Oracle introduces ‘Procure-to-Pay in 30 days’ complete e-procurement system

Just when you thought e-procurement was yesterday’s bandwagon, software giant and ERP applications Number Two Oracle has just launched a new one. The firm says its oddly entitled ‘Procure-to-Pay in 30 Days’ IT solution, due out next month, will get manufacturing users up and saving money within one month, with all the business processes associated with indirect (non production items) on-line procurement being automated. It’s an interesting offer from a non e-procurement specialist – this is not Ariba or Commerce One after all. And on the face of it, it could be attractive – 30 days is quite a claim, and covering everything from pre-sourced catalogues, to requisitioning, purchasing, invoicing, receiving, payments, electronic banking, automatic cash reconciliation and reporting, sounds like quite a deal for any business. Indeed Oracle itself says it “raises the bar for e-procurement by automating the entire purchasing process for all enterprises… Competing solutions simply cannot automate receiving, invoicing, and electronic payments with cash reconciliation, all vital steps in the complete procure-to-pay business flow.” It also says it’s available to companies of all sizes. Phil Wood, e-business suite marketing manager, says the system can interface with any ERP system, shadowing it at the General Ledger level. And he says it integrates with electronic payments services with all the relevant workflow, and with the US-centric Worldcrest contracts and content management services, covering pre-negotiated group contracts which can potentially save a lot of time and money. He also explains that the system provides for web ‘punch-outs’ to other sites where suppliers are not on the e-procurement lists provided. He accepts, however, that Worldcrest is virtually unknown over here. And there are some other issues. Pierre Mitchell of analyst AMR Research points out that pricing is based on a $5 transaction charge, plus a 27% hosting and support charge and an up-front consulting fee around the $100,000 mark. Says Mitchell: “The $100k consulting charge needs to be scaled down to be more in line with the $5 transaction charge. The transaction charges also need to be either translated into subscription charges or scaled down based on volume: otherwise, this buying service will be relegated to the mid-market.” And he adds: “The 30-day implementation is not as audacious as the fabled one-day Oracle APS (advanced planning and scheduling) implementation, but still falls short of the three-to-six month timeframe users should budget for.” He also says: “Oracle should offer the application within the firewall. Historically, Oracle hasn’t been the most stable hosting provider, and providing fully-integrated procure-to-pay support works best internally.” However, Mitchell says: “This is the first group-buying service sponsored by an ERP vendor.” And he concludes that it’s a step in the right direction.