1
SAP AG 2004, Document Title / 1
Procure to Pay in Public Sector – Previous Situation
Procure Receive
Source Pay
Request Product
Sourcing SpecialistRequester Purchaser
Goods recipient Accountant
Government
regulations
� Poor integration of specialized processes (government regulations).
� Delay‘s in the process, process breaks, and time consuming syncronizationbetween processes
� Requester needs to call the sourcing specialist to know the status.
� Key process steps are handeled manually, e.g. Regulations compliance (lock the budget when RFQ is published), and status checks by requestor (budget availablility)
� Highly regulated processes with ever changing law regulations
� Time consuming process of selecting suppliers
2
SAP AG 2004, Document Title / 2
Procure to Pay with “Best of Breed” in Public Sector
Flexible Process Innovation / Extensibility
User productivity/ Collaboration
ProcessEfficiency/ Automation
� Easy and fast adoption of new process variants (like government regulations)
� Up-to-date status checks for Product Mgr � Immediate Budget checks - no need to wait for response from finance.
� Efficient communication with RosettaNet and other B2B communication - replacing fax/ telephone
� Alerts based on user defined criteria
ProcureRequest Product PayReceive
Efficiency/ Automation
User Productivity
Extensibility
Sourcing SpecialistRequester Purchaser
Goods recipient
Accountant
Source
Publish
RFQ
Receive
QuotesEvaluate
Quotes
Select
SuppliersAward PO/
Contract
1 2 3 4 5
� User‘s are more effective: check‘s can be done in a integrated fashion:
�Status check‘s Product Mgr is always informed no need to call.
�Budget checks can be done on the fly no need to wait for response from finance.
3
SAP AG 2004, Document Title / 3
Procurement process: Today’s IT Challenges
SRM
AI
Inventory
Finance
Purchasing
IT Landscape
Sourcing
SpecialistRequester Purchaser
Goods
recipient Accountant
� Integration of complex regulated processes, business
processes, and existing systems � Cross processes managed and maintained in isolated systems
� Integration of new BoB applications, e.g. AI to support various countries
� Inefficient data collection, synchronization, consolidation and reformat
between systems and parties involved in the process
� Data re-entry into multiple systems (SAP and AI)
� Status information and budget availability spread in different systems
� Missing consolidated real time information (status information, budget availability in different systems)
� High cost of maintaining disconnected legacy systems
� High risk in replacing „one piece of the puzzle“
� Process Innovation limited by static system architecture
� Unable to share information with other agencies
� Consolidate information for better compliance
� „One view on the taxpayer“
� Quickly implement new tax schemes
� Changes to existing tax rules
� Enhance System to other business models
4
SAP AG 2004, Document Title / 4
� Fully automated, real-time
exchange of information
between systems (SAP and
AI) (e.g. RFQ status)
� Minimal need for data
replication through
services, e.g. Budget.
� Efficient adoption of new
best of breed systems to
ensure unique business
advantages
� Reduced maintenance
cost by harmonized
platform
The unique Value of IT Flexibility in procurment in Public Sector
Increased
collaboration and visibility
Increased Flexibility
in Deployment and Extensibility
Ease of
Integration and Consolidation
� Ease of establishing new
channels (e.g. Supplier
Portal)
� Consolidated and
harmonized real time
information, accessible
across multiple systems
(e.g. on RFQ status)
Deployment
Flexibility
Business Process Platform
Collaboration
SR
M
Inv
en
tory
AI
Fin
an
ce
Pu
rch
as
ing
Integration
Sourcing
Specialist
RequesterPurchaser
Goods
recipient Accountant