© 2012 Ariba, Inc. All rights reserved.

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Slide1

© 2012 Ariba, Inc. All rights reserved.

Ariba Network Best PracticesDefining the Buyer Compliance Policy

Leigh Tangretti, Director Network Services

Slide2

Agenda

Network Enablement is a JourneyWhat is a Buyer Compliance Policy and why is it important?The key elements of a Buyer Compliance Policy and associated best practicesKey Collaborative Commerce Questions to ask yourself

© 2012 Ariba, Inc. All rights reserved.

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Slide3

3

Specialize and Sustain

Capture More Complex Areas

Expand and Enable

Increase Adoption

Process Maturity

(Learning & Collaboration)

Hi

Low

Hi

Launch and Leverage

Get Early Savings and Organizational Wins

Adoption

(technology/automation)

Phase3

Phase2

Phase1

The Path to Best-in-Class is a Journey

Slide4

Agenda

Network Enablement is a JourneyWhat is a Buyer Compliance Policy and why is it important?The key elements of a Buyer Compliance Policy and associated best practicesKey Collaborative Commerce Questions to ask yourself

© 2012 Ariba, Inc. All rights reserved.

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Buyer Compliance Policy

The foundation for Collaborative Commerce communication is the Compliance Policy

The Compliance Policy directly affects supplier enablement efforts

All internal buyer stakeholders should be aware of and able to communicate the Compliance Policy

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A strong Compliance Policy will result in more suppliers transacting electronically

Slide7

Agenda

Network Enablement is a JourneyWhat is a Buyer Compliance Policy and why is it important?The key elements of a Buyer Compliance Policy and associated best practicesKey Collaborative Commerce Questions to ask yourself

© 2012 Ariba, Inc. All rights reserved.

7

Slide8

What is the Buyer Compliance Policy?

The governing policy by which a Buyer manages their Collaborative Commerce program.

© 2012 Ariba, Inc. All rights reserved.

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Slide9

Defining the EDICT

© 2012 Ariba, Inc. All rights reserved.

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Slide10

Defining the EDICT

© 2012 Ariba, Inc. All rights reserved.

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Dear Seller,

Your participation in this program

is required…..

Slide11

Defining the EDICT

© 2012 Ariba, Inc. All rights reserved.

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Dear Seller,

Completion of Ariba registration is expected by November 12, 2012.

Registration on the Ariba Network must be completed within 2 weeks of receiving the Relationship Request Letter.

Paper, Email, Fax transactions will cease as of November 12, 2012.

Slide12

Defining the EDICT

© 2012 Ariba, Inc. All rights reserved.

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Dear Seller,

By participating in this program, you can obtain the following benefits:

Accelerated cash flow

Continued business with our company

Document visibility of payment status online

Favorable payment terms

Preferred supplier designation

Processing efficiencies

Improved vendor visibility

Slide13

Defining the EDICT

© 2012 Ariba, Inc. All rights reserved.

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Dear Seller,

Consequences of not participating in this program will expose your too:

Extended payment terms

Paper processing fees

Discontinuation of paper delivery/receipt

Discontinuation of business

Slide14

Defining the EDICT

© 2012 Ariba, Inc. All rights reserved.

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Dear Seller,

We are very pleased to announce a progressive change within our company that will improve the way we interact with our suppliers. We have entered into a relationship with Ariba, the leading global provider of collaborative business commerce solutions, which will allow our suppliers to easily extend their back-end systems and processes to benefit from electronic transactions.

Slide15

What is the Buyer Compliance Policy?

The governing policy by which a Buyer manages their Collaborative Commerce program.

© 2012 Ariba, Inc. All rights reserved.

15

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Components of an Adherence Policy:Internal Communication

The most effective deterrent to supplier compliance is conflicting buyer messages

Internal Communication should include:

Initiative Announcement letter to Internal Resources from Executive Sponsor

Training for Key Stakeholders

FAQs/Talking Points for Key Stakeholders

Periodic reminders of Initiative (desk drops, buyer Intranet posting, Email, performance reviews)

Slide17

© 2010 Ariba, Inc. All rights reserved.

Strategic

Operational

Individual

Business strategy, expected value and benefits Program timeline and measures of successCritical success factors

Specific operational changes resulting from the initiativeProcess, technology and people objectivesConsideration of local operations and impactTeam accountability and involvement, particularly as it relates to adherenceActions to be taken to prepare stakeholders

Impact on individual & team goals and objectivesIndividual job and career benefits: “what’s in it for me?” Specific job requirement changes/impact on roles & responsibilitiesActivities and preparation for change resulting from program

Key Internal Communication Messages

17

Slide18

Sample of Internal Communication

© 2012 Ariba, Inc. All rights reserved.

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Operational

Strategic

Overview

Timeline

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Components of a Compliance Policy:Supplier Communication

The Compliance Policy should be pervasive in all supplier communications:

Relationship Request Letter

PO Terms & Conditions

RFXs

Business Awards/Contracts

Payment (Remittance Notes)

Supplier Intranets, Extranets, etc.

Key Stakeholders should emphasize the Compliance Policy during supplier interaction

Slide20

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Supplier Relationship Request Letter should “Issue an EDICT”

Expectation

Deadline

Incentive

Togetherness

Consequence

Slide21

What is the Buyer Compliance Policy?

The governing policy by which a Buyer manages their Collaborative Commerce program.

© 2012 Ariba, Inc. All rights reserved.

21

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Components of a Compliance Policy:Supplier Enablement NCE Process

Non-Compliant Escalation is a key component of the Supplier Enablement process

For buyers with SE Services, NCE is a joint process that can maximize enablement success

To be effective, the NCE process must incorporate the consequences outlined in the “EDICT”

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SE Services NCE Process

Resolve NAE and Ariba Supplier Enablement resumes progress with supplier

Action 2

Action 3

Action 1

Buyer NAE Contact

On

Hold Report

Reject supplier for participation in Collaborative Commerce initiative

Execute appropriate consequence

Slide24

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“On Hold” Supplier Report

Best Practice is to resolve On Hold status relationships within 10 business days

Slide25

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NCE Tracking Process

Slide26

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Supplier Enablement NCE Process

Slide27

Agenda

Network Enablement is a JourneyWhat is a Buyer Compliance Policy and why is it important?The key elements of a Buyer Compliance Policy and associated best practicesKey Collaborative Commerce Questions to ask yourself

© 2012 Ariba, Inc. All rights reserved.

27

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Key Collaborative Commerce Policy Questions

Is participation in this initiative mandatory?

Do we have a desired deadline date for suppliers to convert from paper POs/invoices to the Ariba Network?

Should we provide incentive for the supplier to participate? If so, what incentives are we comfortable and/or prepared to offer?

Do we want to alter payment terms for suppliers participating in collaborative commerce?

Will we allow a supplier to just receive electronic Purchase Orders? Or, will we only issue electronic Purchase Orders if the supplier also submits invoices electronically?

Are there any suppliers that we do not want or cannot move to the Ariba Network?

Do we want to incorporate mass recruitment techniques?

Slide29

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Key Collaborative Commerce Policy Questions

Do we have a new supplier set-up process? How does it need to be modified to include supplier set-up on the Ariba Network?

How do we want to handle one-time vendors? Should they register on the AN?

Should we return paper invoices received after a supplier has registered on the AN?

Can we include supplier participation in collaborative commerce as a condition for the award or renewal of business with our company?

What communication channels do we have available to publicize our collaborative commerce initiative to our suppliers?

Do we have an effective way to communicate our collaborative commerce policy to internal stakeholders?

Do we have executive buy-in and support for implementing our collaborative commerce policy?

Slide30

Questions

© 2012 Ariba, Inc. All rights reserved.

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