1. Ariba
Knowledge
Nuggets
eCatalogs: Your Punchout to Compliance
At the heart of every procurement system is a catalog. Even in an
SUPPLIER TIP environment lacking automation, requisitioners consult a hard copy or
customer service reps use a catalog at the other end of a phone line. So
Suppliers should be
guided on the best it stands to reason that getting everyone to use the correct catalog from
way to use the a preferred vendor at the contracted price will ensure that negotiated
standard fields savings from sourcing and contracting activities are actually realized.
of the catalog This Knowledge Nugget will explore benefits and best practices around
template as well as these core elements:
any additional
required attributes • Price Compliance
depending on the
commodity area. • Supplier Compliance
• Process Compliance
Turn Identified Savings Into Realized Savings — Prevent Spend Leakage
1. Does your company have an eProcurement system?
If not, thoroughly investigate the significant savings that such a system can deliver. Most vendors are
happy to provide you with an ROI analysis of your spend free of charge. This should be of particular
interest if you have already invested heavily in strategic sourcing so you can capture all of the
negotiated savings and avoid leakage.
2. Does your company have an eProcurement system?
• Decide whether it continues to make sense to dedicate resources to a function that may be better
executed by outsourcing.
• Seriously explore the options around eCatalog management solutions. With a small investment
(especially compared to your ERP investment) and in only weeks you can unlock the value of your
ERP eProcurement.
3. You have an eProcurement system and you are happy with its capabilities and performance.
• Enable more catalogs work towards at least 80 percent of your spend. (Don’t forget services.)
• Work with suppliers to execute on the suggestions outlined in this paper to improve the quality of
the content.
• For large catalogs, encourage suppliers to support Level 2 PunchOut.

2. Who Should Manage
the Catalogs?
There are several criteria to consider when determining whether eCatalogs should be managed
internally or by a 3rd party service provider:
1. Are there enough resources in house to support an aggressive rollout and support
all of the eventually required catalogs?
2. Is it worth the cost of developing the skills required?
3. Does the organization have or is it willing to invest in tools for catalog cleansing
and content enrichment?
4. Will an investment be made to develop quality processes and best practices?
The initial rollout of an eCatalog program is resource-intensive due to the amount of coordination
required between the technical lead doing the eCatalog enablement, the suppliers, and the supplier
managers at the buying organization. The technical lead will also need to take the time to educate
suppliers who may be new to providing eCatalogs, while the supplier managers will need to work
with suppliers to get agreement on what content should be included and ensuring that the correct
pricing is being applied. A successful catalog technical lead will need to have the skills required to
understand content requirements, educate suppliers on these requirements, cleanse and manipulate
large amounts of catalog data, and troubleshoot technical errors that may occur during the
enablement. Also, if supplier-hosted content (punchout catalog) is being used; this person will also
need to be strong with HTML, cXML, OCI, or any other communication protocol that is being used by
the system. Tools for catalog cleansing and content enrichment are beneficial
to provide a better end user experience, finding and fixing potential errors,
A successful catalog
adding and/or extracting supplemental attributes, assigning commodity
technical lead will need codes, and ensuring correct content. Developing and maintaining these
to have the skills required tools can be costly and are not practical for smaller organizations. Off-the-
to understand content shelf software designed specifically for this purpose is not available and will
requirements, educate
suppliers on these require IT resources to develop in house. Quality processes and defined
requirements, cleanse procedures for collecting, processing, and refreshing eCatalogs are critical
and manipulate large for ensuring a high-quality end user experience and updated accurate data
amounts of catalog data,
and troubleshoot in the system. The method by which a supplier submits their eCatalog data
technical errors that may needs to be not only user-friendly, but also secure and reliable. Many times
occur during the email is seen as the best way of submitting catalog data, however large file
enablement.
sizes, no visibility to the supplier if transmission was successful, and the lack
of a systematic way to track the most-current version makes this method
undesirable. An FTP site is a somewhat better solution and will allow for the
transfer of large files and also give each
file its own time and date stamp. Ideally Tools for catalog cleansing and content enrichment are beneficial to provide
a better end user experience, finding and fixing potential errors, adding
suppliers should submit their eCatalog and/or extracting supplemental attributes, assigning commodity codes, and
data through a supplier portal where the ensuring correct content.
supplier can see if the transfer has been
successful. A more sophisticated tool should also offer the option of doing some initial data
validation on the eCatalog to let the supplier know of potential errors prior to or at the point of
submission. This supplier self-service tool can dramatically reduce the hassle and time to update
catalogs. It is critical that refreshed data is processed quickly and correctly so that the pricing and
items are up to date.

3. How to Keep
Pricing Current
Keeping internally hosted eCatalog data and pricing current is essential to maximizing user
adoption and driving compliance, and minimizing the number of exceptions that Accounts Payable
manages. Contracted items should have a set time period where the price is valid. Many
procurement applications can attach an expiration date to each item so that when this date is
reached and the price is no longer valid, the item is hidden from view. Once agreement is reached
for a new contracted price, the updated eCatalog can be loaded to refresh the items.
Non-contract items may have a specific or completely random refresh schedule. Expect that
suppliers will provide an updated eCatalog on a quarterly basis. For certain commodities, it may be
necessary to update on a monthly basis. For anything more frequent than monthly, we recommend
that the catalog not be internally hosted, but rather supplier-hosted in a PunchOut catalog. This
minimizes the amount of file handling, validation, and cleansing that needs to be done, as well as
ensures the price is always current without the delay that occurs when content is transferred from
the supplier and then loaded at the customer. Even a best-in-class organization can take up to
three days to collect and process catalog changes.1 Through the use of PunchOut technologies, it
is possible for end users to be directed to the supplier-hosted catalog and select items to add to
the requisition. The benefit is that supplier updates to pricing and items are visible immediately.
Some organizations are hesitant to use supplier hosted content because they feel that they lose
control over price changes. Ideally control can be maintained through a level 2 PunchOut that will
take the user directly to preferred approved items. A well-set-up requisition approval flow, as well
as catalog manager random audits of frequently purchased items, can help minimize this issue and
in almost all cases the benefits of the supplier-hosted content for items that have volatile pricing
outweigh the risks.
Don’t expect suppliers to be diligent about providing updated content on a quarterly basis. It is
important that the supplier manager establishes a specific refresh schedule and follows up with
suppliers as the date nears. The catalog manager may also assist in this effort by developing a
system to track time to the next expected refresh.
Criteria for Catalog Management Vendors
Catalog management vendors should be evaluated on four main criteria:
1. Consumer-like shopping experience through advanced technologies
2. Quality of supplier self-help tools that are available for catalog creation
and maintenance
3. Security, service levels, and quality processes used by the vendor
4. Cleansing and content enrichment capabilities

4. Criteria for Catalog Management Vendor
Consumer-Like Shopping Experience
Many procurement platforms support advanced content technologies that greatly improve the end user
experience if they are configured correctly. These technologies make the difference between a current state-
of-the-art, consumer-like shopping experience (think Amazon.com) and “old-school”, client-server shopping
agony. A minimal list of shopping cart technologies that should be enabled include:
1. Intelligent Fuzzy Search - returns word variations including misspellings
2. Parametric Search Filtering - search filter based on price, supplier, color, etc.
3. Side-by-Side compare - allows easy comparisons of similar items
4. Kit Creation and maintenance - combining multiple items into one SKU
Fuzzy search, parametric filtering and kitting correctly can dramatically decrease search
and requisition time—increasing user adoption.

5. Compliance Control
Compliance/Control
In addition to easy-to-maintain control over spend, the eCatalog solution
should provide:
• Relevance Ranking - sorting search based on pre-configured requirements, e.g.
preferred suppliers or products
• Icons - green, recycled, Woman or Minority-Owned Business, etc.
• Configurable catalog view – depending on roles or business units, views into catalogs
may be limited based on requirements
• Contract compliance – ensuring that during the requisition process pricing is verified
against the contract, including volume discounts and tiered pricing
A catalog management vendor needs to have an understanding of these features and how they can
best be used. Relevance ranking and icons direct buyers to preferred suppliers or products to help
organizations achieve purchasing goals. Similarly the configurable catalog view will direct buyers to
the proper supplier or product based on your business rules. Proactive contract compliance as
discussed earlier, is essential to realizing your previously negotiated savings.
Cleansing and Content Enrichment
The final criterion to consider is the ability of the vendor to perform
catalog cleansing and enrichment. At a minimum, the catalog should
be cleansed for proper formatting of the description verifying that
images are present and confirming that url addresses do not contain
dead links. Data rationalization of words in the short and long
description can aid in keyword searches. For example, the adjective
“black” could be written by suppliers as “blk” or “blck”. Rationalizing
the adjectives to the full word in the description will ensure that all
results are returned when the end user searches using
the full adjective “black”.
Content enrichment such as commodity code assignment and attribute extraction is also valuable.
Commodity code assignment is important if critical business processes, accounting, and approval
rules are driven off of the commodity code assigned to the item as well as for the purpose of spend
visibility. If left up to the supplier to provide the commodity code, the accuracy rate will be 60 percent
or lower. A leading catalog vendor will be able to enrich the content with commodity codes and
achieve at least a 99 percent accuracy rate.
Attribute extraction can greatly reduce the time the end user needs to find a particular item. This is
especially helpful in direct material purchases. A good example would be searching for a “bolt”.
Simply doing a keyword. Using attribute extraction, the end user can be presented with item
parametric filtering where the size, head type, and material
of the bolt can instantly be selected thereby reducing the time required to find the exact item.
Attribute extraction can be labor-intensive, however when the time savings to find items in the
catalog is considered across a large user base, the return on investment can be realized shortly after
the initial set-up.