Supplier management

Managing supplier certificates

SAP Ariba Supplier Management is a solution for managing supplier information, their lifecycle,  performance, and risk in one place. It also provides a smart intuitive workflow to guide supplier selection, qualification, and segmentation process, with proactive ongoing monitoring of your suppliers. Additionally, suppliers can make use of Modular Questionnaires.

Modular Questionnaires

Modular supplier management questionnaires are used to collect information from suppliers in modular units. They are designed to ask limited sets of related questions about specific subjects and store information independently from the core supplier management processes: request, register, qualify, and segmentation. Each modular questionnaire is defined by a separate project template and functions as an independent unit. The user may create a separate approval flow, expiration date, and update possibilities.

Managing Certificates

The properties of a modular questionnaire allow for the use of certificate management. A supplier manager can choose to collect and maintain supplier certificates in modular supplier management questionnaires. A questionnaire of this type can contain both certificate questions and other types of questions. For the certificate questions, it is possible to ask for a single certificate or multiple related certificates from which the expiration dates can be tracked.

How to setup Certificate Management

Managing certificates from a supplier can be done as part of the Supplier Lifecycle & performance module. The user starts by creating a template for a modular questionnaire. When the templated is created the user navigates to the template properties and select a questionnaire type:

Questionnaire types are designed and loaded into the Ariba system via a .csv import file. In this file different questionnaire types can be created as per the organisation requirements. In this case, it will be used to create a modular questionnaire to solicit certification details.

As a second step, the user must create a survey document in which the content for the questionnaire will be created. The user can create both “regular” questions and certificate questions to gather the information needed for the supplier. In the case that a certificate question needs to be created, a specific answer type must be selected.

As seen in the figure above the answer type: Certificate, creates several answer fields related to these questions. If answered YES, the supplier needs to provide information about the issuer, year of publication, certificate number, certificate location, the effective date, the expiration date and add the necessary attachments for proofing.

Use of certificate type Modular Questionnaires

After the modular questionnaire is configured to solicit information about supplier certificates, the procedure of using it remains the same.

The user sends a questionnaire, in this example Supplier Diversity, to the supplier by navigating to manage> SM Modular Questionnaires> select Supplier Diversity questionnaire. When the supplier fills in the required information and sends it back, the information will be visible in the supplier 360° profile. In addition to a regular modular questionnaire, all the certificate information from a supplier will be visible in its profile under the certificates section, with the possibility to enable a notification option when the certificate nears its expiration date, as seen in the figure below.

Support for multiple-line RFQs in Guided Buying

SAP Ariba introduced an extension to request for quote (RFQ) forms. It is now possible to request multiple lines within a single RFQ event. This eliminates the necessity to merge services & goods together and/or create multiple RFQ events when sourcing multiple line items.

The current form remains available in Guided Buying for single line RFQs. In addition, SAP Ariba added a new form for multi-line RFQs. This can be added with JSON or through the UI as seen below (request form marked as “new”).

How to create a multi-line RFQ form?

The build-up of the form remains as is. Existing templates can also be used. A multi-line RFQ form consists of a main item (required) and up to 10 additional items. These additional items can be made either required or optional.

 

When adding an additional item, a screen will be opened in which you need to provide a form template, item title, item description, select required or optional, commodity code, and item type. So within this screen you can add templates for forms with generic or commodity related questions, text fields or attachments that relate to the item that is being sourced.

Once the multi-line RFQ form is created, it will be visible in the UI as a tile. By clicking on the tile, the requester gains access to the form that was created in the previous steps.

How to perform tactical sourcing events with multi-line RFQ forms?

The requester needs to fill out a number of details in order to post the RFQ:

Header-level details:

1. Title of the request: Market Research Bundle
2. Ship-to location: Defaulted on Werk Hamburg
3. Respond by date: deadline for suppliers to respond to the RFQ
4. Estimated budget: Maximum amount that you anticipate to spend on the request (not shown to supplier)
5. Purpose: short description (optional) (is shown to the supplier)

Line-level details:

1. Title (optional/defaulted)
2. Target price (use this pricing field to set a desired value. This will be the amount the supplier sees; suppliers can decide on going above or below this amount.)
3. Custom/Dynamic form fields, questions, and attachments (drawn from the template) (line-level)

 

 Additional Line-level details:

1. Title (optional/defaulted)
2. Target price (use this pricing field to set a desired value. This will be the amount the supplier sees; suppliers can decide on going above or below this amount.)
3. Duplicate (for required and optional items) (file with arrow icon, on the top-right)
4. Delete (only for optional items) (trash-can icon, on the top right)

Once all the mandatory fields are filled, the multi-line RFQ form is completed. Requesters are now able to click next and can navigate to the second screen. Within this view, the requester selects one or more suppliers based on personal preference or based on business rules.

Suppliers need to be qualified and/or preferred for the same commodity/region combination as the form before they will be visible to the requester. When a supplier is qualified for all the selected line-items, there is a 100% match. However, if a supplier is only qualified for one out of the three line-items, there is just a 33% match. Although MGKP Services is only matching with one of the qualified commodities, the supplier is still able to submit a bid for all the line-items that are part of the tactical sourcing event. However, it should be noted that this may result in a compliance issue within some organizations.

For this RFQ scenario we will select two preferred suppliers which are both qualified for 3/3 line-items. Thus, these vendors have a 100% match with the request for quote form that we filled.

When the requester has submitted the forms the quote requests will be send to the supplier. This is dependent on the sourcing scenario that is enforced. This scenario is self-service (no-touch), meaning that there is no involvement or approval from the sourcing/procurement department required. Also, the target price and the estimated budget are displayed within this screen.

Apart from the header details there is also a section that specifies the information related to line-items. Below you can see that the RFQ is split up into three different line-items, which are all priced, and treated independently within the tactical sourcing event.

Supplier Perspective:

Once the supplier intents to participate he/she can select the lots that they want to place a bid for. To have the best chance on getting selected for the tender, the supplier needs select all the line-items.

After having the lots selected, the supplier can provide their pricing per line-item:

Then, the supplier needs to submit their bids. These will be sent to the buyer in Guided Buying. From Guided Buying, the requester is able to click on the RFQ event to access the information that the suppliers sent.

Within the RFQ event, the requester has access to all the information that the supplier sent such as price, attachments, comments, and other terms. To award a supplier, the requester needs to select “accept quote”. It is not possible to purchase line-items across multiple vendors. To achieve this, separate RFQs need to be created where the line-items can be sourced separately from multiple vendors. For multi-line RFQ events, there is only one vendor that is awarded with the lot(s), even if this supplier did not select all lots and is not able to deliver all the line-items in the event. In that case, the line item is not included in the bid and will not be sourced. A separate RFQ event can be set up to source the remaining item(s).

Header level details:

Item level details (left = Terra Advisory, right = MGKP Services):

The supplier on the left (MGKP Services) does not perform Telemarketing Services and was not able to select the lot for it. Awarding the bid to MGKP Services, the requester chooses to cancel the acquisition of telemarketing services.

Once the requester has accepted the bid, the RFQ is flipped into a requisition with 3 line-items.

After the requisition passed all approvers, the purchase order is created and sent to the supplier.

Standing orders in Guided Buying for SAP integrated sites

What is a standing order?

A standing order is a type of purchase order (PO) that can be requested to gain the permission to purchase with a certain supplier to obtain specific goods/services during a specified period.  Once your PO is processed and approved by the Purchasing department, it is possible to create your order directly with the supplier when needed. In other words, a standing order is a recurring authorization to purchase goods/services.

The use of standing orders can greatly increase the efficiency within an organization by replicating purchases, rather than requiring that individual transactions need to be initiated each time a purchase is made. Standing orders are best suited for recurring requirements for low-value items and routine services without buyers having to create multiple orders for the same supplier.

How do standing orders work in SAP Ariba?

The overall workflow is displayed in the process chart below. When a buyer has created a standing order (which corresponds to item category B in SAP ERPs), the items can be procured without requiring goods receipt or service time sheet processes. Once the requisition is approved, a PO will be sent to the supplier. The supplier can optionally respond with an order confirmation. Then the supplier will be able to create and send an invoice back to the supplier. To conclude, the buyer reconciles the invoice, and the invoice can be paid.

How to setup standing orders in SAP Ariba Guided Buying?

Before setting up the configurations in Guided Buying there are two parameters that need to be enabled in SAP Ariba P2P. These parameters can be enabled by your designated service contact from SAP Ariba:

• Procure.EnableServiceItemFieldInRequisition must be enabled;
• Procure.EnableItemCategoryOnRequisitionLine must be enabled;
• ClassificationCodes.SystemCommodityCodeDomainName must be set to the domain for the commodity codes.

Your administrator has to enable/disable the following parameters in the intelligent configuration manager that can be accessed from core administration in the “manage” tab:

• Enable standing orders (Application.Procure.AllowLimitOrderItemCategory) parameter must be enabled;
• Allow non-limit items in standing orders (Application.Purchasing.AllowLimitRequisitionWithMixed Lines) parameter must be disabled.

The first step is to enable standing orders in the parameter settings of Guided Buying. These can be found by navigating to the Guided Buying Home screen à Admin à Manage parameters. Within the parameter settings your administrator can enable the following parameters:

• PARAM_LIMIT_ORDER_SUPPORT
• ENABLE_LIMIT_ORDERS

How to enable commodities for standing orders?

Commodities need to be added to a mapping file before users can place standing orders for them. This needs to be configured in Admin à Policies à Commodity Code Mapping Policy where you need to import a policy file containing the commodity codes you wish to enable.

This policy file can be exported and imported and has the XLSX extension for Excel. The first column defines the item category and needs to be set to “Limit” (item category B). The second column is where the commodity codes are mapped to standing/limit orders. In the example below we enable commodity code 80131503, which is land leases, for standing orders.

When this file is uploaded, the item category for the commodities which are set to Limit (item category B) will change in Guided Buying. It needs to be noted however, that Partitioned Commodity Code Maps in P2x are not synced with the Guided Buying set-up. This means that when enabling a commodity for standing orders in Guided Buying, it will have no effect on the setup in P2x. In P2x admins can change the item category in Core Administration > Commodity Code Manager > Partitioned Commodity Code Maps and adjust the item category to “limit” as seen in the image below.

 

How to create standing orders?

Standing orders can be created by requesting a non-catalog item, a form or they can be created through requesting a catalog item.

Lets first show the process of a standing order that is created through a form. This starts with creating the actual form for the commodity, which can be done through the UI, Excel, or JSON. In this walkthrough we will show how to create it by using the UI manager in Guided Buying. When creating a new requisition form for a commodity that has been enabled for standing orders, you will notice that there is a check box for standing orders. This box must remain checked. It is also advised by SAP Ariba to add the term “standing order” in the key words, which makes sure end-users can easily find forms that have standing orders enabled.

When the form has been configured you will be able to see the tile that has been linked to the form. This tile shows the information such as: title, commodity code (which has been enabled for standing orders), the purchasing unit, the form description, and the keywords that are attached to the tile.

By clicking on the tile, you will be navigated to the form. Since the commodity is enabled for standing orders, the form will look a bit different than other forms. The disparities are:

• Start Date (also available in service forms)
• End Date (also available in service forms)
• Expected Amount
• Max Amount

To request a standing order through a catalog item it is necessary to subscribe to a static catalog from your supplier. This can be created by the supplier on the Ariba Network or you will have to manually upload it in P2P. It is also possible to enable commodities that have existing catalog items, which will make them available for standing orders as well.

The catalog item page will also have some additional fields such as:

• Standing order checkbox
• Expected amount
• Max amount
• Start date
• End date
• Unit of measure

 

The third option to create a standing order is a non-catalog item (also called adhoc item), which can be requester in the Guided Buying homepage by clicking on the dropdown menu of quick links. When selecting “request non-catalog item” you will be navigated to a adhoc form. Within this form you will have to select a category. In this field you need to select a commodity code that has been enabled for standing orders. As is displayed in the example below for land leases.

How to purchase with standing orders?

So lets continue with the information that we have stated on the non-catalog form which involves a land leasing request for 50k euros and a maximum budget of 60k euros. First thing that we need to do is submit the requisition and go to the checkout page.

On the checkout page you can name the requisition and add the need-by-date. Then the checkout page will be updated into the layout that can be seen below. Within this view you can select the validity date range in which you would like to have the standing order open.

Once you have submitted the requisition and every user in the approval flow has approved it, a standing order is created and is send to the supplier over the Ariba Network.

The supplier will receive the PO which is called a Blanket Purchase Order (BPO) from their perspective. The BPO type states no-release required, which means that POs are not needed. The supplier can now send invoices to the buyer which will be subtracted from the (expected) amount. The supplier can send invoices for as long as the standing order remains valid. Each time the supplier sends an invoice it is subtracted from the (expected) amount. Remember, we also provided a maximum budget for the standing order. However, this will not be visible for the supplier.

Once the supplier sends an invoice, it can be reconciled and paid by the accounts payable department.

After submitting the first invoice, the supplier will see that the order is partially invoiced and that the amount is consumed from the (expected) amount.

SAP Ariba Guided Sourcing

Recently SAP Ariba released guided sourcing, a more intuitive interface to help you setting up sourcing events quicker and easier. In Addition to last month’s blog, we will cover some more features that are offered with this solution.

For you
In the previous blog, we covered the single page event creation where the event rules, suppliers and content can be set up in one overview. When moving out of the event (creation) page, the user will be provided with the For You page, which provides easy access to guided sourcing events. An overview of all draft-, open- and completed events will be shown at a glance. This overview contains feed cards for recent events that have occurred as well as events that require approval. It also has a Summary panel. This panel displays all the numbers of guided sourcing events that can be viewed and categorized by the event status (Draft, Open, Review responses, Awarded). It also contains a “recently viewed” section with links to navigate to these items.

Easy access to the For You page can be provided by adding the page to the Ariba Dashboard. The user can access the three most recent feed items and use the search option to search directly for an event from the Ariba Dashboard. This content tile can be added to the dashboard in the following way; select the For You content from the Add Content menu and drag it to the dashboard and click done, as shown in the figure below.

Creating event content

In last month’s blog, we have covered the part on selecting participants for an event and how a list of recommended suppliers is provided based on a commodity and region. When all participants are added, the content for the event can be created. In the previous blog, it was shown how pricing information was separated from additional content like questions, requirements, and attachments, now we will look into the options on how to add these types of content.

Event content can be created in one page, as Guided Sourcing is built for single page event creation. As seen in the figure below, several actions can be performed while keeping an overview of the line items that are added to the event. A selection of actions can be performed:

1. Add, Move, or Delete content. You also have the ability to drag items to rearrange them.
2. The triple- dot- menu option gives access to add new content and also access messaging.
3. Click on terms to edit them inline, eliminating the need to move between different pages.
4. If needed there is still the option to edit the terms in an overview: all options.
5. Search functionality to quickly navigate to line items.
6. Import / Export content via Excel.

Awarding the supplier
Once the event is published and bidding is completed the user reviews the responses from the participants and moves forward to the awarding scenario. This again is a single page creation. The user is presented with two out of the box scenario’s and may create additional customized award scenarios by pressing the + icon as shown in the below figure.

The user can also see the scenario summary as a quick visual in which the total spend is shown and how the selected scenario compares to the Best Bid scenario. If changes need to be made (with the supplier being informed) or another round needs to be initiated with a selection of suppliers, the user can select the option to reopen the event from the triple-dot-menu. When all event criteria are met and the best bid is selected the user may complete the event by awarding the (multiple) supplier(s).

 

SAP Ariba Guided Sourcing

Recently SAP Ariba released guided sourcing, a more intuitive interface to help you setting up sourcing events quicker and easier. In comparison with the existing sourcing offering, there are some new user interface features available.

New Features
The most noticeable change is the single page event creation. In comparison to the original event configuration; the event rules, suppliers and content can be set up in one overview, as seen in the picture below. At the top of the page, a process flow is visible of all the steps to take during the sourcing event. In the create step the event duration, suppliers, and Items & requirements are shown as dropdown fields to have them as an overview on one page. At any point during the event creation, the user has instant access to SAP enable now for guidance during the event creation.

Selecting participants
When the event duration is set, the user can select participants for the event from the supplier dropdown field. If the Ariba Sourcing Solution contains the SLP module and the user has set the commodity and region for the event creation, a list of recommended suppliers will be shown before a search is executed. The SLP Module can qualify and set preferred levels for suppliers on different commodities and regions. By already providing this information Guided Sourcing will show the most suited suppliers to invite for the RFI/RFP, as shown in the picture above.

Another difference with the traditional sourcing event creation is the content, in the new interface line items are created in a different section from the questions, requirements, and attachments. For example, in this RFP a quote for car insurance is created. For the line item, only pricing information is involved. Questions about Own Risk and the amount can be provided as additional information in the questions, requirements, and attachments section, as shown in the picture below.

Monitoring
Also, the way events are monitored is changed within the Guided Sourcing user experience. In one overview it is possible to view the supplier participation, the duration, and the number of line items where participants can bid on. In the supplier participation chart the status of the participants can be viewed from: not yet viewed, Declined to participate, viewed but have not yet participated, to placed bids. The same way line items can be viewed in a chart having the status of items have at least one bid or not yet received, following the pricing and additional information from the participants in a side-by-side comparison, making it easier to award business to the right supplier.