Electronic Requisition Approval and Workflow System for XA Users

Transcription

1 MKA MKASSOC.COM HELPING COMPANIES IMPROVE BUSINESS PERFORMANCE Electronic Requisition Approval and Workflow System for XA Users A Business Case: $21,000 a Month There is a SIGNIFICANT BUSINESS CASE that justifies increasing efficiencies in the requisitioning and P.O. approval process. An annual ROI exceeding $250,000 is frequently realizable. That s over a MILLION dollars in four years. It s also a MONTHLY opportunity cost of $21,000. So, why wouldn t a company consider a project for requisition process improvement? Because they didn t know that an EFFECTIVE system integrated with XA existed to help them do this. This MKA application can help you streamline operations and realize a quick ROI. ELECTRONIC REQUISITIONS FOR XA PAGE 1 MKASSOC.COM

2 Introduction: Issues and Objectives of Requisitioning When requisitioning, many companies face common issues or problems, such as: - a manual and inefficient requisition process - a significant amount of expenditures happen outside the system - NO VISIBILITY to these expenditures - lack of good control of these expenditures - the company has an inefficient (and mostly manual) approval process - low P.O. accuracy - no visibility to budget - no integration with XA (MAPICS), which is critical for true efficiency Consequently, most companies hope to meet both common and specific objectives by implementing a system that provides: - an automated, flexible, and EFFICIENT process for requisitions and P.O.s - visibility to all Requisitions for all areas (by user-defined categories) - control: rules of authority with automated approvals, sign-offs, and notifications - control: the ability to know what expenditures are being committed to (before final approval) - the ability to create a Requisition from a web browser - tight integration with XA to ensure further controls and system integrity A NEW APPROACH: Using Business Process Automation The Requisition Approval System provides a new approach by using business process automation, which includes capabilities like: - workflows - notifications - electronic approvals - alerts - extensive integration with XA (MAPICS) - business process rules - time management - designation of backup personnel - measurements (statistics) - auditability (and complete history) - immediate status recognition of where something is in its process An integrated system that works this way provides new and greater efficiencies. The right information comes to the right people at the right time. It helps you create new and improved processes, and also automates processes so that information moves efficiently. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 2 MKASSOC.COM

3 Application Overview Using This New Approach MKA s Business Process Automation is the heart of the Requisition Approval System. This solution is not created with the traditional programming approach of databases and transactions. It works in a completely different way. It takes a NEW APPROACH. It allows for easy entry of requisitions using data already in your XA system. It delivers the right information to the right user for approval (when needed). It provides for rules as to who and/or what approves a requisition. After the requisition goes through its appropriate approval process, it gets passed to XA Purchasing or Procurement Management, thus being an integrated loop with the ERP system. Users have complete visibility to expenditures. They DON T have to go to several systems or databases looking for information. They don t have to sort through s, make phone calls, manually assign dates, seek approvals, create and maintain spreadsheets, and spend time looking for the right information. It gives you all the information you need in one or two screens or makes it easily accessible with a click or two. The requisition process is automated, integrated, managed, and streamlined via YOUR definitions. Relevant documents, notes, or other electronic data can be associated with the requisition so that all needed information is in ONE PLACE and at a user s fingertips. This is a new and proven approach that INCREASES PRODUCTIVITY across the company. It is not a typical application using typical programming. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 3 MKASSOC.COM

4 Key Features of the Requisition Approval System The following are key features of the Requisition Approval System: - Web Browser based Leading edge Xpage/dojo technology for advanced features without loading java or ActiveX applets. - Remote access Allow access inside/outside the company as needed. - Type ahead Many fields have type-ahead lookup, as you type the information lists are shown that match your partial entry. Saves time, improves accuracy and reduces typing. - Unlimited Parts Enter as many parts on the requisition as you want not one requisition per part. - Highly integrated with XA Maintain suppliers, parts, GL Accounts, and all other required information ONE TIME in your XA system for use everywhere. Web users never access your ERP system directly! - Direct PO Information gathered during the requisition process is written directly to the Purchase Order without re-keying, processing offline batch files, or creating the PO manually from Procurement. - Interface to Procurement If you need to break up the requisition to multiple suppliers/pos, the requisition system also interfaces to Procurement to easily manipulate individual parts. - Limits of Authority Rules The Requisition Approval system handles your limits of authority rules by breaking them down by Location/Department/Expense type. The system calculates the signatures required and enforces the rules. - Backup Approvers Backup approvers can be assigned to handle requisitions when the primary approver is not available. - Complete Audit Trail Tracks every activity associated to the requisition and records the time, date, and who performed the activity. Keeps a complete history of the requisition as it was approved for audit purposes. - Always Visible Follow the process from creating the requisition to closing out the PO. Each step is represented by an easily recognizable graphical icon. Track your requisitions in the My Requisition Work Q. - Approver Notification Approvers receive notification when a requisition is ready for approval. - Approved Notification Originator receives notification when the final approval is completed. - Dynamic Work Flow System Need to add or remove a step from your requisition process? No problem. Include or exclude steps based on data conditions in the requisition itself, if needed. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 4 MKASSOC.COM

5 And More NEW Features of the Requisition Approval System The following features have recently been added to the e-req system: Order Point Requisition Approval/Processing XA order points can generate suggested inventory purchases into the XA Procurement requisition file. Because these requisitions are one part per requisition, there may be a lot of them without an organized way to have these approved, priced and processed. The example below works on the same principles. The part to be purchased is suggested from another application and the purchase parts must be either removed or organized into requisitions to be approved and eventually become a PO. The inventory control agent/purchasing coordinator working with the suggested parts will be referred to as a buyer. Any person with the proper security could be designated to perform these operations. The suggested procedure for processing parts created by the materials management re-order process is: 1. The parts from the XA Procurement requisition file would be synchronized into the erequisition system so the buyer would have one place to work from. 2. The parts queue would allow the buyer to remove any suggested part that is not needed. This could also be done directly from the XA Procurement queue if preferred. Since the two lists are synchronized, any parts removed from the XA requisition queue would also remove it from the erequisitions part queue. 3. The buyer can then add information to the part to help group parts into requisitions for pricing and eventually to be made into a purchase order. Information can be sorted/grouped by buyer, supplier, part and due date. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 5 MKASSOC.COM

6 4. The buyer can also add a part to an existing requisition currently residing in the pricing queue. This feature can be removed if it violates approval by the supervisor or department manager. Where approvals allow, combining new quantities with existing requisitions already in the pricing process help buyers to eliminate duplication of effort in some cases. 5. At any time the buyer can select parts to become a new combined requisition. The requisition is then saved or submitted; the individual parts then disappear from the parts queue but are not removed from XA Procurement. 6. The requisition then follows the normal requisition path for approvals and pricing. 7. After approval, the requisition is made into a PO directly or updated back to Procurement. If the requisition becomes a PO, the parts are removed from the XA requisitions file. If the ereq requisition is updated to Procurement, it updates the requisition parts in XA Procurement with any changes made and sets the approval status. 8. If the buyer plans to create purchase orders from XA Procurement, views should be created to work with requisitions with the proper approval status code. 9. If the requisition is rejected, the requisition is still available to be resubmitted. If the requisition is deleted, the requisition and all associated XA procurement requisition parts are removed. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 6 MKASSOC.COM

7 Currency Specification and Conversion The Electronic Requisition System interfaces seamlessly with XA Purchasing and IFM. All assigned currency codes and operations will be compliant with IFM, and IFM currency fields in the Purchase Order will be updated appropriately. 1. IFM currency codes will be pulled into erequisitions. The codes can then be associated to the locations where they can be used. Not all currency codes in IFM may be appropriate for all locations. 2. The option will be available at the Location level to submit the requisitions to Purchasing in US dollars or the currency specified in the requisition. 3. The requisition will have the option to select from the currency codes that have been setup for that location. 4. If a valid currency code has been associated to the supplier in XA, it will be used as the default when the supplier is selected. 5. The currency conversion rate will be pulled daily from IFM based on the effective date. All new requisitions, all reqs submitted for approval and purchase orders created will be calculated with the updated rate. 6. The conversion rate will not change dynamically on the requisition. Changing dollar totals on the requisition constantly could cause confusion for approval rules, negotiations between buyer and supplier or communicating with the requestor. Currency conversion rates will be updated and the totals recalculated when the requisition is created, submitted for financial approval or the purchase order is created. 7. The requisition total only will be shown in U.S. dollars and the selected currency if other than U.S. dollars. All line items on the requisition will appear in the selected currency. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 7 MKASSOC.COM

8 Budget Snapshot If you use International Finance Management (IFM) budget, you can view snapshots of the budget either by unit or by unit/nature. If the requisition has purchases for multiple units or unit/natures, then a budget snapshot is created for each one. The snapshot is calculated on the fly until the purchase order is created from the requisition and then the snapshot is stored with the requisition permanently. While the snapshot is calculated, search icons are shown for areas where you can drill down into the detail behind the totals. The detail is taken directly from XA IFM. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 8 MKASSOC.COM

9 If the budget icon shows red (over budget), extra approvers can be assigned to the workflow approval step. Home Department Budget - Budget is within 10% - Budget is over - Within Budget If authorized, the home budget icon is shown on the side panel of My Requisitions. Clicking the icon calculates the budget information for the unit number of the department set as the home department in your My Profile. If authorized, you may select the location, department and nature you want to display. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 9 MKASSOC.COM

10 Project Budgets Purchases are often made for long running projects. Some projects you may want to track could be: Capital - a new building or renovation of an old one Product Startups a new product line Engineering a new machine or a large job setup Customer a long term customer project Any project assigned an IFM unit or unit/nature can be tracked in the system (designate in the Location document if you will be tracking by unit or by unit/nature). If a budget is assigned to the unit or unit/nature combination, the budget snapshot will show the budget, actual, and open purchase orders and requisitions. You can track your project budget real-time until the requisition is turned into a PO. The requisition then becomes static information and is kept in history for future reference. Since each unit number can have a different set of approval rules, the approvers can be assigned differently for each project. If all projects have the same approvers, you can designate projects at the nature level or use an approval rule template to cover a group of unit numbers. The tasks associated to setting up a project for tracking are: 1. Assign an IFM unit or unit/nature combination. 2. Assign IFM budget to the unit or unit/nature combination. 3. Setup the project as a department and assign it to the proper location(s). 4. Assign an approval rule to the unit or use an approval rule template to cover a group of units. 5. Begin entering requisitions against the project by selecting the project as the Department or cost center when creating a requisition. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 10 MKASSOC.COM

11 Download to Excel If authorized, you may export some requisition lists directly into Excel. Order Point Queue The purpose of the order point queue is to interface to the direct materials often generated automatically by XA processes into the XA requisition system. Instead of working with one part per requisition, buyers often want to group parts together to get RFQ for pricing or for approvals. To see the proper information in the order point queue, the purchase agent should be sure to set the default location in their My Profile. Lists open XA Requisitions (one requisition per part) often generated by XA Order Point or MRP processing. Group requisitions by adding supplier, buyer, location and other information. Select requisitions to add to erequisitions currently in the pricing queue. Or, select requisitions to create a new erequisition to submit for approval. Once an erequisition is created from the order point queue, it can be processed through the erequisition workflow like any other requisition. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 11 MKASSOC.COM

12 VERY Important Reasons for Tight Integration with XA Experience has shown that stand-alone requisition systems provide very limited value to companies. This is because such systems require system duplication, additional keying, additional receiving, redundant databases, costly and extensive custom integration, and much batch processing. Moreover, they don t take advantage of the EXISTING functionality and existing data that is already in the XA system, such as: - vendor data - item data - production data, such as purchases for specific manufacturing orders or schedules - already defined definitions in XA for data related to items, departments, Buyers, and other areas - IFM data - Budget information - P.O. and related information - P.O. creation process - Receiving process Without tight integration to the XA system, the use of stand-alone systems breaks down and the value to the company is minimized. With a stand-alone system, the company has minimal visibility to expenditures; the approval process is often limited to just MRO items; users have little accountability. Consequently, the Electronic Requisition Approval system is highly integrated with XA, yet it operates without requiring individual XA licenses and access to the iseries system. Users can create requisitions, participate in the approval process, and even view receipts without requiring direct access to XA. Only Buyers need real time access to the XA system to create purchase orders or pass approved requisitions to Procurement or Purchasing. Here are some of the integration points that the Electronic Requisition System for XA provides: 1. Purchasing a. Suppliers suppliers are added, changed, or deleted in the MAPICS XA system. No additional entry in the e-requisitions system is required. The suppliers are captured into an like address book so that multiple addresses and other information that XA does not provide can be tracked and used for RFQ communication. b. Create Purchase Orders directly from e-requisitions No offline files loading or batch processing is required. The system integrates with XA for the automated next PO number and other buyers can still be creating purchase orders outside of the e- Requisition system. c. Pass requisition parts to Procurement Procurement tracks each part as a separate requisition. The e-requisitions System can interface to Procurement and create and track the requisition numbers while allowing the parts to be combined together for the requisition approval process. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 12 MKASSOC.COM

13 d. Comments Purchase order header comments and item comments are entered naturally in the Windows environment and word-wrapped appropriately into the XA comment format. 2. Inventory a. Parts Inventory parts with purchasing descriptions, item balances, and default IFM nature numbers are provided in easy to use searchable lookup lists. b. Part Validation Drop down lists ensure the correct warehouse/part number on the requisition. There is no reassigning invalid part numbers to get the purchase order created. c. Limit Part Lists You decide which parts you allow to be used in the e-requisitions system. Users can limit the list by warehouse, item type, item class or any other MAPICS XA criteria. d. Receiving e-requisitions provides views into received items by PO, requisition number, and more. Users without XA access can still monitor their purchased requests throughout the procurement process. 3. IFM a. Validate Units/Natures The e-requisition System validates proper unit/nature combinations before allowing the Purchase Order to be created. Units are associated to department names so users select them easily from drop down lists. Natures can be defaulted by part number or a list of valid natures is displayed for the selected Unit. b. Budget e-requistions can pull IFM budget and actual at the time the requisition is submitted. Combined with open purchase orders and open requisitions, a total snapshot for the department is generated for approvers to consider. 4. Manufacturing a. MO Associate parts to manufacturing orders for production costing, projects, and customer orders. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 13 MKASSOC.COM

14 Other Advantages of Integration with XA The importance of integration cannot be overstated. The time and cost savings you gain from a system can easily be lost if information has to be re-keyed, verified for accuracy, or if additional steps have to be taken, or if the system causes others to work around missing information. Consider the following: 1. The Electronic Requisitions Approval System does not replace the vital ERP processes you rely on XA to provide. XA is your main business system and any additional systems should tie-in with those processes. The e-requisition System simply enhances the front-end procurement processes using workflow, your rules, , the web, and other tools. Once the requisition approval process is complete, the requisition is moved into Procurement or directly to Purchasing and becomes the same as every other XA purchase order or Procurement requisition. That s integration. 2. Where an XA process already provides an appropriate solution, it is used. e-requisitions does not replace Purchasing or Procurement Management, and Buyers should expect to continue to use Purchasing or Procurement Management as they do today. 3. A separate Receiving process is not part of the e-requisitions System because it SHOULDN T be. XA already provides that solution with excellent integration back to the purchase order and to Inventory Management. Receiving can be enhanced with bar coding and other shop floor automation, but XA provides the glue to keep integrity throughout the procurement process, inventory management, and the financial system. Creating side systems that do not provide all the information gathered at receiving time, or that leave time gaps when the real status of the receipt is unknown, should be unacceptable. 4. e-requisitions does not communicate the purchase order to the supplier. You can use your existing approach for this, or use the e-forms application to send an or PDF of the actual XA purchase order to the supplier (or use the e-forms system to send other electronic forms to customers or suppliers, like automated order acknowledgements, invoices, past due statements, or NAFTA forms). 5. As another integrated option, you can use the integrated and web-based Supplier Requirements system to provide a web view of the supplier requirements. This could include an integrated ASN and quality tracking system. Again, these tools do specific functions that enhance, not replace, XA processes. 6. Invoice upon receipt and other matching options can assist the accounts payable process. However, for streamlining the requisition process across your company, integrating with XA, and providing visibility and accountability, the Electronic Requisition Approval/Workflow System is a unique and valuable system. REQUISITION APPROVAL SYSTEM FOR XA USERS PAGE 14 MKASSOC.COM