Xerox leads non-production buying down new path
By Staff -- Purchasing, 4/22/1999
Before the use of a new ERP system and network-enabled communication, pink slips of paper were flying all over the place whenever someone wanted to order a non-production item at Xerox Corporation. "The requisitioner would fill out a pink piece of paper, walk around to get signatures, put it in interoffice mail and eventually we would mail a PO to the supplier," recalls Carolyn Burke, business support manager for Xerox Global Purchasing. Or the requisitioner would ignore the purchasing process altogether and write a check request.In 1998, that all began to change with the deployment of new strategic procurement software from Oracle. Purchasing professionals at six sites now have access to an automated purchasing tool that collects data for global analysis and streamlines transaction processing. So far six sites are up and running in phase one that converts Xerox's professional buyers from a legacy environment or manual process to the Oracle software.
Phase two, which has begun in the U.S., is to extend the software out to the dedicated requisitioners, the people whose job it is to place the orders. Phase three will be to start using e-commerce with the Oracle system and Xerox data warehouse already in place.
By making the purchasing process electronic, Xerox expects to reduce the cost of processing a purchase order from $150 to around $25, and to save $60 million by having the data needed to negotiate global contracts.
"It's a profound change culturally," says Vince Romano, a former materials manager and now manager of information resources in corporate strategic services for Xerox. Helping to make the change did grow a few gray hairs on Romano. The technical team was adamant that using industry standard components and not allowing the software to be customized was important to the success of the project.
In Webster, New York, for example, the procurement professionals had a 26-year-0ld homegrown legacy system. "It is powerful, traditional software, but it was not built for electronic commerce, electronic catalogues, and all the rest," says Romano. On the other end of the spectrum, some Xerox sites, such as one in Canada, were moving from an entirely manual process to the Oracle software.
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