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Guided Buying – What is it and why do I need It?

by | September 16, 2019

Why you should implement Guided Buying in your organisation and some Best Practice tips.

What is Guided Buying?

As an organisation you want to make best use of your skilled procurement people but may be wary of opening up purchasing to other users in the business. Guided Buying is the solution which enables you to free up procurement specialists from handling day-to-day purchasing activity, whilst maintaining control of spend and ensuring policies are enforced.

Why Do I Need it?

There may be significant numbers of people across your business who either make purchases infrequently, or when they do they buy similar items regularly. Ideally these individuals should be empowered to make purchases without the assistance of buying professionals. They also need to be guided to preferred suppliers for these items and be subject to the policies that govern purchasing.

Guided Buying makes buying in a controlled way the preferred channel for your users.

SAP Ariba provides the tools to create an easy-to-use portal for a wide range of Casual Buyers, who typically make less than 5 purchases a year, usually of 1 item, and Functional Buyers, who spend a good deal of their time making purchases for their departments, but are not professional procurement staff.

Guided Buying empowers buyers across the organisation to easily procure the goods and services they need, whilst ensuring that controls are automatically applied over who buys what, from whom and at what price.

How do you implement Guided Buying?

Follow these steps to implement Guided Buying in your organisation:

  1. Identify the people in the organisation who make purchases (Personas)
  2. Create categories of items that they buy
  3. Identify preferred suppliers for each type of spend
  4. Overlay the policies that govern this buying activity in a single place for buying goods and services

Buying is made easy by presenting users with catalogues of items that are appropriate to their role within the organisation, and pointing them to the preferred suppliers for each type of spend. Rules can be tailored for the Countries or Regions which you operate in.

Users are led through the process of making a purchase, with different channels applicable to different ways of buying, for instance direct purchase from an internal catalogue, punch-out to a supplier web site, or a requisition process for non-catalogue items. The portal presents users with recently-purchased or popular items, as well as allowing browsing or searching for specific products or services.

Buying is as smooth as cart shopping on a web site.

Policy is embedded

When a user creates a Purchase Request the policies that control the spend for the relevant item are applied and the user is;

  1. given additional information about the item, or
  2. requested to provide a justification for the spend, or
  3. prevented from making the purchase, for example if the value is over an allowed limit.

Users therefore know immediately whether a policy has been violated, rather than finding out after a request has been submitted. Approval thresholds are automatically applied to the request, routing the Purchase Request to the appropriate approver(s).

Target Users

Guided Buying can be applied to all the procurement activity in the organisation. From simple self-service facilities for casual and functional buyers, where goods or services are available from preferred suppliers’ catalogues or fixed-rate cards, to purchasing requiring some involvement from your procurement specialists.

For purchases where the supplier list is not extensive enough, forms can be used to request quotes. Complex procurements where there is no approved supplier, and new contracts may need to be established, can also be accommodated.

Behind the scenes the accounting is handled by SAP, with costs being captured to the appropriate General Ledger codes and Cost Centres. Spending can also be linked to projects, enabling budget monitoring of actual and planned spend on projects.

Best Practice Tips

  • Identify people in your organisation who buy goods or services, including what they buy, how often and from whom. This can then be set up in SAP Ariba to establish the Personas, Catalogues, Buying Channels and Policy Rules to manage purchasing.
  • Design of the portal is key to a user-friendly experience. Home pages should have 9-12 tiles and the number of levels of pages kept to a minimum. Avoid directing users to pages with only one tile. Examples of the tiles to be used on the home page might be ‘IT Equipment & Accessories’, ‘Office Supplies’, ‘Marketing Services’.
  • Don’t over-complicate the structure. Personas should be grouped into Regional and/or Purchasing Units that have different buying requirements. These may not be the same as the departments or organisational units within your business.
  • Organise categories correctly. Users are able to search for items or categories, but easy navigation by browsing is critical to the User Experience. Where possible use your own images to illustrate the items that can be purchased.
  • Take care when building the rules that enforce your organisation’s procurement policies. The system will apply these rules automatically but they need to reflect the controls you intend to achieve.

If you want to make best use of your procurement specialists and empower buyers in your organisation to get what they need whilst maintaining control of your spending, book a Guided Buying Workshop with Xoomworks.