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2009 open world chooing the right subscription contract

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  • 1. <Insert Picture Here>
  • 2. <Insert Picture Here>EBS Contracts: How Do You Pick the RightSolution?Susan FlierlProduct Strategy Director
  • 3. The following is intended to outline our generalproduct direction. It is intended for informationpurposes only, and may not be incorporated into anycontract. 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 Oracle’sproducts remains at the sole discretion of Oracle. 3
  • 4. Agenda• Our understanding of Contract Management <Insert Picture Here>• Capabilities and value drivers• Benefits and assessments• Oracle solutions• Oracle credentials• Customer Case Study – ProQuest – Subscription Management with R12 Service Contracts 4
  • 5. Contract Management At-a-GlanceTrading Partner Negotiate Trading Partner & Author Approve & Sign Buy Sell Side Monitor Side Involved Orgs Involved Orgs • Procurement & Enforce • Sales • Project Mgmt • Service • Finance Close-Out Close- Renew • Finance • Legal • Legal “Managing contracts is nothing new – what is new is their complexity. Fortune 1000 companies have [on average] 20,000 - 40,000 contracts. Companies spend approximately 50 basis points of their revenues to manage their contracts, which can be reduced 20-50% using contract management software.” -- Jamie Friedman, Global Equity Research 5
  • 6. Business PressuresProcess Control Trading Partner Management• How can I standardize complex • How can I minimize lengthy post- contracts & contract processes? negotiation redlining?• How can I streamline approvals • How can I avoid costly disputes? of non-standard agreements? Trading Trading Partner PartnerContract Compliance Time to Contract• How can I comply with growing • How will I continually reduce regulatory oversight? contract cycle time and costs?• How will I monitor contract • How can I reduce paperwork performance and execution? and improve efficiency? 6
  • 7. Operational Challenges Manual document Delivery / Service Support Business owners Fulfillment handling creates lack visibility to multiple “out of signed contracts synch” versions Buy-Side Sell-Side Purchase Contract SalesSuppliers Contract Purchasing Administration Sales Contract Customers Lack of contract visibility Sequential work leads to “evergreen” processes lengthen contracts, overpayments negotiation cycle time Legal Finance and payment errors 7
  • 8. Contract Management Opportunity Operating & Processing Costs 10-30% Contract Negotiation Cycle Time 50% Volume of Erroneous Payments 75-90% Additional (New) Contract Revenue 1-2% Renewal Revenue 30% Compliance with Regulatory Guidelines 90-100% Source: Goldman Sachs, Global Equity Research 8
  • 9. Contract Lifecycle Management VP Procurement General Council VP Sales Buying General Selling process Contracts process CFO CIO Contract Management GC* Based on a model developed by Andrew Bartels. Copyright 2008, Forrester Research. Used by permission. 9
  • 10. Oracle Contract Lifecycle Management Native integration to business transaction flows Buying General Selling process Contracts process VP Procurement General Council VP Sales Oracle Oracle Sales Simple Procurement & Service contracts Contracts Contracts CFO CIO Oracle Contract Management GC Oracle Oracle Complex Project Project contracts Contracts Contracts Oracle Federal CLM** Based on a model developed by Andrew Bartels. Copyright 2008, Forrester Research. Used by permission. 10
  • 11. Oracle Contract Management Standalone solution Buying General Selling process Contracts process VP Procurement General Council VP Sales Oracle Oracle Quoting Sourcing / / Order Purchasing Management CFO CIO Oracle Contract Management GC External External procurement ordering application application* Based on a model developed by Andrew Bartels. Copyright 2008, Forrester Research. Used by permission. 11
  • 12. Oracle Contract Lifecycle Management Overview• WHAT – A family of contract applications designed to author and Project Service manage the lifecycle of all contract Contracts Contracts types• HOW – Deployed integrated with order- Procurement Sales to-cash and procure-to-pay flows or as Contracts Contracts standalone application Contract Terms• RESULTS - Improve visibility of all Library business agreements, reduce contract Contract Repository cycle time, and manage risks (Oracle Contract Management*) *Standalone product coming soon 12
  • 13. Oracle Contract Lifecycle Management Solution Integrated Intelligence Sales • Cancellation / • Uplift & • Contract Email Renewal Rate Reduction Bookings Service Contract Lifecycle Management Phone Optimize, Support Negotiate Approve Enforce Amend Renew & & Author & Sign & Entitle Terminate Internet • Collaborative Authoring • Change Mgmt • Workflow Approvals Procurement Contract Standardization Contract Visibility • Clause Library • Contract Legal • Contract Templates Secure Workbench • Selection Rules Access • EnterpriseContracting • Policies Contract Search Finance & Party Accounting 13
  • 14. Oracle Contract Management Process Flow Author terms & conditions on separate contract document 1. Establish 2. Author & 3. Approve Standards Negotiate and Sign• Clause library • Templates and Contract • Flexible approval workflow Expert• Contract templates • Contract Standards and • MS Word Synchronization Deviations• Clause selection rules • Associate with business document, if required 4. Monitor 5. Amend 6. Renew and Track & Closeout• Contract Workbench • Collaborative revision • Expiration alerts• Real-time deliverable tracking process • Standardized closeout process• Full-text search with • Amendment approval flow Enterprise Contract Search • Auditable revision history * New in R12.1 14
  • 15. Oracle Procurement Contracts Process Flow Associate terms & conditions on purchasing documents 1. Establish 2. Author & 3. Approve Standards Negotiate and Sign • Capture products, quantities, • Online collaboration• Central terms library pricing • Flexible approval workflow• Workflow • Templates & role- • Electronic & digital signature configuration based authoring • Contract Standards &• Clause selection rules • MS Word Synchronization Deviations • Supplier paper 4. Monitor 5. Amend 6. Renew and Enforce & Closeout• Contract Workbench • Collaborative revision • Expiration alerts• Terms implementation process • One-click renegotiation• Real-time deliverable tracking • Amendment approval flow • Standardized closeout process• Full-text search with • Auditable revision history * New in R12.1 Enterprise Contract Search 15
  • 16. Oracle Sales Contracts Process Flow Associate terms & conditions on sales documents 1. Establish 2. Author & 3. Approve Standards Negotiate and Sign • Capture products, quantities, • Online collaboration• Central terms library pricing • Flexible approval workflow• Workflow • Templates & Contract Expert • Contract Standards & configuration Deviations • Preview contract on-line and• Clause selection rules print with BI Publisher • MS Word Synchronization 4. Monitor 5. Amend 6. Renew and Enforce & Closeout• Contract Workbench • Collaborative revision • Expiration alerts• Track ordering against sales process • Standardized closeout process agreement • Amendment approval flow• Terms implementation • Auditable revision history• Full-text search with * New in R12.1 Enterprise Contract Search 16
  • 17. Oracle Service Contracts Solution Service Provider / Product Manufacturer 1 Proposals, Quotes Define 2 Products & Warranties Sales Coverage Subscription / Usage Agmts Create Service Contract 3 Bill & Invoice Contracts T&Cs Verify Repository Entitlement R Contract Mgr e 4 Service Requests Provide n Service e w 5 Renewal Notifications Bill & CollectCustomer Service Returns, RMAs Integration Other • AR, Invoicing • Service Application Components • OM, Quoting • Install Base 17
  • 18. Streamline Renewals Management Predictably Protect and Grow Recurring Revenue Expiration Alert High Value RenewalsRenew / CreateActivate Opportunity • Receive automated expiration alert • Convert expiring contracts into sales opportunities • Evaluate complementary products / services for cross-sell & up-sell opportunities • View transaction and interaction history Quote Negotiate Renewal Rule New ContractHigh Volume Electronic Renewals• Automatically renew contracts based on pre-defined rules to maximize retention rates and ensure service continuity • Credit Status = OK • Update Contract • Contract > Threshold • Notify Sales /• Zero-touch web based process automatically Value Value Service Rep renews low value contracts upon expiration • Expire days < 30 • Notify Customer 18
  • 19. Oracle Project Contracts SolutionCustomers Project Owner / Manager Solicitations Contract Manager Solicit or Bid Bid/Proposal Contract Role-Based Access Author/Execute Contract Change Management Secure, Central Sell Contract Repository Side Procure/ Sell SubcontractContractors &Subcontractors Subcontracts Manage Funds (w/Flowdown) Purchasing Track Deliverables • Standard Library: T&Cs, Articles • SOWs Bill & Collect • DeliverablesSuppliers Buy Purchase Orders (w/Flowdown) Integration Other Application Components • Planning • Manufacturing • Projects • Procurement • Shipping • Finance 19
  • 20. Oracle Contract Lifecycle Management R12.1 Features• Contract Repository (Oracle Contract Management) • Structured Terms Authoring • Contract Expert • Microsoft Word Synchronization • Contract Deviations Report • Enterprise Contracts Search• Sales Contracts • Enterprise Contracts Search• Procurement Contracts • Enterprise Contracts Search • Deliverable Payment Holds• Service Contracts • Service Contract Import 20
  • 21. Roadmap: Federal Contract Lifecycle Management • Permits contract managers to create and execute all types of contracts in a single system • Complies with FAR & supplemental requirements for fair & open competition for the Civilian, DoD & Intel communities • Provides vastly improved Business Intelligence • Delivers turn-key implementations through CACI ServicesBuilt out as an enhancement to Oracle’s E-Business Suite Leverage Native Integration of EBS Procurement , Contracts & Financials with Business Intelligence for Enterprise Resource Planning! 21
  • 22. What Forrester Is Saying“Oracle E-Business Suite (EBS) has had a Service Contract product for more than a decade and added Sales Contract and Procurement Contract products in 2004 ..Functional strengths included support for services contracts and other sell-side contracts (like project contracts, sales agreements), contract optimization, contract repository, and contract process management. Existing Oracle customers would find its CLM products to be capable ones that work well with other modules in the suite. Oracle Service Contracts is a top choice for companies needing renewal-based services contracts to be managed.”Contract Lifecycle Management Wave, 2008 22
  • 23. Oracle Contract Lifecycle Management Customers High TechIndustrial Mfg ServicesAerospace & Defense Public Sector 23 23
  • 24. Key TakeawaysChoice of standalone or integrated solution approach • Oracle Contract Management offers standalone contracts solution • Oracle Procurement Contracts and Oracle Sales Contracts offer contracts solution integrated with transaction flows • Complete support for buy-side, sell-side and general contracts * New in R12.1 24
  • 25. Oracle Contract Lifecycle Management Choice of standalone or natively integrated contract solutions Buying General Selling process Contracts process VP Procurement General Council VP Sales Oracle Oracle Sales Simple Procurement & Service contracts Contracts Contracts CFO CIO Oracle Contract Management GC Oracle Oracle Complex Project Project contracts Contracts Contracts Oracle Federal CLM** Based on a model developed by Andrew Bartels. Copyright 2008, Forrester Research. Used by permission. 25
  • 26. Subscription Management withOracle R12 Service Contracts Timothy Hall Sr. Technology Manager, ProQuest, LLC.
  • 27. About ProQuestProQuest creates indispensable research solutions that connect people and informationProQuest creates specialized information resources and technologies that propelsuccessful research and lifelong learning. A global leader in serving libraries of all types,ProQuest offers the culmination of experience from many respected brands, includingCSA™, UMI®, Chadwyck-Healey™, SIRS®, and eLibrary®. With Serials Solutions®,Ulrichs™, RefWorks®, COS™, and Dialog® brands now in the ProQuest family, thecompany continues to build on its legacy of responsive people in partnership withlibrarians.ProQuest consistently seeks new ways to support researchers and qualityresearch. More than a content provider or aggregator, ProQuest is an information partner,creating indispensable research solutions that connect people and information. Throughinnovative, user-centered technology, ProQuest offers a depth and breadth of globalcontent that includes historical newspapers, dissertations, and uniquely relevant resourcesfor researchers of any age and sophistication—including content not likely to be digitizedby others. Inspired by its customers and end users, ProQuest is working toward a futurethat blends information accessibility with community to further enhance learning andencourage lifelong enrichment.
  • 28. Agenda• Strategic Objectives, Program Management – Systems – Where we were – Systems Consolidation Challenges – Systems Consolidation Benefits – The Program / High-Level Timeline – Systems Consolidation• Subscription Management – Challenges / Options / Solution – Subscription Management, Renewals – Product Management, Accounting, Revenue Recognition• Subscription Management Oracle R12 Service Contracts / Subscription Items – Solution Design – Processes – Solution Benefits – Renewals Process Redesign
  • 29. Strategic ObjectivesProgram Management
  • 30. Systems-Where we were• 4 Business Units across the World – Serving North America, Latin America, EMEA, and Asia• Customer data and information in 6 systems• Order, Subscription, and billing data in 6 systems• Critical Financials (General Ledger, Accounts Payable, Purchasing and Fixed Assets) in 3 Financial systems (with lots of spreadsheets)• Independent Chart of Accounts in Each Financial System• Product set up handled in 9+ systems• Multiple e-Commerce strategies with no single strategic solution or platform
  • 31. Systems-Where we were
  • 32. Systems-Where we were SPOC Libra Oracle eBS 11iSix different Order & Billing systems with Subscription Management data Solomon Siebel (CSA) Solomon (RefWorks)
  • 33. Systems Consolidation Challenges• Underlying systems architecture vastly different• Several conflicting differences, made it impossible to do it ‘one way’ in any legacy system• Requirement became clear for a Global solution to reduce costs and increase efficiencies• To realize full benefit, including efficiency and effectiveness, underlying architecture had to be aligned – Single Customer & Item (Product) Master – Single Order and Billing System with a Single Financials System structured on a Common Chart of Accounts – Single Product Setup System
  • 34. Systems Consolidation Benefits• Single system – single source of truth• Ability to key orders / subscriptions for all products in a single system regardless of customer location or currency• All Financials in a single system (single GL) for reporting• One (and only one) item (product) description• Greatly improved data quality and consistency• Multi-currency support• Flexible payment terms and payment schedules• Ability to email quote / renewal / invoice• Consolidated invoicing and monthly statements• Provides greater flexibility across the organization
  • 35. The Program• Started with a Proof of Concept on Oracle eBS 11i system to determine gaps with other ProQuest product-lines• Developed global design first, then implemented for specific business units – US, UK, SPAIN and CAN• Vanilla – From previous experience with customized ERP implementation (Vanilla became theme for project)• Gain support and commitment at every level with high visibility across entire organization• Make it challenging – not crippling• Agile mentality – Regular CRP’s, creative Project Mgmt• Oracle AIM – Customized for PQ (“Agile AIM”)
  • 36. High-Level Timeline2007 2008
  • 37. Systems Consolidation 10/07/20089/17/2008 11/10/2008 SPOC Libra Oracle eBS 11i Oracle eBS12/01/2008 R12 7/06/2009 12/15/2008Solomon Siebel (CSA) Solomon (RefWorks)
  • 38. Subscription Management Challenges Options Solution
  • 39. Subscription Management - Challenges• Intangible and Tangible Products – Heterogeneous Products • Digital Database Products • CD/DVD Products • Microform Products• Complex Customer Structure – Internal Relationships – Bill To is one and Ship to is another – Consortia Relationships – School Districts – Partners/Resellers – Parent-Child Hierarchy (Academic will have University and multiple departments)• Variable Order Types for A Single Product – Subscription and One Time – Variable Terms and Add On Fees – New vs. Renewal – Subscription and Order Visibility across multiple organizations to ensure load balancing• Quality Control of Billing Process – Inability to review and approve Subscriptions entered – Workflow Management/Notification Process• Renewal Cycle – Multiple Notices and Notification via multiple delivery methods (Email, Snail Mail etc.) – Product Specific – Customer Base Specific (Ordering Location)
  • 40. Subscription Management - Challenges• Billing – Delayed – Deferred – Installments • Flexible Payment Plans – PrePayments to be accounted for at time of Order Entry• Credit and Rebill – Ability to Credit or Order a Line or Complete Order – Partial Credits --- Part of a Subscription Term – Upgrade and Downsize the Subscription order (based on budgets/PO approvals)• Immediate Invoicing and Accounting – Ensure COA Reporting and Other Segments are accounted for – Bill a Subscription before or after term start of subscription • Early and Late Renewals• Revenue Recognition – Deferred – Modify Monthly to Daily• Multiple Currencies – Based on Organization, Customer Location
  • 41. Options and Solution Selection• ProQuest UK Operating Unit had a Custom ‘Subscription Management Process’ and Renewals process using OM and Inventory Items from Oracle eBS 11i (11.5.9) Implementation• Custom solution with OM and Inventory resulted in: – Custom Accounting for COA Reporting Segment Requirements – Custom Revenue Recognition for Deferring and Recognition Daily – Custom Renewal Cycle – Manual Quality Control – Goal of Vanilla would be unachievable with this solution• Oracle eBS R12 Service Contracts (Subscription Items) – Researched via Oracle Metaink – Setup configurations on eBS R12 ‘test’ environment – Setup a focused team to review all setups • Reviewed all processes from Order Entry to Revenue to Renewals • Agile Iterative process
  • 42. Subscription Management Solution Design Processes Benefits
  • 43. Subscription Process
  • 44. Renewal Process Flow
  • 45. Solution Benefits• Global WorkFlow Standardization – PAL (one time) and Subscriptions for both tangible and electronic products – Standard Currency Based Templates for each OU – Subscription QA Process Automated – Flexible Pricing – Templates allowed for reduced data entry without customization• Billing and Credits – Auto Accounting – Sales Tax and VAT through EB Tax and Vertex – Partial And Full Credits possible• Automated Renewal processing – Renewals report from single source – No Spreadsheets• Financial Reporting Standardized – Daily Revenue Recognition – Single Billings Report – Single Revenue Report
  • 46. Renewals Process Redesign (eBS R12 Service Contracts made this possible)LEAN Six Sigma Kaizen conducted for ProQuest Global Renewals Process
  • 47. Renewals Process Redesign (eBS R12 Service Contracts made this possible) Lean Metric Prior State Future State Monthly Person Weeks Consumed by Number of Process Steps - Prior State Vs 90 Day Renewals 11.64 2.88 Future State 44 # of Value Added Steps 3 2 45 40 # of Necessary Non-Value Added Steps 44 16 35 30 28 30 25 # of Non-Value Added Steps 7 3 # Steps 25 # of Review Steps 25 6 20 16 13 12 15 11 # of Hand-Offs 30 11 10 7 6 6 3 2 3 5 # of Waiting Opportunities 13 6 - # of Decisions 28 12 % Value Added Time 2.0% 7.2% % Non-Value Added Time 2.3% 0.1% Current State Future State % Necessary Non-Value Added Time 62.5% 66.8% % Review or Approve Time 33.2% 25.9% Prior State vs. 90 Day Future State 15 Prior State to 90 DayPerson Weeks 10 11.64 Future State Time 5 2.88 Savings: 75% 0 Current State Future State
  • 48. Questions?
  • 49. The preceding is intended to outline our generalproduct direction. It is intended for informationpurposes only, and may not be incorporated into anycontract. 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 Oracle’sproducts remains at the sole discretion of Oracle. 49
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