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Contents
ICM Sourcing Business Application[edit]
Overview[edit]
The ICM Sourcing App, based on the solid foundation of Icertis Contract Management (ICM) platform (a world leader in Contract Lifecycle Management), is designed to make it easier for sourcing professionals to negotiate better deals and deliver on business imperatives of velocity, efficiency and risk mitigation.
The ICM Sourcing App is unique in the way it models the Sourcing process to be contract-centric. Since, the most important artefact of any commercial arrangement is an executed contract, ICM Sourcing puts contracts at the center of all Sourcing events. This paradigm is called Contract-Centric Sourcing.
The platform’s modern, scalable and integration-friendly cloud architecture can model even the most complex sourcing scenarios. Its multilingual, multi-currency capabilities make it well-suited for global supply chains.
The app enables secure communication with suppliers and partners that is more efficient than traditional communication methods such as email. Its easy-to-use interface makes it possible for everyone in the enterprise from the legal department to the supply analytics team, to be able to access the platform capabilities.
Using this app, third parties are granted customized access to the ICM platform so that they can submit RFx responses, contract redlines, review their contracts, upload compliance documentation, get alerts, and update obligation assignments with ease.
The Challenge[edit]
In complex business environments, partner, supplier and customer relationships are critical. Emails are no longer reliable for collaboration and raise the risk of delays or miscommunication. Emails also do not allow for information and data to flow from sourcing events and supplier performance systems for insights during negotiations, nor resolve the complexity of multiple languages.
Hence, enterprises with increasingly complex value chain need a better way of communicating and managing these commercial relationships. Procurement organizations need better ways to collaborate with suppliers while balancing risk mitigation with accelerating speed of business.
Some of the key challenges that Sourcing professionals face include:
- Lack of data on past vendor performance
- Sourcing event management tied to contract renewal and expiry timelines
- Contracts language negotiations left for the end of the process
- Non-optimized contracts leading to poor performance
- Siloed contracts in different formats, geographies and repositories leading to inconsistent terms of engagement with same suppliers
- Inability to search and report on legacy and ongoing contracts
- Extremely limited view into the inherent risks and obligations due to the lack of central management
The Solution[edit]
The ICM Sourcing App provides an integrated environment that integrates existing contract portfolio, performance of suppliers in various parts of businesses, obligations related performance of suppliers with RFx management and helps them execute their category strategy much better. The flexible architecture and configurable design of the platform allows buyers to configure and run a variety of sourcing events with different business rules to suit their negotiation approach for specific sourcing projects. The application is also equipped with a secure collaboration feature that allows for broadcast or private mode collaboration with RFx participants so that transparency of the entire Sourcing event process is always auditable.
The most distinguishing feature of the ICM Sourcing Application is its approach of contract-centric sourcing. This approach allows buyers to define pre-requisite and mandatory contract conditions that the prospective suppliers must comply with. The level of compliance and agreement to desired contract terms can be made the third pillar of evaluation beyond the traditional two pillars of commercial and technical evaluation. This contract-centric sourcing approach promises to cut down negotiation cycles tremendously.
The Capabilities[edit]
The ICM Sourcing app helps customers address specific business requirements and get even more of their investment in the ICM platform. It offers these powerful capabilities for sourcing contracts:
- Complete RFx management by automating the Request-to-Award process, using pre-approved templates
- Co-negotiation of contract language with technical and commercial evaluation
- Excel aided bid evaluation and selection, and the ability to score them on quantitative and qualitative criteria
- Multi-round RFx negotiations allowing users to sequentially or parallelly negotiate prices and shortlist best suppliers, and initiate the awarding process based on specific rounds
- Full lifecycle compliance tracking giving full visibility into supplier risk to ensure compliance across source-to-contract process with built-in dashboards providing directional insights into the RFx cycle time, supplier risk or contractual obligations
The Benefits[edit]
The key benefits of using the ICM Sourcing App include:
- Streamlining the entire source-to-contract process with a contract-centric sourcing event design
- De-risking awards by integration vendor performance
- Storing important documents that can be referenced later for various purposes such as shortening or speeding up negotiation cycles
- Making the sourcing process faster and more efficient
- Ensuring a streamlined process when collaborating with external suppliers and internal customers or partners
The Sourcing Process[edit]
The main purpose of the Sourcing process is to acquire the desired product at the best possible price from the most reliable source. The other objectives are improving the overall bidding and awarding process and minimizing the risk.
Here is a quick walkthrough of the Sourcing process offered by Icertis Sourcing application:
1. The organization/buyer performs demand management by understanding and analyzing the requirement for the product, its quantity and the budget for the same. In a more mature organization, this takes the form of category management.
2. The buyer creates an RFx instance for the product by specifying details related to the product. The product to be procured is called as a line item to the RFx. The buyer can add one or more line items to one RFx instance.
3. The buyer then invites the suppliers to submit their bids and creates a round for the same.
4. The suppliers evaluate the RFx invitation and submit appropriate bid responses during the rounds created by the buyer.
5. The buyer collects all the bid responses received from one or multiple rounds and evaluates those responses. The Icertis Sourcing app facilitates an easy way to conduct bid analysis by downloading the bid responses on an excel sheet.
6. The buyer can then initiate the awarding process and award the contract to the selected supplier(s).
7. The Icertis Sourcing application also provides the ability to sign NDAs, and other agreements with the suppliers at any stage of the sourcing process as per the business requirement.
Glossary[edit]
- Sourcing event: Refers to any solicitation process whether informational, commercial or technical.
- RFx: An acronym for X where X may stand for Information, Proposal or Quotation.
- Round: A single cycle of seeking proposals or bids from suppliers and evaluating them may be referred to as a Round. There can be multiple Rounds in the complete RFx lifecycle.
- Bid: The response submitted by a supplier for an RFx created by the buyer is referred to as a bid. Typically, bid is part of a round and may be revised and resubmitted by the supplier till the round is open.
- Bid Analysis: The process of comparing and analyzing the bid responses received from one or more suppliers along with the evaluation criteria created by the buyer.
- Awarding: When all the Rounds are closed, and bids are analyzed, the buyer creates the awarding instance that will be awarded to the suppliers that match the evaluation criteria.
- Split Awarding: It is the process of awarding the RFx to multiple suppliers with specifically decided quantity or percentage.
Related Topics: Agreement Management | Working with RFx | Working with RFI | Obligation Management |
