90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Denise Smith, Director of Purchasing and Contract Services, USNH Jim Barnes, VP, Unimarket Using eProcurement to Lead the USNH System towards Cost Recovery and Savings April, 2011

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Agenda for Presentation Objectives of Presentation Background on USNH and Recent Budgetary Environment Setting and Implementing Strategies to Address Tough Times Cost Recovery/Savings Objectives from eProcurement Illustrating one major cost recovery initiative – (Collaborative RFx) Demonstrating the Unimarket Collaborative RFx Feature

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Objectives for this Presentation Show how USNH addressed a common setting in higher education today – budget stress Discuss how the institution needed to go beyond the current technology to make gains Illustrate how USNH brought a client-vendor partner team together to evaluate eProcurement as a re-engineering strategy to address cost recovery objectives Demonstrate one of the cost recovery objectives – Collaborative RFx – developed from the team Discuss progress and status

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Background – USNH Located throughout New Hampshire Multi-campus environment consisting of: UNH-Durham, UNH-Manchester, PSU, KSC, GSC, FPLC Law School 31,000 plus students (FTE) system wide 6053 faculty, staff, administrators 3000 requestors/buyers 377 Banner requisition approvers 5845 requisitions posted in FY10 138,532 P-card transactions posted in FY10 $619 million annual operating budget (FY10) o 72% goes to salaries & benefits o 28% ($174 million) in non-payroll spend may be “addressable” through eProcurement Banner site since 2003

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Economic Environment State budgets under stress Requiring state institutions to conserve resources for upcoming budget years Actions had to address ways of repurposing head count and real cost savings

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Operations Environment – before eProcurement Procurement processes o Mostly manual process for end-users, did use Banner online requisitioning o Limited ability to collaborate among system institutions o High maverick spend o Time consuming, high headcount administrative processes in RFP processing, vendor data maintenance processing, etc. Banner client o Had gotten full extent of Banner capabilities, needed further capabilities to improve central purchasing offices, business process, obtain cost savings/recovery

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee A Spend Example... Analysis of Office Supplies Spend Total Annual Spend for Office Supplies: –$7,997,581 Total Transactions –40,376 –85% of transactions on contract –58.6% of the dollars –15% of transactions off contract –41.4% of dollars Total Off-Contract –$3.3mm or 41% Industry Assessment Aberdeen Group estimates 38% is average off-contract spend Recommends eProcurement would drive greater contract compliance A behavior change of 8% (Aberdeen ratio) would result in $879,000 in savings

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Setting the Strategy from the Top Bring a team together to consider options No technology just for technology’s sake – must link to measurable, identifiable and actionable cost recovery objectives Set cost recovery objectives Identify and evaluate solutions Implement solutions –eProcurement –RFx –Vendor Master Data Maintenance Measure cost recovery/savings

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Specific Cost Recovery Objectives from eProcurement Repurpose positions in producing and managing Bidding processes Repurpose positions in collecting and managing vendor data for reporting and other needs Channel buying behavior towards preferred/contracted vendors

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Benchmarks around RFx RFX processes – Transition solicitation/bidding events to the Web – Increase collaboration among the four institutions on common buys – Link to public bid advertisement website – Improve cycle time of bid development to award – Measure ability to repurpose positions – Measure results in 2011

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Benchmarks around Vendor Master Data Maintenance Vendor Master Data Maintenance – Transition data collection efforts and maintenance thereof to the Web – Redirect vendors to a self registration process at bidding time and at regular update intervals – Reduce percentage of unregistered vendors – Measure ability to repurpose positions – First version of product to be released at end of 2010 – Measure results in 2011

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Benchmarks around these objectives Contract Compliance – Set baseline compliance rates for major supplies categories – Set compliance rate goals – e.g., office supplies increase by 10% from 59% compliance to preferred vendor – Enable eProcurement solution to manage p- card transactions –Go live with eProcurement –Measure results in 2011

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee DEMONSTRATION OF THE COLLABORATIVE RFX FEATURE October 2010 We will display screen shots for eSourcing (Collaborative RFx )today Live buys already occurring from past meetings Open to all Unimarket and non-Unimarket customers No cost to participate Suggest your own products, services for future collaborative sourcing Contact or

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Collaborative RFx – pooling demand within & across institutions Invite other institutions to participate in Bid – Unimarket or Guest Customers

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Initiating Common Point Purchases Unimarket customer initiates RFx event

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Inviting Other End Users Into the RFx event Set up “frequent” collaborators, consortia members, etc.

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Adding Product and Specifications/Requirements Participants can adopt initiators specs or create own

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Adding Evaluation Criteria Enables the scoring of responses if desired

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Publishing the Initiator’s RFx Social networking forums enable participants to communicate with one another

90 th Annual Meeting & Exposition April 3 – 6, 2011 Memphis, Tennessee Thank-you Denise Smith, Director of Purchasing and Contract Services, USNH Jim Barnes, VP, Unimarket Can we answer any questions?