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#AribaLIVE
@ariba
Closing the Loop in Your
Procure-to-Pay Process
Chris Rauen, Solutions Marketing, Ariba
Lou Valdes, Seni...
#AribaLIVE @ariba
Procurement
#AribaLIVE @ariba
Commerce Level 1: Concentrated
Siloed Processes
Sourcing &
Procurement
Supplier
AP
Mail
Email
Fax
Mail
S...
#AribaLIVE @ariba
Commerce Level 2: Connected
Supplier Portals
Sourcing &
Procurement
AP
Supplier
Send PO
Invoice
Receipt ...
#AribaLIVE @ariba
Defined & Approved
Catalog Content
Commerce Level 3: Collaborative
Closed Loop Value Chain
Catalogs
Perf...
#AribaLIVE @ariba
Ryder Profile
6
FLEET MANAGEMENT
SOLUTIONS
SUPPLY CHAIN
SOLUTIONS
(1) These amounts result from continui...
#AribaLIVE @ariba
Procure-to-Pay Challenges
7
Culture, policy-procedures and technology did not easily support P2P transit...
#AribaLIVE @ariba
Days in the Life of an Invoice
Code Invoice
Receive Invoice
Deliver to approver
Sort and scan
Key
© 2015...
#AribaLIVE @ariba
Goals - Objectives
9
Journey to transform the way Ryder buys and pays goods & services
 Deploy in a con...
#AribaLIVE @ariba
Solution Approach
Launched in a controlled approach (crawl, walk, run)
 Maximize the use of P2P and the...
#AribaLIVE @ariba
Results - Benefits
11
 Spend visibility
 Having details of what you buy creates new opportunities for ...
#AribaLIVE @ariba
Results - Benefits
12
 Automated accruals (including tax)
 Standardization and centralization in procu...
#AribaLIVE @ariba
Lessons Learned
"Change is hard because people overestimate the value of what they have—and underestimat...
#AribaLIVE @ariba
Next Steps
14
 Continue deployment to the Field
 Expand catalogs
 Add new commodities to the program
...
#AribaLIVE @ariba
Agenda
• Al-Futtaim Introduction
• Vision, Mission and Customer Values
• Background
• Business Challenge...
#AribaLIVE @ariba
Al-Futtaim Introduction
• Part of 80-year-old privately held group
• Dominant market leader
 Multi-bill...
#AribaLIVE @ariba
Vision, Mission and Customer Values
Vision
To be the auto company of
choice by providing value-based
cus...
#AribaLIVE @ariba
Background
• Centralized procurement in 2008
• Implemented Ariba Sourcing in 2009
 Entire group now usi...
#AribaLIVE @ariba
Business Challenge
• Inadequate Spend Visibility
 Multiple SAP platforms
 Maverick buying
 Cumbersome...
#AribaLIVE @ariba
Solution - Ariba Procure-to-Pay
© 2015 Ariba – an SAP company. All rights reserved.20
Make it Easy Make ...
#AribaLIVE @ariba
Complexities in Implementation
• Some trade purchase is also handled
• Extensive integration with SAP
• ...
#AribaLIVE @ariba
Solution Themes
• Scope definition – Striking the balance between SAP-MM and Ariba Procure-to-Pay
 Deta...
#AribaLIVE @ariba
Results
• Q4- 2014 data
• 62% of transactions fast tracked through catalogs
 168 catalogs with 6000 + l...
#AribaLIVE @ariba
Way Forward
• Leverage the reporting capability of the tool
 Monthly spend visibility reports for manag...
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Closing the Loop in Your Procure-to-Pay Process

Without connecting invoice processing to the broader source-to-settle process, a P2P transformation project will have limited success. In this session, you will hear how you can implement a "closed-loop" P2P process that enforces invoices against catalogs, orders, and contracts; monitors supplier performance; and improves control over your spend.

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Closing the Loop in Your Procure-to-Pay Process

  1. 1. #AribaLIVE @ariba Closing the Loop in Your Procure-to-Pay Process Chris Rauen, Solutions Marketing, Ariba Lou Valdes, Senior Manager, Procurement Operations, Ryder Logistics & Transportation Solutions Asad Zaidi, Director of Procurement & Performance Improvement, Al-Futtaim Group April 8, 2015 © 2015 Ariba – an SAP company. All rights reserved.
  2. 2. #AribaLIVE @ariba Procurement
  3. 3. #AribaLIVE @ariba Commerce Level 1: Concentrated Siloed Processes Sourcing & Procurement Supplier AP Mail Email Fax Mail Scan OCR © 2015 Ariba – an SAP company. All rights reserved.3
  4. 4. #AribaLIVE @ariba Commerce Level 2: Connected Supplier Portals Sourcing & Procurement AP Supplier Send PO Invoice Receipt & Status © 2015 Ariba – an SAP company. All rights reserved.4
  5. 5. #AribaLIVE @ariba Defined & Approved Catalog Content Commerce Level 3: Collaborative Closed Loop Value Chain Catalogs Perfect Invoice Payment Visibility, Execution & Remittance Perfect PO Analyze Source Order Match Invoice Receipt Requisition Manage/ Approve Order Acknowledgement & Ship Notice Contract “Actual ” Spend Data Pay Supplier © 2015 Ariba – an SAP company. All rights reserved.5
  6. 6. #AribaLIVE @ariba Ryder Profile 6 FLEET MANAGEMENT SOLUTIONS SUPPLY CHAIN SOLUTIONS (1) These amounts result from continuing operations. (2) Net Earnings from Continuing Operations are $243 million. 209,500 RYDER IS A FORTUNE 500 COMPANY WITH FULL YEAR 2014 28,900 VEHICLES EMPLOYEES 6.4 Billion ANNUAL REVENUE (1)$ $ 257 Million COMPARABLE EARNINGS (1) (2) $ 9.1 Billion ASSETS
  7. 7. #AribaLIVE @ariba Procure-to-Pay Challenges 7 Culture, policy-procedures and technology did not easily support P2P transition  A fragmented procurement structure  Limited use of technology and workflow  Limited visibility to contract information  Very manual payment process  Inadequate supplier contact information  Project approved in 2009 The biggest challenge …….…Change management! © 2015 Ariba – an SAP company. All rights reserved.7
  8. 8. #AribaLIVE @ariba Days in the Life of an Invoice Code Invoice Receive Invoice Deliver to approver Sort and scan Key © 2015 Ariba – an SAP company. All rights reserved.8
  9. 9. #AribaLIVE @ariba Goals - Objectives 9 Journey to transform the way Ryder buys and pays goods & services  Deploy in a controlled manner  Approval to Buy vs. Approval to Pay  Automate transactions (target 90% e-invoicing)  Standardize processes and enhance controls  Obtain visibility to contracts and spend  Pay the right price  Continuous improvement © 2015 Ariba – an SAP company. All rights reserved.9
  10. 10. #AribaLIVE @ariba Solution Approach Launched in a controlled approach (crawl, walk, run)  Maximize the use of P2P and the Ariba Network  Focus on change management, supplier enablement and deployment strategy  Integrate with Ryder systems to increase automation  Develop an efficient P2P program  Enable catalogs  Improve how transactions are processed  Create compliance reports to measure success with users and suppliers 10 © 2015 Ariba – an SAP company. All rights reserved.10
  11. 11. #AribaLIVE @ariba Results - Benefits 11  Spend visibility  Having details of what you buy creates new opportunities for RFP  On-demand dashboard reporting (info. on PO spend, suppliers, invoices)  Eliminates need for manual PO logs  Approvals obtained before $ is spent  Ensures we pay negotiated price and reasonable shipping costs  Enforces Ryder’s standard terms and conditions  Cost reduction due to elimination of paper invoices and leveraging spend  Strong validation rules to ensure invoice accuracy © 2015 Ariba – an SAP company. All rights reserved.11
  12. 12. #AribaLIVE @ariba Results - Benefits 12  Automated accruals (including tax)  Standardization and centralization in procuring and paying for goods & service  Less manual journal entries as commodities are mapped to correct GL accounts  Leverage communication with the Field to share existing tools to the Field Key Metrics  2014 YTD e-invoices represents 96% of all invoices  2,200 enabled suppliers  2,300 users  50 catalogs  2015 e-invoices target of 96-98% of all invoices  Expect 3,000+ enabled suppliers  Increase to 3,500 users  Expand to100+ catalogs 2014 2015 © 2015 Ariba – an SAP company. All rights reserved.12
  13. 13. #AribaLIVE @ariba Lessons Learned "Change is hard because people overestimate the value of what they have—and underestimate the value of what they may gain by giving that up.“ James Belasco & Ralph Stayer - Flight of the Buffalo (1994) 13  Develop strategy and prepare accordingly  Be prepared to manage change  Leadership support is key  Have accurate supplier information for enablement  Plan and adjust deployment (users/suppliers)  Build a strong team  Automate and build tools to assist program Change is hard. © 2015 Ariba – an SAP company. All rights reserved.13
  14. 14. #AribaLIVE @ariba Next Steps 14  Continue deployment to the Field  Expand catalogs  Add new commodities to the program  Continuously improve  Enhance user experience and support tools  Further automate compliance reporting  Expand Ariba tools Continue journey to transform how Ryder buys and pays for goods & services © 2015 Ariba – an SAP company. All rights reserved.14
  15. 15. #AribaLIVE @ariba Agenda • Al-Futtaim Introduction • Vision, Mission and Customer Values • Background • Business Challenge • Solution - Ariba Procure-to-Pay • Complexities in Implementation • Solution Themes • Results • Way Forward © 2015 Ariba – an SAP company. All rights reserved.15
  16. 16. #AribaLIVE @ariba Al-Futtaim Introduction • Part of 80-year-old privately held group • Dominant market leader  Multi-billion dollar revenues  Market share of 40% + in UAE  Represents 25 top global automotive brands  Over 250,000 units sold annually  12,800 employees from 70 nationalities  Presence in 14 countries across Middle East, Asia & Africa © 2015 Ariba – an SAP company. All rights reserved.16
  17. 17. #AribaLIVE @ariba Vision, Mission and Customer Values Vision To be the auto company of choice by providing value-based customer experiences delivered by an empowered and engaged workforce Mission Customers and vehicles for life © 2015 Ariba – an SAP company. All rights reserved.17
  18. 18. #AribaLIVE @ariba Background • Centralized procurement in 2008 • Implemented Ariba Sourcing in 2009  Entire group now using Ariba Sourcing  Over 400 online bidding events  Over $40M saved (18%) • Initially handled only non-trade spend • Now handling non-principal trade spend © 2015 Ariba – an SAP company. All rights reserved.18
  19. 19. #AribaLIVE @ariba Business Challenge • Inadequate Spend Visibility  Multiple SAP platforms  Maverick buying  Cumbersome reporting • Lengthy Procure-to-Pay Cycle  No centralized rate contracts  Tedious PO approval process  Manual invoices  Manual 3-way matching for payment © 2015 Ariba – an SAP company. All rights reserved.19
  20. 20. #AribaLIVE @ariba Solution - Ariba Procure-to-Pay © 2015 Ariba – an SAP company. All rights reserved.20 Make it Easy Make it Transparent Finance Suppliers Central Procurement Approvers / Senior Management Business Users … increased realized savings • Leverage group’s buying power • Contract Compliance • Greater Spend Visibility • Extended supplier network …spend visibility • Spend reporting for monitoring & control • Mobile PO approval capability …supplier enablement • Timely payments • Increased process transparency • Building strategic supplier relationships …item catalogs • Search and find items • Quick approval & tracking • Online contracted rates …process efficiencies • On-Time Accurate Invoicing • Streamlined goods receipt process • Tighter control on budget
  21. 21. #AribaLIVE @ariba Complexities in Implementation • Some trade purchase is also handled • Extensive integration with SAP • Complex and different P2P scenarios for in-scope trade purchase  Some categories needed pricing conditions and some batch numbers  Advance Shipping Notifications for accessory procurement  Procurement triggered from job cards and sales orders • Supplier Adoption  None of our suppliers were on the Ariba Network. Concept very new to the Middle East  Supplier apprehension about Ariba Network fees • User Adoption  700 + users scattered across 100-plus locations  Well-entrenched As-Is process © 2015 Ariba – an SAP company. All rights reserved.21
  22. 22. #AribaLIVE @ariba Solution Themes • Scope definition – Striking the balance between SAP-MM and Ariba Procure-to-Pay  Detailed spend analysis to support the scope  Customizations wherever possible to bring spend in scope  Keep customer-facing spend out of scope • Supplier education and training  Completed well in advance to address any challenges before go-live  AF-Auto and Ariba team educated suppliers on the benefits through hands-on training sessions in three waves  For key strategic suppliers, one-on-one sessions carried out before the trainings • OCM and User Training  Engage and communicate with key stakeholders at right time  SOPs, training collaterals and online transaction simulations made available to users  Train the Trainer approach – Wider reach and business ownership © 2015 Ariba – an SAP company. All rights reserved.22
  23. 23. #AribaLIVE @ariba Results • Q4- 2014 data • 62% of transactions fast tracked through catalogs  168 catalogs with 6000 + line items • 96% of third-party POs electronically transmitted through the Ariba Network • 33% reduction in PR to PO turn around time • 94% of invoices processed through automatic IV © 2015 Ariba – an SAP company. All rights reserved.23
  24. 24. #AribaLIVE @ariba Way Forward • Leverage the reporting capability of the tool  Monthly spend visibility reports for managing directors  Reports for category specialists to identify new sourcing opportunities • Enhance the existing solution  Buying against budget • Drive Supplier Performance Management  Track on-time delivery through Ariba Procure-to-Pay © 2015 Ariba – an SAP company. All rights reserved.24

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Without connecting invoice processing to the broader source-to-settle process, a P2P transformation project will have limited success. In this session, you will hear how you can implement a "closed-loop" P2P process that enforces invoices against catalogs, orders, and contracts; monitors supplier performance; and improves control over your spend.

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