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Unlock True Contract Management and Maximize Return on Investment | Ariba LIVE Rome
 

Unlock True Contract Management and Maximize Return on Investment | Ariba LIVE Rome

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It really takes two to tango. Managing contracts was never meant to be within the four walls of your enterprise. Collaborative contract management today offers organizations opportunities to ...

It really takes two to tango. Managing contracts was never meant to be within the four walls of your enterprise. Collaborative contract management today offers organizations opportunities to mitigate those countless risks that haunt supply chain operations. During this session, contract management professionals share their experiences with how working in tandem and on a real-time basis with their counterparts has helped them to identify and address compliance leakages, supply chain risks, and savings opportunities.

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    Unlock True Contract Management and Maximize Return on Investment | Ariba LIVE Rome Unlock True Contract Management and Maximize Return on Investment | Ariba LIVE Rome Presentation Transcript

    • #AribaLIVE Unlock True Contract Management and Maximize Return on Investment @ariba Speakers • Sundar Kamakshisundaram – Ariba, an SAP Company • Irina Ovsiyevitsj – Ariba, an SAP Company • Peter White – Ariba, an SAP Company
    • Agenda • Introduction • Contract Lifecycle Management Best Practices • Contract Management – Demo incl. electronic signatures • Q & A © 2014 Ariba – an SAP company. All rights reserved.2
    • Poor visibility of contractual relationships 0 10 20 30 40 50 60 70 Risk management, visibility, and compliance concerns are paramount 66% 40% 44% 37% Top 5 Reasons Cited “Contract Management technology provides an opportunity for procurement organizations to take contract maintenance out of the hands of legal counsel, while allowing them to focus on increasing efficiency and driving cost savings.” Source: Aberdeen Group, Procurement Contract Lifecycle Management, January 2012 Pressure to reduce supply and supplier risk Poor visibility into supplier performance on contracts Establish better control of enterprise spend Need to improve compliance 34% Top 5 Reasons Cited Contract Lifecycle Management Top Pressures within Procurement © 2014 Ariba – an SAP company. All rights reserved.3
    • Ineffective Contract Lifecycle Management Results in Increased Compliance Risks © 2014 Ariba – an SAP company. All rights reserved.4
    • Contract Management Automation Lead to Better Visibility and Compliance Source: Aberdeen Group, Procurement Contract Lifecycle Management, January 2012 © 2014 Ariba – an SAP company. All rights reserved.5
    • - - - And Drive Superior Procurement Results and Maximize ROI Source: Aberdeen Group, Procurement Contract Lifecycle Management, January 2012 © 2014 Ariba – an SAP company. All rights reserved.6
    • The American Red Cross - The Numbers • 1.3 billion = Sourceable spend • 85-90% = Spend under Management • 7,500 Suppliers • 350 Suppliers Enabled to-Date • 25 Catalogs are Live © 2014 Ariba – an SAP company. All rights reserved.7
    • TopSource - Results • 100% compliance within TopSource • Over 1,300 contract workspaces • 11 different processes for different departments, with associated super users • Multi-location benefits • Corporate council mandated the use of Ariba contracts throughout entire Topco organization © 2014 Ariba – an SAP company. All rights reserved.8
    • 9Confidential VALUE OF A CONTRACT MANAGEMENT SOLUTION TO LVSC Controls Tool to ensure compliance to the contracting process • Global system of record (SOR) for all LVSC contracts • Ensures that Legal and Sr. Management approval workflows are followed • Facilitates the appropriate signature through eSignature capability and automatic storage of signed document • Access control that allows users to see contracts related to their areas of responsibility • Develop and quantify process improvements
    • 10Confidential GLOBAL SYSTEM OF RECORD (SOR) Global System of Record (SOR) Contract Management system that has: • Standard processes • Easy access to contracts details and analytics • Allows for compliance audits Legal Entity or Property Date of Deployment Contracts 2012 Contracts 2013 Contracts 2014 Corporate April 2012 276 444 123 Bethlehem May 2012 64 98 12 Las Vegas June 2012 325 885 116 Marina Bay Sands August 2012 287 1,087 160 Macao June 2013 1 848 403 Yearly Totals 953 3,362 814 Totals 5,129 Contract Data as of February 27th Contract Data as of February 27th
    • 11Confidential PERCENT OF SPENDS VS. CONTRACTS
    • 12Confidential REQUIRED APPROVAL WORKFLOWS • Required Approval Workflows 3 Types of Approvals are used at LVSC:  Contract Request approval by Department Vice-President  Legal review of the contract  Sr. Management approval of tentative contract - Legal review completion is a predecessor to Sr. Management approval • Approval routes can be built on many factors such as dollar amount, General Operations vs. Capital Expense, etc • Approvals can be completed by email; email can be configured with document/summary information • Active Approval report in analytics allows for approval follow-up
    • Determining Contract Management Priorities • Repository  Contract portfolio assessment (active, expired; spend coverage)  Reporting and visibility needs (for manual compliance as well) • Authoring  Streamlining contract creation processes  Minimizing risk relating to contract language • Compliance management  Employee usage of the right contracts  Automating pricing structure compliance What is your company’s top priority today? © 2014 Ariba – an SAP company. All rights reserved.13
    • Contract Management: Typical Adoption Stages Stage 1: Central Repository  Easy to search  Good access controls  Contains header/ structured data and all documents  Automated alerts  Reporting Stage 2: Contract Authoring  Use of clause and template libraries  Integration with Microsoft Word  and external collaboration tools/ workflows  Associated reporting Stage 3: Integrated Compliance  Structured item/ pricing data  Automated back end establishment/ call-off  Usage-based alerting  Advanced usage reporting © 2014 Ariba – an SAP company. All rights reserved.14
    • Start with Pre-Implementation Steps • Assemble an experienced team for the long term • Schedule a kick-off meeting well in advance  Agree on project scope (locations, categories)  Decide between implementing “as-is” or re-designing your processes for best practice  Launch long lead time activities • Get the solution up and running early in the process • Complete initial software training before starting • Get early agreement on the extent to which you will edit the legal language in use for the clauses/templates © 2014 Ariba – an SAP company. All rights reserved.15
    • Agenda • Introduction • Contract Lifecycle Management Best Practices • Contract Management – Demo incl. electronic signatures • Key Takeaways • Q & A © 2014 Ariba – an SAP company. All rights reserved.16
    • #AribaLIVE Contract Management Best Practices @ariba Irina Ovsiyevitsj - Ariba, an SAP Company
    • Agenda © 2013 Ariba, Inc. All rights reserved.18 • Implementation Considerations:  Questions to ask on Master Data  Best practices on Organization Data & User Management  Best Practices on Supplier Data • Prior to design:  Contract Authoring  Contract Workspace create guidance © 2014 Ariba – an SAP company. All rights reserved.
    • Questions to ask on Contract Mgmt • Do you have a contract management process ? Who owns it ? Is it accepted ?  Who reviews contracts ? When ? Who approves them ?  How do you manage amendments ? • Is your contract management process different between regions or business units ? • When do you start negotiating on contracts ? Before award or after award ? And what does negotiating really mean before award ? • Will you load legacy contracts ? How many ? Who has to deliver this data ? • Do you have standard contract templates that we can incorporate in the template ? Are they commodity based ? • Do we have to integrate Ariba Contract Mgmt with Ariba P2P ? 19 © 2014 Ariba – an SAP company. All rights reserved.
    • Best Practices on Supplier Data • FIRST! Should suppliers be loaded in batch?  Not if they are supposed to directly register on the network. Depends on the registration type chosen.  Regardless of the registration type, remember that if contracts would be loaded in batch, at least some supplier organizations would have to be loaded • Be aware of the difference between Supplier Organizations and Supplier Users • Be aware of Contract / Supplier hierarchies 20 © 2014 Ariba – an SAP company. All rights reserved.
    • Best Practices on Header Fields Make fields required so that they can be used for reporting. Creation of 10 custom fields. Don’t create fields you will not use. Think about what fields you will use in multiple solutions and name them consistently. They can share a common value list where applicable. Position the fields logically and user friendly. You can order them in 2 separate columns. Consider the impact of multi-select fields on reporting. 21 © 2014 Ariba – an SAP company. All rights reserved.
    • Best Practices on Workspace Questions Questions can be a very effective way to guide the user through the process. By asking the right questions and linking them to conditions you can prepare a best fit process for the user. Typical questions for contracts are questions on the user of supplier and/or custom paper. If the customer team is not centralized, you can also create templates per language. Questions can also be a good alternative for fields. However, remember that you cannot report on questions! 22 © 2014 Ariba – an SAP company. All rights reserved.
    • Document Management with Authoring A large part of the work on contract authoring is converting legal contracts in new word documents that are ready to be used in contract authoring. It is easier to create the main agreement, load it in a template and then push the clauses into the clause library then the other way around. The clause library is not mandatory to be used. You can store Main agreements perfectly in the templates. The Clause Library you use when you have many different templates using the same clauses or if you require clause approval rules. Verify that you are using a compatible version of MS Word 23 © 2014 Ariba – an SAP company. All rights reserved.
    • Legacy Contract Load • Time-demanding activity to gather all the information  Advice to start early on gathering contracts, especially if there are multiple locations/areas involved • Provide small sets of data in advance to gather feedback on the format/content • Pay attention to special characters for non-English  Project names can contain special characters, but documents can not. Renaming/removing in advance will save time • Make sure that users are not spammed by emails when legacy contracts are loaded 24 © 2014 Ariba – an SAP company. All rights reserved.
    • Agenda • Introduction • Contract Lifecycle Management Best Practices • Contract Management – Demo incl. electronic signatures • Key Takeaways • Q & A © 2014 Ariba – an SAP company. All rights reserved.25
    • #AribaLIVE Ariba Contract Management Demonstration @ariba Peter White – Ariba, an SAP Company
    • Ariba Contract Management 27 Dashboard / Monitoring Authoring / Negotiations Internal/External Review Publish Results Develop Agreement Clause Library Repository © 2014 Ariba – an SAP company. All rights reserved.
    • Thank you Q A& Contact information: Sundar Kamakshisundaram Sr. Director E: sundar.kamak@sap.com © 2014 Ariba – an SAP company. All rights reserved.28
    • Please Complete Session Survey Locate Session 29 Click Surveys Button Select Breakout Survey Rate Session Thank you for joining us © 2014 Ariba – an SAP company. All rights reserved.