Scribd
Upload
1K views22 pages

Materials and Suppliers - Strategic Procurement

This document discusses how ERP systems can improve an organization's procurement process. It describes the key stages of procurement including requisitions, purchase orders, receiving, and payments. It outlines some of the issues that can arise without an integrated ERP system, such as disparate systems and redundant data entry. The benefits of ERP for procurement are then presented, including streamlined approval workflows, reduced costs, and improved visibility across the process. Key concepts like purchase requisitions and purchase orders are explained in more detail.

Uploaded by

deepak_update
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
1K views22 pages

Materials and Suppliers - Strategic Procurement

This document discusses how ERP systems can improve an organization's procurement process. It describes the key stages of procurement including requisitions, purchase orders, receiving, and payments. It outlines some of the issues that can arise without an integrated ERP system, such as disparate systems and redundant data entry. The benefits of ERP for procurement are then presented, including streamlined approval workflows, reduced costs, and improved visibility across the process. Key concepts like purchase requisitions and purchase orders are explained in more detail.

Uploaded by

deepak_update
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
You are on page 1/ 22

Materials and Suppliers – Strategic Procurement

Richard Byrom
Oracle Applications Consultant

Enterprise Resource Planning Seminar – 24th May 2002


Objective

To illustrate how
ERP systems add value
to the procurement
process
Procurement Process
Requisitions

Negotiations Purchase
& Awards Orders

Catalog
Content Sourcing Ordering
Management Receiving

Analysis

Supplier
Management Payment

Supplier
Performance
Procurement Process
Requisitions

Purchase
Orders

Ordering
Receiving

Payment
Without ERP Systems in Procurement

• Disparate and fragmented systems do not


talk to each other
• Information is not appropriately shared
between applications
• Too much paper!
• Risk of error is high
• Transactions costs are inevitably
increased
Procurement Process Failure

Requisitions

Purchase
Orders

Ordering
Receiving

Payment
Benefits of ERP systems in Procurement

• Create, edit and view purchasing documentation


on-line in one application (no re-entry of document
information i.e information flow is ensured across
applications)
• Review the current status and action history of all
purchasing documentation
• Route purchasing documentation according to
approval hierarchies
• Enables accurate and automated accounting for all
transactions
• On line approvals – less paper
• Reduced total transaction costs
Purchase Requisitions
Why Purchase Requisitions?

• Purchase requisitions allow you to decentralise


your purchasing department by having requesters
• Purchase requisitions allow you to source your
requisition with the best suppliers and at the
lowest cost
• Purchase requisitions ensure that the appropriate
management approval is given before purchase
orders are created.
Where Purchase Requisitions Fit
Demand

Inventory WIP MRP Order Mgmt

Import/reschedule
requisitions Internal
sales order
Order entry

Approve
Supplier
Manually Approval
create Requisition
Requisition
pool
Business Needs Associated with
Purchase Requisitions

• Automate the procurement process


• Monitor and control spending amounts by
approval authorizations
• Simplify the interaction with suppliers
• Free buyers from daily transactions to focus on
negotiation management and supplier analysis
• Reduce administrative costs and inefficiencies
Who Acts on Purchase Requisitions?

• Employee
• Buyer or buyer-planner
• Approvers
• Suppliers
• Purchasing staff
Purchase Orders
Why Create Purchase Orders?

• Supplier is selected to satisfy demand for goods


or services
• Summarize all demand for a given item or category
• Supplier terms and conditions established
• Contract with a supplier: external or internal
• Business need for goods or services is formalized
Where Purchase Orders Come From

Oracle Oracle OracleOrder Other


Oracle Oracle
MRP Inventory WIP WIP
Mgmt systems
Demand

Automatically
imported
Manually
created

Requisitions
Requester

Create
purchase orders
Manually Create Purchase Orders Using
Procurement Solution
Procurement Solution enables you to:
• Create purchase orders easily
• Create purchase orders from:
– Requisitions
– Quotations
– Other purchase orders
• Create one time and repeated purchase orders
• Flexible approval and security controls
Purchase Invoices
Entering Purchase Order Matched
Invoices : Overview
Receive invoice Enter invoice Match invoices
to PO or receipt

Approve invoice View invoice

Account for Pay invoice


invoice File invoice
Why Enter Purchase Order Matched
Invoices?

• Match Payables invoices to purchase orders to


ensure that you pay only for the goods that you
have ordered.
• Match to purchase order receipts to ensure that
you pay only for goods that you have received.
• Payables automatically creates invoice
distributions based on the purchase order
distributions.
You Can Set Up Controls That Require
You To Do The Following:

• Purchase order match each invoice


• Match the invoice to either a purchase order or
receipt
• Match within amount or quantity tolerances
Accounting Entries should be created at
each stage of the process

• Record items into inventory or expenses


• Appropriate valuation of stock should take place
• Physical and Monetary Variances between
requisition and order should be recognised
• Physical and Monetary Variances between order
and invoice should be recognised
• Account for invoice and payment into creditors
Conclusion

ERP is the best solution for your


organisations procurement problems

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy