The document discusses the various buying processes within SAP Ariba procurement solutions, outlining their respective categories, goals, and best practices for strategic spend management. It emphasizes the importance of mapping spend to appropriate processes and provides guidance on selecting the right buying process based on specific requirements. The document also includes details on how to implement these strategies effectively within organizations.

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March 21, 2017
Alice Hillary, SAP
SAP Ariba Procurement:
The Buying Process

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• Having a Plan for Your Spend
• What Are the Different Buying Processes in SAP Ariba Solutions?
• How Can I Decide Which Process Works for Me and My Organization?
• Hands-On Exercise
Agenda

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SAP Ariba Procurement: Buying process

4. Planning how to buy

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Goals
 Clearly defined goals for your spend
– Enablement
– Spend under management
– Cycle times
– Adoption
Requirements
 Map your spend categories to the best fit
– Define core business requirements
– Define regulatory requirements
– Learn about the different business processes in SAP Ariba solutions
– Implement using best practices
What you need to plan

6. Buying processes

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Buying processes available in SAP Ariba solutions
Buying process Description Best used for
Catalog
Buyer selects items from a company-specific
catalog for purchase
SKU-based items such as office supplies,
promotional products, noninventoried MRO, IT
hardware and peripherals
Spot buy
Buyer selects items from a public marketplace
catalog (such as eBay, Grainger,…) for
purchase
Infrequent, one-off purchases fulfilled via
public marketplace e-catalog; can include
nonsourced categories
Contract-based
requisition
Buyer selects item from a company-specific
catalog linked to a contract based on item,
commodity code or supplier (such as volume-
based discounts)
Materials and services to include facilities
maintenance, items on consignment, items
with tiered pricing, …
Invoice against contract
Contract pricing terms are entered into the
application without the need for a PO. These
terms are available for the supplier to invoice.
Simple and complex services for recurring,
milestone, or fixed-fee activities to include
consulting, professional services, snow
removal, janitorial services, rent
Collaborative
requisitioning
Collaborative requisitioning between buyer and
supplier supporting, clarification on
specifications, spot quotes, and 3-bids and a buy
Simple and complex products and services that
require collaboration between buyer and supplier
to include materials with variable pricing,
marketing services, temp labor, …
Non-catalog requisition
Buyer enters information manually into
requisition, in many cases with a supplier quote
attached
Infrequent, one-off purchase; sourced through
existing suppliers for materials and services
not in a catalog
Non-PO invoice
AP group creates invoice in system for payment,
or supplier creates invoice and routes to buyer
for payment
Infrequent, one-off, and low-dollar purchases
such as catering services, employee
reimbursements, charitable contributions, ….
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8. Buying process: Finding the right fit

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A guide to finding your fit
Buying Process
Requirement
YourRequirem
entsSpotBuy
CatalogRequisition
Contractbased
Requisition
Invoice
Against
Contract
Collaborative
RequisitioningNon-Catalog
RequisitionNon-PO
Invoice
Catalog X X X
Contract already exists X X
Frequent purchases X X
One-time Purchases X X X
Need authorization with each purchase
X X X X X
Services procurement X X X X X
Need to review suppliers' proposals
prior to purchasing (3 bid 'n buy) X
Partial Invoice by Amount
X X
Deliverables/Milestones need to be
met
X X X
Goods procurement X X X X X X
Receipt Required X X X X X
Detailed Time Entry for services
X X X
Accumulate spend for discounts X X
Check purchases against budget
X X X X
Compare offers from suppliers
X X
Pay with Credit Card X X* X*
De-centralized buying process X X X X
Spend is not sourced X X X X
* Charge Order feature is enabled for SAP Ariba Buying

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Invoice Against
Contract
Collaborative
Requisitioning
Contract Based
Catalog
Catalog (PO)
Spot Buy
Non-Catalog
Purchase
Order
Non-PO
Invoice
Compliance Continuum
Compliance to Spend Management
EfforttoSetup/Maintain
• Category Spend
• Volume
• Effort to set up
• Timeframe
• Supplier supported
• Internal Change Mgmt.
• Benefits
Considerations:

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“We may have all come on
different ships, but we’re in
the same boat now.”
Martin L. King, Jr.
Run Simple

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What does happiness looks like to
a procurement professional?

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TAKE ACTION: Start mapping your spend to the appropriate process to
develop a plan of action. See example below of a sample category mapping.
IT Products & Services Example Buy Process Mapping
Subcategory
Annual
Spend
%
Sample
Vendors
Primary Process
Alternative
Process
Software X % ABC
Catalog
Contract based catalog
Invoice against contract
Networking
Equipment
X % ABC
Catalog
Contract based catalog
Invoice against contract
Data Storage X % ABC Invoice against contract
Hardware X % ABC
Catalog
Spot-Buy
Invoice against contract
Disaster Recovery
X % ABC Invoice against contract
Web Hosting
X % ABC
Invoice against contract
Contract based catalog
Total $XX 100%

14. Thank you
Contact information:
Alice Hillary
Sr. Consultant, Best Practice Center
New Jersey
412.297.8540 (Skype)

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