Ariba Supplier Network Alternatives: Oracle (Part 2)

Please click here for the first part of this series.

Oracle is one of the few providers that doesn't charge buyers or suppliers any type of fee to use their supplier network. They told Spend Matters specifically that, "there are no fees to Oracle procurement buyers and their suppliers for integrating with and sending transactions through OSN." Transcepta, an Oracle partner who also provides connectivity services as well as supplier enablement for the OSN, has a fee structured "designed to incentivize supplier participation." For projects involving organizations using Oracle's procurement technology, Transcepta offers models where suppliers pay a small, fixed monthly fee (that includes unlimited volumes) as well as models where suppliers do not pay any fees under either model, there are never any setup, percent of transaction, or transactional-based fees to suppliers. Rather, "Transcepta charges the Buyer a one-time 'project initiation' fee and either a low per-invoice delivery fee or a flat rate fixed monthly fee."

Through the OSN, Oracle only provides XML connectivity as well as the ability to send documents via email. Yet Transcepta increases the universe of connectivity points for Oracle users and "allows suppliers to maintain their existing billing processes and for line-level invoice details to be extracted as data elements." In addition to the invoice data, Transcepta can also pass through the OSN to the Buyer an invoice image file that can be fed into Oracle's Imaging and Process Management solution and used to facilitate invoice approval (note, Spend Matters has not reviewed this separate Oracle solution). They suggest this not only avoids the cost of paper transmission and processing, but also reduces error rates from "imprecise character conversion technologies such as OCR/scanning." Spend Matters research suggests OCR/scanning services and technologies are far more precise than they were in the past and may be sufficient for companies for indirectly electronically enabling SMB supplier invoices. Yet unlike OCR/scanning providers, Transcepta guarantees 100% invoice accuracy, supporting both email and virtual printer invoice delivery.

In terms of supplier enablement, Oracle can partner with Transcepta to provide a "full service supplier on-boarding program" that encompasses collecting and actively managing, on an ongoing basis, information such as supplier names, contact details, banking information, automated TIN checks, etc. Oracle told Spend Matters that the "OSN together with Transcepta provisions supplier accounts providing them access to their customer's E-Business Suite or Peoplesoft procurement and A/P portals. Suppliers are able to maintain their profiles in self-service including general information, contacts, addresses, bank information and business classifications." Our experience with the Oracle iSupplier Portal is that it offers a basic degree of registration/collection capability, but that users looking for broader supplier self-service and data management may wish to consider other solutions, including Oracle's own supplier management tools -- Oracle Supplier Lifecycle Management and Supplier Hub.

For every day transactional usage, OSN supports the delivery of purchase orders, the ability to change PO documents on OAG or xCML format, inbound delivery of PO acknowledgements, PO change requests, advanced ship notifications (ASNs), advanced shipping and billing notifications (ASBNs) and invoice documents in OAG or cXML format. Suppliers are able to access the delivery status of documents with OSN. In addition, "OSN together with Transcepta provisions suppliers with access to the Oracle portals -- as iSupplier Portal (EBS) and eSettlements/eSupplier Connection (Peoplesoft Enterprise) which provide the complete application level status (such as Invoice on-hold, payment made etc.)."

Oracle supports a range of matching capabilities through the OSN, though native support is based in the AP module itself. Oracle suggests based on company preference -- which is customizable based on any number of factors -- that "matching may be set to 2, 3, or 4-way" approaches. From a discounting perspective, Oracle's AP module "allows the definition of any number of discount regimes that can be attached to the supplier profile and used to process individual invoices." Here, they suggest that "typically, the discounts are pre-negotiated with a supplier and the AP Manager can opt to take a discount for early payment."

For systems/eProcurement integration, Oracle suggests that the OSN "is fully integrated with E-Business Suite and Peoplesoft Enterprise." They also say that they have not integrated into an Ariba Buyer or P2P environment, but that "many Ariba customers are also using Oracle financials or procurement applications." Furthermore, "for buyers that are running EBS or Peoplesoft Enterprise then OSN and Transcepta can be used to provide a far more cost effective solution" than other supplier network approaches in the market.

Stay tuned for our final post on the Oracle OSN.

Jason Busch

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