The document outlines best practices in end-to-end contract management, emphasizing the importance of procurement compliance to achieve expected savings from contracts. It highlights the benefits of automation in contract authoring and compliance, showcasing capabilities that enhance visibility into compliance, negotiated savings, and invoice management. Overall, effective management leads to significant savings and improved operational efficiency for both buyers and suppliers.

1. PUBLIC
Deepak Sanghi, Debashis Banerjee
August 2017
Best Practices in
End-to-End Contract Management

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Procurement compliance is needed to ensure realized savings
from sourced contracts
Contract
Savings
From
Sourcing
(20-25%) Realized
Savings
Without
Procurement
(10-13%)
Time
Value of
Procurement
Lost
Savings
via
Leakage
(10-12%)
1
2
3
Invoice
Reconciliation
/Discounts
Poor Process
Management
Lost Contract
Compliance
5-7%
1-2%
4-6%
10-12% Lost Savings
Without Procurement compliance

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“Applying procurement guardrails is of
paramount importance to achieve the
compliance goals and realize the
forecasted savings. It not only helps
buyers but suppliers as well.”
Sudhir Bhojwani
Senior Vice President, SAP Ariba Apps

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* Source: Ardent Partners, The Rewards of Best-in Class Contract Management, February 2015
21%
35%
34%
39%
35%
41%
54%
56%
Visibility into contract compliance rates
Visibility into implemented savings
Visibility into booked savings
Visibility into identified or negotiated
savings
Best-in-Class
All Others
© Ardent Partners - 2014
Procurement teams
differentiate themselves
by having greater
visibility into contract
negotiation, performance,
savings and compliance.
Contract Management Automation
Visibility into Savings and Compliance

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End-to-end Contract Authoring and Compliance Solution
Authoring Repository Compliance Visibility
Clause 1
Clause 2
Clause 3
Signed
Legal
Contract Repository
Release
No
Release
Purchase Order
Receipt or
Service Sheets
Invoice
Catalog
Spend
Visibility
buyer supplier

6. Demo – Contract Authoring, Contract
Compliance

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Contracts cover PO based spend, invoices and ad-hoc
services spend
 Po Based Spend, takes care of contract compliance during
requisitioning
 Invoices, takes care of invoices against contracts and
automatic generation of invoices for fixed and recurring
payments
 Ad-hoc Services Spend, helps in enforcing price compliance
for ad-hoc services (service entry sheets)
Contract Compliance

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Capabilities
 Automatic selection of best contract for a purchase
 Automatic creation of requisitions based on pre-determined forecasted spend
Benefits
 Automatic selection guarantees contact utilization and best prices
 Timely booking of liabilities for the forecasted spend
 Easy monitoring of spend
Contract Compliance – PO Based Spend

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Capabilities
 Suppliers can submit invoices directly against a contract
 Automatic creation of invoices on-behalf of suppliers for the fixed and recurring spend
Benefits
 Spend under control even without a PO – price check, cap on spending, receiving checks, etc.
 Easy monitoring of spend
Contract Compliance – Invoice Spend

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Capabilities
 Services PO reference a contract
 Suppliers can select items from the contract for the service entry sheets
Benefits
 Buyer can control the items that are added to the service entry sheets
 Price compliance
 Easy monitoring of spend
Contract Compliance – Ad-hoc Services Spend

11. Demo
Remove this after the demo is prepared
1. Create a supplier level contract
2. Supplier punches in to create a contract invoice
3. Show invoice in downstream with exceptions and stress of the
fact that you now have a procurement document to ensure that
invoice goes through basic checks

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13. Thank you.
Contact information:
Deepak Sanghi
Director, Product Management
Debashis Banerjee,
Product Owner