Richard Waugh, VP of Corporate Development at Zycus, presented on applying artificial intelligence for predictive procurement. Zycus offers a comprehensive source-to-pay suite that uses machine learning to clean master data, guide users through key decisions, and digitize the entire procurement process. AI can help classify spending data, guide requisitioning and sourcing, and automate repetitive tasks through robotic process automation. Benchmarking shows best-in-class companies realize significant savings through higher spend under management, faster contracting cycles, and lower transaction costs.
2. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Today’s Presenter – Richard Waugh, VP Corporate Development, Zycus
Extensive background in B2B e-commerce
Helped Launch GE's TPN, first on-line
Marketplace for Sourcing & Procurement
Industry Analyst in Supply Management
market for the Aberdeen Group
Co-Founder of B2eMarkets
First SaaS Sourcing Suite providers
3. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
About Zycus – Comprehensive Source-to-Pay Suite
Recognized by Leading Analysts
4. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Machine Teaching – Apply AI for Predictive Procurement
01
Train your machines to clean
Master Data at the source by
leveraging AI to properly categorize
and classify transactional and
supplier-related data the first time,
and to learn more from the
exercise every time
02
Let AI Guide your users through
key decision-making processes for
better outcomes, a better user
experience, and better data
03
Digitize the entire Source-to-Pay
Process including “pockets of paper”:
• Incoming Request Management
• Tail Spend not under management
by Procurement
• Performance and Savings
Management tracking and reporting
04
Leverage RPA to automate
repetitive tasks – flawlessly
5. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Applying AI to Procurement Starts with Spend
“Vendors such as Zycus, SpendHQ and Coupa Spend360 are already
using machine learning to improve spend classification. The next step in
this area is to explore the predictive spend analytics that can further
improve the planning and prioritization of strategic sourcing activities.”
Source : Gartner : “Start Preparing Now for the Impact of AI on Procurement”
Train your machines to clean Master Data
at the source by leveraging AI to properly
categorize and classify transactional and
supplier-related data the first time, and to
learn more from the exercise every time
10. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
AI suggests relevant categories
based on user’s natural language
search term and organizational
buying patterns
AI steers users to approved suppliers
and Buy/Pay channel for the category
AI Invokes category-specific
workflows, map to GL account and
default bill to/ship to based on user
profile
GUIDED BUYING
Key
Finding
AI-Enabled Guided Buying – Key to Better UX and Better Data
Let AI Guide your users
through key decision-
making processes for
better outcomes, a better
user experience, and better
data
11. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Key
Finding
AI-Enabled Guided Sourcing & Contracting – Better Decisions
“SmartAssist” Suggestions:
• Which Suppliers to Shortlist for Sourcing
• What Type of Negotiation Yields Best Results
• When Do I Need to Start Contract Process
• Which Clauses Need to Be Included
Let AI Guide your users through
key decision-making processes
for better outcomes, a better
user experience, and better data
12. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Digitize the Entire Source-to-Pay
Process including “pockets of
paper”
Sourcing
Spend
Analytics Contracts
Supplier
Management
eProcurement
Supplier
Performance
eInvoicing
Strategic
Operational
Request
Management
Digitized Source-to-Pay…Connected Dots, No Pockets of Paper
Financial Savings
Management
Non-Procurement
Managed Tail
Spend
14. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Benchmarking Digital Transformation
Requisition
Purchase
Order
Release
to Blanket
Order
PO
Change
Order
Invoice
Receipt
Payment
Full Automation – Digital Transformation Target
95–98%
Top
Performer
Peer
Source: Hackett Group P2P Performance Study 2017
% Electronic Transactions (Fully Automated Approval Workflow/Order Dispatch)
81%
79%
100%
66%
85%
100%
63%
28%
62%
28%33%
80%
15. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Best Practices for S2P Transformation Sequencing
Spend analysis E-Sourcing SBM
Map external spend
Negotiate Strategic
Agreements
Manage compliance
Manage Supplier
Relationships
Key Success Factors
• Identify and use data
from relevant
transaction systems
• Deduplicate and classify
• Assign ownership of
Key Success Factors
• Promote a culture of
control and
responsibility
• Involve stakeholders in
category plans, work
Key Success Factors
• Build a pipeline of cost
reduction opportunities
• Create a center of
excellence
• Make use of e-sourcing
mandatory
Key Success Factors
• Segment supplier base to
rightsize management
• Deploy solutions that
support supplier
collaboration
Source: Gartner “Best Practices for Sequencing Procurement Solution Investments”
17. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Best-in-Class Advantage – Source-to-Cash Cycle Time
Best-in-Class Achieve Higher NPV of
Savings Realized 42% Faster
Best-in-
Class
Industry
Average
45 Days Sourcing Cycle
75 Days
11 Days Contracting Cycle
22 Days
1 Days Order Cycle
2 Days
3 Days Invoice Cycle
5 Days60 Days
104 Days
RFX
Award
Contract
Order
Invoice
Pay
18. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Customer-Centric Procurement Teams Focus on User Experience
19. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Procurement Request Management Solutions
Reject inappropriate requests
eSourcing
Contract
Management
Project/
Savings
Management
Supplier
Management/
P2P
ProcurementApproverRequester
Sends
requests
Approves
requests
Manages and
Processes
Requests
Create Contract
Create Sourcing Event
Onboard a Supplier
Pre-purchase Request
Supplier Performance improvement
PO Amendment
Contract Amendment
Task Assignment
Initiating a Project
Price or terms change request by
Supplier
Configurable Flexiform
Configurable Approval Workflow
Conditional Logic / Rules
Calculated Fields
Delegation
Comprehensive Reporting
Process Use Cases
Features
20. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Automated request management and tracking triages procurement’s
work queue – empowers and engages end-users
Sophisticated, conditional approval workflows (>175 conditions, 4-5
approvals per form)
Conditional logic integrates IT security reviews with on-boarding
requests
Supports multiple request use cases, e.g. negotiate contract, run
sourcing project, on-board supplier, capital appropriation project
approval
Seamless process flow from request to execution – e.g. approved
request initiates activity in target module
Also supports non-procurement (Hotel, Facilities, HR, IT) requests
Extending
Beyond
Procurement
Users
Integrating
Business
Processes
Customer-
Centric
iRequest - Porsche
Customer-Centric Case Study: Request Management
21. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
• Focus Sourcing FTEs
• Collaborate Globally
• Standardize Process
• Self-Service Sourcing
• Ensure Compliance
• Standardize Process
Customer-Centric Doesn’t Mean All Customers are Equal
22. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Standardized, Self-Service Tail Spend Sourcing
Tactical, Spot Buys – 3 Bids & Buy
Create and Invite New Suppliers on the Fly
Create RFQ Inquiry on Single Screen
23. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Financial Savings Management Challenges/Solutions
Challenges
• Most organizations tracking with spreadsheets/home-
grown tools
• Existing tools lack Finance collaboration and approval
workflow
• No standard definition of savings calculation and allocation
methods exists, and lifecycle tracking visibility is missing
Solution
Align:
• Import baseline spend from
Spend Analytics
• Establish Finance-approved
spend baseline and savings
calculation formulae on
common, enterprise platform
Validate:
• Employ workflow to obtain
validation from stakeholders
• Map savings projects to
stakeholders and approvers
Analyze:
• Segregate savings by type,
e.g. cost reduction vs.
avoidance, and accounting
period
• Identify savings by
project/sourcing strategy
• Map savings impact to P&L,
Balance Sheet, Cash Flow
Source: Gartner/Rutgers Survey
24. Source to Pay Suite: Spend Analysis | eSourcing | Contract Management | Supplier Management | Savings Management | Project Management | Request Management | Procure-to-Pay
Case Study: Financial Savings Management
600+
Savings Projects Initiated
$40-50M
Annual Incremental Savings Realized To Date
000’s of Users
40 Power Users Create Savings Projects and Collaborate with
000’s of Stakeholders (600 Financial Analysts Alone)
25% Productivity Gain
Category Managers Save 2 Hours per Day from Data Gathering
Tasks
Single Version of Savings Truth
Standardized calculation/allocation formulae
Full audit trail and version control
Secure user access by BU/Div/Dept/Cat
Fx conversion and multi-lingual UI
Flexible/multiple savings types/definitions
Approval workflow sign-off by budget owner and Finance
Dashboard analytics and Financial Statement impact reporting:
P&L/Budget/Balance Sheet,/Cash Flow
Savings Tracking for Non-Procurement
Platform applied to non-procurement savings projects (e.g. Reorg, ERP
Consolidation, M&A), Budgeting/S&OP, Cash Flow Forecasting
iSave - Qualcomm