2. Confidential and Proprietary
Table of Contents
Introduction
Contract Management Challenges
Current Contract Management Process
Recommendations for Solution: Short Term
Recommendations for Solution: Long Term
Appendix
2
3. Confidential and Proprietary
Introduction
3
Problem
Desired
Outcome
Impacted
Groups
Lack of centralized contract management tool and limited
visibility of contracts across the firm resulting in potential
financial, operational, and legal risk to UCI
Implementation of centralized contract repository tool with
visibility to all authorized Business users
Legal, Business Affairs, Strategic Sourcing & Procurement,
and all Business Groups
4. Confidential and Proprietary
Contract Management Challenges
4
Inconsistent Contract Management Processes Across the Firm – Potential for high levels
of non-contract supported maverick spend, inadequate supplier service level
management and possible regulatory non-compliance.
Lack of Contract Management Ownership – Unable to effectively manage contract
commitments throughout the organization due to the lack of a centralized system.
Limited Contract Visibility Across the Organization – Constricted visibility hindering
efforts to monitor contract compliance, access supplier pricing and volume discount
rebates, analyze supplier performance, and more efficiently manage contract
commitment expiration.
5. Confidential and Proprietary
Current Contract Management Process
Microsoft Access
• Current repository tool
can be inefficient
• Underperforms when
multiple users are
logged in
• No approval workflow
during contract
negotiations
• Lack of automated
reporting to monitor
expiring contracts
• Only accessible by
Strategic Sourcing &
Procurement
Oracle
iProcurement
• Transactional
purchasing tool
• Supplier can have zero
to hundreds of
Purchase Orders
• Invoices, PO Blankets,
Change Orders, and
attached PDFs of
contracts
• Payment terms in
supplier master file do
not always match terms
stated in contract
Shared Folder
File Storage
• Contracts stored in
multiple folders awaiting
manual uploading into
contract repository
• Highly manual effort to
locate correct contract if
supplier has many
contracts
• Some file names lack
proper description (see
below)
5
6. Confidential and Proprietary
Recommendations for Solution: Short Term
Consistent Naming Convention of File Names
• Name of Supplier, Effective Year, Type of Contract, Status
• Eases search of contracts both pre and post upload into contract repository
• Quick referencing for desired contract
Providing Access of Repository to Multiple Business Groups
• Encourage uploading of contracts into a single centralized location
• Reduces time spent waiting for input from other departments when executing P2P transactions
requiring contractual pricing support
• Less “back-and-forth” email communication traffic between departments
• Ability to easily access pricing and contract terms
Adding Payment Terms Field
• Assists Working Capital firm-wide initiative (See slide 9 in Appendix)
• Quick reference - eliminates accessing contract PDF through Sharepoint to locate payment
terms (See slide 10 in Appendix)
6
7. Confidential and Proprietary
Recommendations for Solution: Long Term
Explore the option of a centralized contract repository tool to be used across the firm
7
Solution
Benefits
Ensures Visibility to All Authorized Users
Allows for contract execution approval routing to all applicable Business, Legal, Procurement and Finance staff
Reduction in Contract Negotiation Cycle Time (Contract Approval Workflow)
Allows interaction between UCI departments and suppliers during contract negotiations to execute a contract
based on UCI preferred terms and mitigates potential risk.
Reduces Contract Risk Exposure
Provides the Strategic Sourcing & Procurement teams with awareness of expiring contracts, therefore allowing
appropriate preparation time to explore options and execute negotiations with incumbent or new supplier(s)
Scheduled demos with potential suppliers
Iasta
Captera
Open Source Inc.
Solution
Supplier Demos
9. Confidential and Proprietary
Working Capital - Supplier Payment Terms
9
Working Capital Supplier Review
Description Count %
Total Suppliers Identified for review (Listed Class A, B and C suppliers) 3888 100%
Total Suppliers Reviewed to date 2176 56%
Total Suppliers Updated to date 168 13%
Weighted Average - DPO
Description 8/7/15 7/31/15 7/23/15 7/16/15 7/9/2015 7/2/15 6/25/15 6/18/15 6/11/15 6/5/15 12/31/14
Top 100 Suppliers DPO * 17.92 17.68 17.81 17.06 16.80 16.81 15.88 15.46 15.33 15.31 13.99
All Suppliers - DPO 13.16 13.39 13.32 11.88 11.74 11.68 11.74 11.89 11.65 11.62 10.09
• Top 100 suppliers DPO weighted average exclude the following suppliers: Deutsche Bank, Wilmington Trust, J Aron, Televisa, Venevision, ADP and GE Financial
• The numbers highlighted in red are before my arrival at Univision and inclusion in the Working Capital Project
As a result of the actions implemented above, the improvement in working capital in 2015 as of 8/7/15 is:
$9,191,403.06
In addition, of the vendors that have been reviewed in Class A and B, these vendors have shown an improvement in the weighted average DPO of 2.73
days and working capital of $1,736,682.21 as of 8/7/15.
