Non-Compliance Escalation (NCE) is a key component of the Supplier Enablement process. For buyers with Supplier Enablement Services, NCE is a joint process that can maximize enablement success.
To be effective, the Supplier Enablement Non-Compliance Escalation process must incorporate the consequences outlined in your “EDICT” . As is the case with software adoption, it would be nice to think that everyone will just do it because you asked. However, that is usually not the case and having a process in place to enforce your policy will help your suppliers know exactly what will happen if they do not comply and give you the authority to follow through with the established policy.
Key Collaborative Commerce Policy Questions ....
- Is participation in this initiative mandatory?
- Do we have a desired deadline date for suppliers to convert from paper POs/invoices to the Ariba Network?
- Should we provide incentive for the supplier to participate? If so, what incentives are we comfortable and/or prepared to offer?
- Do we want to alter payment terms for suppliers participating in collaborative commerce?
- Will we allow a supplier to just receive electronic Purchase Orders? Or, will we only issue electronic Purchase Orders if the supplier also submits invoices electronically?
- Are there any suppliers that we do not want or cannot move to the Ariba Network?
- Do we want to incorporate mass recruitment techniques?
In addition to Supplier Enablement, Non-Compliance should also be monitored for:
- Internal compliance by Key Stakeholders
- Registered suppliers that do not transact
- Transacting suppliers that revert back to paper
- Registered suppliers that do not maintain their AN account in good standing
Consequences should be defined for Non-Compliance:
- Internal Non-Compliance – Escalation to Manager, impact on Performance Review, etc.
- External Non-Compliance – Execution of defined consequences in EDICT (e.g. extended payment terms, paper processing fee, discontinuation of business, etc.)
Non-Compliance Escalations Ongoing Process Tips and Best Practices
1. Executive buy in and support ***(this is the key to all successful policies)
2. Designated Non Compliance Escalation Process owner
3. Ability to flag Ariba Network suppliers in the ERP system
4. ERP report on Ariba Network suppliers that states both paper and electronic transactions
5. Defined Non Compliance Escalation process with consequences
6. Policy Violation Tracking Process (e.g. spreadsheet, database, etc.)
Key Collaborative Commerce Policy Questions …….
- Do we have a new supplier set-up process? How does it need to be modified to include supplier set-up on the Ariba Network?
- How do we want to handle one-time vendors? Should they register on the AN?
- Should we return paper invoices received after a supplier has registered on the AN?
- Can we include supplier participation in collaborative commerce as a condition for the award or renewal of business with our company?
- What communication channels do we have available to publicize our collaborative commerce initiative to our suppliers?
- Do we have an effective way to communicate our collaborative commerce policy to internal stakeholders?
- Do we have executive buy-in and support for implementing our collaborative commerce policy?
Beverly Dunn is a Customer Success Manager with Ariba. All customers are invited to join the private Customer Success group on Ariba Exchange, where you can access the Customer Success Spotlights, Lunch 'n Learn Webinar calendar and replays, and the Ariba Knowledge Nuggets.