1. The Administrative Application That Could
E-Procurement
The Administrative Application That Could
Anthony Rotoli Channel Sales Manager SciQuest, Inc.
Copyright Anthon Rotoli This work is the intellectual property of the author. Permission is granted for this material to be shared for non-commercial, educational purposes, provided that this copyright statement appears on the reproduced materials and notice is given that the copying is by permission of the author. To disseminate otherwise or to republish requires written permission from the author

2. Agenda
About SciQuest
Tactical vs. Strategic Procurement
HigherMarkets Solution
Case Studies

3. What is the innovation supply chain?
About SciQuest

4. About SciQuest
SciQuest's secure on-demand solutions integrate organizations with their suppliers to enable comprehensive spend management for the life sciences and higher education markets.
SciQuest's suite of modular applications helps to automate the
source-to-settle process. When used with the SciQuest Supplier
Network, these solutions reduce redundant tasks and maintain
data integrity throughout the cycle of finding, acquiring and
managing goods to increase efficiency, reduce cost and provide
total spend visibility.

5. SciQuest Customers Higher Education University of Chicago
University of New Mexico
Rensselaer Polytechnic Institute
University of Edinburgh
Emory University
University of Michigan
University of Notre Dame
University of Arizona
Indiana University
University of Nottingham
University of Nevada Reno
Pace University
Moody Bible College
University of Pennsylvania
University of Kentucky
Arizona State University
Penn State University
Industrial Research
Air Products
GE Corporate Research
Johnson & Johnson
Life Science
GlaxoSmithKline
Schering-Plough
Amgen
Biogen
Memorial Sloan Kettering
Corixa
Theravance
Aventis Pharmaceuticals
Burnham Institute
Boehringer Ingelheim
Lexicon Pharmaceuticals
Genentech
Ciba Vision
Inspire Pharmaceuticals
Dendreon Corporation
Ambit Biosciences
The Salk Institute
Epix Medical
Roche
Enanta Pharmaceuticals
OSI Pharmaceuticals

6. Current State of Higher Education
DECREASE IN BUDGETS Dramatic reductions in state and federal funding
INCREASED COST PRESSURES Plunging endowments and restricted grants
Increased Demands on Campus Services
INCREASE IN REGULATIONS Patriot Act regulations, increased EPA fines, threat of bad press
INCREASE IN STUDENTS Serving more people with less resources

7. Overall Increase in Indirect Spend
Traditional Approach
FIND
BUY
MANAGE
MANAGE
FIND
BUY
Manual searches
Limited selection of suppliers
No integrated visibility into inventory
Manual requisitioning
High volume of orders to multiple suppliers
No tracking beyond receipt
Separate process from purchasing
Redundant purchases
Manual tracking, limited chemical information
Manual compliance reviews and reporting
Overall Increase in Indirect Spend
Increased cost of goods
Increased Processing Costs
Increased
Risks & Inventory Costs

8. Integrated Solutions for Higher Education
FIND
The smartest purchase is the one that isn’t made.
Change what they buy, not just how they buy.
Integrated Inventory
Integrated Sourcing
Cost of Goods Processing Costs Inventory Costs
Integrated Processes
MANAGE
BUY
Maximize productivity, minimize risk.

9. Reaching Your Strategic Procurement Goals
What is the innovation supply chain?
Reaching Your Strategic Procurement Goals

10. Tactical vs. Strategic Procurement
Focused on transactions
Set and achieve short term goals
React to departmental purchasing needs
Perceived as a cost center
Focused on spend management
Set and achieve long term goals
Proactively working with departments and suppliers
Perceived as a value creator

11. Procurement Continuum
MOST
ARE
HERE
TACTICAL
STRATEGIC
Managing manual processes effectively
Disparate data
Using human resources to fullest capacity
See opportunities for improvement
Desire to make an impact
Unsure of the best approach

12. What is the innovation supply chain?
Bridging the Gap

13. IMPROVED PRODUCTIVITY
What’s missing?
E-Procurement
INCREASED EFFICIENCY
BETTER INFORMATION
RIGHT TOOLS
TACTICAL
STRATEGIC
IMPROVED PRODUCTIVITY
BETTER DECISIONS
RIGHT RESULTS

14. E-Procurement Enables Best Practices
Improve Productivity
Automate Manual Tasks
Better Decisions
Capture Comprehensive Data
Right Results
Influence Buyer Behavior

15. Gain more resources to devote to strategic initiatives
Automate Manual Tasks
Enable and Configure Catalog and non-catalog suppliers
Select and Compare Products
User friendly shopping experience
SPEND DIRECTOR
REQUISITION
MANAGER
Electronic Routing
Approval Workflow
ORDER
MANAGER
Order Parsing & Distribution
Process Orders
SETTLEMENT
MANAGER
Receiving
Electronic Invoicing
Gain more resources to devote to strategic initiatives

16. Capture Comprehensive Data
Purchasing Data
Supplier Data
Transaction Data
Better data helps you make better decisions

17. Achieve your strategic goals by helping end users
Influence Behavior
How end users buy
What they buy
Who they purchase it from
Achieve your strategic goals by helping end users

18. The Experts Agree…
Aberdeen Research survey concluded the typical post-implementation benefits of e-procurement include:
5--10% reduction in indirect / non-production spend
73% reduction of costs per purchase order ($114 to $31 per order)
Andersen Consulting estimated that the typical organization will reduce its indirect spend by 7% by using e-procurement
Giga predicts e-procurement solutions will deliver 5-15 percent cost savings in the first year.
Gartner estimates that small and mid-tier life science companies can achieve savings of 15-20% annually by using e-procurement solutions “that help researchers make smarter buying decisions.”

19. E-Procurement Solutions Deliver Financial and Productivity Savings
Increase contract compliance
Promote preferred vendors in search results
Promote “Organizational best buys”
Provide detailed data for auditing user and supplier compliance
Identify new savings opportunities
By Supplier and Commodity using detailed spend reports
Realize significant productivity savings
Increase efficiency of end users and procurement
Minimize IT commitments

20. Spending Trend With Preferred Suppliers
54.4% % (7.1% increase)
Began using preferred
positioning for key suppliers
Preferred positioning of key suppliers increases on-contract spending and decreases materials purchase by %

21. Order Distribution Trend with Preferred Suppliers
Began using preferred
positioning for key suppliers
Preferred positioning also consolidates client’s supplier base by 20%
resulting in less work for accounts payable

22. Productivity Savings Avg Cost* of a PO: = $114 (per NAPM/ISM)
Avg E-Procurement PO Cost: = $31 (per Aberdeen)
Savings with e-procurement: = $83 per PO
* Primarily based upon total allocated labor costs from sourcing through payment
Example:
2,000 orders per year
x $83 savings per order
$166,000 productivity savings
(~ equivalent to recouping the productivity of two to three staff members)
By minimizing the unproductive time that users spend sourcing,
requisitioning and procuring products, they will have more time
for value-added activities such as research and negotiating savings.

23. Introduction to HigherMarkets
What is the innovation supply chain?
Introduction to HigherMarkets

24. Connect with Existing Systems & Suppliers
SCIQUEST SUPPLIER NETWORK
ON-DEMAND TECHNOLOGY PLATFORM
SPEND DIRECTOR
REQUISITION MANAGER
ORDER MANAGER
BUSINESS
INTELLIGENCE

25. Flexible Supplier Enablement Options
NETWORK
Key
Supplier
Punch-outs
Your
Preferred
Suppliers
Your
Local
Inventory
Approved
Network
Suppliers
Hosted Configurable Catalog

26. Partnership with SCT
Jointly develop and market “HigherMarkets for SCT Banner”
Fully-integrated, comprehensive procurement solution
Works with Banner Finance 6.0 and Luminis Data Integration Suite
SCT is the leading global provider of technology solutions for colleges and universities of all sizes and complexity. The Company supports more than 1,300 client institutions worldwide with administrative and academic solutions.
                              

27. HigherMarkets for SCT Banner
SciQuest
Higher
Markets
SCT
Banner
Luminis Data Integration
for eProcurement
Higher
Markets
Adapter
Luminis
Message
Broker
Luminis
Message
Gateway
Higher Markets for
SCT Banner

28. Integration with Luminis Data Integration
LDI for e-Procurement is a built on LDI’s Publish and Subscribe architecture
LDI for e-Procurement is standards based (JMS, HTTPS, XML, IMS Enterprise Specification, OpenEAI, etc.)
HigherMarkets for SCT Banner and LDI for e-Procurement allows these systems to behave as if they were one application
Leverages the current investment into Banner
Eases burden on IT staff and resources
An open, interoperable, and extensible solution

29. HigherMarkets Benefits All Stakeholders
End Users
Procurement
One-stop shopping experience
Freedom of choice: wide range of suppliers and products from which to choose
Fast, easy requisitioning
Control and visibility of spending
Contract compliance
Paperless process
Error-free requisitions
               
               
               
Senior Management
Information Technology
Reduced materials costs
Increased purchasing and user productivity
Better budgeting information
Low maintenance software
Secure, reliable access
Straight-forward integration

30. HigherMarkets Product Introduction
What is the innovation supply chain?
HigherMarkets Product Introduction

31. Search Hosted Catalogs or Punch-Out to Suppliers
Use parametric criteria to search hosted catalog content
Punch-out to suppliers’ e-commerce Web sites

32. Quick Order
Enter catalog number or SKU and immediately add to cart

33. Favorites Manage personal favorites
Administer organizational “Best Buys”, approved items and supplier specials

34. Search by Keyword
Refine searches by limiting searches to specific subcategories
Search using parameters

35. Product ReSources Antibody ReSource Column ReSource
Chemical ReSource with structure searching
Oligo ReSource also available

36. View Search Results Refine search by supplier or category
Basic product information with your contract pricing. Access to complete product descriptions
Search results from preferred suppliers appear first
Select multiple products to compare

37. Side-by-side Product Comparisons
Add to cart from product compare screen
Compare detailed product information

38. Accurate Requisitions
Pre-populated item information from shopping cart
Pre-populated ship to/bill to information

39. Customized Approval Workflow
End users can preview approvals
Customize approval workflow based on any requisition field

40. Track Order Status
Access all order online
Track order status

41. What is the innovation supply chain?
Case Studies

42. University of Pennsylvania
Challenges:
Supplier enablement
User adoption
Solution:
Spend Director
Supplier Promotion Module
Location: Philadelphia, PA Enrollment: 18,913
Client Since: ERP: Oracle
                              

43. University of Pennsylvania Results
Campus-wide implementation to 1,600 users
Enabled 75 preferred suppliers, representing 3 million SKUs and cover 68% of all transactions within 120 days
Realized $2.1 million in documented cost savings from 16 renegotiated contracts

44. Rensselaer Polytechnic Case Study
Challenges:
Inefficient purchasing processes
Inability to control “maverick spending”
Solution:
Spend Director
Requisition Manager
Order Manager
SciQuest Supplier Network
Business Intelligence
Location: Troy, NY Undergrad Enrollment: 5100
Client Since: ERP: SCT Banner

45. Rensselaer Return on Investment
YEAR
CONTRACT SAVINGS
PROCESS SAVINGS
TOTAL SAVINGS 1
$130,000
$40,000
$170,000 2
$220,000
$65,000
$285,000 3
$370,000
$110,000
$480,000 4
$525,000
$155,000
$680,000
TOTAL
$1,245,000
$370,000
$1,615,000

46. E-Procurement should be a critical component of an e-business strategy
Conclusion
E-Procurement should be a critical component of an e-business strategy
Benefits are real
Cost Savings
Process Efficiency
Renegotiated Contracts
Integration with ERP can extend value

47. Questions
Q & A

48. "What people need to realize is that purchasing can have a direct impact on the bottom line. The economy is very bad, the state institutions are not getting funded, and there are cutbacks. But there’s a multiplier effect through smart purchasing: Every dollar we save though smart purchasing translates to 10 or 15 dollars that’s not needed in revenue. …You really can’t afford not to pursue an e-procurement initiative.” Tim Gibney
Assistant Vice President for Procurement Services
University of Notre Dame
“Taking the Pain Out of Purchasing,” University Business. April 2003