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Level 1 Procure to Pay

Level 2 P.O. Generation And Fulfillment

Level 3 Generate P.O.

Level 3 Select Buying Channels

Level 4 Create Requisition

Draftv5Nov15,

0010.4 a P.O. Generation and Fulfillment


Identify Need

Requestor

0010.41
Select Buying
Channel
Requisition
Required

CT
1

Pro-card
Pcard
Designated
Transaction

$10k per month, $1k per, annual $2.5, no stock or maint.


Mostly0010.43
admin. Card account no.
$10 million
Generate
25,084 trans
$398 / trans.
53% Opp <$5k

Requisition
Release

Release
Required

Buyer

0010.42
Generate
P.O.

SAP Requisition
Selected
Vendor
Vendor
Selection

Materials

113,000 P.O.
32,000 <$5k
152,000 Trans.

CT
1

Services

0010.44
Monitor
Status

Materials
Close P.O.
Services

SAP P.O.
(Fax, Auto Fax
Email)

Q
2

No Selected
Vendor

Q
1

Q
3

60-70% of Transactions
SAP MRP
Requisition

System

SAP PM
Work Order

Supplier

11
SAP

SAP

10% EDI Trans.

Accept /
Confirm
P.O.

Draftv5Nov15,

Settle
And Pay

Acceptance /
Confirmation

Fulfill
P.O.
P.O.

Received
Order

Receive
Material

24
Fulfilled Order

117,696 Invoices
On Time 86%
Disc Taken 76%

0010.41 - Select Buying Channel - Materials (Does not apply to Services)

Note 1

Pro-card

Identify Need
Yes

Requestor
Zone
Store?

No

Yes

Storehouse
Stock?

Yes

No

BOM
Purchase?

No

20

Note 1

26

No

Procard
Item?

Yes

Material
Tracking
Required?

No

Yes
Is Material
No. Needed?

25

Maintenance
Planning

Select from BOM


or look up
material number.

Draw From
Stores

16

Material
No. Exists?

Complete request
for material
number (J-Sheet)

No

Yes

0010.43a
Generate
Material
Requisition

Phase II
0010.4.2
Generate
P.O.

Buyer

SAP MRP
Requisition
SAP PM
Work Order

System

SAP Requisition

SAP Requisition

SAP

SAP
SAP Requisition

Supplier

Draw From Zone


Stores/submit
replenishment order

Pro-card

Draftv5Nov15,

1 Policy and Accountability Issues


16 Process and Enablers
9 System Related

SAP

0010.42 Generate P.O. Materials

Requestor

No PO Approval

0010.41
Select Buying
Channel

0010.43
Generate
Requisition
Release

13
PO
Approval

25
5

Yes

Vendor
Selection

25

Selected
Vendor

13

Buyer:
Contact Supplier

0010.44
Monitor
Status

22

Workflow

No

No

No
No

20
SAP Requisition

Buyer

Requisition
Requires
Release?

No

Vendor
Determined?

7
17

SAP MRP
Requisition

System

SAP PM
Work Order

Supplier

Draftv5Nov15,

Yes

Workflow

Auto P.O.
Activated?
Yes

No

Create and
Process P.O.

21

P.O.
Yes
Confirmed?

Transmit
P.O.

19

8
CM

SAP

SAP P.O.
(Auto Fax
Email) 2

P.O. 14
EDI/xml

12
Confirm /
acknowledgement

Phase II
Add more
E-transactions

1 Policy and Accountability Issues


16 Process and Enablers
9 System Related

Accept / Confirm
P.O.

Price Yes
Change?

Over
DOA?

Contact
Requisitioner
or Manager
for Approvals
and
Update P.O.
Yes

0010.44 Monitor Status - Materials

Requestor

Close P.O.

Tips and Tricks


Monitor
Status

Buyer

21

Resolve
Issues

18

Settle
And Pay
Received
Order

System

Receive
Material

SAP

Supplier

Start.

P.O.

Fulfill
P.O.

Draftv5Nov15,

Fulfilled Order
Invoice

1 Policy and Accountability Issues


16 Process and Enablers
9 System Related

0010.42 Generate P.O. Services


Start.
Approver

Requestor
Define
Requirement

10

Outline
Agreement
Exists?

Approver

Involve Buyer
early in this
process
No

25

13

PO
Approval

0010.43
Generate
Requisition
Release

Contact
Buyer

13

Yes
SAP
Requisition

Vendor
Selected

SAP
Work Order

5
Buyer

3
25

System

Get more
Info
(Contract
Requester or
View w/o)

Workflow

Vendor
Selection
/OA Search

Yes

21
Requires
Release?

No

19

Transmit
P.O.

Monitor
Status P.O.

8
Vendor
DB

20

Create and
Process P.O.

CM

SAP

SAP P.O.
(Auto Fax
Email)

P.O.
(Auto-Fax
or Email)

P.O. 12
Acknowledgement

14

Supplier

Draftv5Nov15,

Accept /
Confirm
P.O.

1 Policy and Accountability Issues


16 Process and Enablers
9 System Related

Settle and Pay


Product or Service
delivered

Vendor

0010.1
Mail or email
Invoice

No

Plant Site

0010.2
Receive
Invoice &
approve for
payment

SCAN
Invoice
?

0010.3
Mail invoices
to Cleaninghouse

0010.4
Scan invoice

Yes

0010.5
Scan Invoices,
Load Queue
With images

Clearing
House

Accounts
Payable

Systems

0010.6
Index invoices
From Queue

1 Policy and Accountability Issues


16 Process and Enablers
9 System Related

Draftv5Nov15,

C-House
database

PO Invoice
?

No

C-House
database

SAP

Yes

Invoice passes Yes


System checks
?

0010.7 18
Park for
Approval

SAP

0010.8
Invoice posts
for payment
0010.9
Invoice enters
Workflow for
resolution

No

SAP

SAP

END

3.1.1RequisitionsforPurchaseOrders
APOmustoriginatefromarequisitionthathasbeenproperlyreviewedandapprovedbyanauthorizedperson.The
requisitionand/orPOmustbereviewedbytheapprovertoensurethattherightsupplierisdesignated,thatthequantity
oraccurateservicedescriptionislisted,andthatthereisacorrectdelivery/servicedategiven.Requisitionsmustinclude
anSAPmaterialand/orservicematerialgroupnumber.Therequisitionmustalsoincludetheappropriatetaxcodebased
ontheitemorservicebeingpurchased.POtaxcodesstartwithaPorQ.TheSAPsystemwilldeterminethe
taxabilityoftheitembasedonthematerial/servicegroupandthetaxcodeselected,alongwiththetaxingjurisdictionof
thecostcenter.Iftheapproverneedshelpdeterminingtheappropriatetaxcode,theapprovershouldcontacttheTax
Departmentforguidance.
ThefollowingaretheonlyallowablePOpurchasesthatdonotrequirearequisition:
Freight
Restockingfees
HotShotfees
Fuelsurcharges
Expeditingfees
Finishedproducts

(FinishedProductsreferstothoseitemsbeingpurchased,generallybytheSupplyChaingroupfordirectresale.ExamplesResin,Ethylene)

Feedstocks
(Feedstocksaredefinedasrawmaterialsrequiredforanindustrialprocess.Inthechemicalindustry,commonfeedstocksincludenaturalgas
liquidssuchasnaphtha,gasoil,andethane.Benzene,ethylene,propylene,andotherolefinsareexamplesoffeedstocksusedasthebuilding
blocksfortheproductionofvalueaddedpetrochemicals.Ingeneral,theproductmustbeabuildingblockforcreatinganotherproductandit
mustbechanged(reacted)intheprocess.)

Draftv5Nov15,

3.2ProcurementCard
TheProCardprovidesdelegatedpurchasingauthoritybyallowingnon
procurementpersonneltopurchasetargetedmaterialsandservices(whena
contractisinplace)foruseinthecourseofconductingcompanybusiness
withoutProcurementPersonnelsinvolvement.Thisprocessiscosteffective
forCPChembecauseordersareplaceddirectlywiththesupplierandthe
handlingofpurchaseorders,invoicesandchecksareeliminated.
ThefollowingaretheguidelinesforuseoftheProcard.Uncleartransactions
consideredfortheProCardshouldbediscussedwithGlobalProcurement
fortherequestedcommodityortheProCardAdministratorpriortopurchase.
Certain Materials (TBD)

Certain Vendors (TBD)

Certain Situations (TBD)

Forfurtherdetails,consultthepolicyportalfortheProcurementCardPolices
andProceduresManual.
Draftv5Nov15,

On site receiving issues who does it belong to?


Numbering system for these
contracts? Off line types

Draftv5Nov15,

3.1.3Approvals

Appropriateapprovalsshouldbeobtainedpriortomakingcommitmentstothirdparties.APOmustbe
reviewedandapprovedbyanauthorizedpersonwhohasbeendelegatedtheappropriateauthorityasdefined
ontheDelegationsSummary(DOA)document.Allpersonnelshouldreferencetheirrespectivedelegations
summarydocumentpriortoauthorizingthePO.
PurchaseOrdersignatureislimitedtodelegatedauthorityoftheresponsiblepersonsigning.Electronically
issuingoroutputtingaPurchaseOrderconstitutesanelectronicsignature.Asignaturealsoconstitutes
approvaluptothesignersdelegatedauthority.

3.1.4ChangeOrdersorChangestoExistingOrders
TherearesituationswherechangestoPurchaseOrdersarenecessary.Iftheprojectedspend,overalllimitin
SAP,foranexistingorderorneworderexceedstheamountauthorizedontherequisition;itwillbe
necessarytonotifytherequesterforthepurposeofsecuringauthorizationtoincreasethecommittedfunding.
WhenthetotalvalueofaPurchaseOrderisbeingincreased,theProcurementapprovalrequiredisbasedon
thenewtotalcommitvalue.

Draftv5Nov15,

5.10ZoneStores

ZoneStoresarepointofusestores.Thepurposeofazonestoreistoprovideeasyaccesstohighusage
partsatornearthepointofuse.Zonestoresincreaseproductivitybyeliminatingthetraveltoandfromthe
warehouseandeliminatingsystemprocessrequirements.Therearetwoprimarytypesofzonestores:
Vendormanaged:Arepresentativefromthevendormonitorsthezonestore,entersreplenishment
ordersandinsuresthatthereplacementstockisdelivered.
Plantmanaged:Plantpersonnelprovidetheseservices.
Materialssetupinazonestoreshouldbehighvolume,lowcost.Therulesforestablishingzonestore
stockinglevelsarethesameasthoseusedtoadditemstoStores.TheplantMRFmustbeusedforapproval
eventhoughamaterialnumbermaynotberequired.Thevendorsrepresentativeforvendormanaged
inventoriesneedstofollowthesameprotocolsorprovidejustificationforstockinglevelscalculatedbyother
meansandobtainapprovalfromProcurement.
Zonestoresaretobereplenisheddirectfromthesupplier,notfromtheStorestockedmaterials.Eachzone
locationmustbeclearlymarkedfortheitemitcontainsandaccesstoZoneStoresistobelimitedasmuchas
possibletotheusersofthematerials.
StoresorProcurementmustrandomlyselectaminimumpercentageofthematerialandcountittoverifythat
thematerialquantitymatchesthepackingslip.

Draftv5Nov15,

GenerateRequisitionMaterials

Draftv5Nov15,

AutoP.O.

Draftv5Nov15,

MRPProcess

Draftv5Nov15,

RequisitionRelease

Add Workflow
approval reminders

Inform requester of who has to approve it


New Release Codes
MRNZ
NY 50k
Need a general
Review and update

Auto from PM

Material Return

Draftv5Nov15,

Service Return

P.O.Materials
Inform requester of who has to approve it

Add Workflow to approval


And approval reminders

Add supplier
confirmation

Draftv5Nov15,

TransmitP.O.

Up to date info

Materials Return

Draftv5Nov15,

Services Return

Vendors prefer edi


Target high volume

VendorSourcing

Draftv5Nov15,

Involve the Buyer


Early in this process

P.O.Services

Generate P.O. Return

Draftv5Nov15,

Involve the Buyer


Early in this process

Monitor Status Return

0010.43a Phase II Punch out Round Trip Procurement

Draftv5Nov15,

MaterialNumberDecision

From Marian Ruiz


Port Authur

Draftv5Nov15,

TimeSheetsandWorkApproval

Draftv5Nov15,

WorkflowwithCCTS
Contractor
Performs Work

Contractor &
Owner Approve
Transactions

Contractor Enters Time


(L,M,E+ 3rd Party) in
CCTS

CCTS Validates POs


WOs, Contractor Rates And Gate
Log

Auto Interface to
CMMS & Posted to
POs, WOs, & G/L

Auto Interface
To A/P

Contractor
Paid by EFT

Draftv5Nov15,

Required human
intervention