Process Modelling and Reengineering

1. The following is a description of a typical strategic sourcing and procurement process for a large enterprise.

a) Draw an As Is Process Model using swim lanes and BPMN 2.0 conventions. Show messages as dashed lines, rather than additional tasks. Note that the process has been simplified for modelling purposes. In this case, the current As Is Process is highly dysfunctional and your model needs to depict the problems.

The Strategic Sourcing Group (SSG) analyses the Companys purchases by querying the ERP system on the top 10% spend categories. The SSG determines the major spend categories and major suppliers and calls for RFT (Request for Tender) submissions from suppliers to be the sole supplier for their category to the Company. The SSG determines the most competitive submissions based on quality and price criteria and Approved Suppliers (AS) are appointed for each Category. Purchasing Officers are required to raise official Purchase Orders (POs) from the ERP system and send them by email to the AS at the Approved Tender Price (ATP) stored in the ERP Database. AS are required to send an Advanced Shipping Notice (ASN) by email. The ASN is checked against the PO by the Purchasing Officer. 25% of POs result in an out of stock situation, as determined by the ASN, and an amended PO is emailed by the Purchasing Officer to the AS. 30% of the time, Purchasing Officers order from Non-Approved Suppliers (NAS) off system by phone and fax. Invoices are received from AS, entered into the ERP system by the Accounts Payable Officer (APO), which then matches to the final PO and ASN. These invoices are further matched to a Good Received Note (GRN) by the APO in the ERP system. The APO then authorises these Invoices for Payment in the ERP system. Non Approved Invoices (NAI) are received from Suppliers that cannot be matched to a PO. 50% of the NAI cannot be matched by the APO to a GRN due to semantic difficulties. APO needs to resolve these NAI with the Purchasing Officer to approve for payment. These NAI are delayed by 6 weeks on average. Suppliers contact the APO frequently requesting for payment for their NAI.