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QUALITY, EXPERIENCE, DELIVERY

SAPSOURCINGBUSINESSPROCESS

Contract ManagementContract Management

Your Contracts Are Your Your Contracts Are Your BusinessBusiness

Copyright © 2009 Total Asset Management Solutions Pty Ltd QUALITY, EXPERIENCE, DELIVERY

Did you know…

90% of enterprises view effective creation, monitoring and management of contracts as either “very important” or “critical” to

their overall business success.


GlobalCorp’s Business Dilemma

1. IT Hardware costs have spiralled out of control

2. They have multiple suppliers supplying the same items

3. They have a number of different support contracts with different terms and conditions

4. They are not maximising their purchasing power with one large strategic contract and making the most of volume discounts


GlobalCorp’s Vision

1. Reduce IT Hardware costs

2. Use one strategic supplier to maximise their purchasing power so they can realise volume discounts

3. Standardise support contracts with the same terms and conditions

4. Monitor supplier performance against the contract


Solving GlobalCorp’s Dilemma

Analyse IT Hardware Spending

Source a Strategic Supplier

Generate Supply Contract

The Business Process – A Simple Example


Gain Visibility into Spending

The Sourcing Manager uses his portal to access Spend Analysis by Commodity.







The Sourcing Manager can analyse the

breakdown of Spend by

Commodity.

He sees IT spend is a large portion of the overall spend.






Drilling down most of the IT

Spend is in Hardware.






The Sourcing Manager can see that

24% of their ITHardware costs are

coming from purchasing printers.

They are currently being supplied by 11 different suppliers, each with their own support agreement, and with different contract terms.






Drilling down they can also analyse dollar and

percentage spend by supplier.





Source More Strategically




The Sourcing Manager creates a project to

source a new strategic printer supplier for

GlobalCorp.

Here he can create and issue an RFP. Then he

can evaluate the responses based on his

score criteria.






The suppliers can enter their responses

online through the supplier portal.






The Sourcing Manager can then view the response

online.






The results of all the responses can be

compared.

The top responses can be selected to create a supplier

auction.






During the auction the Sourcing Manager can see the bids

realtime and view the savings.

Best Info Tech Inc wins the Auction.


Create and Negotiate Contracts




The Sourcing Manager now creates a Master Agreement

from the Auction.






The Sourcing Manager can then select clauses from the RFP as well as

standard clauses from the Contract Library Clauses to generate

the contract.






The Contract is then automatically

generated in Microsoft Word.






The Contract can then be checked out and

sent to the supplier for review.






The Supplier can review the contract

and request changes.






Once the supplier has reviewed the contract

and added their changes it is sent back and checked into the system.






The contract can then be sent to the

Business Unit for final signoff.






Once the Contract has been approved by the business unit the

operational contract is generated.






The contract is now operational in the

system.

All purchases will now be tracked against the

contract.

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