How Sourcing Bots automate 93% of tasks in Ocean mini-tenders

October 3, 2019

Sonja Straub

Keelvar and Siemens hosted a Learning Lab at Digital Procurement World in Amsterdam on September 19th last, presenting the successful deployment of Keelvar’s Sourcing Bot at Siemens AG. 

Sebastian Kahlmeyer, SVP & Data Officer, SCM Digitalization at Siemens spoke of Siemens’ journey with Keelvar, what the Sourcing Bot does at Siemens and how it supports his sourcing teams. Sebastian outlined the role of the Sourcing Bot during the sourcing process, and how humans remain firmly in control of sourcing even with this powerful new category of technology. 

Of 44 tasks identified within the sourcing process of running mini tenders for Ocean Freight, 93% of these are now automated. As for the final 7%, these remain deliberately manual: and are based on human decisions. The people running the sourcing process retain clear, fine control throughout the entire process. They are asked by the Sourcing Bot for information, they approve each stage, and they maintain the option to override any of its actions or stages. The Sourcing Bot simply automates the mundane, repetitive tasks, thereby establishing consistent excellence and increasing the speed of the process.

How does the Sourcing Bot work? 

If a requester in your organization wants to ship goods from A to B, they use Keelvar's Fulfillment Optimizer, Keelvar's intelligent rate finder, to search for rates. They enter their A to B details (with slick auto-completion and suggestions) as well as any further relevant information. The rate finder will supply the following information to the user:

  1. the available, contracted rate or
  2. the next best available rate (if there is not a contracted rate for this specific rate request)
  3. the option for the Sourcing Bot to go-to-market with the specific request via eRFQ. 

If Option 3 is selected, the request is sent to the Sourcing Manager. Once approved, the Sourcing Bot creates and runs the event, then identifies the winning bid. It then requests approval of the winning bid from the manager, notifies the winning bidder, and finally, automatically populates the rate card with the rates and notifies the requester.

No doubt, this level of automation brings innumerable benefits. The speed of the process improves as well as consistency in excellence. Best practice is established and executed as the Sourcing Bot learns from past events, and refines its actions with each event it runs. The savings generated surpass that of a simple eSourcing tool because it is possible to build in richer and more expressive bid mechanism and scenario analysis that reasons about trade-offs more precisely than time-constrained human users can do. A highlight for the sourcing teams using Sourcing Bots is the time that they regain, enabling them to focus upon the more engaging aspects of their work that require human empathy and strategic reasoning. This brings higher levels of talent retention for the organizations engaging Sourcing Bots for their sourcing processes.

Levels of Sourcing Automation: The Ocean Freight Bot operates at Level 4 under a prescriptive process that adopts a fixed best practice approach.

Keelvar's Sourcing Automation is a software framework that leverages Keelvar's core product, Sourcing Optimizer and uses instances of Sourcing Bots to automate manual processes for sourcing teams. With this optimization engine as the bedrock of the Sourcing Bots, users automatically benefit from the power of Keelvar's core product that includes proactive bid validation and robust and flexible scenario analysis options that provide great flexibility for bidders.

Where to start?

Keelvar has eliminated the need for strategic sourcing teams to invest many hours learning how to use sourcing software, thus leading the way for low risk, easy adoption. Many of the early adopters worried that they did not have what they thought would be vast amounts of data required to train the Sourcing Bot. Conversely, by simply running a number of events in Sourcing Optimizer, the Sourcing Bot already has enough data to be trained and configured. It will not require any effort for businesses to move from Level 4 to Level 5 Automation. Organizations are advised to start with one team, and one category. As the teams adjust and begin to enjoy the benefits of Sourcing Automation, and the stakeholders see the positive outcomes, Sourcing Bots are then rolled out throughout the organization incrementally. In the words of Dr Rich Wilson, "start small, start sustainably".

Contact us today for more information or to speak to the team about Sourcing Automation or Sourcing Optimizer.

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