Heriot-Watt University saves money & boosts efficiency using e-Procurement

The system, eMarketplace from supplier UKprocure, went live at the end of September 2004.

The University has set itself a target to achieve a 5% reduction in non-pay expenditure against ‘maverick' turnover and a 1.5% reduction in spend against its top 200 suppliers as a result of its e-Procurement strategy. Heriot-Watt expects to achieve tangible business benefits from the eMarketplace, including improved contract compliance, a significant reduction in the transaction costs for the University and its suppliers, a reduction in order processing time, improved payment performance and an improved commercial relationship with suppliers. Heriot-Watt is already seeing keener prices from its suppliers because of the benefits they see from trading electronically with the University via the eMarketplace.

Tony Newjem, Director of Purchasing & Supply Services at Heriot-Watt University said: 'UKprocure provides a comprehensive eCommerce solution, based on the Oracle platform. Following a detailed analysis of the market we carried out a tendering exercise, and from the responses received, concluded that UKprocure would best meet our needs. This decision was based on the cost of the solution for the University and its suppliers, the technical capabilities of the system and UKprocure's ability to support our bullish supplier adoption programme. By harnessing the system we will be able to drive down raw material and process costs and revitalise our contracting and contract management programme whilst giving ourselves more control over our spend through information-rich expenditure data.'

The introduction of the eMarketplace builds on Heriot-Watt's implementation of the Oracle E-Business Suite. Initially, Heriot-Watt will be using the eMarketplace to provide hosted, supplier-maintained catalogues and ‘punch-out' functionality to suppliers' transactional websites where appropriate. Electronic Invoicing functionality will be introduced within two months of going live, as a way for the University and its suppliers to add increased efficiency into the purchase-to-pay cycle.

Eoin MacDonald, Procurement Systems Manager at Heriot-Watt University said: 'With limited staff, it is not possible for us to manage on-line catalogues for all our top 200 suppliers. By using a tailored eMarketplace, we have effectively moved that responsibility onto the suppliers and UKprocure. With devolved requisitioning involving a potential maximum of 1,500 users, we wanted to make the process of raising orders and contract compliance as easy as possible. Using supplier-maintained catalogues, hosted on the eMarketplace, will make the purchasing process uniform across our core suppliers and will dramatically reduce the incidence of errors and invoice rejection.'

The first thirty Heriot-Watt suppliers will be on the eMarketplace by the end of 2004. The selection of these suppliers has been based on total turnover, number of transactions, sound contract coverage and level of e-enablement. Heriot-Watt will be targeting the remaining top 200 suppliers, which account for 75% of non-pay spend, over the next 18-24 months. The University is now working with UKprocure to introduce a programme of eTenders and eAuctions to deliver further cost and time savings.

Related links to this article:

Heriot-Watt University

UKprocure

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