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How new systems and technologies are impacting contracts.

How new systems and technologies are impacting contracts.

Part 1
Consider how contracts are evolving and how new systems and technologies are impacting contracts,
sustainability, and quality. Discuss how the acquisition has changed (e-commerce and RFID are just two
examples) and how you think it will change in the future. Discuss how the economy might have an impact on
contract compliance. Consider the impact of Small Business and Government
Part 2
Part I: List and describe the “best practices in practice” as noted by Mollenkopf & Closs (2005) [attached].
Review related articles from Change in the Chain news link on the Home screen.
Part II: What kind of information must be gathered to place value on time?

A gathering of fiscal source control managers, faculty, and IACCM considered executives occurred on January 26, 2018 in The Big Apple. A number of different topics were discussed during this session, and the agenda was kept fairly open in discussing how emerging technologies would impact the supply management and contracting space.

Clearly, you will learn a quantity of automations growing, which include prohibit sequence, approach automation, AI, and digitization, along with an general new influx of technological innovation drawing near at us. Tim Cummins noted that “we see the next wave as the potential to transform trading relationships and networks. We have been through the era of ERP, have moved towards a high level of standardization, and have driven tremendous improvements in data, to a point where standardization led to the disaggregation of activities from the enterprise to a diverse supply base. In financial services, an extreme amount of due diligence has been given to internal controls, but as these organizations have outsourced more and more, they do not have the same level of insight into quality and performance of diverse suppliers and customers is beyond the capability of existing technology. So organizations are now having to throw a high level of human resources at the consequences of outsourcing to manage these outsourced resources.

There are several consequences of this trend.

We now have trouble, but every customer and dealership works differently, and other norms really can be found on the way you want to run. I have a specific way for invoicing, that is unique and different. We this creates massive a complexity and risk in the system, because we refuse to standardize aspects of our relationship that have no economic value for being different. A second dimension is the technology itself, and the way that emerging technologies have the promise to provide us with a better way of operating across organizational boundaries. We have suggested that the potential efficiencies of technologies is equivalent to improvements and savings generated through ERP systems, but this does not address the external piece. We need to enter into the era of Relationship Resource Planning to manage our outsourced contractual relationships. And how does automation emerge in this environment, and how could we be using these technologies to ensure that we are benefiting from outsourcing and not driving additional costs into our external relationships? In the ensuing discussions, the role of these emerging technologies was discussed at length, by several individuals present. Here is a snippet of some of the conversations that took place.

Dynamic Discounting

Technological innovation can have a significant affect afterwards surroundings of economic passes from the provide chain. At a major global bank, for instance, procurement is employing a dynamic discounting tool, that provide opportunities for cost saving as well as early payment discounts for supplier that require access to working capital. For example, typical payment terms may be 10 days with a 2% discount, or 0 discount in 30 days. But what if the supplier needs cash immediately? What would they be willing to pay to get the payment within 2 days? Some organizations are even borrowing against their payables to get letters of credit, and pay higher interest rates on commercial paper. The bank is piloting a tool that enables the manager to set an internal hurdle rate, and put current payables out on an auction, that allows suppliers to bid and request early payment on their payables. This can yield significant cost savings for the bank, and help suppliers with their cash flow positions.

Block Chain

Pilots inside the economic field is likewise underway making use of smart contracts to impose SLA treatments for their hosting server commitments within their outsourced details center. In one case, IBM manages 400 prepositioned servers for a bank, which is in their data center. Each sub-server has an IoT sensor, and is pre-positioned for the bank, and is tied to a condition in the contract for those storage services. When the server is provisioned, the IoT trigger automatically triggers a purchase order and invoice for that server, and once provisioned, there is a Service Level Agreement (SLA) that goes into effect, stating that the server must operate at an uptime of 98.6% (example). But if there is a faulty chipset, and the server fails to hit the SLA, two things happen. First, the server sends a signal into the block chain it generates a service credit. Second, the block chain immediately creates a settlement for the credit, using an internally generated cryypto-currency, with a defined value.

The potential potential conditions for uses of stop series are huge towards the monetary remedies market. One of the biggest expenses for banks is professional services, and one of the biggest challenges associated with professional services is how to monitor services delivered in a Master Services Agreement. From a contract management perspective, the challenge is how to ensure that the verification of services performed occurs against the contracted requirements and statement of work. For instance, if using an “Agile” software development perspective, you could build a two-week deliverable checkpoint into the process, that would allow the customer to send a signal back into the block chain showing that the code had been completed, has been tested, and verified. This would in turn be used to drive the payment cycle. This is one of many potential future applications that would transform procurement, and potentially eliminate the need for software such as Ariba, etc. that requires processing of PO’s, invoices, requisitions, etc. The entire sector would be disrupted. This is indeed an exciting potential development.

With agreement control technological innovation, businesses can achieve process harmonization, boost openness and visibility, and get organization performance support. And the results speak for themselves.

For instance, a serious international air carrier recently employed technological innovation to improve its overall operating efficiencies, such as the handling of its deals. The company introduced efficiencies by standardizing and streamlining the contracting process from initiation to delivery, consolidating disparate processes for over 3,000 suppliers and reducing the management costs and cycle times for over 7,500 contracts. The airline facilitated transparency on $7 billion in annual contracted spend through a new closed-loop process, increasing productivity and visibility while lowering costs.

A sizable technologies company associated with drilling, manufacturing, and handling remedies inside the oil and fuel market was going through related concerns. It had inefficient, inconsistent procurement and sourcing practices that led to a lack of visibility and compliance, as well as a duplication of effort between contracting teams. Moving from completely manual processes, the company implemented technology to automate and standardize its workflows, reduce administrative work, increase its responsiveness, and improve negotiations. Through a common enterprise-wide robust system, the company achieved a 91% improvement in its contract processes, reducing the cycle from six days to half a day, in a way that is convenient, fast, easy, and seamless. The company achieved greater efficiency, higher productivity, and reduced risk exposure.