Category Archives: Procurement Innovation

Despite Attempts to Simplify It, There Are MANY Categories of ProcureTech Solutions

When selecting a ProcureTech Solution, you have all the following buckets:

Function X Classic Type X SaaS Category X Integration
Sourcing
SXM
CLM
Analytics
e-Procurement Best-of-Breed Standalone App
(full function)		 Suite EcoSystem
Invoice-to-Pay Mini-Suite Lightweight App
(task specific)		 I2O Ecosystem(s)
ESG/Sustainability Suite Bolt-On
(extends a module)		 Open API
GRC
Category/Cost Intel
Niche (Legal, Marketing,
Hospitality, SaaS/Tech, etc.)
I2O

And if you do the multiplication, that’s 297 combinations … and that’s just the tip of the iceberg when there are 10 core areas of SXM, multiple niche areas being addressed (some classic solutions were just for print/telco), multiple buckets of risk management solution, generic and scope-3 specific sustainability solutions, different approaches to intake-to-orchestrate, and that’s just addressing the functional areas of Source-to-Pay+.

Then you have the situation where some vendors only offer a single best of breed (BoB) module, others offer a mini-suite, and others still offer a mega-suite with all of the core modules and often a half dozen more on top of that.

While most are SaaS apps these days, they vary from heavy standalone apps that implement full functions to lightweight apps designed for specific tasks (that are usually missing from larger standalone apps that purport to completely cover a function but don’t) to bolt-ons that offer advanced functionality, but require a core module to work on top of.

One also has to consider how you integrate them into a comprehensive workflow that supports Source-to-Pay+. Sometime modules integrate into one-or-more suite ecosystems out of the box (like the SAP Store or The Coupa Store), other times they just come with a (semi) open API, and now some, not built for integration, are integrating into one or more of the new orchestration ecosystems.

And while functionality should come first, you have to consider all of these other factors as well because if you select a suite for a module, you’re probably locking yourself into the other modules you need as those the suite offers due to cost and integration cost considerations, if you select light-weight or bolt-on apps, then you better have something to integrate them into, and you better be sure the ecosystem has all of the modules you will need to implement over the next five years or so before locking yourself into an ecosystem.

So even though THE REVELATOR believes that everything is going to be a bolt-on or an app and that’s all your going to have to worry about, unfortunately the ProcureTech world is NOT going to make it that simple. Overlooking traditional category and integration can completely destroy the value you require if you can’t easily integrate with complementary modules/apps (and especially if you are in a [primarily] direct industry and need to integrate with supply chain applications for the data you need to make good supply chain aware decisions).

However, it will be interesting to see the primary solution category, breadth, and integration of ProcureTech Solutions (by, and independent of, function) in the future.

Sweating With SAP? Make Indirect Procurement a Breeze with BeNeering!

If you’re in direct, and are a mid-sized-plus organization, you are running off of a major ERP which is most likely SAP or Oracle. If you are in the EU, and the DACHS region in particular, let’s face it, it’s SAP. And while you make it work for direct (because that is, after all, what it is designed for), and your engineers don’t complain no matter how convoluted the process is (as long as there is a repeatable workflow that lets them do their jobs), the buyers probably don’t care for it, and the end users likely don’t have a clue how to use it (and never will).

You need another solution for indirect. While once upon a time that was Ariba (as nothing else out there really integrated with SAP [and, by the way, Ariba didn’t really integrate with SAP either as the first integration was accomplished through middleware]), given the age of Ariba, and the focus on (really) large organizations, that’s likely not the case anymore for most organizations (especially in the mid-market).

That’s where BeNeering comes in. Founded in 2007 by technologists, engineers, and AI experts to help their customers simplify and automate operational procurement with SAP, they have grown from a scrappy start-up with a just a couple of employees (and no sales and marketing, which was only added in the last couple of years) to a solution provider powering over 300,000 users across 40+ large customers operating in 85 countries (and did so just through referrals).

The core of the BeNeering Digital Procurement Platform, which natively integrates to SAP through low level interfaces (for real-time push and pull to and from SAP, ensuring all data and process state is maintained in your ERP), is the following capabilities:

  • Catalog Management
  • Services Procurement
  • Guided Buying
  • “AI” Intake (Chatbot) Assistant
  • Simple Sourcing
  • Supplier Portal

Catalog Management

BeNeering is a full catalog management solution where buyers can create their own hosted catalogs, import a vendor’s catalog, or integrate a third party punch-out catalog which can all be accessed separately or as an integrated, federated, catalog with integrated, federated, search. The buyer can define as many validation rules as they like for a supplier’s catalog and (re-)run them all before accepting a supplier’s catalog, or update, for publication.

One one or more items (or standard services) are selected from the catalog and added to the basket, the requester can submit the purchase requisition. If everything is a standard/preferred product from an an approved catalog, within the requester’s budget, and below the approval limits, the request will automatically be translated to a purchase order which will be processed touch free by BeNeering through its deep SAP integration that will handle everything and track the entire process to the goods receipt, and even associate the request with the invoice when it enters SAP through the organization’s invoicing system. At any time, the requester or the buyer can see where it is in the process and the complete document flow across SAP through the BeNeering portal.

Services Procurement

The platform contains with one or more services specific forms for buyer to request pre-defined/standard services (against contracts) or unplanned services (against budgets). Every form will collect standard fields such as service names, required by/delivery date, department/group code, currency, service code, (master) contract, supplier, etc. Specific forms, such as for IT services or hospitality will have additional fields to select service types and resource options in the first case and catering items, office location, and exact time in the second case. And, as with the catalog, all of the relevant SAP fields for proper classification, indexing, contract and supplier and material group association, and routing will be pre-filled in for (and not editable by) the user. Finally, the platform supports service entry sheets or timesheet confirmation processes with suppliers being able to add contract items directly to SES.

Guided Buying

Since the BeNeering platform also supports inventory integration as well (provided the inventory is also maintained in SAP), the platform can offer a true buying guided solution across inventory, preferred vendors and catalogs, (pre-defined) services on contract, standard request forms, and sourcing event (creation) all depending on what the user is searching for. And, of course, even if the user requires multiple items and services of different types from inventory, established contracts, preferred vendor, and open bid, all but the last can be added to the cart (and the smart checkout functionality will split the cart up as appropriate, guiding the individual POs through the right process) and the latter can easily be initiated from the search bar or AI Chatbot assistant.

“AI” Intake Chatbot Assistant

The AI Chatbot assistant takes an unstructured request, asks questions, and guides the user to the right catalog (item), service request form, or dynamic form for a new product/service request which will be built-up step by step by the AI as it asks questions, elicits the right information, identifies the appropriate fields, and finds the right cost centres, codes, product/material groups, framework agreements and other descriptors to populate the key fields that will be needed by a buyer who needs to process the request.

Simple Sourcing

If the product or service a requester requires is not in the catalog, then the user can initiate a simple sourcing event provided that they know the category and estimated dollar value (and it’s within their budget/request limit, or they get approval if it’s not within their request limit/budget), define the currency, and verify that they have searched the catalog and supply forms.

In this simple sourcing event, they describe their requirement (product name and type, required delivery date, units, required quantity, etc.), select the delivery location, invite onboarded/approved suppliers, add any necessary attachments that detail specifications, and send it out. The suppliers receive it in their portal and can choose to bid on all, some, or none of the items, and once the bids are in, or the deadline is passed, the buyer can see the quotes from each supplier and either award all to a single supplier or cherry pick the suppliers by line item. Since this is for simple sourcing (which will generally be small projects), there is no support for complex price breakdowns, what if scenarios, etc. It’s a essentially just quick quote/basic RFQ functionality, which is all that is typically needed for many smaller/tail indirect purchases in an average organization. (And if the organization has more strategic buyers, or a lot of regular requests for the same product/service, the application can be configured with demand consolidation and then the buyer can consolidate all requests for the same product or service in the queue into one before the request goes to a supplier if this would allow for better pricing due to volume or a better response rate due to less price [update] requests.)

Supplier Portal

The supplier portal gives suppliers the ability to:

  • maintain their core organizational and user data
  • access their POs and generate acknowledgements
  • access sourcing events and place bids
  • maintain their catalogs and submit one or more to the buyer for approval

Profiles are standard profiles and all input and revised data will pass through the validation rules defined by the platform to either the partner SRM solution for onboarding/validation/update or straight through to the SAP SRM module, as appropriate to the customer and their SRM solutions and configuration.

With respect to services purchase orders, the supplier can add specific service categories or resources it needs to compete the service, which will then allow a buyer to create appropriate timesheets (in BeNeering) for services tracking.

With respect to sourcing, they have a standard interface where they can bid on each line item, add attachments, and asynchronously message with the buyer.

With respect to catalogs, the supplier can upload as many as they want, edit them in the BeNeering system, submit them to the buyer when they are ready, where they go into an inactive state until accepted by the buyer (who can also reject them in which case they are just in the upload library on the supplier’s side).

Summary

The real power from the platform is the automation of the majority of most requests to receipts from end-users (if they are requesting approved products and services within their limits), and the vast majority of purchase orders to receipts (once a buyer has given approval for a request for a non-standard/off contract product or service or above a spending limit). On average, they automate over 90% of PRs/POs for their clients.

All of these capabilities can be accessed through their menu options, their widget based dashboard that allows quick entry into these capabilities, or through the search bar which searches across all of the platform modules. In addition, the platform can also support other capabilities that can be built/integrated on a customer-by-customer or project-by-project basis. For example, some customers have built/integrated:

  • reservations, where requesters can reserve product in inventory for an upcoming use
  • process/requests/sourcing checklists (to make sure a requester has followed the proper process, done their research, and gathered the appropriate information)
  • budget requests (which are then routed to either the head buyer if it is a request for reallocation of existing budgets, or an external system if it is for a new budget)
  • supplier onboarding requests (which are then routed to the ERP or a third party Best of Breed supplier onboarding system, which could be their partner’s solution, if the requestor needs to request from a specific supplier)
  • timesheets (for supplier personnel to fill out for maintenance, hourly rate contracts)
  • other capabilities that can be captured in a form-based workflow
  • etc.

Setup/administration is relatively simple since BeNeering will reuse all user roles, workflows, etc. that are already in place with SAP. No having to replicate everything in your standalone indirect e-Procurement application. Plus, lead buyers can work in SAP or BeNeering as all of the data is maintained in SAP.

For those who also want more strategic procurement capabilities, BeNeering also partners with:

  • Ap solut Squando for supplier lifecycle management (built on BTP)
  • Portal Systems AG for contract management (built on Microsoft 365 / Sharepoint)

All-in-all for a mid-sized or large organization sweating with SAP, BeNeering offers a modern, all-inclusive, efficient, mostly touchless, platform for day to day tactical and operational indirect and tail-spend Procurement that will be easy, and efficient, to use for all organizational employees and buyers alike. It’s definitely a solution that any organization who needs an indirect and tail-spend Procurement solution that needs to natively integrate to their SAP backbone should check out.

An Update on Promena: The Rich Caffeinated Citrusy Turkish Punch

In our last write up of Promena in November of 2023, we introduced you to this two-decade old mid-market Source-to-Contract player (with some e-Procurement capability) based in Türkiye that does over 3 Billion in annual transaction volume. While a lot of that volume is still in Türkiye, Promena is expanding throughout Europe and into North America with its multi-lingual solution that supports 13 languages.

In that update we covered the core of their:

  • RFX: which supports RFX survey forms, product selection (from the product library), supplier selection, bid management, response comparison (with lowest bid for each line item outlined), and award selection
  • e-Auctions: which supports English, Dutch, and Japanese auctions; allows parameters to be configured; suppliers to be invited; and the auction to be run
  • Contracts: when an award is selected, the system supports contract creation and indexing up to the signature (which needs to be wet, scanned, and uploaded) and acts as an integrated e-filing cabinet
  • Supplier Management: information, relationship, baseline (KPI) performance management, and onboarding with a supplier suitability score (that is assessed through supplier responses to the buyer’s form-based questions) and quick access to all events and corrective action requests the supplier is involved in, products the supplier offers, and contracts the supplier is bound to
  • Corrective Actions: are supported and can be buyer created, sent to suppliers who need to respond, and then buyers can accept or reject the response and can always search the complete history of requests
  • ESG Management: which was mainly a section for collecting surveys and centralizing KPIs related to ESG
  • Product Management: collects and stores the descriptions of the products and services the buying organization needs in the organization’s category hierarchy and the foundation of the catalogs supported by Promena
  • Catalogs: from which organizational users to self-serve purchase standard, approved, on contract products and services
  • Purchase Orders: that can be generated off of a sourcing award, contract or a catalog item

Since then, Promena has made updates in the following areas:

  • Supplier Discovery: for identifying suppliers not in your database
  • Supplier Certifications: for centralization and tracking thereof
  • Contract Drafting: enhanced capability to pull in platform data
  • Enhanced ESG/Supplier Profiles: on organizational suppliers
  • Configurable Workflows: for platform processes and approvals
  • Completely Redesigned UX!

Supplier Discovery

Promena has built an internal supplier directory with default (public) profiles for all of the suppliers across its customer database which can be searched by any organization on product/service and location and, if relevant, added to their internal supplier database (and then invited to events, etc.). (They are investigating integrating with an external supplier discovery platform to assist global organizations in more extensive supplier discovery.)

Enhanced ESG/Supplier Profiles

The ESG profiles have been enhanced, with graphical displays for easy analysis, and integrated news feeds with recent articles related to a suppliers sustainability efforts/carbon footprint (in beta, and publicly available in the next release).

Configurable Workflows

This is one of the two major enhancements to the platform that we felt you should know about. In the new version of the platform, all of the RFX and auction, contract management, supplier onboarding, and approval workflows throughout the application can be individually configured for each buying organization. Furthermore, they are all exposed in the administration section and a sufficiently capable administrator can edit the core workflows themselves or work with Promena on implementation to customize the workflows to their liking.

In addition to having standard workflow definitions for each module/section of the platform, the platform uses these to generate wizard-like path-based walkthroughs in every section that make it clear (at the top of the screen) exactly where the user is in the process, what they just did, and what they will need to do next.

Completely Redesigned UX

Much of the year last year was spent updating the stack, building modern workflows, and redesigning the entire user experience to be easier, cleaner, and much more obvious so that users can get up and running with little to no experience, and they have done a great job in this regard. It’s cleaner, more streamlined, and the enhanced use of workflow and templates allow organizations to define the right process with the right template that minimizes the work buyers have to do on a daily basis and makes it easy for users to find what they want in catalogs, follow along with events (as they can be invited in viewer roles), fill out surveys, and so on.

And while this did delay some of the planned functionality for the second half of 2024 (like line-item price breakdowns, which is now coming the second half of this year), it was definitely worth it because, once implemented (, configured to the organization’s process, populated with default forms and documents, and loaded with the existing catalog) most buyers will be able to sit down, dive in, and get an event live with no training.

Roadmap

As per above, items for this year include:

  • enhanced supplier discovery through Promena‘s supplier marketplace (and possibly a third party supplier discovery player)
  • enhanced ESG profiles with real-time news updates and AI summaries
  • line-item cost breakdowns for deeper cost insight (and comparisons in the platform)
  • Brazilian auctions
  • Auction Guidance which will mathematically analyze the past 5 years of results (if available) on the product/category and advise you on which auction will likely generate the best results

For a mid-market company, it’s a fairly extensive platform that’s easy to use, easy to customize, and easy to grow on. This makes Promena a platform that should definitely be considered for your short-list if you are looking for a modern S2C mid-market platform with purchase order support and services support if you need it (either from Promena direct where their account teams manage over 5,000 sourcing events a year or from 11 Global Partners who can deliver integration and support services).

Calculum Charts your Course to Commerce Cultivation and Cash Cutting!

Calculum is a very interesting solution offering — it’s a working capital analytics solution meant to be the missing link between Finance and Procurement that just doesn’t exist today. Built to help their customers (which are mainly Global 3000 companies) to optimize their working capital across Procurement by optimizing payments and payment terms while taking weighted average cost of capital into effect, it offers a broader, and deeper, picture of cash needs and options than most platforms today.

Moreover, it goes well beyond the typical Procurement approach of simply recommending paying every supplier on the last possible day you are legally allowed to (based on either the contract or the country regulations, which they track for you) without penalty, and possibly the last possible day with penalty (if the contract is for less than the legally allowed maximum payment term) if the organization’s cost of capital is known to be lower than the penalty.

More specifically, it allows a company to understand the impact to working capital from

  • paying on a different (later) date
  • paying early (on a discount schedule)
  • paying up front (to reduce the supplier’s cost of working capital)
  • borrowing / using supply chain finance options to pay up front / early
  • using (virtual) cards

while taking into account its

  • cash conversion cycle (C2C)
  • days sales outstanding (DSO)
  • days payable outstanding (DPO)

and provide a company with true working capital and financing option optimization across Procurement, Finance, and Treasury and, in doing so, provide an average increase in free cash flow by 10% for every dollar analyzed.

Calculum does this by being possibly the only working capital optimization platform that is built on a solid spend analytics platform with its interface customized for working capital optimization, instead of category spend optimization.

Calculum starts by uploading your suppliers, contracts, and AP (invoice and payment) data, matching the data, helping you cleanse it until they have at least 90% 3-way match across your spend data (using their large, internal, supplier database of millions of suppliers ), from which they can determine immediate working capital optimization opportunities, prioritize suppliers for the realization of those opportunities, and distribute the opportunities across their 9 boxes for term extension and financing opportunities. (And you can see the exact degree of match, as well as the reasons for exception, in the match dashboards that present statistics on the data received, match rate, data quality, exclusions, and reasons for — and give you the data you, or Calculum, needs to improve the match rate)

Let’s start with that last sentence. Once the data is matched, the platform’s built in analytics will automatically identify:

  • all of your term extension opportunities across the supply base (taking into account any country legislations and noting existing terms where they are defined) organized into 9 cash flow buckets defined by impact vs. probability of success (which can be computed based upon historical supplier decisions, tracked in their centralized supplier database with anonymized data and past decisions, and similar supplier responses)
  • all of your financing opportunities from early payment discounts that are not being realized and/or negotiable discounts for early payments based on your weighted average cost of capital vs. that of your supplier also organized into 9 cash flow buckets based upon impact vs. probability of success (calculated in a similar manner)

Once the data is loaded, matched, and verified, a user can move from matching to optimizing gtheir working capital in the Opportunity dashboards and tabs. In this set of tabs and dashboards, you can:

  • see an overview that summarizes current payment terms (by contractual, opportunity, and excepted averages), cashflow opportunity, economic profit opportunity, affected entities, opportunity by category, and opportunity by program area (spend volume, supplier count, cash flow, and economic profit)
  • undertake your supplier prioritization efforts based upon your assessment of the easiest realized significant opportunities (by getting them to agree to different terms for faster payment or larger/future orders etc.)
  • review the 9 boxes financing built during the match
  • create your waterfall plan for attacking as much opportunity as possible

Moreover, because Calculum built their working capital optimization platform on a real spend analysis platform (with real cube support), which allows them to optimize payments and payment terms on multiple factors optimized against over 3 Trillion in analyzed spend, you can filter on any (set of) dimension(s) you like down to a small group of transactions.

Once you have finalized the opportunities and your waterfall/wave plan, you can move into the manage dashboards that allow you to

  • monitor your progress in the overview dashboard that tracks progress between current and target average payment terms, cashflow improvement progress, analyzed vs. planned vs contacted (effort begun/underway) vs. agreed (which could result in an unchanged term, as the opportunity should be closed either way after an [attempted] negotiation)
  • track your negotiations and reach out

And, of course, you can drill into any supplier, parent, or spend line of interest at any time because it’s a real spend analysis platform and see all of the relevant data at any level of the hierarchy that you like.

In addition, you can get a snapshot of working capital related information (spend, spend lines, (average) contracted terms, (average) payment terms, opportunity, etc. by supplier at any time simply by entering the suppliers dashboard and drilling into the supplier (or parent) of interest. The primary view will also tell you where the supplier is in the analyzed vs. planned vs contacted vs. agreed working capital optimization workflow supported by the platform. Drilling into a supplier will bring up basic corporate details, the corporate tree, any available ratings and metrics, and a payment terms vs. pricing analysis where you can calculate impacts from changes in payment terms, financing rates, your rates vs. the supplier’s rates, etc. to determine the optimal time to pay a supplier. The platform will then calculate the cost impacts of any potential/suggested change to both you and the supplier so you can make an informed decision (because sometimes an early payment doesn’t save you anything and sometimes extending a payment term costs you dearly in the long run). This allows you to propose win-win (or at least win-neutral) options that the supplier really shouldn’t be rejecting!

In addition, the platform uses AI to analyze all of the data they have on the supplier against standard strategies and built in models to recommend a detailed strategy for each supplier in the opportunity section so that you have deep guidance on how to approach a negotiation to alter the payment terms.

Moreover, Calculum is more than just a platform, it’s also a partially managed service where they work with you to ensure your data is properly uploaded and matched, the opportunities appropriately identified, the initial plan realistic and realizable, and execution effective, especially during the first few months where results and success is critical. They’re also there to support you on an ongoing basis and, if necessary, handle the refreshes / updates for you.

It’s a very unique offering and one that complements many Source-to-Pay or Procure-to-Pay platforms nicely for mid-market-plus organizations that need to maximize the value of their cash in these difficult times. It’s certainly a platform to check out if working capital optimization is front-and-center on the CFO’s mind.

We like what it’s doing and how it’s doing it and believe it is very valuable to a large segment of the mid-market. Upon a first review, there were no obvious holes or situations where we would say “the platform really should do this“, and the only point of sorrow we walked away with is that it’s not being sold by Calculon 2.0 (but then again, they are 988 years too early).

Wham Up Your Direct Sourcing with EffiGO!

EffiGO might not be a name you know, as they spent the first decade building, deploying, and growing primarily in India (where they have over 150 enterprise customers including some of the largest names in India in Construction, Manufacturing, CPG, Automotive, IT, Pharma, and Chemicals and have sourced and procured over 25 Billion in Spend), but they now have a growing presence across Asia, the Middle East, and are just starting to expand into Europe (with America coming soon).

However, it now is a name you should know because they built the system from the ground-up to be a complete purchase requisition to invoice approval system with all of the key sourcing and procurement steps in between for indirect (and tail spend), direct, rate-card based services AND complex (project) procurements for their customers — whatever their customers needed. And the foundational “plan to pay” from purchase requisition to ok-to-pay suite can be obtained by a LMM or SE (Large MidMarket/Small Enterprise) at an annual license cost starting at 100K. Integrations, and they highly recommend integrating to the ERP (where they have integrated with most major ERPs multiple times including, but not limited to SAP, Oracle, Infor, Dynamics, etc.), custom configurations, and services are extra, as with any other major player, but the license cost makes it affordable for the mid-markets who need a direct/complete sourcing solution.

The core of the EffiGO platform is broken into two main modules that cover the two main work streams:

Plan to PO

The Plan to PO component consists of the creation/acceptance of the Purchase Requisitions (which can be pushed from the ERP or manually created in the platform), the creation and execution of the sourcing events, the selection of the award, and the definition of the contract that orders will be made against.

Once a Purchase Requisition is pulled in from the ERP or manually created by a user in another organizational department, the user will see it in EffiGO and can pull it up, see all the details, edit those details (including, but not limited to the goods and services requested, the units, the delivery dates requested, the payment terms, etc.) or request an edit if they don’t have the authority, and approve it for sourcing.

With respect to core sourcing, the platform supports:

  • RFX – Quick
  • RFX – Full (with or without TechnoCommercial Evaluation)
  • Auction
  • Reorder (from a past RFX created in the last quarter)
  • Order from Catalog (for products where [rate] contracts are in effect)

RFX (and auction) creation starts by selecting one or more approved requisitions to kick-off an RFX (or auction) process, selecting the event type, entering basic information (name, business unit, event owners, business unit, desired delivery locations, currency, etc.), and determining whether the event only requires commercial specifications and terms or detailed engineering/technical review and a weight-based award based on commercial terms and product/supplier review.

Note that the system will inform the buyer if one or more parts or items in one or more of the requisitions they select is either in inventory and/or already under contract and can just be fulfilled without going through a sourcing event.

Once the basic event criteria have been defined, and the items and quantities confirmed, the user is walked through the remaining configuration steps that include:

  • documentation – standard organizational terms and conditions, NDAs, and other project specific documents (which can be pulled in from a central library) or uploaded
  • price tables – the platform supports pre-configured bidding templates for different categories and products (that can be associated with any level of the product and service hierarchy they support), which can include non-price components, and the user just needs to select one
  • vendor selection – the buyer can search for vendors by group, category, location, etc. and add them one at a time or in groups
  • dates: clarification questions, bids, follow-ups (if requested), notifications, etc.
  • review criteria: techno only – select the template that will be used for product/services/vendor review and scoring

Note that since the requisitions can be pushed in by the ERP, they can range from a requisition for a single item to a requisition for a complete bill of materials, each item or part can be associated with its own cost breakdown table defined in the EffiGO platform, each part can have its own associated documents, including drawings and detailed product specifications, which can be included in the ERP push, pulled in from the EffiGO library, or even pulled in from a (n optional) PLM integration, and the cost tables can also include service cost rate tables as well. To make bidding easy for the suppliers, the bid sheets can be pulled down into Excel (and then re-uploaded), and that can be done on a product or event basis (and then the workbook will be multi-tab if different cost models are required for different parts and/or service rate cards).

If the sourcing event is being awarded on commercial terms only, then the application will select the lowest bids at the part, bundle (grouping), or RFQ level for award, and if the buyer approves, the award selection(s) can be output for offers, letters of intent, and contract negotiations, one per supplier. If the sourcing event is on commercial and technical, the commercial are auto-scored and the buyer scores the technical components, and then the award can be auto-computed in the application according to the award level.

Once a contract has been signed, it can be uploaded with all of the terms and conditions defined (and all meta-data from an associated event can be associated with the contract), and custom completion requirements can be specified in the meta-data to make sure that all POs go out with those requirements (and they are not forgotten — more on this in our discussion of the PO to Pay module).

PO to Pay

The PO to Pay component consists of the creation of the purchase orders, the management of the purchase order and assurance of contract terms and conditions, the management of associated communications (acknowledgements, change requests, ASNs, etc.), the acceptance of the invoices against the orders, the processing and approvals, and the creation of an ok-to-pay push notification to the payment system.

When a buyer is ready to place an order, the buyer can create a purchase order:

  • off of an RFQ
  • off of one or more catalog items which may or may not be under contract (but are approved for purchase)

As with sourcing, if the buyer selects an item that is already in inventory or under contract (and can be requisitioned without any approvals), the system will inform the buyer.

As with any other system, a purchase order consists of items, units, approved pricing, delivery locations, dates, and other key pieces of information. Unlike other systems, the buyer can specify a full host of requirements that must be met before the PO can be issued, acknowledged, and dispatched against which include, but are not limited to:

  • whether an Ack(nowledgement) is required
  • whether acceptance is mandatory
  • whether an ABG (Advanced Bank Guarantee) is required
  • whether a [C]PBG ([Contract] Performance Bank Guarantee) is required
  • whether a LC (Letter of Credit) is required
  • whether the vendor needs to submit any technical documentation
  • whether the requesting buyer needs to provide the vendor with any instructions or documents
  • whether stage monitoring is required (and what the stages are; these can be selected from pre-configured or PLM lists)
  • whether transportation is in the scope of the buyer or vendor
  • whether the vendor is required to submit dispatch instructions
  • other potential organizational specific requirements around purchase orders (for certain products, services, or categories)

When a vendor receives the purchase order, they also receive all of the associated documents and information provided by the buyer along with all the instructions they need to follow and requirements they need to meet to make a delivery AND get paid for it.

Once a vendor has dispatched (part of) a purchase order (which is also tracked against an RFQ to make sure that they never dispatch more units than they have been approved for), they can submit an invoice, which is associated with the order, which goes into an approval queue. Approval chains can be configured to be as simple, or complex, as needed, with as many steps as necessary.

Catalogs are buyer maintained. Suppliers can upload and submit catalogs to the buyer, but they don’t go live until approved by the buyer, who can accept or reject items and pricing. Once awards have been made and/or contracts have been signed after the issuance of a sourcing event, the buyers can create catalog items with the details and pricing, and mark them as under contract if a contract is signed or the rates are approved (if the supplier is willing to honour the quotes in the latter case).

Catalog items can have as many buyer standardized fields as needed to completely specify the item, which can be searched by type, category, supplier, location, status, and keywords against key fields. All items can be associated with their proper place in the organizational category hierarchy, which can be as deep as required. (Note that vendors can identify the categories they service up to Level 4 in their profile.)

Vendor Management

Required vendor information management is embedded throughout the process and is included with both of the core modules and includes vendor onboarding as well as ongoing information management, reviews, status updates (which can block on a category, unit, or organizational level), and insights (through the built-in reporting).

Vendors can be loaded from the ERP on implementation or created inside the platform. Vendor profiles in EffiGO consist of basic corporate details (type, corporate id, taxation registration, primary category, HQ, etc.), deep business details (registered and correspondence details, production locations, etc.), financial info, registration & certifications (statutory, documents, etc.), sustainability information, declarations, and audit log. Additional forms can be configured on implementation to capture any additional information that the buyer needs to track.

In addition, the buyer can maintain the vendor status and whether or not they are approved on a division, or even category basis. Unapproved vendors can be invited to events by an authorized user, but cannot be sent POs, or approved for payment.

Vendor Portal

A vendor has their own portal to interact with the buyers on the EffiGO platform. While they will get email notifications of every sourcing event, change, award, contract offer, purchase order, change, information request, etc., many actions will need to be taken through their portal (for which they will get a direct link to do so in the e-mail). This is because communications, acknowledgements, change requests, etc. need to be associated with the right event or purchase order, key documents need to be secure, and the organization needs to make sure invoices (with payment instructions) are not tampered with.

Summary

EffiGO is a very different kind of platform — one that was built to serve manufacturing clients in Construction, CPG, Automotive, IT, Pharma, and Chemicals from the ground up and one that ended up being a direct-focussed system that can also handle indirect, services, and complex project procurements as well! It’s a name you don’t know, but if you have a mix of direct, service, and indirect needs, one you should know — especially if you are based in EMEA where EffiGO is currently expanding to!

Technobug
Technobug
Technobug
Technobug

It puts the boom-boom into my heart (hoo-hoo)
It sends my soul sky-high
When the PR starts
Technobug into my brain (yeah, yeah)
Goes bang-bang-bang
‘Til my keys do the same

But something’s bugging me
Something ain’t right
My best friend told me
What he did last night
When I was sleeping in my bed
I was dreaming
But I should’ve been Sourcing instead

Wake me up for EffiGO-go
Don’t leave me hanging on like a yo-yo
Wake me up for EffiGO-go
I don’t wanna miss it when we hit that high
Wake me up for EffiGO-go
‘Cause I’m not planning on Sourcing solo
Wake me up for EffiGO-go
Lets get Sourcing tonight
I wanna hit that high, yeah yeah!