Managing Services Spend
Oracle’s BPO Program
Definition:
Business Process Outsourcing (BPO) is the outsourcing
of a related set of business processes to an
organization other than your own.
Not just IT or apps management services
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BPO Powered by Oracle
Strategy
“BPO Powered by Oracle” places Oracle applications,
technology and ancillary services “under the hood” of
BPO Provider service offerings
Objective
To help BPO providers reduce risk, lower cost and
improve flexibility in the services offered to their
customers and provide “BPO Powered by Oracle”
choices to our customers.
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Service Provider Software Matters
Look for a service provider that delivers BPO Powered by Oracle:
– Protect your investment – now and future
– Reduce process transition risk
– Improve time-to-deployment
– Mitigate change management disruption
– Improve process continuity
– Increase end-user adoption
Oracle solutions deliver:
– Lower operational TCO
– Tools/templates enable standardized deployments
– Proven upgrade track record
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e-Procurement and Services Procurement
Powerful Combo to Manage Goods and Services Spend
Capability
Goods
Services
Powerful, easy to use self service capability
X
X
Configurable, flexible approval workflow
X
X
Simple services requisition management
X
X
Integration with Enterprise ERP suite
X
X
Easy to use catalogs for purchasing indirect goods
X
Integration with Resource Management
X
Competency based requisitions
X
Integrated strategic sourcing module and bidding ability for Services
X
Services specific workflow items like interviews and on-boarding/offboarding
X
VMS capability
X
Integrated, rules based time reporting, progress reporting and expense
reporting feeds back to projects and financials
X
Integrated pro-forma invoicing
X
•5
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Specific Benefits
Driver
Competitive
Bidding
Preferred Supplier
Enforcement
Process
Efficiency
Visibility &
Control
Accurate
Invoicing
Early Pay
Discount
Benefit
2-5% Hard Cost
Savings
1.5-5% Hard
Cost Savings
1-2% Savings,
55%+ cycle time
reductions
Risk Mitigation
Best Practices
Enforce contract rates & require minimum number supplier bids/resumes
Enforce “market-driven” rate bands (not-to-exceed)
Monitor rates by position/supplier
Enforce supplier selection logic and manage exceptions
Capture qualitative and quantitative metrics to feed performance scorecards
Increase buying leverage buying using less suppliers
Close loop procure to pay process
Enforce no-PO no-Buy policy
Automate PO/CO/Invoice processes
Eliminated/Control co-employment risk
Increase supplier quality – drive more spend to the best suppliers
Auditable process tracking
1-2% Hard Cost
Savings
Auto-generated invoicing from timesheets and deliverables
Automated rate sheet compliance
Automated budget compliance
1-4% Hard Cost
Savings
Negotiate and enforce discounts
Don’t negotiate discounts that can’t be enforced
Evaluated Receipt Settlement (ERS)
Automated invoice generation
•** Not illustrated – headcount optimization / increased capacity
•6
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About Provade
Mission: To enable companies to gain the maximize
spend under management while leveraging current
investments in Oracle Technology & Infrastructure
HQ in Silicon Valley with global presence
(Sydney, Singapore, UK, Hong Kong, India)
Oracle Tier 1 Procurement SaaS Partner
Largest sPro customer for Oracle
MASSIVE spend volume
• No single instance under $100M in annual
spend under management (throughput)
• Over $1.6 billion in spend in 2007 alone
7
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Sample Customers
Provade delivery model
Procurement
Candidate Sourcing
Payment
Analytics
 Strategic Sourcing
 Requisition Management
 Invoice Management
 Benefits Tracking
 Benchmarking
 Candidate Management
 Exceptions Management
 Compliance Reporting
 Category Management
 On-Boarding / Off-Boarding
 Payroll (Direct)
 Time to Recruit and
 Content Management
 Non-Panel Sourcing
 Compliance Reporting
 Supplier Management
 Compliance Management
 Contract Management
 Timesheet / Approvals
Fulfilment ratio
 Candidate and Supplier
Performance
 Spend Analytics
Global Managed
Services Provider
Global Managed
Services Provider
• Support Services
 Implementation
 Help Desk
 Change Management
•Technology Foundation
 Oracle/PeopleSoft Service Procurement
Provade Enhanced (Provade CSM)
• Infrastructure Services
 SAS70 Level II Certified
(24/7
8 Availability, Security, Integrity)
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Global Managed
Services Provider
&
Case Study: Regional Subsidiary of a Global
Financial Services Firm
Project Scope
•
Drive spend for contingent labor, professional recruitment,
legal and consulting towards preferred suppliers with
renegotiated rates
•
Automate the procure-to-pay process to facilitate compliance and
increase visibility
Approach
•
Phased program to address contingent labor and professional
recruitment spend first, with legal and consulting spend thereafter
•
Utilize Provade Managed Services to manage these categories of
spend
– Strategic Sourcing to select preferred suppliers, as well as
negotiate rates and contract terms
– Ongoing Category Management services to monitor and
report on program status, savings and supplier performance
•
Implementation and rollout of Provade Category Spend
Manager™ (Provade CSM), an on-demand procure-to-pay system
based on Oracle/PeopleSoft procurement applications
Results-to-Date
•
Renegotiated and standardized bill rates for each service that
resulted in a 16% rate reduction
•
Savings of 10-15% in each category
•
Eliminated the manual entry of 10,000+ invoices/year
•
75%+ reduction in supply base
•
Increased quality of contractors and services provided
9
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•Profile
• Regional division of a large
global financial institution
• 9,000+ employees
•Background
• Division growing rapidly
• Lack of visibility into
— Services spend
— Contractors onsite
— Management of intellectual
property by contractors
• Inconsistent process to request
and manage services across
operating units
• Increasing number of exceptions
from invoicing errors
Services Case Study:
Global Enterprise Solutions Company
•
•
Project Scope
– $250M in spend for North America and Asia-Pacific
– Address other global areas in following phases
Approach
– Complete Managed Services
• On-site resources to manage procure-to-pay process
• Supplier management, including contracting, monitoring
and management
• Consolidated invoicing to simplify settlement
• Program management to help organization drive ongoing
savings and additional opportunities
– Provade Category Spend Manager
•
•
•
•
•
Self-service online requisitioning
Transactional sourcing
Timesheet and Expenses
Integration with Oracle iProcurement and Financials
Results-to-Date
– Mitigation of risk from co-employment
– Consolidation of supplier contracting terms into a
standardized MSA
– Improved compliance to procurement policies
– Process efficiencies from consolidated invoicing
– Improved visibility for department managers
10
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Profile
• 60,000+ employees
• 7,000+ contractors
• 250+ suppliers
Background
• $250M+ in annual contingent labor
and subcontracted services spend
in the US, Europe and Asia-Pac
• Lacking full visibility into global
contingent labor spend
• Centralized procurement with
resource constraints
• Oracle eBusiness Suite for
Procure-to-Pay
Migration Case Study:
Fortune 500 Financial Institution
•
•
Project Scope
– Transition of niche provider solution to Provade
– Go-live with $400M of contingent labor and
professional services spend in first phase
– Second phase to integrate with on-boarding/offboarding systems and have Provade be the
system-of-record for all contingent workers
Approach
– Provade Category Spend Manager™ to manage
contingent labor and professional services spend
• Conversion of all contractor and supplier data over
to new system
• Full integration with PeopleSoft Financials
• Training
• Level 2 Technical Support and Data Maintenance
Services
Profile
• 38,000 employees
• 30,000+ contractors
• 90+ suppliers
• 600 active users
Background
Currently doing $700M+ in annual
contingent labor and professional
services spend, which is growing
rapidly due to M&A
Issues with their second point
solution to manage services spend
Lacked the promised integration
Viability concerns – owner of
solution has changed twice
Support and stability issues
PeopleSoft Enterprise ERP
11
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Summary
•
Obtain highest value of spend under management
– Provide enterprise procure to pay solution for all categories possible on a
single stack
– Obtain highest throughput possible
•
Achieve best-in-class savings on total spend
– Conservatively recognizing cost savings of 6% with no assistance and up to
15% within months of “go-live” with Provade’s Managed Services offering
•
Drive compliance, reduce overhead
– Provade’s “same technology stack” solution provides full transactional audit
trail while integrating to Oracle
•
Improve ‘effectiveness’ of spend management
– By providing req-to-check processing and tying into Oracle, spend is now
clear and actionable
•
Deploy a ‘storefront’ model to enable easy, self-service spend
management processes
– Provade solution seamlessly directs users through e-procurement technology
and leverages future Oracle investments
12
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Questions