Supplier Community Enablement: New Channels for Content ONCE Global Summit May 2005 Vance Checketts Global Solution Architect – Procurement Supplier Community Enablement Defined Supply base management – Identification – Qualification – Negotiation Catalog & contract management – Catalog content creation & management – Price changes – Contract deliverables & compliance Purchase/sales execution – Electronic messages – Self-service transactions – Online inquiries The Problem . . . Supplier enablement has traditionally dictated an “every one for themselves” solution Company B Company A Company C Company E Company D n2 Effect 5 buyers, 5 suppliers = 52 or 25 individual connections The net result is Distributed Complexity High costs, low performance for everyone Buyers Suppliers Symptoms of Distributed Complexity Requires multiple standards, protocols and translators Buyers need to maintain preferences for each supplier All supplier changes require work for buyers IT project for each supplier “enablement” effort Difficulty maintaining connections No centralized transaction tracking and error control Result: Even the best companies have only “enabled” a small % of their supply base Solution – Supplier Networks Centralized information, centralized management Also . . . Specialized Services Specialized procurement services are a great compliment to procurement software and traditional implementation services Perfect Commerce, Saqqara – Catalog management D&B, Austin-Tetra – Supplier data cleansing Zycus – Category rationalization AT Kearney – Sourcing strategy BearingPoint – Business process definition IBM – Business process outsourcing Content Management Multiple options to support different needs Option Request Type Item Characteristics 1 No Catalogs, One-time requests & User-specified items “Smart” Forms Early stages of implementation services 2 Local Raw materials, Items under strict controls (hazardous, etc.) Catalogs assets & Items under existing long term agreements mission critical items Loaded from spreadsheets, XML or EDI Remote: 3 Supplier Hosted Services, Dynamic pricing & availability supplies & Configurable items non-critical Large selection of items items Accessed via punchout Remote: 4 Network / Hub New or sourcing Static item and pricing information items, supplies Approval controls for price changes & non-critical Items not tightly controlled items Accessed via punchout Actual Catalog Implementations 70 60 Percentage 50 40 30 20 10 0 3rd Party 3rd Party Punchout to Internal Supplier Catalog Hub Supplier Catalog Network Source – Aberdeen Group, Dec „04 Other Areas of “Enablement” Supplier profile management Invoicing Contractor time & expense tracking Inbound logistics Negotiations Contract management Supplier-managed inventory Consignment Design & prototype Forecasting Software vs. Services Pure software – Oracle, SAP, legacy PeopleSoft, legacy Ariba Pure services – D&B, Austin-Tetra, BearingPoint, etc. Services w/supporting software – CC-Hubwoo, Saqqara, ATK, legacy FMKT, etc. Software w/supporting services – Emptoris, Requisite, Ariba/FMKT, etc. Panel Questions What is supplier “content” beyond a product catalog? What value-added services complement content? What are “supplier networks” and where do they fit? How does regional, vertical and commodity-specific content increase the ROI of procurement software? Should regional content providers expand globally? How? What is the role of software / service partnerships? What role will interoperability play in global expansion, especially for large, multi-national buying customers? What are customers of procurement software requesting re supplier content? What are customers of supplier content requesting re procurement software?
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