Ariba Knowledge Nuggets

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Key Activities / Steps

  • Search for new suppliers 
  • Finalize list of suppliers
  • Prepare Request for Information
  • Prepare Scoring & Grading rules
  • Launch RFI
  • Train stakeholders: RFI grading
  • Send Confidentiality Agreement
  • Supplier response follow-up

 

Key Deliverables
  • Final Suppler List
  • RFI Result summary  

 

Tools

  • Market Making Sheet 
  • RFI template (by category)
  • Scoring/Grading templates
  • Search engines company web sites, site supplier database

 

 

How To Prepare for Researching Suppliers and Developing an RFI:

 

Consider the goals for the sourcing project:

  • Should you increase/decrease the number of suppliers?
  • Are you trying to move away from a monopoly/unique supply?
  • Are you looking for alternatives/proposals to consider?
  • Are you looking for higher quality suppliers?

 

Consider supplier capabilities:

  • Is another other area of the world becoming best place for finding suppliers for this good/service?
  • Is there anew way of producing the product?
  • Are there innovations in production that you could benefit from?

 

What areas/regions/countries have suppliers who are capable of providing the goods/services:

  • Not all areas/regions/countries have suppliers who can be competitive for all categories.
  • the good/service may benefit from a local supplier as well because of service requirements.

 

 

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Best Practice for Supplier Search

 

Consider requirements such as the following and prioritize:

4Is there a minimum annual sales figure for a supplier to merit consideration?   If so, what is that figure?
4Are there any specific service level requirements that a supplier must have?(e.g. on-site personnel, ability to make emergency shipments)
4Are you interested in international suppliers? If so, which countries or regions?
4Are there specific geographic requirements?
4Do suppliers need to have English speaking capabilities?
4Do suppliers need to have other language capabilities?
4Do these suppliers need to have location(s) in your country?
4Do global suppliers need to have domestic representatives with whom you could work?
4Are you willing to work with a manufacturer’s representative? Is this requirement only for domestic suppliers or does it apply globally?
4Should suppliers have experience in specific industries?
4If yes, which ones and what level experience?
4Must suppliers have special equipment and/or capabilities to perform special processes?
4Are there specific inventory requirements (Kanban, VMI, consignment, warehousing, etc.)?
4What is the minimum quality certification that would be required of suppliers? (Example: ISO 9002 Compliant)
Best Practice for Supplier Research
  • Start within your own companyAre there other divisions/groups that purchase the same goods/services?
  • What suppliers do they use? Research the competitors of your Incumbent (current) suppliers.
  • Research suppliers using industry/trade association publications and/or web sites·
  • Research suppliers using internet search engines·
  • Compile a list of suppliers
  • Check the suppliers on your list against your company’s list of Non-Performing Vendors
  • Obtain approval from other internal stakeholders on the supplier list

 

RFI Set-Up Suggestions

 

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Based on supplier criteria, develop the list of questions that suppliers must answer before being considered for participation in the project.

 

Leverage the RFI Template (Excel file) as a starting point --       

 

Based on the supplier criteria, develop the sections or groupings of questions:

  • Company Information
  • Financial Information
  • QualityProcess/Service Capabilities
  • References      

 

Determine what questions might need to be asked to help with lotting strategy:
  • Supplier locations
  • Supplier capabilities
  • Material experience       

 

Determine what type of response suppliers should provide:

  • Free text
  • Drop down checkboxes 
  • Radio buttons       

 

Consider limiting the number of questions to those that will really help make a sourcing decision:
  • Too many questions may make bidders reluctant to participate
  • If the RFI is very complex, an offline version in Excel could be used and uploaded via AS platform       

 

Obtain internal approval from other stakeholders on the RFI content

 

 

 

Genius is 1% inspiration and 99% perspiration. Accordingly a genius is often merely a talented person who has done all of his or her homework.
~ Thomas Edison