Presentation on theme: "Chris Nelms Supplier Management Ameren’s Story Implementing"— Presentation transcript:
1 Chris Nelms Supplier Management Ameren’s Story Implementing Supplier Lifecycle Management SLM02 OCT 2014Chris Nelms
2 About Ameren… Electric Customers 2.4 Million Gas Customers ~1 Million Service Area 64,000 Sq MiGeneration 10,300 MWElectric System Miles 85,400Gas System Miles 21,000Total Assets $22 BillionTotal Revenues $6.6 BillionEmployees ~8,500Fully RegulatedPresenter Introduction:Chris Nelms leads the operations team charged with the ongoing strategic implementation of processes & systemic changes around the Supply Services Systems & Processes, which include further enablement of electronic supply chain collaboration. A licensed PMP, he holds an MBA and two Bachelor of Science Degrees.
3 Ameren & Oracle…Ameren’s Oracle odyssey began in 2003 with two modules –2004 brought in the eCommerce Consultant2005 & 2006 the Source to Settle program was conceived and developed2006 Sourcing was implemented stand alone and completely vanilla for ~16 users2007 S2S was implemented full scale, big bang –2007 Ameren joins Oracle North American Procurement Customer Advisory Board (CAB) Still the only investor owned utility on the CAB
4 Ameren & Oracle…Database OBIEE10g11g SEPHR Analytics APR 2013P&SA OCT 2013UPKEBS ApplicationsSourcing MAY 2009 SEP 2013Procurement Contracts MAY 2009 SEP 2013iProcurement MAY 2009 SEP 2013Core Purchasing MAY 2009 SEP 2013iSupplier Portal MAY 2009 SEP 2013Services Procurement MAY 2009 SEP 2013Accounts Payable MAY 2009 SEP 2013Accounts Receivable MAY 2009 SEP 2013CCTM* MAY 2009 SEP 2013Buyer’s Work Center - - OCT 2009 SEP 2013 (Complex Procurement)Hyperion - - DEC 2010 SEP 2013iExpense - - JUL 2011 SEP 2013SLM SEP 2013General Ledger JUL 2014*CCTM: Contractor Cost Tracking Module. Custom bolt on atop Services Procurement to handle recurring services
5 Ameren & Oracle… Chris Nelms Manager Process & Systems Group Victor AlarconSr CoordinatorKate MinorSr CoordinatorMike RenieriBus Perf SpcLaura AngeloSC ClerkTiffany PallmeSC AnalystKay CotnerSC AnalystLawanda McGillSC ClerkMelissa OrrSC Clerk
6 Historical Supplier Situation… Supplier General MaintenanceIn 2008 Ameren maintained ~18,000 supplier recordsAP Manages the overall supplier record, banking information and the remit-to site(s)Supply Chain manages the purchasing sites and contacts for each supplier2009 manually on-boarded 400 suppliers to iSupplier Portal2009 supplier cleanup/purge project – 18K to 10KNo PO’s for past three years -Nuclear plant specific suppliers exempted2012 ALL new suppliers must be registered, trained and on-boarded to iSP2013 Exceeded 2000 suppliers on iSPAll manually on-boarded
7 Historical Supplier Situation… Supplier Insurance Maintenance2009 Corporate Project Oversight Committee (CPOC) formedInsurance requirements were increased in rigor during this approximate time frameBrowz (www.browz.com) was implemented to handle insurance certifications for all services suppliers with =/> $25K annual volumeAll other services suppliers were handled manually in MS Access that containing the summary abstraction of the insurance in force for each supplier.Access DB allowed for single user onlyRoughly 5000 services suppliers maintained in AccessRe-certifications tend to be received at CY mid year and year endAlways a backlog of data entry on insurance. Always.
8 Supplier Addition Process… Any Requisitioner in any Business Line can request any supplierNo real supplier vetting process in placeBuyers rationalization – Easier to setup than to researchIn most cases the new supplier was just added, no questions askedIf a supplier insists on a credit application being completed:Ameren has no credit department per sePersonal involvementHard push back on every request, insisting that due diligence in finding an existing, registered supplier be engagedIf after due diligence we were compelled to add the supplier, we provide a standard response including trade references and other descriptive information about the AmerenNothing really discouraging the addition of new suppliers based on request aloneNew suppliers crept in incrementally over time
9 Supplier Lifecycle Management… Supplier Maintenance Costs:This reference from the AMR shocked us:We didn’t know if this high end cost applied to usWe knew we were not considering the cost of supplier maintenance as suchWe knew there were efficiencies Oracle AP and Purchasing by themselves were not addressing“…companies are spending up to $1,000 per supplier annually…however, when information, enabled by technology, becomes visible across the organization, costs per supplier quickly dwindle to below $150 per supplier.”- AMR Research, June 2009
10 SLM & Supplier Hub… Managing the Supplier Lifecycle ConsolidateData Quality3rd Party IntegrationsPublishSupplierRepositoryAPSCMProc.D&BAnalyticsSupplier Self Service RegistrationSupplier Self Service Profile ManagementSupplier & Stakeholder QuestionnairesWorkflow ApprovalsManaging Data Quality & IntegrationManaging the Supplier LifecycleSupplier Lifecycle Management (Process)Supplier Hub (Data & External Connectivity)
11 Supplier Data SLM… Supplier Management Designed to… Do you know your top suppliers?Do you know your high risk suppliers?Are you adding new suppliers records when they already exist?Can you analyze your supply base for diversity?Do you know your tier-2 suppliers?Do you maintain supplier profile data in multiple systems?Does it take too long to on-board a new supplier?When a supplier goes on hold, when do all your systems with supplier data know about it?Supplier DataImpact these processesProcurement CentralizationSupply Base RationalizationStrategic SourcingSocial ResponsibilityContract ComplianceRisk MitigationS2S ExecutionSupplier Management Designed to…Reduce the cost/time of managing supplier informationImprove the quality/accuracy of supplier data
12 Single Supplier Master SLM…Transactional DataAnalytical DataSingle Supplier MasterMaster DataSpend AnalyticsDashboardsKPIsReports/ChartsS2SContractsSourcingPurchase OrdersInvoicesEtc.Supplier HubExtended Attributes*De-DuplicatesMergesClassify SuppliersIntegrate to Legacy & 3rdParty DataSupplier Lifecycle ManagementOn-Board SuppliersSupplier AuditSupplier AssessmentSupplier Profile Self-ServiceeBusiness Suite
13 Ameren Justification… Functionality AreasInsurance Certification ManagementAllows multiple users into the DB simultaneouslyEffectively reduces the cycle throughput of maintenance and update by at least halfJustification for entire SLM module was covered by productivity improvements on this single pointIn conjunction with extensive supplier search and grouping capability, improves supplier selection and grouping for sending mass actionable notificationsInsurance Certification Lookup/ReferenceBuyers and Sourcing people no longer rely on worksheet index to determine if valid insurance is in forceThey review directly in Oracle with an image of the certificate available
14 Ameren Justification… Functionality AreasCertification ManagementIn addition to Insurance which is handled separately, SLM handles these certificate types as well for Ameren:Abatement (general) certifiedAsbestos certifiedHealth / Environmental certifiedTraining certifiedASME certifiedThe certificate area is wide open to accommodate a wide variety of certification management needs and can be augmented later as business needs change
15 CyberSecurity Certificate Retention Ameren Justification…Functionality AreasCyberSecurity Certificate RetentionIT developed an elaborate (50+) question CyberSecurity QuestionnaireUse applicable for some IT suppliers onlyApproval of CyberSecurity aspect separate from Purchasing/Sourcing approvalSLM will contain the questionnaire as a stand alone attachment only for CS approved suppliers
16 Supplier Communications & Notifications Ameren Justification…Functionality AreasSupplier Communications & NotificationsExtensive supplier search and grouping capability allowing the user to parse and group suppliers by extensive criteriaInsurance and other certifications are renewable annuallyNotifications allows for quick and intuitive build of supplier communication across many possible points
17 Qualification Management (Supplier Diversity) Ameren Justification…Functionality AreasQualification Management (Supplier Diversity)SLM engages creates an invitation when users send requests for update out to suppliersRegistered suppliers can then update their information directly on SLMDiversity takes these qualifications into Oracle via approval workflowA third party is used to validate supplier qualifications twice per year
18 Ameren Justification… Functionality AreasSupplier On-boardingGround Rules:Ameren does not expose supplier registration to the internetPolicy is invitation only for new suppliersAmeren developed a two round supplier approval process:Round 1All based and addresses the vetting of the proposed new supplier against the existing suppliers checking for duplicatesSLM uses fuzzy logic to return lists of suppliers that match based on spelling, address, city, etc. Vetting is quick and accurateis routed according to CAT code assigned to supplierCyberSecurity Questionnaire is reviewed (if applicable)If approved, supplier is advanced to Round 2, if not approved, an existing supplier is used
19 Ameren Justification… Functionality AreasSupplier On-boardingRound 2 (Currently under review for improvement)Supplier is re-contacted by clerks to fully complete their profile onlineSupplier added to supplier master by APInformation augmented by PurchasingInformation certifications are uploaded and approved (if needed)Tracked certifications are uploaded and approved (if needed)Supplier diversity qualifications are uploaded and approved (if needed)CyberSecurity Questionnaire is attached to supplier record (if needed)Supplier is approved and enabled for use in Oracle.
20 Ameren Justification… IT InterestCapital InvestmentIT keen to implementGL to go live on (JUL 2014)Fully regulated utilityRate recovery cases go before state PSCCapital intensiveCapital expenditure more readily enters rate baseSLM completely new functionality to AmerenPresence of SLM allowed IT to capitalize the upgrade of EBS
21 Upgrade to 12.1.3 SLM Overall Ameren Experience… Roughest in our history with OracleUnderestimated impact at Ameren/supplier user levelOne round of testing less than usually doneMany more user impacting problemsPDF forms not workingPurchasing forms functionality not workingLitany of problems, all resolved now, but some took months.SLM OverallDifficulty implementing the two round approval loop processUnderestimated the volume of new supplier requestsRFI update form facing suppliers not working properly, intermittent problemsLogin problems on supplier end
22 Ameren Experience… Insurance Certificates Other Certifications Functionality worked as plannedCapability to build and run a data load programSeparate from SLM but promising for mass updateManually entering insurance informationMaintenance is up to date with little if any backlogOther CertificationsPaper files to convertMuch data entry to accomplishOnline functionality works as expectedBacklog is worked by clerks and also by interns as we hire them for summer, Christmas break, etc.
23 Ameren Experience… Supplier Diversity CyberSecurity Attachments – OK Promises a large upside for this small user communityUse of supplier facing forms for self update still having problemsCyberSecurity Attachments – OKStandard attachment dialog usedNotifications preparation and grouping for communications all working as expectedInitially worked as planned.With the recent RUP’s & switching to Exadata, the functionality is somehow disabled – SR with Oracle filed.
24 RUP’s…Comprehensive Roll Up Patches were implemented spring and early summer 2014.Extensive testing was doneExadata servers were implementedOracle General Ledger went liveSLM suffered some technical and process setbacks as a result of this implementationWe re-evaluated the two cycle process and eliminated the initial supplier contact for supplier update. This would’ve happened regardless.Supplier grouping and function was somehow disabled around the time Exadata became part of the topology. An SR with Oracle was created.