As a procurement manager or CPO in an organization that uses an SAP indirect procurement solution with catalogs, it’s highly likely that you thought the easy ‘web shop’ user experience (insert the name of a well-known shopping website here) and the use of online catalogs would make your users highly productive and enforce compliance to preferred vendors and contracts.
You may feel, though, that there is room for improvement in the user experience to help them find what they want to order faster or with less scrolling, clicking, or typing. Maybe there is more effort than expected in the existing user experience for buyers to check free text requisitions and assign the right vendor and price. Sound familiar?
If so, I thought I would provide some guidelines to help you optimize your existing SAP on-premise or SAP Ariba solution to deliver an increased value. Our initial analysis shows you could save more than 50% of requisitioner effort and reduce spend with non-preferred or contracted suppliers by more than 85% through the Ariba procurement approach.
Our approach to procurement processes is twofold. First, we optimize your existing SAP and Ariba solution, and then we look at extending the requisitioning solution to really accelerate savings. More on that aspect of procurement processes later.
- Optimize the SAP Ariba Solution
It is surprising how many implementations I have seen where the requisitioner cannot find what they need quickly and easily, through no fault of the technology.
Users need to have fast and intuitive searching routes (via tile clicks), or a comprehensive keyword search facility to enable quick and complete access to procurement datasets. Be it contracts, preferred suppliers, or detailed items, and pricing information that catalogs provide, they simply won’t be able to find the right supplier and price for their requirement. This will severely limit the savings your procurement processes can deliver.
Here are my recommendations on how you should look to optimize your requisitioning process with SAP procurement:
- Maximize the User Experience
Nowadays, users require very little or no training to be productive from the first login, thus saving you time and money with low training and end-user support costs. SAP Ariba Guided Buying should be the de facto for companies who have many occasional requisitioners. This allows a requisitioning entry-point via a web-based portal sitting on top of the main SAP or Ariba Procurement application. It is familiar for most users with its tile-based structure with pictures, links to favorites, previous requests, and approvals, all in a well-proportioned screen. It has a powerful keyword search box in the most obvious place to help users find preferred suppliers and catalog items fast.
Figure 1: SAP Ariba Guided Buying Landing Page
The landing page and tiles are configurable, and new tiles are available once a tile is clicked. It allows you to have an easily configurable front end that is attractive and easy to use for requisitioners and can be configured. It does not need a developer; anyone can do it.
While user experience is very important, it alone cannot achieve spend reductions across the enterprise.
- Improve and Extend your Tile Structure, Forms, and Policies
In our experience, one guided buying design does not fit all. We have seen how different companies ask their users to buy in very different ways, even within the same spend category. When buying in the facilities management category, the purchasing route could be catalogs, a service requisition or blanket order, or a combination of multiple buying routes.
It can get more complex because some categories require requests to be vetted by a central team of experts, may require additional information to be entered by the requester or may be subject to bidding rules. This requires the setup of commodity-level forms to be completed for some types of purchase requests, to be routed to individuals or teams to vet prior to continuing through the normal purchase requisition approval process. These paths and forms can also be complimented nicely by policy messages showing error or warning messages when the type of request is not complete or compliant.
If you don’t feel your specific category requirements, terminology, and buying mechanisms are reflected in your Guided Buying setup, then change it. Users can then click in the right places to get to the data or forms required.
- Comprehensive Data Coverage
Once the user has accessed the right route for their purchase, they need to have immediate access and visibility to the right suppliers and pricing through catalogs or contracts for the type of good or service requested. In our experience, most SAP procurement customers do not have the right data available to their users. Often the users cannot find the right supplier for SAP procurement or a reference price for what they need. On many occasions, if there is a price, it can also become outdated quickly.
This does pose a challenge, as the volume and accuracy of data required can be significant, and data maintenance overheads can be high. The priority should be to focus on the critical indirect categories for your business first. Focus on those that are ordered most frequently, carry the most risk, or have the highest average order price. Users should be able to find all of the required contracts, catalogs, or preferred vendors for these categories, as they form the cornerstone of your business (and your business case).
- Maximize the User Experience
- Extend your Requisitioning Solution
Once you have optimized your SAP Ariba solution, your users can find preferred suppliers, contracts, and catalogs fast, and the user experience will be great. But what if the user cannot find what they need because there aren’t any catalogs, contracts, or preferred suppliers for what they want? This can be called tail spend purchases and requires a great deal of manual effort from the requisitioner. They typically trawl through a long list of approved vendors to suggest one they think may be appropriate. They often need to put a note to the buyer containing their thoughts on the vendor and estimated price. The effort is then on the buyer to check for the right supplier and price. This manual effort per request, once multiplied for all requests across the business, will form a vast number of hours spent on manual, operational tasks for requisitioners and buyers
There is a way to address this tail spend problem and drastically reduce manual overheads in indirect procurement. We advocate experimenting with and delivering technological innovations for this purpose.
- Think and act ‘outside-of-the-box’
Rather than use ‘out-of-the-box’ SAP and Ariba features and functions, we suggest you extend the requisitioning process outside of SAP and Ariba. Use different technological components to help requisitioners find suppliers and price details for non-strategic, high-volume requests, where information should be able to be gleaned from external data sources, rules, and algorithms.
SAP Ariba solutions have a great many extensibility options through the use of various open APIs. In addition, the RPA bots can be integrated into the Ariba procurement landscape to extend, simplify, and automate the process. The new integration and extensibility possibilities have removed the traditional boundaries for customers and partners. We recommend you to consider these extensibility features to help the users find non-catalog and off-contract spend items quickly and easily. We have a proven demo and extension case study using our own HCLTech IP. We are confident that you will have tremendous savings on these manual tasks.
- Think and act ‘outside-of-the-box’
If you would like to know more about our point of view, or hear more about our innovations in this area, message us at email@example.com.