Richard Waugh, VP of Corporate Development at Zycus, presented on applying artificial intelligence for predictive procurement. Zycus offers a comprehensive source-to-pay suite that uses machine learning to clean master data, guide users through key decisions, and digitize the entire procurement process. AI can help classify spending data, guide requisitioning and sourcing, and automate repetitive tasks through robotic process automation. Benchmarking shows best-in-class companies realize significant savings through higher spend under management, faster contracting cycles, and lower transaction costs.

1. Machine Teaching:
Apply AI for Predictive Procurement

2. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Today’s Presenter – Richard Waugh, VP Corporate Development, Zycus
Extensive background in B2B e-commerce
Helped Launch GE's TPN, first on-line
Marketplace for Sourcing & Procurement
Industry Analyst in Supply Management
market for the Aberdeen Group
Co-Founder of B2eMarkets
First SaaS Sourcing Suite providers

3. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
About Zycus – Comprehensive Source-to-Pay Suite
Recognized by Leading Analysts

4. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Machine Teaching – Apply AI for Predictive Procurement
01
Train your machines to clean
Master Data at the source by
leveraging AI to properly categorize
and classify transactional and
supplier-related data the first time,
and to learn more from the
exercise every time
02
Let AI Guide your users through
key decision-making processes for
better outcomes, a better user
experience, and better data
03
Digitize the entire Source-to-Pay
Process including “pockets of paper”:
• Incoming Request Management
• Tail Spend not under management
by Procurement
• Performance and Savings
Management tracking and reporting
04
Leverage RPA to automate
repetitive tasks – flawlessly

5. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Applying AI to Procurement Starts with Spend
“Vendors such as Zycus, SpendHQ and Coupa Spend360 are already
using machine learning to improve spend classification. The next step in
this area is to explore the predictive spend analytics that can further
improve the planning and prioritization of strategic sourcing activities.”
Source : Gartner : “Start Preparing Now for the Impact of AI on Procurement”
Train your machines to clean Master Data
at the source by leveraging AI to properly
categorize and classify transactional and
supplier-related data the first time, and to
learn more from the exercise every time

6. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Check out our webinar at https://zyc.us/2AQGwXK

7. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Spend Classification – Before AI
Data
• Distributed data
• Multiple GL codes
• Multiple languages
• Multiple classification
standards
Spend
Report
• Inaccurate reports
• Low reliability
• Low spend visibility
• No ROI
Garbage In Data Warehouse Garbage Out

8. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Spend Classification – After AI
Data
• Distributed data
• Multiple GL codes
• Multiple languages
• Multiple classification
standards
Spend
Report
• Statistical model based
data classification
• Handles erroneous data
• Automated and rapid
classification
• Quick ROI
Quality In Quality Out
Analytics

9. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Spend Mining
Next Generation Spend Analytics
COST
MODELS
Market Indices Spend Data
Spend Benchmarking
QuickSearchLaptop T430 from Lenovo
Spend Search
Prescriptive
Proactive
Predictive
Participative
Spend Monitoring

10. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
AI suggests relevant categories
based on user’s natural language
search term and organizational
buying patterns
AI steers users to approved suppliers
and Buy/Pay channel for the category
AI Invokes category-specific
workflows, map to GL account and
default bill to/ship to based on user
profile
GUIDED BUYING
Key
Finding
AI-Enabled Guided Buying – Key to Better UX and Better Data
Let AI Guide your users
through key decision-
making processes for
better outcomes, a better
user experience, and better
data

11. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Key
Finding
AI-Enabled Guided Sourcing & Contracting – Better Decisions
“SmartAssist” Suggestions:
• Which Suppliers to Shortlist for Sourcing
• What Type of Negotiation Yields Best Results
• When Do I Need to Start Contract Process
• Which Clauses Need to Be Included
Let AI Guide your users through
key decision-making processes
for better outcomes, a better
user experience, and better data

12. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Digitize the Entire Source-to-Pay
Process including “pockets of
paper”
Sourcing
Spend
Analytics Contracts
Supplier
Management
eProcurement
Supplier
Performance
eInvoicing
Strategic
Operational
Request
Management
Digitized Source-to-Pay…Connected Dots, No Pockets of Paper
Financial Savings
Management
Non-Procurement
Managed Tail
Spend

13. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Benchmarking Best-in-Class Source-to-Pay Performance
SUM
Avg. – 55.2%
BIC – 92.0%
Spend Sourced
Avg. – 41.1%
BIC – 69.8%
On-Contract Spend
Avg. – 52.8%
BIC – 70.9%
Contracting Cycle
Avg. – 22.2 Days
BIC - 11.5 Days
Discount Spend%
Avg. - .02%
BIC - .10%
Cost per PO
Avg. - $17.18
BIC - $4.93
Maverick Spend
Savings
8%
Sourcing Savings
Avg. – 5.6%
BIC – 7.1%
Cost per Invoice
Avg. - $4.84
BIC - $2.23
P-Card Spend%
Avg. - .66%
BIC - 4.75%
Spend w/Line Item
Visibility
Avg. – 38%
BIC – 99%
Suppliers w/Failing
Scores
BIC – 3.8%
Sourcing Cycle
Avg. – 75 Days
BIC – 45 Days
Invoice Approval
Cycle
Avg. - 5 Days
BIC - 3 Days
SM Productivity
Savings
20%
Suppliers per $1B
Avg. -17,899
BIC - 6,795
Source: Hackett Group Benchmarks Source: SpendMatters Benchmark
Source: Hackett Group Benchmark
Source: Aberdeen Group Benchmark
Source: Ardent Partners Benchmarks
Source: Ardent Partners Benchmark
Source: Ardent Partners Benchmark Source: Hackett Group Benchmark

14. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Benchmarking Digital Transformation
Requisition
Purchase
Order
Release
to Blanket
Order
PO
Change
Order
Invoice
Receipt
Payment
Full Automation – Digital Transformation Target
95–98%
Top
Performer
Peer
Source: Hackett Group P2P Performance Study 2017
% Electronic Transactions (Fully Automated Approval Workflow/Order Dispatch)
81%
79%
100%
66%
85%
100%
63%
28%
62%
28%33%
80%

15. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Best Practices for S2P Transformation Sequencing
Spend analysis E-Sourcing SBM
Map external spend
Negotiate Strategic
Agreements
Manage compliance
Manage Supplier
Relationships
Key Success Factors
• Identify and use data
from relevant
transaction systems
• Deduplicate and classify
• Assign ownership of
Key Success Factors
• Promote a culture of
control and
responsibility
• Involve stakeholders in
category plans, work
Key Success Factors
• Build a pipeline of cost
reduction opportunities
• Create a center of
excellence
• Make use of e-sourcing
mandatory
Key Success Factors
• Segment supplier base to
rightsize management
• Deploy solutions that
support supplier
collaboration
Source: Gartner “Best Practices for Sequencing Procurement Solution Investments”

16. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Best-in-Class Advantage – Realized Savings
Spend/Transaction Volumes
• $1B Spend
• $2.5M Supplier Management Cost
• 75K POs
• 150K Invoices
Savings Management
Spend Analysis
eSourcing
Procure-to-Pay
Contract Management
Supplier Management
₊ 37% More SUM
₊ 29% Incremental Spend Sourced
₊ 1.5% Higher Savings Capture Rate
₊ 18% Higher Compliance to Contract
₋ 20% Lower Supplier Management Cost
√ Best-in-Class Cost per Transaction
√ Best-in-Class Discount Capture Rate
$287M Incremental Spend Sourced
$26.5M Incremental Savings Identified
$18.8M Retained Sourcing Savings
$.5M Supplier Management Cost Savings
$1.3M Transaction Cost Savings
$.8M Early Pay Discounts
-------------
$21.4M Incremental Realized Savings
Best-in-Class Advantage vs. Average

17. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Best-in-Class Advantage – Source-to-Cash Cycle Time
Best-in-Class Achieve Higher NPV of
Savings Realized 42% Faster
Best-in-
Class
Industry
Average
45 Days Sourcing Cycle
75 Days
11 Days Contracting Cycle
22 Days
1 Days Order Cycle
2 Days
3 Days Invoice Cycle
5 Days60 Days
104 Days
RFX
Award
Contract
Order
Invoice
Pay

18. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Customer-Centric Procurement Teams Focus on User Experience

19. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Procurement Request Management Solutions
Reject inappropriate requests
eSourcing
Contract
Management
Project/
Savings
Management
Supplier
Management/
P2P
ProcurementApproverRequester
Sends
requests
Approves
requests
Manages and
Processes
Requests
Create Contract
Create Sourcing Event
Onboard a Supplier
Pre-purchase Request
Supplier Performance improvement
PO Amendment
Contract Amendment
Task Assignment
Initiating a Project
Price or terms change request by
Supplier
Configurable Flexiform
Configurable Approval Workflow
Conditional Logic / Rules
Calculated Fields
Delegation
Comprehensive Reporting
Process Use Cases
Features

20. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
 Automated request management and tracking triages procurement’s
work queue – empowers and engages end-users
 Sophisticated, conditional approval workflows (>175 conditions, 4-5
approvals per form)
 Conditional logic integrates IT security reviews with on-boarding
requests
 Supports multiple request use cases, e.g. negotiate contract, run
sourcing project, on-board supplier, capital appropriation project
approval
 Seamless process flow from request to execution – e.g. approved
request initiates activity in target module
 Also supports non-procurement (Hotel, Facilities, HR, IT) requests
Extending
Beyond
Procurement
Users
Integrating
Business
Processes
Customer-
Centric
iRequest - Porsche
Customer-Centric Case Study: Request Management

21. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
• Focus Sourcing FTEs
• Collaborate Globally
• Standardize Process
• Self-Service Sourcing
• Ensure Compliance
• Standardize Process
Customer-Centric Doesn’t Mean All Customers are Equal

22. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Standardized, Self-Service Tail Spend Sourcing
Tactical, Spot Buys – 3 Bids & Buy
Create and Invite New Suppliers on the Fly
Create RFQ Inquiry on Single Screen

23. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Financial Savings Management Challenges/Solutions
Challenges
• Most organizations tracking with spreadsheets/home-
grown tools
• Existing tools lack Finance collaboration and approval
workflow
• No standard definition of savings calculation and allocation
methods exists, and lifecycle tracking visibility is missing
Solution
Align:
• Import baseline spend from
Spend Analytics
• Establish Finance-approved
spend baseline and savings
calculation formulae on
common, enterprise platform
Validate:
• Employ workflow to obtain
validation from stakeholders
• Map savings projects to
stakeholders and approvers
Analyze:
• Segregate savings by type,
e.g. cost reduction vs.
avoidance, and accounting
period
• Identify savings by
project/sourcing strategy
• Map savings impact to P&L,
Balance Sheet, Cash Flow
Source: Gartner/Rutgers Survey

24. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Case Study: Financial Savings Management
600+
Savings Projects Initiated
$40-50M
Annual Incremental Savings Realized To Date
000’s of Users
40 Power Users Create Savings Projects and Collaborate with
000’s of Stakeholders (600 Financial Analysts Alone)
25% Productivity Gain
Category Managers Save 2 Hours per Day from Data Gathering
Tasks
Single Version of Savings Truth
 Standardized calculation/allocation formulae
 Full audit trail and version control
 Secure user access by BU/Div/Dept/Cat
 Fx conversion and multi-lingual UI
 Flexible/multiple savings types/definitions
 Approval workflow sign-off by budget owner and Finance
 Dashboard analytics and Financial Statement impact reporting:
P&L/Budget/Balance Sheet,/Cash Flow
Savings Tracking for Non-Procurement
Platform applied to non-procurement savings projects (e.g. Reorg, ERP
Consolidation, M&A), Budgeting/S&OP, Cash Flow Forecasting
iSave - Qualcomm

25. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Leverage RPA to automate
repetitive tasks – flawlessly
Accounts Payable
Supplier/Vendor On-boarding
Requisition & Order Management
Sourcing & Supplier Negotiations
Contract Management
Stakeholder Collaboration
(Legal, Suppliers, Finance/AP)
Procurement
Processes
Transactional/
Manual Tasks
LOW HIGH
Applying RPA-Enabled AI to Core Procurement Processes

26. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Finding the Right Bot for the Job
Merlin A.I. StudioTM
Buyers Desk BOT
Invoice Email Attachment BOT
Invoice Metadata Extraction AI BOT
Contract Metadata Extraction AI BOT
Contract Clause Classification BOT
Contract Risk Analytics AI BOT
Buyer-Supplier Negotiation AI BOT
RFQ/Auction Assembler AI BOT
Supplier Onboarding RPA BOT
Request Fulfillment BOT
Approver Reminder BOT
Requester Reminder BOT
Sample RPA Bots

27. +1 866 563 9219
info@zycus.com
www.zycus.com
Thank You