Electrifying Procurement Processes

Feature Article | October 17, 2005 by admin

enviaM

enviaM

envia Mitteldeutsche Energie AG (enviaM) is the result of a merger of various regional energy suppliers in eastern Germany. With headquarters in Chemnitz, enviaM has served as the regional division of RWE Energy since 2003 for the federal states in the former East Germany. In 2001, enviaM implemented mySAP Supplier Relationship Management (mySAP SRM) and went into production with it in the same year. Because the solution is integrated with the company’s SAP R/3 back-end solution, enviaM can completely map and trace its procurement processes. Thanks to the integration component, SAP NetWeaver Exchange Infrastructure (SAP NetWeaver XI), the applications of customers, vendors, and enviaM can all communicate.
The SAP procurement solution ensures binding approval procedures throughout the enterprise. Udo Küttner, director of the purchasing organization and a project director at enviaM, says, “The signature rules in traditional, paper-based purchasing that are divided according to material group, consumers, and value limits and require approval from a department are now mapped in automatic approval workflows.”
enviaM has combined the goods and services to be procured into material groups and assigned them to 23 shopping baskets. Some 80 percent of vendors come from the region. Right now at enviaM itself, 350 users work with the solution. But the company opened the procurement platform to its outside partners. In 2002, it became available to municipal power plants, distributors, and installers. In another expansion move, enviaM enhanced the platform yet again and markets it as a portal for central Germany. So far, more than 100 business customers with 365 users use the portal to procure goods and services. “We’ve taken care of one piece for suppliers to qualify them for the electronic purchasing platform,” says Küttner. He is also satisfied with the result. “We’ve been able to serve a good number of interfaces, including complex ones, to non-SAP applications. We’ve created the technical preconditions to link several partners and reach a position in the market that offers vendors – especially those in the region – an option to use the platform as an additional sales channel.”

More than 100 Catalogs

enviaM sees itself as an application service provider. It supports integration of the procurement solution in the back-end systems of its customers and provides user-friendly content and catalog management. More than 100 catalogs with more than 1.5 million items – primarily from regional vendors – are available online. The items can be accesses in two ways: as general catalogs with a complete assortment of items or as buyer-specific catalogs with a tailored selection of products available with special conditions only to specific purchasing organizations.
Says Küttner: “We give a new vendor a license, vendor access to the portal, and a BMEcat specification. The vendor can then create an electronic product catalog based upon standards. We use eClass as the industry norm for material classification and material groups – and work quite well with it.” Vendors can create their own content without the assistance of partners. As soon as vendors place a BMEcat file in the vendor portal, plausibility checks in catalog management run automatically. The checks display whether all images, texts, measurements, and item numbers have been entered. A green light indicates a successful check to a vendor. After that, vendors are just a click away from releasing the catalog as a new version on the platform.
enviaM also plays the role of a vendor; it deals in materials for natural gas, heat, water, and sewage in addition to materials for electricity. The energy provider delivers items to secure supply media – items that must be available quickly in the event of a breakdown. The portal also informs users of technical requirements for a hook-up and on items in online documents that define setup exactly – such as how a home connection should appear and what materials it requires.
“In the catalog, installers see exactly how a part should be installed and what they must pay attention to, such as hazardous materials or classes of dangerous goods. We thus contribute to quality management and uninterrupted service,” explains Küttner. If an item requires expert examination, the responsible department uses appropriate workflows in the system to release the item. “That lets us check at any time to see what has been released,” says Küttner. “We can be certain that a master craftsman in one location uses the same tested pliers as a craftsman in another city.”

Transactions in Quantity

Because products can be found under several descriptions, searches guarantee a long hit list. If a user wants to find offers for a folding rule, it makes no difference if the user enters “folding rule,” “yard stick,” or “ruler.” And users can search for products with similar characteristics or according to product classes. The procurement solution enables easy comparison of items – it displays competing offers according to product characteristics on the screen.
The portal already handles 40,000 orders each year for goods and services. “We’d never be able to mange these transactions without mySAP SRM,” emphasizes Küttner. “It has successfully organized uniform procurement processes throughout the entire enviaM Group. If we had to work traditionally, we would have had no opportunity to react to changes in requirements that can occur rather rapidly.” The portal continues to grow along with the increasing needs of partners and within the enterprise.

Guido Kaup

Guido Kaup

Tags: , , ,

Leave a Reply