What are ‘Streamlined Procurement Processes’ and how can they benefit companies in the region?

This gives you greater spending control, while minimizing the time and effort involved in buying the materials and services you need. You can also integrate requisitions from any materials-planning system with data from other back-end systems to streamline sourcing tasks – such as supplier identification, qualification, and selection.

Once the system creates a follow-up document (such as a purchase order or contract), it can return the document to the back-end system for execution. Automating processes frees you up from routine operational tasks and gives you more time to focus on strategic activities such as strengthening supplier relationships and negotiating deals that deliver maximum value to your organization.

How can you manage the contract process more effectively?

By reducing manual entry of document data, SAP SRM also minimizes the impact of human error on the purchasing process SAP SRM can further reduce supply cycle time and paperwork by letting you execute transactions and communicate with suppliers online. The quick and easy-to-use online spare-parts catalogue can significantly speed up purchasing for both standard and ad hoc material and service needs. The catalogue is based on contracts with OEM suppliers, which enforces contract compliance across the enterprise.

Centralized contract management can result in better terms, greater cross-enterprise contract visibility, assured compliance, and reduced administrative costs. It can also help you develop enterprise-wide contracts that increase compliance throughout the organization. SAP SRM supports a fully integrated contract process that makes it easier to ensure that all suppliers, business units, and individual buyers comply with the terms and conditions you negotiate.

The contract management functions in SAP SRM can be fully integrated with processes for bidding, auctioning, and material resource planning in back-end systems – giving you greater control over the entire contract process. SAP SRM helps you manage and monitor contracts at both the enterprise and individual department levels. A central contract repository facilitates document and knowledge management. You can store contracts electronically for enhanced access by whatever subsidiaries and plants you choose. This mix of centralized support and local flexibility can boost productivity by freeing individual business units from many of the burdens of contract management.

How can you transform these processes in better supplier relationship management?

Successful supplier relationship management also requires cost effective methods for helping suppliers of all sizes connect to multiple processes throughout the supplier relationship life cycle. SAP SRM gives suppliers direct access to supply-side transactions and other relevant information – such as supplier performance data– using a powerful, browser-based, and highly scalable supplier portal as the single point of entry. Suppliers can use this portal to update their catalogue data, document acknowledgement of invoice creation and verification, and track their payment status and other relevant supply chain information (such as inventory and supply/demand plans). Through integration with SAP PLM, you can provide a collaborative document repository to your organization and external business partners. You can store all documents related to your procurement process, no matter how complex, and easily share those documents with all the related parties in real time.

SAP SRM covers the full supply management cycle – from strategy to execution. It can help oil and gas companies in the region optimize supplier selection, improve collaboration, compress supply cycle times, and reduce obsolete inventory. The solution offers the consolidated content and master data functions you need for business decisions that support your corporate strategy and goals.

The solution helps sourcing professionals develop effective supply strategies, measure supplier performance, analyze spending patterns, and streamline sourcing processes. It provides integrated support for preparing bids, executing electronic requests for quotations and reverse auctions, evaluating bids, awarding suppliers with purchase orders, and creating contract documents.

There is support for centralized, enter-led, distributed, marketplace, and other procurement models – which is needed for oil and gas firms with offshore, manufacturing, refinery, and storage operations in multiple locations or countries. Coupling SAP SRM with the SAP Product Lifecycle Management (SAP PLM) solution can provides framework for real-time sourcing and document collaboration between your internal cross-functional teams and external business partners. Seamless integration with SAP PLM extends the sourcing process for complex assets and turnkey projects procurement.

Is it possible to demonstrate the better supplier management results in tangible business benefits?

More than 3,000 companies throughout the world have adopted SAP SRM, including more than 30 of the world’s leading oil and gas firms. Among them is Oil & Natural Gas Corporation Limited (ONGC), one of India’s most successful companies. Having already realized many benefits from SAP software for enterprise resource planning, ONGC implemented SAP SRM to improve its procurement processes.

ONGC succeeded in its objectives of enhancing supply chain visibility, improving efficiency, and enhancing relationships with suppliers. At another global oil and gas company, SAP SRM has helped reduce order placement processes by 72% and cut the cycle time for suppliers’ sales processes by 70%. By optimizing and reducing supply costs, the solution has cut inventory for purchased items by 25% and trimmed costs for maintenance inventory by 25%.

By improving this company’s procurement strategies and strategy compliance, SAP SRM has helped reduce average one-year contract prices by 6%.