Cloud Workflows for Procurement

In association with B2B Smart Networks
24 May 2013, 15:00 -16:00 CEST (GMT+2)
Dr. Deasún Ó Conchúir PMP
BSc PhD CEng FIET FIEI PMP
http://www.scatterwork.com/

Technical Settings
 As a Participant
◦ You cannot be heard
◦ You do not need a microphone
 Please
◦ Keep microphones & phones muted
◦ Switch your webcam off
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© Scatterwork GmbH 2013

How to Communicate
during the webinar
1. Listen to the presentation
◦ Use Internet (VoIP) or telephone
2. Answer “Yes” or “No” to presenter questions
using the “My Mood” (at the top)
3. Write comments and questions in the Chat
Window (left column).
◦ The moderator will review and select comments
for response by the Presenter after the formal
part of the presentation.
3

How to Communicate
during the webinar
3. Write comments and questions in the Chat
Window (left column).
part of the presentation.
4

How to Communicate
during the webinar
3. Write comments and questions in the
Chat Window (left column)
part of the presentation
4. Respond to the polls
5

How to Communicate
during the webinar
3. Write comments and questions in the
Chat Window (left column)
part of the presentation
4. Respond to the polls
6

 Dr. Deasún Ó Conchúir PMP
◦ Collaboration Consultant ,
Scatterwork GmbH, Switzerland
◦ Author of "Overview of the PMBOK Guide" published by
Springer-Verlag
◦ Volunteer Member of the Engagement Committee of the
PMI Educational Foundation for EMEA (over 120 countries!)
as well as Australia & New Zealand.
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Presenter Introduction
 Selected Clients

B2B smart networks
 Focus on applying collaboration technologies
to specific tasks and functions, such as
procurement
 B2BSN BOX is a cloud-based collaboration
portal, customised for client applications
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Webinar Objectives
 This webinar introduces Procurement
Specialists to:
◦ The concept of Workflows in the Cloud
◦ Their advantages
◦ Priorities for Implementation
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Agenda
 Webinar Concept
 Procurement Processes
 Business Process Modeling (BPM)
 Procurement Objectives and Challenges
 Priorities for Procurement Cloud Workflows
 General Discussion and Questions
© Scatterwork GmbH 2013 10

Polls
1. Where are you located?
2. What is your function?

Webinar Concept
Procurement uses deliverable-oriented routine teamwork,
based on processes
Business Process Modelling captures the design and
execution of processes
Social media and internet provide the communication
infrastructure without limits of time, place or participation
Cloud Workflows bring these technologies together,
offering significant benefits to Procurement Processes

Webinar Concept
based on processes

What is a Process?
 Any repetitive sequence of actions to
generate an output
 Also called:
◦ Procedure
◦ Technique
◦ Operation
◦ SOP (standard operating procedure) etc
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Image courtesy of FreeDigitalPhotos.net

Your experience
What other words are used
for “process”?
Write your comments in the
Chat Window (on the left).

Processes in Procurement
 Processes are a central element in
Procurement because they help achieve:
◦ Optimum life cycle costs
◦ Adherence to technical and business requirements
◦ Best payback on expenditure with minimum effort
and risk
 This is important because Procurement
(together with Payroll) costs usually account
for the majority of company expenditure
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Stated more simply…
 Procurement Processes
◦ Save time and money
◦ Reduce risk
◦ Ensure that important steps
are not forgotten
 Source: Purchasing Insight
http://purchasinginsight.com/about/
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Sample Procurement
Processes
 Supplier selection and evaluation
 Obtaining multiple quotations and selection
of contractors
 Negotiation & award
 Order Processing
 Procuring Office Supplies in Large Companies
 Spend Analysis

Procurement Process
References
 Source:
BusinessDictionary.com
◦ Step 1: Need Recognition
◦ Step 2: Specific Need
◦ Step 3: Source Options
◦ Step 4: Price and Terms
◦ Step 5: Purchase Order
◦ Step 6: Delivery
◦ Step 7: Expediting
◦ Step 8: Receipt and
Inspection of Purchases
◦ Step 9: Invoice Approval
and Payment
◦ Step 10: Record
Maintenance
 Source: Zycus
◦ Strategic Sourcing
◦ Contract Management
◦ Supplier Management
 Source: eHow
◦ Supplier Selection
◦ Requesting Information
◦ Tender Returns
◦ Tender Evaluation
◦ Contract Award
◦ Contract Conclusion

Sample Procurement Process
Graphics
 Anglia Rustin University: Procurement OJEU
[Official Journal of the EU] process
◦ http://procurement.anglia.ac.uk/documents/document.asp?type=
6&doc=238
 Jisc InfoNet: Generic procurement process
◦ http://www.jiscinfonet.ac.uk/infokits/learning-
spaces/implementation/procurement/
 Microsoft Technet: Requesting and approving
a new vendor
◦ http://technet.microsoft.com/en-us/library/hh227499.aspx

Your experience
What other processes are
used on Procurement?

Sample BPM Workflow
 Obtain Multiple Quotations, and Selection of
Contractors
Source: www.questetra.com

Sample BPM Workflow
Contractors
Similar to “Flowchart”;
intuitively simple to understand

Sample BPM Workflow
Contractors
Each “Swimlane” is
assigned to one
person or group

Sample BPM Workflow
Contractors
Adjustments are
made graphically, not
by programming
assigned to one
person or group

Sample BPM Workflow
Contractors
Adjustments are
made graphically, not
by programming
Implementation is driven by Workflow Engine;
communication across locations by e-mail notifications
assigned to one
person or group

BPM facilitates Procurement
Process Implementation
 Can also be applied in most Business Environments
◦ Logistics and Distribution
◦ Product Development
◦ Factory
Production
◦ Marketing
◦ Accounting
◦ Healthcare
◦ Maintenance Programs
◦ Inventory Management etc.

Image courtesy of FreeDigitalPhotos.net
Continuous Improvement
of Procurement Processes
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 Applying Continuous
Improvement (aka Kaizen)
leads to further incremental
benefits in:
◦ Cost
◦ Quality
◦ Risk
◦ Efficiency

Your experience
What other advantages come
from applying continuous
improvement to documented
Procurement Processes?
Write your comments in the Chat
Window (on the left).

Sample Procurement
Strategy Objectives
•Cost reduction
•Compliance
•Supplier reliability
•Qualified suppliers
•Performance improvement
•Standard Terms & Conditions (T&C)
•Delivery quality
•Planning and On-time delivery
•Spare parts stock visibility
•Local suppliers for local business
•Expansion of global supply base
•Competition

Challenges for Procurement
 Globalization of contracts
 Need for enhanced flexibility and workflow
capabilities among internal and external stakeholders
 The significant role of Contract Lifecycle Management
 Self-service infrastructure
 Improved strategic focus
 Standardized purchasing procedures
 Reducing manual and paper-based processes
 Impact of mobile technologies on future business
processes
Source: Procurement 2020 by SciQuest
(http://www.sciquest.com/future-procurement-challenges-nextlevel-2013/)

Your experience
Based on your experience,
add to or comment on the
Challenges for Procurement.

Challenges impacted by
Mobile Technologies
 Globalization of contracts
 Need for enhanced flexibility and workflow
capabilities among internal and external stakeholders
 The significant role of Contract Lifecycle Management
 Self-service infrastructure
 Improved strategic focus
 Standardized purchasing procedures
 Reducing manual and paper-based processes
 Impact of mobile technologies on future business
processes
Source: Procurement 2020 by SciQuest
(http://www.sciquest.com/future-procurement-challenges-nextlevel-2013/)

“Challenges” of traditional
◦ Adherence is difficult to ensure
◦ Processes may not be implemented
consistently
◦ The status of a process is not visible
◦ Laborious collection of statistical data
to guide improvement efforts
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“Challenges” of traditional
◦ Adherence is difficult to ensure
◦ Processes may not be implemented
consistently
◦ The status of a process is not visible
◦ Laborious collection of statistical data
to guide improvement efforts
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Business Process Modeling (BPM)
Workflows address these issues

BPM Workflows in the Cloud
 Allow very significant increase in accessibility
using several innovations:
◦ Broadband
◦ Wi-Fi
◦ Smartphone and Apps
◦ SaaS – software as a service
◦ Cloud Computing
 The user is freed from office environments
with hardwired networks
 Implementation possible across locations,
departments, time zones and continents
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Process vs. Workflow
 A process has defined
◦ Inputs
◦ Work Methods
◦ Outputs
 A workflow is more general:
◦ Systematic activity in a given area
◦ May incorporate several processes

Competitive Advantages of Cloud
Workflows for Procurement
 Consistent Procurement Process Implementation
◦ Reduces the variations between individuals
◦ Systematic Process Improvement Possible
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 Business Rules can be separated out
◦ Simplifies adherence to legal and business requirements
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 Visibility and Performance Management of Processes
◦ Traditionally you just can’t see what state has been reached.
48

 Acceleration of Decision Making
◦ with reaction times in seconds or minutes, Facebook-style instead of even
weeks or months in traditional environments. This leads to faster business
cycles, leading to increased profitability
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 Acceleration of Decision Making
◦ with reaction times in seconds or minutes, Facebook-style instead of even
weeks or months in traditional environments. This leads to faster business
cycles, leading to increased profitability.
 Reduced Risk of Undocumented Processes
◦ Including non-optimal implementation, dependency on individuals,
unclear assignments and inefficiencies etc.
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General Advantages of
Cloud Workflows
 Choice of Expertise
◦ Greatly increased, often at more attractive cost.
 Accelerated Engagement of Expert Staff
◦ Without the costs and delays of personal mobility, work permits etc.
 Reduced Dependency on Individuals
◦ Avoidance of knowledge asset losses when staff move
 Greater Choice of Time Zone
◦ To accelerate development cycles and provide 24/4 service
 Elimination or Reduction of Real Estate Requirement
◦ Driving down cost overheads such as leasing, insurance, maintenance and
cleaning, security, computer and telecommunications infrastructure etc.
 Capitalizes on your know-how investment
 etc.
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Polls
 Which benefit of Cloud Workflows is MOST
relevant for Procurement?
 Which general advantage of Cloud Workflows
is most relevant for Procurement?

Your experience
What applications and
benefits do you see for Cloud
Workflows in Procurement?

Special free offer for
Webinar Participants
 Scatterwork will work with you remotely to
identify, prioritize and capture one critical
procurement processes, using standard BPMN in
the cloud.
◦ Fill out the form on this page including the message
“Webinar Participant” (or mail info@scattework.com)
◦ Offer valid until 30 June 2013
◦ Maximum effort: 2 hrs consulting
 Future Webinars
◦ If you have suggestions for future webinar topics and/ or
would like to present one, please tell us now via the Chat
Window.

Contact us!
 Dr. Deasún Ó Conchúir
◦ Join me on LinkedIn:
http://www.linkedin.com/in/scatterwork
◦ Email: deasun.oconchuir@scatterwork.com
◦ Mobile: +41 79 692 4735
◦ Skype: deasun99
◦ Web: http://www.scatterwork.com
 Jean-Pierre Doggett
◦ Join me on LinkedIn:
uk.linkedin.com/pub/jean-pierre-doggett/6/451/a3a
◦ Email: jp@B2Bsmartnetworks.com
◦ Phone: +44 203 286 6003
◦ Skype: jpdoggett
◦ Web: http://www.b2bsmartnetworks.com/home
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