Scientists embrace electronic-purchasing

How do you keep 500 plus scientists happy every day? An unusual question but an important one for the National Physical Laboratory (NPL) in Teddington, which carries out essential measurement research and testing on behalf of the Government and industry as a GOCO (Government Owned Contractor Operated) organisation. The solution for the NPL purchasing team was a suitably scientific one to enable scientists to choose and order their own products and put the process online, a practice which RS, a principle supplier, played a pivotal role.

The challenge of serving a large community of scientists, working simultaneously on a number of different projects, is a considerable one. On a daily basis requests can come in for elements as diverse as semiconductors or multimetres to screwdrivers or hard-to-find screws, a purpose for which an industry supplier, like RS, is ideally suited. The range of work carried out in Teddington includes critical maintenance of national standards and sharing measurement best practice in areas from time to electromagnetics, biotechnology and colour.

Over a year, a total of 11,000 orders cost NPL 21 million. NPL Procurement Manager, Sue Gibbons, said, Requirements at NPL are fairly immediate, scientific projects can be quite organic in nature and it is impossible to plan ahead for everything, so when a part is needed work cannot progress until it arrives. Luckily RS delivers the next day as part of its service. However the paper-based requisitioning system we used to have meant that this was being lengthened to three days.

From online to e-systems: 1997-2004

Online ordering with spend limits

NPL and RS had been trading for decades when, in 1997, RS put its world-renowned catalogue online. When NPL became a GOCO in 1995 Serco, one of the worlds leading service companies, was appointed by the DTI to manage the laboratory. The purchasing team was anxious to try the RS Online service because it met its objective of greater efficiency in servicing its internal clients.

NPL allowed scientists to place orders direct on the RS website which gave the scientists access to up to date contract pricing with discounts already calculated, up to date stock availability, instant order confirmation and comprehensive technical information, whilst giving the purchasing department peace of mind that the scientists were purchasing to pre-agreed online spend controls. A win/win situation for both the scientists and the purchasing department. At a stroke it removed the paper requisitioning process and brought in next day deliveries from RS, which in turn removed the need for NPL to hold surplus stock.

Recognising how important change management can be when a new process is introduced, NPLs goal for the new RS Online system was to get users to comply with the new procedure quickly and consistently. Fortunately the scientists where quick to embrace the benefits of the new paperless process, added to which RS ran a comprehensive end-user training scheme and provided a dedicated web helpline and site show sessions. The result was that a smooth-running purchasing process was achieved at NPL both quickly and successfully.

NPL found RS Online to be a positive experience which helped lead them to introduce the Oracle Financials system in 2000, to remove all paper-based requisitioning and create a smooth-running electronic central purchasing function, that helped reduce timescales, check budgets, rationalise suppliers and reduced admin such as data entry.

RS Online operated independently of the Oracle Financials system to deal with low value orders to RS only, whilst NPL implemented Oracle to integrate with their internal system and generate requisition orders for higher value goods from a variety of suppliers. RS merges with Oracle when scientists want to purchase products over set spend limits, by contacting a Purchasing Manager to ask them to set up and authorise a requisition for the high value order.

PurchasingManager

Given the positive experience of online purchasing NPL had enjoyed with RS, it was naturally interested when in 2002 RS took its online proposition a stage further with PurchasingManager, a free online procurement tool. The benefits for NPL were that it gave total control over online purchasing, set approval workflow and created instant reports that provided visibility of the whole organisational spend with RS, all without the need to integrate into NPL's system.

In October of 2002 NPL became one of the first companies to use PurchasingManager. Gibbons comments, The benefits NPL received by adopting PurchasingManager included valuable tools such as control over online purchasing, managing approval workflow and instant reporting. Having been convinced through our usage of RS Online to the advantages of managing our own ordering from RSs product range, this was the logical next step.

e-procurement

PurchasingManager, in turn, gave NPL the conviction that managing the catalogue of their suppliers electronically was the way forward. In January 2004, NPL selected BT Exchanges Oracle-based platform to create a content management and e-procurement system for them. NPL wanted suppliers information uploaded on to the BT Exchange as a static text catalogue, but by doing this with the RS catalogue, NPL would lose all the features that the scientists had come accustomed to, such as up to date pricing and stock information. To maintain these features, RS integrated with NPL's content system by enabling a user to PunchOut of their BT exchange e-procurement application and land on the RS website. The user then searches for the product, creates a requisition, which is returned to the e-procurement package to go through approval, the approved order is then returned to RS via XML ordering. This provided a completely dynamic online system that had no risk of errors or need for manual intervention. The ability to PunchOut to RS' website went live on NPLs new system in April of this year.

Reaping the rewards

The net result of these changes for the purchasing team at NPL are that requisitions and purchase orders now take two-thirds less time to process than they used to. Sue Gibbons says that, Given that half of the orders are under 200 and from the same 30 trusted suppliers means that the purchasing team can devote more time to looking at the 2,500 other suppliers for more-expensive purchases.

Now when an order is placed with RS by any of the 500 scientists that use the NPL system, they can select the item required by viewing the RS portfolio of 135,000 products. Notification then goes to one of NPLs 45 group leaders, if spend limits are broken, who can instantly authorise the scientist to acquire the item. RS dispatches the item on the same day, to arrive by the next.

Gibbons also feels that NPL would not be where they are today without its relationship with RS which has, step by step, been with NPL through its innovations in purchasing procedure. My department is now delivering the best service ever to NPL and its community of scientists, and credit has to go to RS for not only being a key strategic supplier, but for growing our confidence in what was possible, and helping us to be the team we are today.

What next at NPL?

NPL are now looking at closing the e-procurement loop by introducing e-invoicing to make the entire process, from beginning to end, a paperless one. And what will the 500 scientists of Teddington think of this next innovation? Sue Gibbons believes that the improvements mean a more efficient service at a time when NPL serves both Government and increasingly the private sector too, Scientists dont want to waste hours searching for the right components and then wait days to receive it, and e-procurement has streamlined everything. They like this new way of doing things, its more scientific.