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With the use of Oracle Fusion Sourcing, negotiation information is integrated and
streamlined within the Oracle procurement process. Oracle Fusion Procurement suite. With
Self Service Procurement, you can find requisitions to create your negotiation and when you
have completed your award, you can generate purchasing documents for further
processing. When creating a negotiation, you can surface contract terms from Procurement
Contracts for suppliers to review. With Supplier Qualification, you can search for qualified
suppliers when you are inviting suppliers to a negotiation.

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Oracle Fusion Sourcing: Smarter Negotiations
Oracle Fusion Sourcing delivers the structure, tools and information you need to maximize
the value of supplier negotiations, you can negotiate enforceable agreements that comply
with policies and deliver realized savings. You can use negotiations in Fusion Sourcing to
manage your Request for Quote, Request for Information, or Reverse Auction processes.
Oracle Fusion Sourcing also provides you with award analysis tools that allow you to quickly
determine the best award decision for your business based on factors such as price, quality
and value.

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The total life cycle of a sourcing business process begins with identifying sourcing
opportunities and key suppliers to defining and executing the plan. Sourcing enables
companies to make buying decisions as part of an overall strategy for achieving business
goals, with a view toward building long-term relationships with key suppliers.
Oracle Fusion Sourcing in the Cloud will help you to automate your sourcing practices to
drive down your total cost, while at the same time delivering improved efficiencies.

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You can collaborate across your organization and with suppliers on negotiation events.
Fusion Sourcing provides tools such as Online Messaging and the Oracle Social Network to
help facilitate the collaboration and communication of all parties involved. When it comes to
creating an event like a Request for Quote or Reverse Auction, the process is made much
easier by providing negotiation templates that you can reuse and having a guided
negotiation creation process. You can keep track of all Sourcing events with the Calendar
and Recent Activity. Fusion Sourcing also provides powerful Award Analysis tools when it
comes time to make the final award decision. Oracle Sourcing provides:
Simple Event Creation
• Guided Navigation
• Negotiation Templates
• Negotiation Styles
Easy Collaboration
• Oracle Social Network
• Online and Off Line Bid Submission and Analysis
• Online Messaging

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Straightforward Oversight
• Negotiation Calendar
• Recommended Actions
• Award Analysis

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(N) > (H) Negotiations
You can use the Negotiation Overview to view information that is important to daily sourcing
activities, for example:
• You can easily view recent activity and ongoing events.
• You can use your negotiation calendar to see the status of your negotiations that are
in progress.
• You can easily manage draft negotiations.

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(N) > (H) Negotiations > (H) Create Negotiation > create negotiation pop-up
Sourcing provides many features to provide a flexible and easy process for creating
negotiations.
• Negotiation Styles simplify the data requirements and functionality.
• Guided negotiation process streamlines negotiation creation.
• Negotiation templates allow for reuse of best practices.
• Support for three different types of negotiation: auction, RFQ, RFI
• Support for different purchase document outcomes: standard purchase order, blanket
purchase agreement, contract purchase agreement

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(N) > (H) Negotiations > (H) Create Negotiation > Create Negotiation pop-up (Type = RFI)
You can use the Request for Information (RFI) negotiation type when you want to get
information from your suppliers. A request for information (RFI) is a standard business
process whose purpose is to collect written information about the capabilities of various
suppliers. An RFI is primarily used to gather information to help make a decision on what
steps to take next. In addition to gathering basic information, an RFI is often used as a
solicitation sent to a broad base of potential suppliers for the purpose of conditioning
suppliers’ minds, developing strategy, building a database, and preparing for an RFP, RFQ,
and so on.

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(N) > (H) Negotiations > (H) Create Negotiation > Create Negotiation pop-up (Type = RFQ)
A request for quotation (RFQ) is a standard business process whose purpose is to invite
suppliers into a bidding process to bid on specific products or services. You can use the
Request for Quote (RFQ) negotiation type for complex procurement negotiations such
negotiations having many lines or lines with detailed price adjustments (for example price
breaks). You can also use RFQs for negotiations with extended response windows such as
government negotiation that must be conducted according to legal guidelines. Specialized
response rules allow you to control the quoting process.

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(N) > (H) Negotiations > (H) Create Negotiation > Create Negotiation popup (Type =
Auction)
You can use the auction negotiation type for a variety of procurement situations such as
negotiations having a limited number of lines or negotiations that have a shorter response
time line. The shorter window for suppliers to submit their responses leads to more
competitive behavior based on price. In Oracle Fusion Sourcing, you can define additional
auction controls such as setting up Auto Extensions (where the system can automatically
extend the auction based on specified criteria) or stagger the closing of lines.

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Oracle Fusion Sourcing’s intuitive user experience also benefits suppliers. A comprehensive
overview of sourcing activity makes it easy for suppliers to understand current status and
take action. Support for commonly used applications, such as spreadsheets, makes
submitting bid responses very straightforward. And Oracle Fusion Sourcing even offers
embedded online training that makes it easy for suppliers engage in every part of the
sourcing processes.

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Sourcing provides many displays you can use to monitor a negotiations progress. These
displays are updated in real time. You can access a negotiation’s displays by clicking on the
Monitor icon for that negotiation on the Negotiation Overview. With the Negotiation Monitor,
you can:
• Improve visibility with real time access to supplier activity
• Provide multiple embedded analytics for graphical view of activities and projected
savings
• Allow category managers to take action directly from the live negotiation monitor

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Manually compiling and comparing supplier proposals is time consuming and can lead to
poor sourcing outcomes. Fusion Sourcing’s Award Analysis provides powerful tools so you
can perform “what if” analysis on different award scenarios and determine the best way to
allocate your business among suppliers. Sourcing provides you with many different award
options. You can award a negotiation to a single supplier, award different lines to different
suppliers, and split a lines business among multiple suppliers.

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Sourcing provides robust displays and graphs that allow you to perform in-depth analysis of
the supplier responses you receive for a negotiation. You can analyze supplier response
data using side-by-side and graphical comparisons. These analysis tools let you experiment
with different award scenarios, as a result you can quickly determine the best award for your
business based on multiple metrics like price, quality, and value

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There are several processes that potentially involve much date entry or manipulation. For
these tasks you can use Sourcing’s spreadsheet capability. This allows you to download a
spreadsheet and enter the necessary data and then upload the spreadsheet back into the
application. Spreadsheets allow you to perform these data heavy tasks offline.
• Upload requirements to streamline negotiation creation
• Allow suppliers flexibility to respond offline using familiar tools
• Spreadsheet formatting support list of values, optional versus required fields, color
coding

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Your application may use the approval management system to track and manage approvals
of both your negotiation document and your award decisions. You can approve the
negotiation document, the negotiation award, or both. When approvals are used, internal
reviewers view and OK the details of the negotiation document and the final award decision.
When the negotiation document requires approval, it can be automatically submitted for
approval when you publish the document. For award approval, you submit the award for
approval after you have saved your award decision and prior to generating purchasing
documents.
Whether a document or award needs approval depends on the approval rules. For example,
a negotiation could be subject to approval because it includes items from a particular
category, or an award decision could need approval because the award amount is over a
certain limit.

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A surrogate response is a negotiation response that you enter on behalf of a supplier
company. This feature allows suppliers who are not able to directly enter a response online
to still participate in the negotiation.
Supplier companies may submit their responses using different communication methods
such as faxing or mailing paper documents, emailing PDF documents or spreadsheets.
Once you receive the supplier response, you enter this response in the application as a
surrogate response. Surrogate responses are handled by the application the same as
responses entered by suppliers with online access.

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Throughout a negotiation, there may be times when you need to communicate with the
buying organization or other suppliers (if allowed by the type of negotiation) to provide
additional information or request clarification. You can use online messaging for these
communications.
You can participate in multiple online conversations within the context of a negotiation. All
messages you initiate are addressed to the buying organization and can be viewed by all
members of the buying organization who are also participating in the negotiation. You can
reply to message you are sent by an individual participant of the buying organization.

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Government organizations and departments as well as other public sector enterprises such
as banks often follow a two-stage RFQ process. This process involves the submission of
two separate sealed quotes: one contains what is termed the technical quote, and the other
contains what is called the commercial quote. The technical quote includes supplier
responses to questions pertaining to the technical aspects that are used by the sourcing
organization to evaluate the technical feasibility and the capacity of the suppliers. The
commercial quote addresses the issues of price and other factors associated with the
execution of the sourced items. The technical quotes are opened and evaluated first to
determine a list of qualified suppliers, and only then are the commercial quotes of the
qualified suppliers opened and evaluated.
This two stage process is prevalent among some public sector and many government
organizations where it is sometimes mandated by law that the buying organization offer the
tender or sourcing contract to the lowest price bid from the qualified bidders. The buying
organization initially assesses the suppliers to be technically qualified before their price
quotes are unsealed and evaluated. This is done to ensure no bias in awarding the contract.

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You use the Functional Setup Manager to implement your Sourcing product. There is a task
group called Define Sourcing Configuration that contains the implementation tasks you use
to set up Sourcing. There are initial implementation tasks you perform in FSM when first
setting up Sourcing. You can also use FSM to perform ongoing maintenance tasks after you
have implemented Sourcing.

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(N) > (H) Setup and Maintenance > Manage Implementation Projects > Search on
“implement project name” > Procurement > Define Sourcing Configuration
The setup and maintenance tasks are contained in the Define Sourcing Configuration task
group.

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If the majority of the negotiations that category managers create contain the same features,
for example, line attributes, price breaks, cost factors, response controls; or negotiation data
such as negotiation lines, invited suppliers, or values for certain fields, you may want to
create a negotiation template they can use each time they create a new negotiation. A
template specifies the target negotiation type (auction, RFQ, RFI) and negotiation outcome.
Using a template saves time by streamlining the creation process. When category
managers create new negotiations using templates, they use the template as a shell for the
negotiation. They add to and edit details of the negotiation as necessary, and then publish
the negotiation.

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(N) > (H) Setup and Maintenance > Manage Implementation Projects > Search on
“implement project name” > Procurement > Define Sourcing Configuration > Manage
Negotiation Styles
A negotiation style is a tool users can use to streamline the creation of negotiation. When
you create a negotiation style, you select which negotiation features to include and/or
omit. A negotiation style therefore only displays the creation features necessary to create
the particular type of negotiation. Any features not needed by the negotiation are not
displayed using that negotiation style.
For example, the style being created above does not provide instructions on the different
edit pages. It also does not use requirements or a collaboration team. It does not support
cost factors or price tiers, and omits procurement contract deliverables.
Additionally, you can create negotiation styles for use with any negotiation type (RFQ,
auction, or RFI), or create a negotiation style and enable it only for a particular negotiation
type.

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(N) > (H) Setup and Maintenance > Manage Implementation Projects > Search on
“implement project name” > Procurement > Define Sourcing Configuration > Manage
Requirement Section Lookup > (I) Go to task
When creating new lookups, you must specify both internal and display information:
• Lookup code: The internal designator for the lookup value
• Display sequence: The position in the list of values
• Enabled: Whether the lookup value is available for use
• Start date: The date the lookup value becomes available for use
• End date: The date the lookup value becomes unavailable for use
• Meaning: The value name that is displayed to users
• Description: The description displayed to users
• Tag: An optional name for use in searching
Until the new lookup value is enabled, it cannot be used. The start and end dates can also
be used to specify a time window of availability.

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Cost factors identify additional costs in addition to response price (the price offered by the
supplier for one unit of the line item/service). Using cost factors allows buyers to identify and
take into account these additional costs when negotiating with suppliers. These can include
tangible costs, such as transportation or storage, or intangible costs, such as the risk
associated in dealing with a new supplier.
Cost factors are defined as either a:
• Fixed amount for the entire line
• An amount for each unit
• A percentage of the line price (price * quantity)
Several related cost factors can be defined to a cost factor list. The list of cost factors can
then be applied to a particular negotiation line within the sourcing document.

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When creating attribute lists, you can first define Attribute Groups which would be logical
names for groups of attributes. When you create your attribute list you can assign attributes
to groups.

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Line attributes make your negotiation line more descriptive and can also be used to ensure
that all responses submitted for the line include specific details not included elsewhere in
the line information. You can define line attributes at the line, lot, lot line, and group line
levels. When defining attributes, you must enter or select values for the following:
• Attribute: The name of the attribute as it appears to the supplier
• Response: Values can be: Display Only, Optional, or Required
• Value Type: The data type allowable for responses, for example, text, numbers (digits
with decimals allowed), date, or URL
• Target: A target value for the attribute
• Weight: An indication of the attribute’s importance relative to the other attributes
• Acceptable Values: A list of allowable response values
• Score: For each acceptable value, a score denoting the desirability of that value
among the other acceptable values

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There are many situations during the life cycle of a negotiation when the applications
generated notifications and sends them to appropriate participants. For example, when you
invite a supplier to a negotiation, the application sends a notification to the contact you
specify in the negotiation document. This notifications invites the supplier contact to
participate in the negotiation. Or if the category manager who created the negotiation closes
it early, notifications are sent to the participants.
There are many notifications which the application creates. If you wish to use only a subset
of the notifications, you can indicate the ones you wish to use by subscribing to those
notifications. The notifications to which you don’t subscribe are not generated by the
application.

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