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P&G Purchase Price Digitization

Deadline: March 29, 2023

Business Background:

P&G buys multiple materials (chemicals, packaging, and finished products) from various suppliers. The materials’ price update and governance can be very complex because of several factors (feedstock, quantity, logistics, FX, duties, and complex formulas).

Due to ongoing supply chain constraints and global market challenges, price governance has become a focus area and requires:

  • Precise price definitions in contracts
  • Better/more effective process to determine the right price (eliminating overly complex excel files)
  • Avoiding dependency on individual buyer knowledge to reduce value leakage risk and achieve optimal governance process

Business Challenge / Needs Definition:

“Materials Price Update” is complex in P&G and mainly Excel based. There are productivity opportunities through digitizing price formulas and improving communication with suppliers, buyers, operations, and supporting systems.

Key challenges to address:

  • Lack of Data Harmonization
  • Time-Consuming/Manual Governance Process
  • Over ~2000 Price Models
  • Complex Price Mechanisms
  • Disconnected Data Sources & Processes
  • Sub-Optimal Data & Analytics

Vision: Touchless Price Digitization

The below highlight considerations for evaluating potential technology solutions:

  • Pricing digitization and automation functionality/Technical Capability:
    • Creation: Price models and calculations that include links to internal (e.g., FX data) and external reference platforms (underlying commodity pricing)
    • Maintenance: Automatically produce updated price lists as per contract (e.g., monthly) against underlying criteria (volume, time, commodity changes, etc).
    • Collaboration: An approval workflow that allows buyers and suppliers to approve the new pricing
    • Capability to upload the prices into systems like SAP and Coupa
    • Storage of historical price updates as reference for later governance
    • Ability to compare invoices against the latest prices agreed upon and the underlying price calculation
    • Ability to upload and use the newly created price models in inquiry tools, e.g. Coupa CSO. 
    • Ability to upload the price model into a contract as an exhibit
  • Functional capability with Use case demos
  • Implementation capability with industry use cases
  • Commercial terms and pricing

Relevant technology domains may include, but are not limited to:

  • Price Digitization
  • Strategic Sourcing
  • Source-to-Contract
  • Source-to-Pay
  • eSourcing
  • Supplier Relationship Management
Deadline: March 29, 2023
Posted on: March 16, 2023
Key Words:
price governance, Information Technology, data access, data analytics, supply chain database, digitalization

Business Background:

P&G buys multiple materials (chemicals, packaging, and finished products) from various suppliers. The materials’ price update and governance can be very complex because of several factors (feedstock, quantity, logistics, FX, duties, and complex formulas).

Due to ongoing supply chain constraints and global market challenges, price governance has become a focus area and requires:

  • Precise price definitions in contracts
  • Better/more effective process to determine the right price (eliminating overly complex excel files)
  • Avoiding dependency on individual buyer knowledge to reduce value leakage risk and achieve optimal governance process

Business Challenge / Needs Definition:

“Materials Price Update” is complex in P&G and mainly Excel based. There are productivity opportunities through digitizing price formulas and improving communication with suppliers, buyers, operations, and supporting systems.

Key challenges to address:

  • Lack of Data Harmonization
  • Time-Consuming/Manual Governance Process
  • Over ~2000 Price Models
  • Complex Price Mechanisms
  • Disconnected Data Sources & Processes
  • Sub-Optimal Data & Analytics

Vision: Touchless Price Digitization

The below highlight considerations for evaluating potential technology solutions:

  • Pricing digitization and automation functionality/Technical Capability:
    • Creation: Price models and calculations that include links to internal (e.g., FX data) and external reference platforms (underlying commodity pricing)
    • Maintenance: Automatically produce updated price lists as per contract (e.g., monthly) against underlying criteria (volume, time, commodity changes, etc).
    • Collaboration: An approval workflow that allows buyers and suppliers to approve the new pricing
    • Capability to upload the prices into systems like SAP and Coupa
    • Storage of historical price updates as reference for later governance
    • Ability to compare invoices against the latest prices agreed upon and the underlying price calculation
    • Ability to upload and use the newly created price models in inquiry tools, e.g. Coupa CSO. 
    • Ability to upload the price model into a contract as an exhibit
  • Functional capability with Use case demos
  • Implementation capability with industry use cases
  • Commercial terms and pricing

Relevant technology domains may include, but are not limited to:

  • Price Digitization
  • Strategic Sourcing
  • Source-to-Contract
  • Source-to-Pay
  • eSourcing
  • Supplier Relationship Management

How To Respond:

Please submit your response here.

Submissions will be accepted until March 29, 2023.  

  • How To Respond:

    Please submit your response here.

    Submissions will be accepted until March 29, 2023.  

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