invoice for verification for easy confirmation and correction, and then the invoice goes into the queue for processing)

Once the invoice is in the queue for processing, the matches are applied, and if they succeed, it goes straight for approvals, and if the invoice is against a blanket PO or contract and in budget, it can be auto-approved and go straight to posting, which can get the Vendor paid fast (and gives the Vendor a reason to use the system).

Note that we did not mention RFQs because Vroozi has streamlined the RFQ process for Vendors and when a vendor gets an email invite, it takes them right to the RFQ response page where it’s usually just a matter of providing their price per unit and submitting the bid. They can change the due date, quantity (if they can’t provide the total requested), or even the part number (if they believe they have a viable substitute) if they want to, knowing that it may decrease their odds of winning the bid. This makes sure they don’t lose it in a list of events in the portal or have to go through unnecessary steps just to submit a quick bid to an RFQ.

All in all, Vroozi is a very extensive, and complete, P2P solution that is perfect for Mid-Market and larger enterprises who need an easy to use system that can be customized with multiple views for multiple sub-units, whatever those may be.

Vroozi: Address the Bluesy of your Procurement Problems With a Solution That’s Doozy and Approved by the Choosy! Part 1

Vroozi was founded in 2012 with a vision of building a modern P2P solution that could be used by all organizations and Procurement professionals regardless of where they were and what device they were using — as they were the first P2P platform with a mobile-first philosophy. The goal was to build a solution that was easy to use, automated to the extent possible, collaborative, and easy to adopt by all individuals in the organization that needed to make purchasing requests, do Procurement, give approvals, and make payments. The opposite of the highly manual, closed, and cumbersome first-generation systems that gave their users the City Boy Blues.

They’ve achieved their goal, and then some, with a solution that is enterprise grade but yet priced for the mid-market. Whereas most P2P solutions fall short of payments, they can do payments (with their direct integration into two leading payment platforms) — and they can do invoicing compliant with both post-audit and clearance countries. Whereas most Procurement solutions require you to switch to a sourcing suite for a simple RFQ, they can do RFQs too. Whereas most focus on either internal/hosted or punch-out catalogs, they do both, as well as mixed and templated service offerings — all through a single integrated search that can also take into account enhanced company and product attributes on hosted and mixed catalogs. Whereas most P2P solutions don’t tie to contracts, the Vroozi platform can maintain all appropriate contract metadata to track spending against contracts and budgets. Whereas most have only the minimal supplier details to send the PO and Payment, the Vroozi platform allows for extended data to be maintained to allow for in-depth recommendations during search, straight-through processing rules for invoices when there are minor exceptions, and meaningful reports and analytics. Speaking of analytics, whereas most P2P platforms have limited to non-existent reporting solutions, Vroozi has integrated a reporting package that’s on par with most mid-market Source-to-Contract and P2P suites which provides a decent starting point for many organizations to get a handle on their spending.

Going back to supplier data, Vroozi can integrate with your ERP/MRP/Supplier Master and keep the relevant supplier data current for you — enhancing what you already have. It’s an extensive P2P++ solution that can even negate the need for a sourcing platform in an organization where the majority of purchasing is tactical or of moderate value or less. (If an organization doesn’t have a lot of high spend or strategic categories that need sophisticated sourcing technology with auctions or optimization capability, they can usually do without a dedicated platform and use pay per event solutions like MarketDojo or consultancies with licences. In other words, the only other solution the organization may need is a CLM solution — which only enhances the value of the Vroozi solution.) Also, because it can be opened up to the entire organization, who can have view access into the status of their request and all associated documents at all times, it has intake out of the box. (And because it can connect with relevant enterprise ERP, Finance, and S2C systems, it can serve as the Procurement orchestration platform as well.)

e-Procurement

In the Vroozi platform, e-Procurement revolves around purchase requests that come from:

  • catalog search
  • non-catalog requests
  • RFQs

which may or may not be accessed through their SmartChat NLP (Natural Language Processing) tool.

Integrated and Intelligent Catalog Search

In the Vroozi system, a user can do a search across all of their catalogs, whether they are hosted, punch-out, or mixed (as the user can replicate part of a punch-out catalog in the hosted environment to augment and enrich the data with relevant company and product attributes that can aid in not only the search but the ranking and recommendation). The system can support ordered recommendations based on (lowest) cost, contract/preferred status, diversity supplier, or a weighted combination of those and/or other factors.

Search brings up results in a consumer like (Amazon) interface where it’s one click to add to a cart, and one click in the cart to initiate a purchase request. If a user can’t find what they want internally, or prefers a third-party site, one click takes them to the punchout site, and one click in the punchout site (including Amazon [Business]) takes them back to the Vroozi portal to submit the purchase request.

Search can be filtered on all relevant dimensions (supplier, brand, product [sub] category, etc.), which, if the content is hosted, can also include a slew of company attributes and product attributes. Company attributes could include diversity, green certified, preferred contract, premier (off-contract) supplier, IT, MRO, Office Suppliers, and other relevant categories. Product dimensions can include preferred product (off-contract), free shipping, refurbished, warranty, etc.

Non-Catalog Requests

Not all requests are for products found in a catalog. Some are for custom configurations of products where standard configurations are catalog, and some are for relatively standard service offerings that have contract pricing based on easily defined variables or configurations. The Vroozi application can support both of these through extended-catalog and non-catalog requests. If a buyer needs a new laptop with a custom configuration, the system will bring up an item with drop downs and/or special request fields where the user can select the precise configuration she needs. If a buyer needs to request janitorial services for the new, temporary office location, she can bring up the request, specify the required parameters that define the service level (square footage, type of cleaning [one-time or daily/weekly maintenance for a period of time, deep cleaning, etc.], hours it needs to be completed in), and the system will compute the number of people needed and the contract rate. Even complex requests can be completed and submitted quickly and with ease.

Bulk Upload Requests

Vroozi supports the creation of requisitions via extremely simple bulk upload. It can be as simple as a 2-column .CSV file containing Item Id, Quantity rows for basic products in the catalog. In addition, a full SOW (Statement of Work) requisition can also be created simply by specifying the core fields of: Supplier ID, Category ID, GL Account, Item Description, UOM (Unit of Measure), Price, Tax Code, Currency, Start Date, and End Date for each line on the SOW (Statement of Work). All of the appropriate information is automatically pulled in to create a complete requisition, which can be instantly used to generate a PO if the purchaser is buying from approved suppliers/blanket POs within their budget and auto-approval rules.

Next-Gen AI Powered Smart Chat

One of the main selling points of the intake and orchestration platforms getting all the buzz (and all the funding, some to the point where they are going to have to sell the solutions at ridiculous prices to reclaim the investor’s money) is their ability to not only make it super easy for organizational users to make Procurement requests in natural language through an AI chatbot, but an AI chatbot that will ask the right questions to get them to the exact product or service they need and let them put a request in with a single statement or confirmation (“create purchase request” or “yes”), and, in particular, text-based smart chat bots that can be served through an API to another enterprise platform the employees use daily.

Well, guess what? Vroozi has this too! No need for an overpriced “intake” or “orchestration” platform.

The Vroozi Smart Chat Bot is very well designed, and will ask as many questions as needed to get the user to the exact product or service they need. In the laptop scenario, the system will ask for the primary use (business, development, etc.), memory requirement, storage requirement, etc. In the services scenario, it will confirm the user wants janitorial services, confirm the vendor and contract, take the user through the questions, propose the requisition, and automatically create it with a confirmation.

RFQs

RFQ Functionality in Vroozi is very straight forward. The user simply has to give the request a name and due by date; define the products or services they want by description, part/service number, category, quantity, unit of measure, and delivery date; and select the suppliers from the directory (or create a new ad-hoc supplier; however, no PR or PO can be created without approvals and master data setup if awarded to an ad-hoc supplier). That’s it. Then it’s wait for either all the suppliers to respond or the due date to hit, evaluate, make an award, and (if no ad-hoc suppliers were selected that require approval), create the requisition. (Once the RFQ is created, the suppliers are notified by email, and it’s one-click from the e-mail to go to the bid screen, where they will be required to enter their one-time bid passcode to prevent compromised logins.) Awarding is just a matter of selecting the bid and clicking the award button.

Easy One Click Approvals

Once a purchase request has been created, it goes to the first approver for approval. It gets entered to their queue in the Vroozi application, where they can approve it instantly, and through e-mail, where they can one-click approve or reject it. The click takes them to either a screen that acknowledges their approval, or a screen that acknowledges their rejection where they can input a reason and whether or not the requester can resubmit with a modification. To make the rejection process super easy, the user can select a standard reason for dispute from a drop down and only needs to free-form enter a reason or further explanation in special situations that should not be the norm.

Invoice Management

Vroozi is not just an e-Procurement platform, it’s also an Invoice-to-Pay / Accounts Payable platform with full invoice management capability. The great thing about the Vroozi platform is that it supports super easy PO flip in the portal (as well as allowing vendors to submit invoices in multiple standard encodings), meaning all the data can come in complete, correct, and already matching. They also support PDF (by email) submission, and have the capability to process (relatively) “standard” PDF invoices and auto-extract all the key fields.

Once the invoice is in the queue for processing, the matches are applied, and if they succeed, it goes straight for approvals, and if the invoice is against a blanket PO or contract and in budget, it can be auto-approved and go straight to posting, which can get the Vendor paid fast (and gives the Vendor a reason to use the system). If they fail, then the invoice is stopped for processing. If everything matches and there are blanket POs or contracts and budgets are met, it can be auto-processed and goes straight to the posting queue. If not, it goes out for approval. Once the invoices is stopped for match failures or is deemed to need manual approvals, it stays in the processing queue until it has received any necessary non-AP approvals (which might be required if all invoices above a threshold value or for certain categories must get sign-off even if there is an approved PO) and there is a goods receipt to match against the invoice with the PO for a 3-way match or an AP manager completes exception processing and pushes it to to the processing queue. Once corrected and/or approved, the invoice goes straight to posting. And, of course, the supplier, if they use the portal, sees the current invoice state at all times.

The great thing about the platform is the power that is contained in approval chain creation and management, which can be setup in the same manner as purchase order approval chains if desired. Once an invoice is in the processing queue, if there is a 3-way match, it is automatically processed, and if it matches exactly or within tolerances, it goes straight to posting without any touch. If there is only a 2-way match, and if there are exception rules (for example, services, recurring charges, etc.) that allow 2-way processing, then if there is an exact match or a match within tolerances, it will also go to straight to posting without any human touch.

In other words, in Vroozi, only exception invoices need to be processed, and a single click can reject and flip them back to the supplier (preferably with a reason) or accept them when the variation is acceptable, agreed to, or approved by the buyer (such as a higher price for substitute items when an order was made without the necessary notice). Furthermore, to ensure that exception processing is efficient, the end user organization can define multiple types of exception handlers to ensure that the invoice is routed to the right group when there is an exception. For example, if it’s just a tax issue or an unexpected shipping and/or handling charge, then it can likely be resolved by AP and should go to an AP clerk. But if it’s a unit price issue that doesn’t match the contract, which the supplier is refusing to back down on, it might need to go to Procurement for an exception approval or to Legal who may need to call the supplier and explain what will happen next if the unit price isn’t fixed.

In addition, there are built-in options for auto-processing / auto-return for overcharges. The system can automatically reject the invoice, automatically modify the invoice based on agreed to amounts and then notify the supplier of the changes upon approval, or leave the invoice as is and automatically create a credit memo (and notify the supplier on approval that the credit was applied against this invoice or will be applied against a future invoice at payment time).

Shipping Notices & Good Receipts

The Vroozi platform is capable of accepting and processing shipping notices in the same manner that it receives invoices, and these can even be used in a 4-way match if desired by the system. Shipping Notices and Goods receipts are incredibly easy to create in the Vroozi system. Just like a user can one-click flip a PO to invoice, they can one-click flip a PO to a shipping invoice where all they have to do is verify the line-item quantities. Similarly, a user can one-click “flip” a goods receipt from a PO, shipping notice, or invoice as easy as a supplier can flip a PO into an invoice. All the user has to do is enter the quantity received for each line item and the goods receipt is complete and can be used in the 3-way match for straight through processing. Note that if the organization has turned on the appropriate matching, the users will have to receive goods before the associated invoices can be processed.

3-Way Match and Straight Through Processing

The power of an I2P solution is one that can automate invoice processing touch free and free up valuable Procurement and Accounts Payable time to focus on the exceptions and the issues, and not tactical processing which prevents issues from being resolved, and sometimes even from being detected when an invoice has too many line items for detailed processing and all the AP clerk can do is a rough check on the total amount versus the total expected amount. Also, as it is capable of automatically processing every invoice that comes in, it can identify obvious and potential duplicates, invoices that don’t match a PO, and invoices that are potentially fraudulent and reject them or “quarantine” them for manual review.

Credit Memos

Credit Memos are automatically created during invoice exception handling when the buyer decides that the organization is going to pay the PO price (which usually happens when the organization has a contract or valid commitment that has not yet expired from a previous quote), overrides the invoice price to the PO price, and then approves the invoice, which is queued for payment at the adjusted amount captured in the (automatically generated) credit memo that is sent to the supplier. The supplier gets the credit memo in their portal, as well as a status change that informs them that the buyer adjusted invoice has been approved for payment.

Come back tomorrow where we will continue our discussion of the Vroozi P2P++ offering, including Payments, the Supplier Directory, Analytics, Platform Administration, and the Supplier Portal.