1. Digitization in Procurement – A Success Story Amit Bhowmik
22nd February 2019

2. Background… Pain Areas & Challenges
Local Purchase through Non PO invoices
Large number of C class vendors with low value items
Scattered demand – Less Buying power
High Transactional P2P cost
Prices offered by the vendors are uneconomical
Procurement Team
Less time for Strategic Procurement
Large number of Manual requests & Purchase Orders
Processing of large number of invoices

3. Current Status – Complex Scenario
Request through
RFQ
Quote
Vendor A
for validation of specs
RFQ
Procurement Team
Clarification on Specs
Technical specifications
COB Preparation – Vendor Selection
SC update
RFQ
Quote
Vendor B
Go ahead to raise SC
Sending of PO
Quote
Sending of Invoice
Vendor C
Payment of Invoice
Supply of material
Vendor L1

4. A Digital Procurement Platform
Objective…
Project Iceberg –
A Digital Procurement Platform

5. Improve Transparency and Compliance
Objective…
Introduce Automation replacing manual processes
Implement Punch out product catalogue
Reduction of suppliers from large numbers to limited One
Bundling the scattered demand and build the power of negotiation to generate savings
Introducing online pricing contract replacing Non PO purchase and increase automation
Utilize productive time in Strategic procurement rather than transactional procurement
Generate Savings in P2P cost
Improve Transparency and Compliance
Reduce Operation
Costs
Accelerated time
To Value

6. Future Scenario – One Window Solution

7. How the Tool Works….

8. Vendor Web Page

9. Vendor Web Page
Grouping of Materials for synchronizing the material codes
Grouping will help to drill down the product at specification level

10. Vendor Web Page

11. Vendor Web Page

12. Vendor Web Page

13. Vendor Web Page

14. SRM System

15. Thank you for your attention!
Simplified Solution…
Thank you for your attention!
SC, Delivery
SC creation – Approval – PO Generation - GRN
Purchase Order
Delivery Follow up
Payment

16. Benefits Benefits Conversion of Manual POs to Automated POs
Particulars
Current
Proposed
Remarks
No of C Suppliers
1200
120 – Future reduce to 10
Reduction of suppliers more than 90%
Total Value p.a.
₹20 Crores
₹19 Crores
Saving approx ₹1 Crore
No of Purchase Orders p.a.
10000 POs
No changes in PO numbers
Automation 0%
90%
 Conversion of Manual POs to Automated POs
No of invoices p.a.
10000 approx.
1000 approx
Target : 120 invoice p.a.
No of Payments p.a.
10000 payments approx
1000 payments approx
Target : 120 payment run p.a.
Cost per transaction
₹ 2000 per transaction
₹ 200 per transaction
₹ 1800 per transaction
Savings :
Bundling of Volume = Rs. 1 Crore (approx.)
Transaction cost Rs 1800 X 9000= Rs 1.62 crores

17. Thank you for your attention!
Next Steps…
Thank you for your attention!
Automation of GRN through Bar coding

18. Thank you for your attention!
Next Steps…
Thank you for your attention!
Mobile App for supplier Ledger

19. is Incomplete without team support
The Journey is Long
&
is Incomplete without team support