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Strategic Sourcing. Features, Functions and Demo. Eddie Quinn, CPA Senior Manager The Business and Technology Resource Group EQUINN@BTRGROUP.COM. PeopleSoft SCM. Supplier Relationship Management Modules – Where does Strategic Sourcing module Fit In ?.

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strategic sourcing

Strategic Sourcing

Features, Functions and Demo

slide2

Eddie Quinn, CPA

Senior Manager

The Business and Technology Resource Group

EQUINN@BTRGROUP.COM

peoplesoft scm
PeopleSoft SCM
  • Supplier Relationship Management Modules – Where does Strategic Sourcing module Fit In ?

PeopleSoft Enterprise SRM Family of Applications:

• Spend Mart

• Strategic Sourcing

• Supplier Contract Management

• eProcurement

• Services Procurement

• Purchasing

• Procurement Mart

• Supplier Rating System

• eSupplier Connection

strategic sourcing1
STRATEGIC SOURCING
  • FEATURES
  • A complete internet-based sourcing solution
  • RFxcapability
  • Reverse auction capabilities and proposal analysis tools
  • Event creation
  • weighting assigned to Bid Factors for response optimization and evaluation
  • Digital signatures
  • Configurable Bidder search criteria
  • Filter criteria for Event Workbench
  • Supplier Registration to bid online
  • Segregation of duties
  • Event collaboration security
  • Proposal response analysis and award
  • BENEFITS
  • Reduced procurement costs through competitive bidding and reverse auctions
  • Alignment of purchasing objectives and execution with business strategy
  • Long-term strategic supplier relationships based on best value and lowest cost supplier performance
  • Ability to exploit untapped value in your supply chain
buy events
Buy Events

Sourcing buyer and seller buy event process flow

The buyer creates an event, and optionally copies from an existing event, an event template, requisitions, purchase orders, contracts, Manufacturing bills of material (BOMs), Engineering BOMs, or planned orders.

The buyer includes bid factors and business constraints, and invites bidders.

Optionally, the buyer invites collaborators to give input to the event, reviews the input, and posts the event based on the input.

Bidders register, review the event, and submit their bids.

The buyer evaluates the bids manually or uses the optimization engine, and can create another round of the event to solicit more bids.

Optionally, the buyer invites collaborators to give input on the bids and bidders.

The buyer awards the winning bid, and the system notifies the winners and nonwinners.

The buyer either creates a purchase order or contract to order the goods or services from the warded

bidder.

If the bidder isn't previously a supplier, the system creates a record

sell events
Sell Events

The seller creates an event by selecting depreciated assets. The seller optionally includes bid factors, and invites bidders or customers.

Optionally, the seller invites collaborators to give input to the event, reviews the input, and posts the event based on the input.

Bidders register, review the event, and submit their bids.

The seller evaluates the bids based on the bid factors, and can create another round of the event to solicit more bids.

Optionally, the seller invites collaborators to give input on the bids and bidders.

The seller awards the winning bid.

The system notifies PeopleSoft Asset Management

roles
Roles

Internal default roles:

• Event Administrator: The Strategic Sourcing System Administrator.

• Event Approver: Users who will approve sourcing events.

• Event Buyer/Seller: Users who will create buy or sell sourcing events.

• Event Collaborator: Users who will provide input on the creation, award, or both of sourcing events.

• Plan Owner: Users who will create sourcing project plans.

• Plan Approver: Users who will approve sourcing project plans.

• Task Owner: Users who will be assigned sourcing project plan tasks.

External default roles:

• Event Bidder: Businesses or individuals with whom the enterprise has not previously done business.

• Event Customer: Businesses or individuals to whom an enterprise has sold before.

• Event Supplier: Businesses from which an enterprise has purchased before.

• Event Guest: Default role for guest users who have not yet registered as bidders.

role related tasks
Role Related Tasks

Event Administrators perform the following tasks:

Set up bidder registration.

Set up bidder self-categorization trees.

Set up the file attachment server.

Set up discussion forums.

Set up chats using the MultiChannel Framework.

Review and approve bidder registration requests if registration approvals are selected.

Event buyers and sellers perform the following tasks:

Create bid factors.

Create global policies and constraints.

Create events and invite bidders.

Invite collaborators (optional).

Monitor their event and, if necessary, pause the event or create another round or version.

Invite collaborators for event analysis.

Analyze the event.

Award a bidder.

Event Collaborators perform the following tasks:

Receive invitations to collaborate on event creation.

Check out events from the Manage Events Workbench and enter input on bid factors.

Receive an invitation to collaborate on event analysis.

Enter input on bids and bidders.

creating an event
Creating an Event

Header

Line(s)

Processes

bid factors
Bid Factors

Bid factors are questions bidders must answer about their products, services, or company.

You set weightings for each bid factor, letting bidders know how much value you give to that portion of their bid.

You can also create bid factors that you do not display to the bidders, but instead answer during the analysis of the bids. These bid factors can be for subjective responses such as current business relationship or interview results.

header vs line bid factors
Header vs Line Bid Factors
  • Header bid factors relate to the overall event and cover the entire event. For example:
      • Is this a minority-owned or woman-owned business?
      • In what state is the corporate headquarters located?
      • Is the company ISO certified?
  • Line bid factors can be set for individual Event lines. For example:
      • Color might be an important factor. You can set different colors or weightings for a color list bid factor on the line items.
      • You can set ideals and weightings that, for the line item, differ from the same bid factor set in the header.
total cost modeling
Total Cost Modeling
  • Analyze bids based on three different criteria:
            • Lowest price
            • Best score
            • Lowest total cost
  • All three methods can be used simultaneously to give you the most information for making the best award decision.
  • Costs are calculated based on:
  • Bidder's bid price,
  • Bidder's bid quantity,
  • Predefined cost range,
  • User-defined cost.
  • Use: manual analysis or optimization engine
  • Calculate a cost related to:
  • Each bidder's response to a bid factor,
  • Total line cost
  • Total event cost
slide16

Purchasing an item that has a warranty bid factor associated with it?

ITEM: You are asking the bidders to indicate the length of warranty provided for the item with a range of one year to five years.

BidFactor: A longer warranty period reduces maintenance and repair costs.

Each extra year of warranty provided = $50 in maintenance and repair per unit. You can assign this cost to the warranty bid factor so that the total cost for this bid factor will be calculated based on the bidder's response.

Bidder 1: bid $1,000 per unit but only provide a one-year warranty,

Total cost = $1,000 – (1x50) = $950

Bidder 2: bid $1,100 per unit but provide a five-year warranty.

Total cost = $1,100 – (5x50) = $850

Even though the first bidder has a lower bid price, the second bidder will have an overall lower cost because the bidder is providing the full five-year warranty.

scoring vs weighting
Scoring vs Weighting
  • 3 factors regarding scoring vs. weighting:
  • The score depends on how close the answer to the bid factor comes to the ideal answer.
  • The weighting is based on how important the bid factor is to the overall line or event.
  • The final score is the average of the score and the weighting.
  • The header and line bid factors are scored separately; each bidder gets two scores.
creating an bid factor
Creating an Bid Factor

Cost Contribution for White or Other

slide28

Save the Date

APRIL 7-11, 2014

Sands Expo and Convention Center

Las Vegas, Nevada

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