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VendorServer - Cost Management

Driving Down Purchased Product Costs

Solution

VISIBILITY VendorServer®

Solution Benefits

The client implemented VendorServer which provides the following benefits:

• Complete buy side supply chain management in a real-time Web environment

• Quotation requests, RFQs, purchase order entry and management

• Supplier quote response management & assessment

• Comprehensive workflow

• Document management

Customer Background

A Visibility customer headquartered in the mid-western United States, manufactures highly engineered boilers and capital energy equipment used by utility companies.

Key Challenges

• Reduce cycle times for proposals and products

• Uncoordinated and lengthy purchasing process

• Improve collaboration between engineering, manufacturing and suppliers

• Lower cost of purchased goods

• Tighten integration with the enterprise application

Detailed Challenges

The business process for collaborating internally and with suppliers prior to implementing VendorServer® needed improvement. A seamless process to work with engineering, buyers and suppliers to shrink the lengthy and cumbersome supply chain cycle was imperative. The need to communicate with design, engineering, sales and suppliers to quickly turn opportunities into proposals, and proposals into orders and executable plans, was critical. The opportunity for miscommunication throughout the entire supply chain was significant with countless departments and external suppliers involved in the process and extremely complex purchasing activities.

The lengthy and involved designing, buying and building process is further complicated by time based milestones and the proper timing of materials that can extend beyond a year. The previous business process had many manual and disconnected automated purchasing systems limiting the ability to effectively manage the supply chain process. There were no provisions for supplier interaction beyond telephone and fax methods.

Without adopting a more strategic approach, the client was faced with higher costs, less accuracy, long lead times, higher carrying costs and lower customer satisfaction. The client created a 360-degree view of requirements for taking its supply chain and supplier collaboration to a new level to enhance business operations in an area with substantial payback.

Solution Details

By implementing the use of VISIBILITY VendorServer with the VISIBILITY ERP application, the client is able to work collaboratively with its suppliers to affect complete buy side supply chain management in a real-time Web environment. This solution supports the entire supply-side management process from formation of Quotation requests or "RFQs", to entry and management of purchase orders, delivery of both RFQs and POs directly to suppliers via e-mail and the Internet, integrated supplier quotation response value assessment to facilitating supplier and buyer order inquiry any time, any where via the web. Included in this comprehensive management solution is dynamic workflow for proactive business process management and collaborative document management.

Managing the Requisition to RFQ Process - Using the browser interface, users verified as secure can create and process requisitions based on MRP demand, BOM, MRO or new part quotations. Users can attach documents such as specifications, drawings, supplier lists and comments for collaboration with the buyer and/or supplier. Business rule based workflow facilitates approval, routing and assignment of purchasing activities. Buyers can construct RFQs on-line from user requisitions, new part numbers and previous POs or RFQ line items and attach additional documentation so that suppliers clearly understand RFQ requirements and are able to respond quickly and with more accuracy.

Supplier Communications, Analysis and Selection with Event Driven Workflow - Buyers choose from existing candidate suppliers or new potential suppliers and electronically transmit detailed RFQs and supporting documents. Suppliers can receive RFQs via event driven workflow providing single-click access to secure an RFQ reply form while allowing direct entry of supplier RFQ responses. VendorServer notifies the buyer of all RFQ responses and can aggregate, rank and compare competing supplier quotations and provide the buyer with direct online access to existing supplier pricing agreements, past quotes and POs for comparison. By providing for the organized solicitation, analysis, ranking, selection and directed conversion of supplier replies to competitive bids, VendorServer streamlines and significantly reduces time and expense with greater contract pricing compliance and increased number of qualified quotes.

PO Creation and Management - Once a supplier has been selected, the buyer builds POs in real-time directly from supplier quotes, requisitions, parts listings or prior POs. VendorServer facilitates managing blanket POs and rapidly and directly communicates PO amendments. Transaction history and an audit trail are captured for future use.

RFQ and Order Status Inquiry - Subject to secure access, authenticated users such as buyers, planners, materials managers and selected suppliers are able to access information related to material requirements, purchase requisitions, RFQs, POs, quote activity and history, and material demand and shortages. Workflow events automatically deliver order status and requests for action to the appropriate personnel assuring more efficient and timely response. This improves the quality and flow of information and significantly reduces the time spent checking on the order status.

Collaboration – Workflow and Document Management - Built-in messaging based workflow capability facilitates direct communication by allowing buyers, planners and suppliers to be notified of events that require their attention which improves material management efficiency and eases decision-making. Integrated document management facilitates central focus, provides access to all documents associated with purchased items and an audit trail. Managed documents may include virtually all Windows® application file types.

Supplier Product Part Number Cross-Reference - The client can utilize extended document management capabilities to enhance part number cross-reference by supplier with both internal documents defining part numbers, as well as supplier provided product documentation. Documents may include pictures, drawings and other multimedia information that cannot normally be stored for retrieval within the ERP application.

By taking advantage of the dramatic strategic and tactical business advantages that VendorServer offers, significant costs have been reduced and immense improvements have been achieved through improved supplier collaboration.