Global Preparer and Center-Led Shared Services in iProcurement

An Oracle White Paper

March 2005

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Table of Contents

Introduction …………………………………………………… 3

A. Global Preparer ……………………………………………. 3

. Setup ………………………………………………………4
. Sample Scenario ………………………………………..…5
. Technical Details ………………………………………… 9

B. Center-Led Shared Services ………………………….……10

. Limitations and Restrictions ……………………………..10
. Basic Setup ……………………………………………... 10
. Sample Scenario ………………………………………....11
. Process Flow in iProcurement ………………………...…12
. Technical Details …………………………………..…….15

Summary ………………………………………………………16

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Introduction

Business are becoming more and more global where companies are finding
the opportunity to get better deals buying in high volume from suppliers
located anywhere in the world taking advantage of the benefits of local
organization doing the transactions.

Oracle Procurement offers features to enable centralized procurement or

sourcing service centers encompassing all of global business units. In
11.5.9 release, Global Agreement was introduced. In 11.5.10 release,
Global Agreement concept was further expanded to include Global
Contract Agreement integrated with local requisitioning, purchasing,
receiving, and accounting.

In 11.5.10 release, iProcurement delivers Global Preparer feature to align

to the centralized Procurement trend.

In this document Global Preparer and Center-Led Procurement features

are deployed within iProcurement context. Details are provided to help to
understand the setup for these new features.

First, the Global Preparer setup and a scenario is shown. Then, the Center-
Led Procurement setup and usage in iProcurement is described.

A. Global Preparer/Requester

Global Preparer allows employee from one business group to raise a

requisition in behalf of employees from another business group.

Global Requester is the requester logging to a responsibility from other

business group and ordering an item for themselves from that business
group.

Global Preparer can view, copy, change/cancel requisitions created by

them or from another requester in a different business group depending on
the value of profiles HR: Cross Business Group and ICX: Override
Requestor.

The security rules from Purchasing responsibility > setup > Purchasing >
Document Types > Purchase Requisition is valid for global preparer and
requesters.

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Global Preparer will be assigned with responsibilities from different
operating units. Each responsibility will have profile MO: Operating Unit
pointing to the operating unit of the Business Group.

Approval will follow the preparer’s approval hierarchy. Preparer’s

supervisor can belong to a different business group if profile HR: Cross
Business Group is set to Yes to both users. If using Position Hierarchy, the
approval list will not build automatically.

Setup

The main setup steps to Global Preparer to create requisitions in behalf of

requesters from another Business Group or another operating units within
same Business Group and to give the ability to the requestors to see the
requisitions created in their behalf are:

1. Profiles to set:

1.1 HR: Cross Business Group - Defines whether Single Business

Group access or Cross Business Group access is used. Set
this profile option to indicate whether your installation allows
resources to access data in other business groups.

Enter YES to allow Cross Business Group access.

Enter NO to allow only Single Business Group access (only within
business group)

Viewing and receiving are not restricted by this profile.

1.2 ICX: Override Requestor – Determines whether users can override

the default
requestor. This setting can be limited to user only, users within the
same personnel organization, or users within the same business group.

Enter NO to not override requestor and not see requestors in the

LOV.
Enter BY ALL to override requestor cross business group.
Enter WITHIN ORGANIZATION to override requestor only in
the same business group.

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 1.3 POR: Apply Expense Account Rules to Favorite Charge Accounts
(POR_REQ_ENFORCE_EXP_ACC_RULE) – Apply Expense
Account Rules to Favorite Charge Accounts to enforce category-
based accounting.

Set to YES to enforce category-based accounting rules to favorite

charge account.
Set to NO to not enforce category-based accounting rules to
favorite charge account. This is optional for Global Preparer, but it is a feature
but it is a feature that can apply if needed.

2. Business Group
To check in which Business Group the employee belongs to go to
Human Resources responsibility > People> Enter and Maintain Employee
form and Click Assignment button, then choose Purchase Order Information
tab to find the Business Group.

3. Security rules by document is from Purchasing responsibility > setup >

Purchasing Document Types > Purchase Requisition. Viewing requisitions
Document Types > Purchase Requisition. Viewing requisitions
depend on the security defined at the document type level.

4. To define Expense Charge Account Rules go to Procure to Pay

Administrator responsibility > Purchasing Setup > Financials > Accounting >
Expense Account Rules

5. Favorite accounts are defined in Preferences link from iProcurement

pages at the right top. Then click iProcurement Preferences
link in the left sideof the page.

6. Assign responsibilities from different operating units from different or

same Business Group to the Global Preparer.

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Sample Scenario

A simple scenario where a Global Preparer belonging to Vision

Corporation Business Group and Vision Operations operating unit can
create a requisition in behalf of a requestor from Vision France Business
Group is outlined below.

User: Requestor_US - Employee from Vision Corporation Business

Group
Responsibilities: iProcurement – Vision Operations
Purchasing – Vision Operations
iProcurement – Vision France
Profile: HR: Cross Business Group set to Yes at the user level
ICX: Override Requestor set to BY ALL at the user level
POR: Apply Expense Account Rules to Favorite Charge
Accounts set to Yes

User: Requestor_France – Employee from Vision France Business Group

Responsibilities: iProcurement – Vision France
Purchasing – Vision France
Profile: HR: Cross Business Group set to Yes at the user level
ICX: Override Requestor set to No at the user level
POR: Apply Expense Account Rules to Favorite Charge
Accounts set to No

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Logged as Global Requestor user Requestor_US using responsibility
iProcurement – Vision France.

Creating the requisition as the Requestor_US using iProcurement – Vision

France, global requestor can see requestors from France’s Business Group
in the requestor LOV

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Requisition forwarded to an approver from France Business Group, using
Position Hierarchy.

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Approval history actions.

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Logged as Requestor_France and can see the requisition created by
Requestor_US.

From here the requisition can follow the process like a requisition created
by the requestor.

Technical Details

Following Workflow Processes involved in Global Preparer feature:

1. Worfklow Process Account Generation (file poxwfrag.wft – item

type: POWFRQAG) has three nodes to handle category-based
accounting rules to favorite charge account:

. Get Favorite Charge Accpunt – Get the user’s favorite charge

account.
. If Enforce Expense Acount Rules – Check if the expense account
rules should be
enforced through profile POR: Apply Expense Account Rules to
Favorite Charge Accounts

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 . If Rules Exist for All Segments – Check if the expense account rules
exist for all segments.

2. The Workflow procedures and functions are in the package

PO_WF_PO_RULE_ACC ( files POXRUACS.pls and
POXRUACB.pls).

B. Center-Led Procurement Shared Services

Center-Led Procurement Shared Services is known also as Centralized

Procurement. It allows to have one or more centralized locations creating
Global documents to be shared/used by operating units from different
Business Groups. There are many benefits in this feature like cost
reduction by volume negotiation, standard terms and conditions, and other
advantages by invoicing from local office of the supplier site.

The two Global documents are Global Contract Agreement and Global
Blanket Purchase Agreement which allows to standardize terms and
conditions across all enabled organizations when transactioning with a
supplier.

Global Blanket Agreement was delivered in 11.5.9. In 11.5.10 Global

Contract Agreement was added to enable centralized business
relationships among the business groups and suppliers. Requisitions and
Standard Purchase Orders can reference global documents if they belong
to the operating units enabled on the document.

Limitations and Restrictions

Cross-Operating Unit Procuring is not supported when:

. Inter-Company Transaction Flow are not defined or not valid

. Encumbrance is 'ON' in either Requesting or Purchasing Operating Units.
. Project/Task is specified with expense destination.
. Requisition line is VMI enabled (see Oracle Inventory User Guide).
. Requisition shipment has a consigned relationship (see Oracle Inventory
User Guide).
. Destination inventory organization is OPM enabled (See Oracle Process
Manufacturing
User Guide)
. Master/Organization Item is not defined in the requesting or purchasing
operating unit, destination inventory organization,
or logical inventory organization (as defined in

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 Transaction Flow). Description based items can be added to GBPA.
. For Service Line Types, if HR: Cross Business Groups profile = No then
the Requesting
and the Purchasing Operating Organizations must be in the same
business group.
. Using P-card for Master/Organization items belonging to another
organization.

Basic setups

Some of the basic setup for Global documents are:

1. Create a Global Buyer user and set profile option HR: Cross Business
Group to Yes at the user, responsibility or site level.

If HR: Cross Business Group profile is set to No, buyer name will be
on the Purchase Order (PO), but not in the buyer LOV
for the users (requesters/buyers) from other Business Groups.

2. Enable Global Document

Creating Global Contract or Global Blanket Agreement check Global
flag in PO forms in Purchasing responsibility.

3. Enable Organizations
While creating a Global Document in Purchasing responsibility,
in PO Form > Tools Menu > Enable Organizations.
Choose the organizations to enable. If the document is approved,
enabling organizations will requires re-approval.

4. Define transaction flows

To define the procurement relationship between different operating
units go to Oracle Inventory responsibility > Setup >
Organizations > Intercompany Transaction Flows.
Define the transaction flows according to the business process.

5. Enable receiving organization in iProcurement > Receiving > Receive

Items using Personalization.

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 Click Personalize link on top of receiving page.
Enable Purchasing Organization column on the Receive Requisitions
page.

6. Assign Purchasing and iProcurement responsibilities to the Global

Buyer from each operating unit.

7. Create supplier site in each enabled organization.

Sample scenario

Following a sample scenario of center-led procurement:

- Center-Led Procurement Shared Services organization is in US. The

organization creates Global Contract Agreement and Global Blanket
Purchase Agreement as a result of sourcing negotiation. Sourcing could be
done using Oracle Sourcing module from Oracle Applications.

- Supplier is in France. This is the supplier registered in

Purchasing/iSupplier.

- Buying organization is in France. It will own the Purchase Orders

generated from the Global document.

- Supplier Site is in Canada. This is the supplier site registered in

Purchasing/iSupplier.

- Demanding/Receiving organization is in Canada. It is the deliver-to

location. It owns the requisition and does the receipt.

This is one of multiple scenarios feasible to create using Center-Led

Shared Services features. Other combinations are possible according to the
business needs and processes involving worldwide procurement.

Process Flow in Procurement

Once Global Contract Agreement or Global BPA is negotiated, catalog

can be bulkloaded or items be available from Punchout across the
organizations. Requesters can search items in iProcurement and create
requisitions against the Global documents.

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Going forward, all catalog content should be stored in Global Blanket
Purchase Agreement.

Processes involved in Center-Led Shared Services emphasing

iProcurement:

1. In Oracle Inventory, define transaction flows. Transaction flows

define the procurement relationship between different
operating units. Create transactions flows to support advanced
intercompany invoicing and intercompany invoicing for global
procurement business flows.

2. Create items in Purchasing responsibility > Master Items form

enabling the items
to the inventory organizations across Business Groups.

3. Extract items after added them to Global Purchase Agreement

documents. Execute Catalog Extract Classifications and Items if
the items are in Master/Organizations items in core Purchasing.

4. Bulkload items referencing Contract documents in iP if the items

are not from the extract process.
Go to iProcurement Catalog Administration responsibility > Load
Data and Schema > Upload Items. Choose Operating Unit and
enter Contract Purchase Agreement.

5. Requesters from the enabled organizations can create requisitions

from punchout above or using the items from the extraction
process or bulkload in iProcurement.
Requestors or preparers can execute search in iProcurement and
create the requisitions.

6. Purchase Orders can be created automatically or manually in

AutoCreate form by/for the buying organization.

7. Receiving center can record the receipts in iProcurement.

Logged as Global Buyer and creating Global Blanket Agreement and

Global Contract.

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Global Blanket Purchase Agreement created by Global Buyer. The global
flag is checked.

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Global Contract Agreement created by Global Buyer. The global flag is
checked.

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Enabling Global Blanket Purchase Agreement (BPA) to requesting and
purchasing organizations.

Once enabled the Global documents, they are available in the

organizations to create requisitions and purchase orders by global buyers,
global preparers or requestors.

Technical Details

Following the details of where changes were done to fit Center-Led

Shared Services in Procurement:

1. Workflow Processes:

PO Create Doc (poxwfatc.wft – item type: CREATEPO)

PO Account Generator (poxwfpag.wft – item type: POWFPOAG)

2. Destination Charge Account and Destination Variance Account are in

the Purchase Order and Purchase Order Summary forms at Distribution

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 level. These accounts are derived by the PO Account Generator
Workflow. They correspond to accounts valid to the Receiving
Organization (Requesting Organization). Inter-company invoice
transactions will occur automatically after receipt and deliver.

3. To support centralized procurement, the destination charge accounts

are included also in the Import Standard Purchase Orders – POXPDOI.
Destination charge account shares the same charge account fields
(segment1, segment2…) on PO_DISTRIBUTIONS_INTERFACE table.

4. New table added for this feature is PO_GA_ORG_ASSIGNMENTS.

Summary

Global Requestor and Center-Led Shared Services provide a multitude of

possibilities to automate the global negotiation activities. The documents
are shared across organizations allowing users to collaborate in the
procurement process. Deliverables and clauses can be managed using the
new feature with Contracts in Procurement.

Buyers can benefit using Oracle Sourcing to source suppliers, executing

auctions where suppliers are invited to participate from anywhere in the
world in real time negotiation. Once supplier(s) is chosen, Global Blanket
Agreement or Global Contract can be created.

Suppliers can view the purchase orders as well interact in the approval and
change request process from iSupplier.

Procurement module from Oracle Applications encompass iProcurement

including Services, Purchasing including Contracts, iSupplier, and Oracle
Sourcing to give a comprehensive solution to multinational companies
doing business with worldwide suppliers.

In this context iProcurement contributes with Global Requestor and

integration with center-led shared services to allow requisition creation
and receiving be done by requestors across business groups.

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Global Preparer and Center-Led Shared Services in iProcurement
March 2005
Author: Clarina Allen
Oracle Corporation
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Worldwide Inquiries:
Phone: +1.650.506.7000
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Oracle is a registered trademark of Oracle Corporation. Various
product and service names referenced herein may be trademarks
of Oracle Corporation. All other product and service names
mentioned may be trademarks of their respective owners.
Copyright © 2003 Oracle Corporation
All rights reserved.

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