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Creating a Roadmap for Best-in-Class SupplierManagementISM Webinar 9th Nov 11
Chris NelmsManaging Supervisor
Supply Chain Process & Systems, Ameren Services Company
Mark Peachey
Product Strategy Director
Advanced Procurement, Oracle
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Prior to ISM, Nora was a supply management professional for manufacturing andretail firms. Nora holds a B.S. from the University of Arizona and an MBA from
Arizona State University.
Senior Vice President
Institute for Supply Management
Moderator - Nora P. Neibergall
Nora Pollard Neibergall, CPSM, C.P.M., Senior VicePresident at Institute for Supply Management. Starting
her career with ISM in1994, Nora now oversees ISMseducational program development, professional credentials,public relations, marketing and sales efforts.
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Todays Web Seminar Will Focus On
Understand the role of supplier management and itsinterdependence with other supply management disciplines
Learn best practices for developing organization structures, charters,and talent that foster ongoing improvement
Review real-world case studies that emphasize changemanagement and supplier involvement
Understand how to develop a technology portfolio that supportsemerging supplier management requirements
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Presenter Chris Nelms
Managing Supervisor, Supply ChainProcess & Systems,Ameren Services Corporation
Prior to joining Ameren in 2004, Chris was a management & technology consultant in the
manufacturing & supply chain systems practice at Cap Gemini and Ernst & Young and hasover 15 years of experience in various consumer products, medical device, aerospace andmanufacturing industries in the areas of process improvement & design, systemsimplementation and project management. He holds an MBA from Maryville University andtwo Bachelor Degrees from Southeast Missouri State University.
Chris leads the operations team charged with the ongoing projectsaround continued eCommerce enablement of Amerens supplybase, and leading the continued strategic implementation ofprocesses around the source-to-settle program (S2S) which include
further enablement of electronic supply chain collaboration usingOracles Advanced Procurement Suite (R12) especially iSupplierPortal and the Contractor Cost Tracking Module (CCTM) a customapplication developed to extend the existing capabilities of Oracles
Services Procurement module."
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Director of Product Strategy, E-BusinessSuite Advanced Procurement Applications,Oracle Corporation
Prior to joining Oracle, Mark worked in EMEA as a management consultant, gathering 15years experience on a wide range of IT system implementations for clients in various
consumer goods, pharmaceutical, brewing and manufacturing industries. The projects hewas involved with ranged from the design of shop floor plant control systems, through theintroduction of MRP systems to the deployment of global Supply Chain Planningsolutions. He holds a BSc in Technology & Management Science from Bradford University,UK.
Presenter Mark Peachy
Mark has spent over 10 years in Oracle's Development divisionguiding the evolution of the applications that allow buyingorganizations to streamline their Source-to-Pay processes and
collaborate more effectively with their supply base. Most recently, hewas responsible for designing and introducing a new set of SupplierManagement modules that enable buying organizations to rationalizetheir supplier master data, manage the qualification process, tracksupplier performance and monitor supplier risk factors.
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The following is intended to outline our generalproduct direction. It is intended for informationpurposes only, and may not be incorporated intoany contract. It is not a commitment to deliver anymaterial, code, or functionality, and should not berelied upon in making purchasing decisions.
The development, release, and timing of anyfeatures or functionality described for Oracles
products remains at the sole discretion of Oracle.
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Supplier Management Agenda
What is Supplier Management?
Why is it Important ?
Key Business Challenges
Supplier Management at Ameren
Supplier Management at Oracle
Q&A
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9 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Compliance CSR / CoC
Labor Practices EH&S
Finance / Credit
Strategic Preferred
Watchlist Improvement Plan Probation
Performance
ManagementRisk
Management
Supplier ManagementExercising Control Throughout the Lifecycle
TransactRetireQualifyDiscover
Online registration
Supplier search
Profile enrichment
Detailed assessment
Compliance checks
Approval process
Review process
End relationship
Close account
Transact
& Review
EnableAccount creation
Electronic connection
Document formats
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10 Copyright 2011, Oracle and/or its affiliates. All rights reserved.10 Copyright 2011, Oracle and/or its affiliates. All rightsreserved.
Spate of Worker Suicides
Customers in Damage
Control to Protect Brand
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11 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Supplier Relationship RisksThreats and Vulnerabilities
Labor Action, Force Majeure / Natural Disaster / Security
Competition Pressures, Transport, Employee Turnover Liens and Claims, Insurance CoverageOperational Risk
Product/Service Delivery Delay / On-Time Performance
Product Quality Issues Out of Specification
Warranty SupportTransaction Risk
Negative Media Code of Conduct Breaches
Potential Criminal Investigations Product Safety Standards / Environmental Safety StandardsReputation Risk
OFAC / Suspect / Debarred Watch-list
Global Public Health
Country - Potential and Readiness for Civil Unrest/Military ActionOther Risk
Code of Conduct / Hazardous Chemical Usage / Worker Cond.
Contract / SLA compliance
E-Waste Leakage etcCompliance Risk
Financial stability / Ability to Grow
Credit Problems, Bankruptcy Business LossesFinancial Risk
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12 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Reducing Supplier Management Cost
Enhance productivity by eliminating paper Supplier on-boarding to include setup for
electronic connectivity
Provide self-service profile administrationto suppliers
Improving Operational Efficiency
Socialize supplier qualification details andperformance evaluations
Flag and track dependable and cost effectivesuppliers
Be assured that spend analytics is completeand accurate
Minimizing Risk, Improving Compliance
Monitor supplier adherence to all laws,regulations & standards
Ensure that suppliers are meeting Code ofConduct requirements
Gain visibility to risk factor trends
Key Business Challenges
TransactRetireQualifyDiscover
Onlineregistrati on
Supplier search
Profileenrichment
Detailedas sessment
Compliancechecks
Approval process
Review process
Endrelationship
Closeacc ount
Transact
& Review
EnableAccountcreation
Electronic connection
Documentformats
Avoiding Data Fragmentation
Unify duplicated, incomplete, inaccuratedata held within multiple, disparatesystems
Consolidate & federate shared informationacross instances
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13 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Technical
Data structure or lack thereof
Location, location, location(internal, external, 3rd party)
Variable life expectancy
Organizational Multiple ownership no real control
Impacted by multiple projects from across the organization,e.g. Risk, Finance, Engineering (new product development)
Supplier Management as a discipline
Operational Data volume & visibility
Definition of scope
Executive focus
Hurdles to SuccessPractical Issues That Will Impact Any SM Program
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14 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Key Implementation Considerations
Technical
Organizational Structure
Operational
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15 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Suppliers
Change Orders
Forecast & Schedules
Shipment Notices
Invoices & Payments
Supplier Profile (W9)
v.1
v.2
Time Cards
Catalogs
BuyingOrganization
Supplier ManagementA More Complex Choreography
Phone
Paper
Fax
Orders
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16 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
SuppliersBuying
Organization
Supplier ManagementA More Complex Choreography
Phone
Paper
Fax
ChangeOrders
Forecast &Schedules
Shipment Notices
Invoices & Payments
Supplier Profile (W9)
v.1
v.2
Time Cards
Catalogs
Orders
Certification
Insurance
Diversity
Credit
Internal User
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Supplier Management Agenda
What is Supplier Management?
Why is it Important ?
Key Business Challenges
Supplier Management at Ameren
Supplier Management at Oracle
Q&A
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About Ameren
Ameren Corporation, through its subsidiaries, operates as apublic utility holding company in Missouri and Illinois.
It engages in:
Rate-regulated electric generation, transmission, and distributionbusinesses
Rate-regulated natural gas transmission and distribution
businesses Non rate-regulated electric generation businesses.
Ameren Services is where all the common business elements ofthe corporation are housed.
The company was founded in 1881 and is headquartered in St.
Louis, Missouri.
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About Ameren
Electric Customers 2.3 Million Gas Customers 925,000
Service Area 64,000 Sq Mi Generation 15,200 MW
Electric System Miles 81,507
Gas System Miles 20,350
Total Assets $18.1 Billion
Total Revenues $6.5 Billion
Employees 9,400
Regulated in Missouri
Non-Regulated in Illinois
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Database 10g ____ 11g_____2007 2012 ?
Applications 11.5.7 11.5.10.2 R12.0.6_ R12.1.3 / 12.21
Sourcing - 2006 MAY 2009 2012 ?
Procurement Contracts - 2006 MAY 2009 2012 ?
iProcurement 2003 2007 MAY 2009 2012 ?
Core Purchasing 2003 2007 MAY 2009 2012 ?
iSupplier Portal - 2007 MAY 2009 2012 ?
Services Procurement - 2007 MAY 2009 2012 ? Accounts Payable - 2007 MAY 2009 2012 ?
eCommerce Gateway - 2007 MAY 2009 2012 ?
XML Gateway - 2007 MAY 2009 2012 ?
CCTM2 - 2007 MAY 2009 2012 ?
Buyers Work Center - - OCT 2009 2012 ?
(Complex Procurement) iExpenses - - JUL 2011 2012 ?
Hyperion - - DEC 2011 2012 ?
General Ledger - - - 2012 ?
Oracle Footprint and Direction
1Dependent on release timing
2CCTM: Contractor Cost Tracking Module.
Custom bolt on to Services Procurement to handle recurringservices such as engineering, consulting and construction.
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Historical Perspective
2004 - 20,000 systemic registered suppliers 2006 consolidation project leaves ~12,000 remaining
On-going consolidation Present day ~9,000 suppliers
Initial Request (usually from Buyers)
Disallow self registration
Supplier request form in MS Outlook
All new suppliers must use Sourcing & iSupplier Portal
Credit history inquiries handled with standard package
Qualification Insurance Requirements
BROWZ
Supplier Management
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Accounts Payable
Creates supplier in Oracle AP Creates remit-to site
Tracks changes to supplier information
Supply Chain Process & Performance
Creates purchasing sites Creates known contacts records
Trains/on-boards supplier Sourcing, iSupplier & CCTM
Coordinates/enables iSupplier, Sourcing CCTMresponsibilities
Advises Buyer of supplier readiness for use
Supplier Management
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Ongoing Supplier Maintenance Update Sourcing, iSupplier & CCTM responsibilities
Update remit-to sites (infrequent)
Update purchasing sites
Update contacts
Remediate training
Receive and catalog insurance certificates
Monitor supplier qualification compliance in BROWZ Transition fax or USPS trans method suppliers to eMail or iSupplier
Transition suppliers to EDI/XML trans method
Coordinate acknowledgement auto update with EDI/XML suppliers
Monitor workflow notification undeliverable messages and intervene forprofile updates
Merge/consolidate suppliers
Purge unused suppliers (3 yrs., no activity) monthly
Supplier Management
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In a Perfect World:
AP & Purchasing in the same organization, preferably co-locatedphysically
AP kicks off the setup with FIN information
Purchasing fleshes in the relevant PUR information
Designate 1 AP and 1 PUR super user (and a backup for each)
as the arbiters of all supplier information
Automate the supplier information collection document
Reject incompletes back to originator no science projects
Restrict new supplier self registration
Supplier Management
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In a Perfect World:
Contractually require the use of a supplier collaboration portal orsome method of electronic connection (EDI, XML etc)
Push existing supplier profile maintenance out to suppliers
Route undeliverable workflow eMail notifications to a designated
actionee
Implement a robust purchasing card (credit card) program
Purge no-activity suppliers on an annual schedule
Use no-activity for past three or five years as the criteria (self-determined)
Route candidate list to Purchasing and Materials Management(Inventory) leadership for review
Set a deadline and stick to it
Supplier Management
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Supplier Management Agenda
What is Supplier Management?
Why is it Important ?
Key Business Challenges
Supplier Management at Ameren
Supplier Management at Oracle
Q&A
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27 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Larry Ellison, CEO
Chief OperationsOffice
CorporateController & Chief
Accounting Officer
Source to SettleOrganization
Global ProcurementProcess Owner
SVP Global FinanceOperations
VP ProcurementSystems
Executive VicePresident of
Development
Fusion E-Business Suite
AdvancedProcurement
Product Strategy
Product Mgmt,Engineering, QA,
PeoplesoftEnterprise
JDE
Supplier Management at OracleSource to Settle Organization
Source to Sett leO r g a n i z a t i o n
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28 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Supplier Management at Oracle
223 ft
100 ft
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Supplier Management at Oracle
Business Challenges
Number of Suppliers: Large Number of Invoices: V. Large
Number of Systems: 1
Potential New Suppliers: 60,000 /yr
Project Scope Replaced a number of existing paper-
based processes
Prospective Supplier Invitation toRegister
Performance Tracking for ExistingSuppliers
223 ft
100 ft
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30 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Key Project Features
Impact of Sun Acquisition
Highly complex, virtual, direct materials Supply Chain On-line supplier scorecard a key requirement
Short time line; 3 months to complete technical implementation
New Supplier Requests (NSR) initiated byrequestor base 101,000 Users
60,000 NSR per year
Approached user rollout as a Proof of
Concept beginning with low volumecountries 17 countries completed
Timeline and Phasing
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31 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Supplier Invitation to Registration
Prospective Supplier to Oracle
INVITE SUPPLIERProvides estimated annual spend and business justification
SUBMIT NEWSUPPLIER REQUEST
RECIEVES NOTICE OFAPPROVAL
SUPPLIER
LOBREQUESTER
SUPPLIERMGMT
ADMIN.
RECEIVE INVITE ANDACCESS LINK
ON-LINE ACCESSGRANTED
STRATEGIC
OWNER
STRATEGIC OWNER;
APPROVER(S) MAKE DETERMINATION
SEND NOTICE OF
APPROVE OR REJECT
APPROVE: RECORD ADDEDREJECT: NO RECORD CREATE
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32 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Source to Sett leO r g a n i z a t i o n
Supplier Online Registration
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33 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Progress to Date
Replaced offline supplierregistration process
Introduced automated supplierreview/approvals driven bysupplier type, estimated spenddollar threshold and business
classification Supplier data ownership &
collaboration
Attachment support (W9)
Automated new supplier
welcome letter distribution(custom)
Deployed to 17 Countries
Efficiency Improvements
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34 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Supplier Performance ManagementTracking Buying Team Feedback
Key Drivers
Allows for Automated Global Evaluations Promotes Uniformity in Scoring
Collaboration across multiple teams
Result history maintained in Suppler Master
Score Card tracking: Cost
Quality
Availability (Delivery &Lead Time)
Strategic/TechnicalDevelopment
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35 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Supplier Management Results
Increase in efficiency
Data accuracy increased 100% Accommodated a 54% increase in volumes with only a 10%
headcount increase
Decrease in costs
35% decrease in cost per transaction
33% decrease in time required to enter supplier data
Next steps
Additional Supplier Onboarding Capabilities
Walk up Registration, Qualification/Risk Assessment Process (RFI)
Supplier Self Service Profile Maintenance Improve data quality on existing supplier records, annual review
Contracts Integration
Master agreements integrated into Supplier Master
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36 Copyright 2011, Oracle and/or its affiliates. All rights reserved.
Compliance CSR / CoC
Labor Practices EH&S
Finance / Credit
Strategic Preferred
Watchlist Improvement Plan Probation
Performance
Management
Risk
Management
Supplier ManagementExercising Control Throughout the Lifecycle
TransactRetireQualifyDiscover
Online registration
Supplier search
Profile enrichment
Detailed assessment
Compliance checks
Approval process
Review process
End relationship
Close account
Transact
& Review
EnableAccount creation
Electronic connection
Document formats
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Oracle Supplier Lifecycle ManagementThe Vendor Management Application that Institutes Formal Supply-BaseOversight
Extensible profile management
Risk-driven supplier segmentation
Integration with third-party supplierinformation services
Streamlines Registration andQualification of ProspectiveSuppliers
Web-based self-service registration
Supplier evaluation and scoring
Configurable approvals
Enables Cross-FunctionalPerformance Evaluation
Templatized questionnaires
Flexible feedback mechanisms
Visibility into archived supplier appraisals
Assures Effective Governance andRisk Mitigation
Profile and
Banking Details
Mfg Planning
Forecasts
Capacity
WaterfallAnalysis
eRFx &Auctions
VMI &
Consigned
Inventory
Order
Collaboration
ContractNegotiation &
Binding
Catalog
Authoring
Shipping & Work
Confirmations
Supplier
Search
Supplier
Qualification
Supplier
Inactivation
Supplier
Performance
Management
Invoicing, Inquiry
& Dispute
Resolution
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TrustedSupplier
Data
Legacy Legacy
Oracle Supplier HubUnifies and Shares Critical Info about an Organization's Supply Base
Consolidate Supplier InformationFlexible data import formats acrossheterogeneous systems, advancedattributes and relationships models, andconfigurable rules governing a goldensupplier record
Cleanse & Enrich Supplier DetailsEmbedded data-quality tools, fuzzymatching de-duplication and intelligentmerge, and integration to third party datasources like D&B and Trillium
Share Supplier Profile across Silos
Comprehensive business events,syndication and federation services, andreal-time message delivery
http://www.nokiausa.com/indexhttp://www.nokiausa.com/indexhttp://www.nokiausa.com/indexhttp://www.hira.or.kr/cms/rib_english/index.htmlhttp://www.symantec.com/index.jsphttp://www.wamu.com/http://www.hanjin.com/en/index.jsphttp://www.nokiausa.com/indexhttp://www.tsa.gov/index.shtmhttp://www.westpac.com.au/internet/publish.nsf/Content/PB+HomePage8/3/2019 Oracle Final Slide Deck v1
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Questions and Answers
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F l A k d Q i (FAQ )
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Frequently Asked Questions (FAQs)
Attendees of todays event will receive an email from ISM within ten
working days with a secured link to:
Your Continuing Education Hour certificate. CEHs are awarded toattendees who participated for at least 50 minutes of the seminar.
For detailed information on ISM Web Seminar participation and
instruction, go to:http://www.ism.ws/files/Education/WebSeminarParticipationDetails.pdf
Note: The archived interactive recording of todays event will be
available within 14 business days on ISMs Web site athttp://www.ism.ws/Seminars/WebSeminars.cfm.
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Participant Survey of Todays Event
Please take a moment to give us your thoughts ontodays Web Seminar.
Thank You.