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Description  |
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BACKGROUND INFORMATION
1. Field of the Invention
This invention relates to a method and system for facilitating the ordering
of items from suppliers. In particular, an electronic catalog requisition
system and method is disclosed.
2. Background Art
Traditionally, procurement systems have been manual, labor intensive and
costly operations. For example, a supplier would do mass mailings of
catalogs to potential customers; the customers would browse the catalogs
and select items to be purchased; and then the customer would complete a
paper order form, or call the supplier to order the items. The entire
process, from preparing the catalog to receipt of orders, often took
several weeks, and possibly months. If a supplier wanted to continually
update his catalogs, or provide different price schedules to different
customers, the printing, distribution and administrative burden would be
even more tremendous.
On a relatively small scale, some suppliers have offered catalogs through
computer services, such as PRODIGY (a registered trademark of Prodigy
Services Corp.). With PRODIGY, a computer user can dial-up a service from
home and select items to purchase from various catalogs maintained on the
system. Upon selection, PRODIGY initiates the order with the supplier.
While this has improved upon some of the disadvantages in typical
procurement situations, there are still problems remaining that have yet
to be solved. One such drawback is that PRODIGY does not provide the
purchaser a competitive shopping tool. Comparative information on products
offered by various suppliers is not simultaneously displayed, which would
facilitate item selection.
Another drawback is that PRODIGY is not integrated with the industrial
customer's procurement system, though its use is not limited to home
customers. Still another drawback is that PRODIGY does not permit
customers to maintain "Private Catalogs" on their own computer systems.
Private Catalogs permit individual customers to control or limit the
products or services, as desired by the customer. Private Catalogs also
allow separate pricing structures for different customers based upon
negotiated agreements with suppliers, as well as permit large corporations
to maintain listings (catalogs) of surplus items available to its
employees.
OBJECTS OF THE INVENTION
Therefore, it is an object of this invention to provide a new electronic
procurement/requisition system and method which allow a purchaser's
requisition system to be integrated with a catalog system, and a supplier
computer system.
It is another object of this invention to provide an electronic requisition
system which includes public and private catalogs.
It is another object of this invention to provide an electronic requisition
system which allows individual customers to control the products and
suppliers that may be ordered.
It is still another object of this invention to provide an electronic
catalog ordering system that allows the simultaneous display of
competitive product information.
It is still another object of this invention to provide private catalogs
that are supplier maintained through access to the public catalog, thus
significantly reducing customer maintenance of their private catalogs.
It is another object of this invention to provide an electronic catalog
ordering system which includes direct catalog maintenance by suppliers.
SUMMARY OF THE INVENTION
These objects, and many more features and advantages as will be shown
further, are accomplished by the electronic catalog ordering process and
system herein described. The system comprises two major components: 1) the
Electronic Catalogs, and 2) the Electronic Requisition.
The first Electronic Catalog segment consists of a Supplier Master Catalog
which is maintained by each Supplier. It is used as the basis for the
second Electronic Catalog segment, consisting of the Public Catalog and
the Private Catalog.
The Public Catalog permits multiple customers to access and identify
products from a variety of Suppliers. The Public Catalog contains the
following functional features: Catalog Query/Display for logically guiding
the requestors through the available catalog data; a Customer preferred
path controller which directs the user to preferred Supplier catalogs
thereby permitting customers to select products at prenegotiated
discounts; a catalog finder which provides efficient search routines to
locate Supplier catalogs card items within; a price discounter which
automatically translates retail prices to specific customer contracted
discount prices; customer shopping lists; Supplier authorization control;
and the ability to permit Customers' procurement personnel to locate
available supplier products and services required to satisfy requestor
needs, as well as, provide supplier catalog data for initial load and
maintenance of the Customers' private catalogs.
The Private Catalog functions allow Customers to load, access and identify
supplier products on their own local computer systems rather than the
Public Catalog. Private Catalogs contain many of the same features as the
Public Catalogs, except for the price discounter function which is not
required since the data base of the Private Catalog is customer specific.
The Electronic Requisition automates all manual transactions currently
experienced in generating and processing hardcopy requisitions, including
the approval process. Customization via automatic routing tables allow
each Customer site to control requisition routing.
The electronic ordering method allows Suppliers to create machine readable
forms of their Feaster Catalogs and transmit them to a public database as
Public Catalogs, and to Customers as Private Catalogs, either directly or
via the public database. The Customer, in turn, would then search the
Catalogs for items to be purchased, load pertinent ordering information
into an electronic requisition, and send electronic Purchase Orders for
the items to the Suppliers.
BRIEF DESCRIPTION OF THE DRAWING
The foregoing and other advantages of the invention will be more fully
understood with reference to the description of the preferred embodiment
and with reference to the drawing wherein:
FIG. 1 is a block diagram showing the electronic catalog relationships.
FIG. 2 is a detailed diagram of the Catalog Loader function.
FIG. 3 is a block diagram showing the requisition process.
FIG. 4 is a detailed block diagram of the Electronic Catalog Ordering
System.
DESCRIPTION OF THE PREFERRED EMBODIMENT
General Concept
The electronic catalog ordering process and system provide an automated
facility for procuring standard commercial parts and services. The two
major components are: (1) the Electronic Catalog which permits on-line
access to Suppliers' catalogs of products and services; and (2) the
Electronic Requisition which automates the hardcopy requisition and its
approval process. The interactive, electronic coupling of these 2 major
components enable a Requestor to complete a purchase request during one
system session. These two major components are distributed among the three
principal players in the system, as described in further detail below.
Referring to FIG. 1, the electronic catalog ordering system involves three
principal players, the Suppliers, designated by block 100; the
Customers/Requestors, designated by block 102, and the Public Database,
designated by block 104. The Suppliers 100 load and maintain the catalog
data of the products and/or services that they offer to the Customers 102.
The Customers/Requestors 102 are those who purchase products and/or
services from the catalogs. The owners of the Public Database 104 develop,
maintain and provide a host operating environment where the Public Catalog
106 resides.
The Electronic Catalog, in its full function configuration, consists of
three functionally distinct catalogs. The Supplier 10 Master Catalog 108
is the catalog which contains the master information for all of the
Suppliers' products and services. It is loaded and maintained by Suppliers
100 on their own local computer systems. From the Supplier Master Catalog
108, each Supplier 100 creates a Public Catalog 106 and sends it to the
Public Database 104. The Public Catalogs 106 from many Suppliers 100 are
loaded and maintained on a Public Database for access by Customers 102.
Suppliers also may create Private Catalogs 110 from the Supplier Master
Catalogs 108 and from the Public Catalog 106. The Private Catalogs 110 are
then loaded and maintained by Customers 110 on their own local computer
systems for access by Customer employees. Private Catalogs 110 may also he
maintained by Suppliers 100.
Electronic Catalog
Referring to FIG. 2, the Electronic Catalog consists of the Supplier Master
Catalog 108, the Public Catalog 106 and the Private Catalog 110. The
Supplier Master Catalog 108 is defined as a special catalog separately
owned and maintained by Supplier for the purposes of building, storing and
maintaining his catalog data prior to transmittal as a Public Catalog 106
or Private Catalog 110. The loading of the Public Catalog 106 is
accomplished by loading the entire catalog, selected catalog commodity
groups, or individual catalog items.
The Public Catalog 106 is defined as cross-industry catalogs resident on a
third party network, for access by multiple customers. The loading and
updating of the public cross-industry sector catalogs is accomplished by
Suppliers whose catalog data is loaded using one of the following methods:
A) batch ANSI X12 (832) business transactions for initial loading or mass
updates;
B) real-time, on-line access for low volume or emergency updating;
C) a tape dump, CD-ROM load, etc. of the Supplier Master Catalog 108.
The Private Catalog 110 is defined as a special catalog separately owned by
the Customer and distinct from that of the Public Catalog 106. This
catalog most likely would be resident on a Customer's local host computer
system. Customers can store@catalog items in Private Catalogs where there
are volume purchase agreements, corporate contract discounts, preferred
suppliers, control items, special trading partners, etc. The goal of the
Private Catalog 110 is to provide customers with competitive sourcing
solutions. Private catalog loading is obtained by either;
A) periodic direct downloading from the Public Catalog 106;
B) direct input from the Supplier database; or
C) created by the Customer.
The Private Catalog 110 can reside on a Customer's host computer system, or
on a public network, and can be maintained by Customers or Suppliers.
The loading and maintenance of the Supplier Master Catalog 108 is
facilitated by a Catalog Loader Program (Cata-Loader) 112. The following
is a list cf functional features of Cata-Loader Program 112:
A. Create New Catalog
B. Catalog Set-up Profile
C. Catalog Maintenance/Update
D. Catalog Bulletin Maintenance
E. Customer Access/Downlcad Control
F. Customer Access Data Reports
G. Catalog Review Session
H. Public Catalog Load/Maintenance
I. Private Catalog Load/Maintenance
The Create New Catalog function permits a Supplier to create a catalog. The
Catalog Set-up Profile function allows a Supplier to set-up a profile
relating to his own business information which would eliminate the need to
provide common information more than once. The type of data that falls
into this category would include: supplier number, address, telephone
number, contracts, business class, class of trade, fax number, DUNS
number, etc. The Catalog Maintenance/Update function allows the addition
of catalog items and includes the following fields: item name, commodity
code, part numbers, description, prices, units of measure, package
quantities, lead times, discounts, stock availability, etc. The Catalog
Bulletin Maintenance feature allows a Supplier to provide general
information to the Customer subscribing to its electronic catalogs.
Announcements would include new product announcements, special promotions,
price changes, recalls, etc. All bulletins generated by the Suppliers are
classified into one of the above categories to permit Customers to have
control over the types of bulletins propagated to their Requestors.
The Customer Access/Download Control function permits catalog Suppliers to
control Customers' access to and downloading of Supplier maintained
catalog data on the Public Catalog. This aids Suppliers in controlling
where, and to whom, their product/pricing information is made available.
Customer access control provides a mechanism for catalog Suppliers to
control Customer access to their database. When invoked, this would
inhibit/permit specific users access to the catalog information. Customer
Download Control provides a mechanism for catalog Suppliers to authorize
Customers to download catalog data to another host computer system. The
Customer Access Data Reports function allows a Supplier to get reports on
catalog usage and can be a very useful marketing aid. Comparisons of
access time, market share, etc. are valuable features.
The initial loading or mass updates to the Public Catalog 106 are performed
using EDI ANSI X12 832 business transactions. Features allow the Supplier
to load catalog items, load catalog changes, load by specified commodity,
load by specified item part number.
The Private Catalog 110 can be updated by the Suppliers. Data items that
could be customized include unit prices, discount, payment terms, usage
fees, etc. Suppliers can issue separate batch transaction commands
modifying the above fields and sending the modifications via an EDI 832
transaction update directly to the Customer computer system.
Electronic Requisition Process
The Electronic Requisition is an automated form residing on a computer
system which is used to initiate the procurement process. It is intended
for use by four primary groups, each of which has specific
responsibilities with regard to the ordering process and completion of the
requisition as further described below with reference to FIG. 3. All user
groups will need access to terminals or personal computer workstations to
access the mainframe application.
The Requester is the party who defines the need for a purchased item and
has the responsibility for creating the purchase requisition. Through an
application program, the Requester initiates the requisition by accessing
the Public or Private Catalog to search for the item of interest (Block
300). If the item is found, the system will prefill the required fields of
the requisition (Block 304). If the item is not in the Catalogs, the
required data will have to be manually entered (Block 306). When utilizing
the Private Catalog, the process becomes automatic since the source of the
catalog item has been preapproved, and the order can be sent directly to
the Supplier, without Buyer involvement, after approvals are obtained.
Non-catalog purchases are routed and approved by the axle process, but the
actual purchase transaction is completed by a buyer.
The validated requisition is then routed to the Approver (Block 308). The
Approver will either reject it, which will bounce the requisition back to
Block 300, or approve it. If approved the requisition will be routed to
the company's procurement system (Block 312) for items ordered from the
Private Catalog. For items not from the Private Catalog, the requisition
goes to the Buyer for completion of the requisition and approval of the
Supplier (Block 314).
The Buyer is the party in most companies who has been identified as the
authorized agent to make purchases. The Buyer typically has responsibility
for selecting where products may be purchased, as well as establishing an
acceptable price that will be paid. In the electronic processing
environment, the Buyer may receive an individual purchase requisition from
a Requestor once it has been routed through the approval process. The
Buyer may access the Public or the Private Catalog as deemed necessary to
perform the normal buying task. When items are selected from the Catalog,
the requisition is prefilled with required data and only minimal
additional data will be needed. If a non-catalog item is to be purchased,
the Buyer will keyboard in the required data to complete the transaction.
Once the requisition has been approved (if required), it will then be
processed through the company's procurement system and a Purchase Order
will be electronically sent to the Supplier (Block 316).
The Approver is the party that has the authority to validate the need for
purchase, that funding exists, etc. This individual will be identified by
the company, and system tables will autocratically route requisitions as
they are processed by the Requestor.
The Application Administrator is the party assigned over-all responsibility
for the maintenance and control of the electronic requisition process.
There may be more than one area responsible for different portions of the
system. For example, a database administrator may control the
routing/approval process in all associated tables. A Procurement
Administrator may typically control those areas that relate to the
requisition requirements.
System Architecture
The detailed system architecture is shown in FIG. 4. The Supplier's
computer system is preferably an IBM 3090 (IBM is a registered trademark
of International Business Machines Corporation) mainframe computer with
attached personal computer workstations. With this arrangement, Supplier
100 can maintain catalogs using the Catalog Loader facility 112. Supplier
100 can also receive, translate (Block 400), validate (Block 402) and
enter orders (Block 404) into its existing order entry system.
The Public Database 104 also uses an IBM 3090 mainframe running the MVS
operating system. It includes facilities for controlling and distributing
catalog data via communication lines connected to Suppliers and Customers.
The Customer operating environment includes a mainframe computer such as
the IBM 3090 or AS/400 (AS/400 is trademark to International Business
Machines Corporation) with attached personal computer workstations. Buyers
406 and Requestors 408 all interface to the system via workstations. The
Electronic Requisition 410, which is the output of the electronic catalog
ordering system is ted into Customer's existing procurement system 412.
Procurement systems and methods are well-known in the art and are beyond
the scope of this invention.
Communications between the computer systems are best accomplished using
industry standards such as American National Standard Institute (ANSI)
X24. Details of this standard can be obtained directly from ANSI.
While the invention has been particularly shown and described with
reference to a preferred embodiment thereof, it will understood by those
skilled in the art that various changes in detail may be made therein
without departing from the spirit, scope and teaching of the invention.
Accordingly, the system and method herein disclosed is to be considered
merely as illustrative, and the invention is to be limited only as
specified in the claims.
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