SQS SUPPLY MANAGER
INFORMATION SYSTEM

SQS SUPPLY MANAGER

What is the SQS Supply Manager?

The Supply Manager is the module used by the Purchaser within the SQS System to manage registered “Applicants” or “Approved Suppliers” information.

What information detail does the SQS Supply Manager provide to the Purchasers authorised personnel?

The SQS Supply Manager provides to the Purchasers authorised personnel the following information:

• Access to data applicable to applications lodged by Unapproved Suppliers (Applicants).
• Access to data in respect of SQS Approved Suppliers information.
• Access to data based on the type of Goods available for purchase by the Purchaser.
• Access to data based on the type of Services available for purchase by the Purchaser.
• Access to data detailing the number of Approved Suppliers able to supply a specific Goods or Services type i.e. this can be used as a Suppliers or Tenderers List.
• The actual grading an Approved Supplier has obtained via the SQS. The Approved Supplier status within the SQS are:

Can the SQS Supply Manager influence purchasing decisions?

Yes. The SQS Supply Manager module can assist the Purchasers authorised personnel to retrieve Supplier data so that appropriate decisions can be made by Procurement, Finance, Engineering and Operational staff prior to engaging an Applicant (Unapproved Supplier).

What are the two Supplier categories within the SQS Supply Manager?

The two Supplier category types within the SQS Supply Manager are:

1. Unapproved Supplier (Applicant)
2. Approved Suppliers.

Authorised Purchasing Representatives have the ability using this system to evaluate and either accept or reject an application from an Unapproved Supplier.

Purchasing Representatives can also unassign Approved Suppliers who do not perform up to the Purchasers expectations. This is also known as a “Revoked Supplier”.

What is the difference between an “Unapproved Supplier (Applicant)” and an "Approved Supplier”?

An “Unapproved Supplier (Applicant)” is a company which the Purchaser has not yet approved via the SQS, i.e. their application is pending approval by an authorised purchasing representative.

An “Approved Supplier” is a company who has undertaken qualification via the SQS and has been approved by the Purchaser to supply either Goods or Services.

Why do Purchasers want to implement this system?

This system will realise additional benefits to the Purchaser that a paper-based system cannot achieve, as well as enhancing relationships with key Approved Suppliers and providing the Purchaser with a viable e-commerce Supplier Qualification System.

What are the goals sought by the Purchaser in using the SQS system?

The goals of the SQS is to provide the Purchaser with a system which is:

• Electronic
• Efficient
• Effective
• Secure
• Commercially appropriate
• Web based
• Where data is easily retrievable
• Is a database/knowledge management tool
• Cost effective
• Centralised
• Able to build on existing and new supplier relationships
• Measures supplier performance
• Contains up to date data
• Operates in real time
• Can allow for appropriate purchasing decisions to be made.

What is a major benefit to the Purchaser of using the SQS System?

The SQS establishes for the Purchaser a central repository of information (An e-commerce knowledge management system) whereby authorised users can make informed purchasing decisions via an electronically medium enabling them to retrieve Supplier data via a secure network, at multi sites accessible by multiple personnel in real time.

The SQS will assist authorised purchasing representatives to manage Suppliers and make informed purchasing decisions based on supply data contained in the SQS.

Who will be the likely users of the SQS who work for the Purchaser?

The likely users will be management and staff working either on a project or operation within purchasing, administration, operations, engineering, warehousing, accounts payable and finance.

Which purchasing representatives will be able to access the SQS Application?

The authorised users of the SQS Supply Manager will be determined by the Purchasers nominated management overseeing the SQS for use by their company.

What functionality can the SQS provide to the Purchasers personnel?

The SQS can provide the Purchasers personnel with the following functionality:

• Retrieve, review and assess new applications from SQS Unapproved Suppliers (Applicants).
• Approve or reject electronically an SQS Unapproved Suppliers application for qualification via the SQS System.
• Retrieve and assess Supplier data from SQS Approved Suppliers via the SQS System.
• Categorise Goods and/or Services types into lists for evaluation.
• Assign gradings and regradings to SQS Approved Suppliers based on their performance.
• Add new Goods or Services types to the SQS Supply Manager.
• Add a new Supplier on a temporary basis without the Supplier going through the SQS application based on an urgent commercial or operational need.
• Revoke an Approved Suppliers SQS status for continual non performance.

WHY DOES THE PURCHASER NEED TO PREQUALIFY COMPANIES BEFORE THEY PROVIDE GOODS OR SERVICES TO THEIR PROJECT OR OPERATION?

The reasons are many and varied. The old saying “you don’t know what you don’t know” is very apt. Best practice dictates that prior to contracting with a Supplier a Purchaser should understand the commercial risk of doing so.

Why is it necessary for the Purchaser to qualify their Suppliers?

It is necessary that prior to carrying out business activities with a Supplier that the Purchaser has a thorough understanding of their strengths and weaknesses, so they can make informed decisions as to whether they see merit in purchasing Goods or Services with them.

What are the possible ramifications of the Purchaser not qualifying their Suppliers for their project or operation?

Failure to adequately assess a Suppliers capabilities prior to the Purchaser buying Goods or Services can lead to unwanted issues and risks arising which could have been reduced or eliminated had the Supplier been assessed and gone through a qualification process.

What are the groups Suppliers can be categorized into in respect of performance?

Suppliers can be grouped into the following categories in respect of their performance:

Suppliers who:

• Exceed the Purchasers requirements.
• Meet the Purchasers requirements.
• Do not meet the Purchasers requirements.

This variability means some Suppliers may perform extremely well (above expectations) whilst others will meet or fall below the Purchasers expectations.

The above performance measurement groups convert to risk and cost, which the Purchaser may be subject too!

What are examples whereby Suppliers may fall below their required expectations?

Examples whereby the Suppliers may fall below the required expectations include but are not limited to the following:

• Delivering goods late.
• Not complying with the required Health and Safety provisions.
• Not carrying out the required services in accordance with the agreed schedule.
• Providing technically non compliant goods.
• Not providing all the required contract deliverables.
• Assigning unapproved subcontractors.
• Not complying with the negotiated Terms and Conditions.

What is the level of investment the Purchaser undertakes when purchasing Goods and Services?

The Purchaser invests heavily in the purchase of Goods and Services for their project or operation and any Supplier non-performance issue tends to impact heavily and negatively on their operation in respect of financial or operational risk.

Who are the Purchasers nominated representative for this initiative?

The person managing this initiative for the Purchaser is Glenn Turley (Project Procurement Manager).

Who makes the decision whether an Unapproved Suppliers Application is accepted or rejected by the Purchaser via the SQS?

The following Purchasers personnel have the right to accept or reject an SQS Applicants (Unapproved Suppliers) application:

• This will be confirmed in the licensed version of the SQS.

When does the Purchaser intend to start using the SQS?

• This will be confirmed in the licensed version of the SQS.

What will the Purchasers authorised personnel use this information for?

The Purchasers authorised personnel will use this information to:

• Assess and evaluate an Unapproved Suppliers application via the SQS and determine whether they are worthy of being granted an SQS Approved Supplier Status.
• Rate and rerate an SQS Approved Supplier based on their performance using the SQS.
• Analyse Supplier information to enable the Purchaser to make informed commercially acceptable decisions prior to and after purchasing Goods or Services from Suppliers.

WHAT GOODS AND SERVICES CATEGORY GROUPS HAS THE SQS ADOPTED?

THE GOODS CATEGORY GROUPING TYPES ARE:

Examples of Minor Onsite Goods may be:

Examples of Corporate Goods may be:

Examples of Major Onsite Engineered Equipment may be:

Examples of Minor Goods (Offsite)may be:

THE SERVICES CATEGORY GROUPING TYPES ARE:

Examples of Minor Onsite Services may be:

Examples of Corporate Services may be:

Examples of Minor Consultancy Services may be:

Examples of Major Consultancy Services may be:

Examples of Major Subcontracts (Onsite) Services may be:

Examples of Major Subcontracts (Offsite) Services may be:

Examples of Minor Offsite Services may be:

What are the Approved Supplier gradings/classifications that the Purchaser is implementing as part of this SQS?

An “Applicant” is a company who has not registered or been approved to supply either Goods or Services via the SQS. An Applicant is also known as an "Unapproved Supplier”.

An “Unassigned Supplier” is a Supplier:

• whose application for Approved Supplier Status has not yet either been reviewed or approved by the Purchaser.

“Provisional Supplier” is an SQS Approved Supplier who has:

• been approved by the Purchaser to provide Goods or Services to their operation. The Purchaser made this approval less than 90 days ago.
• been downgraded by the Purchaser as a result of their inability to perform up to the expectations when providing Goods or Services to their project or operation.

“Standard” is an SQS Approved Supplier who has:

• been approved by the Purchaser to provide Goods or Services to their operation. This approval was made by the Purchaser more than 90 days ago.
• been upgraded or downgraded by the Purchaser as a result of their performance when providing Goods or Services to the Purchasers project or operation.

“Preferred Supplier” is an SQS Approved Supplier who has:

• been approved by the Purchaser to provide Goods or Services to their operation.
• been graded by the Purchaser as a result of their performance when providing Goods or Services to the Purchasers project or operation.
• This is a non-exclusive arrangement with the Purchasers.

“Partner Supplier” is an SQS Approved Supplier who has:

• been approved by the Purchaser to provide Goods or Services to their operation.
• been graded by the Purchaser as a result of their performance when providing Goods or Services to the Purchasers project operation.
• achieved exemplary service to the Purchaser in the supply of either Goods or Services to the Purchasers.
• only 10% of suppliers achieve this standing and are seen as an essential part of the Purchaser strategic arrangements.
• this is a non-exclusive arrangement with the Purchasers management unless otherwise agreed in a contract agreement.

“Unsuccessful Supplier” is an “Applicant” (Unapproved Supplier) who has been rejected as an “Approved Supplier” under the SQS application process.

“Revoked Supplier” is an SQS Approved Supplier who:

• was once an SQS Approved Supplier but due to not performing up to the Purchasers expectations has been disqualified from providing the Purchaser with either Goods or Services.

This is a fictitious set of events/scenarios to highlight the benefits of qualifying your Contractors who provide Onsite Services.

• A large number of Contractors are accessing the project site who are not pre-qualified.
• Contractors are being engaged to perform Onsite Services by the Purchaser with either no, few and/or inadequate commercial arrangements being implemented prior to them being contracted.
• Some of the Purchasers onsite representatives are issuing contractors with Service Orders without negotiating mutually acceptable, commercially prudent Terms and Conditions and Service Level Agreements (SLA’s).
• The Purchasers onsite management are unhappy with this practice as it is commercially inappropriate but they are constrained by time and are unable to implement adequate, fully recordable and traceable pre-qualification systems.
• The Purchaser has determined that some major contractors have no clearly defined, mutually agreed service obligations. This includes Terms and Conditions of Service which defines the Purchasers and Contractors contractual obligations as well as their service deliverables and expectations.
• Unqualified contractors can potentially add increased costs to their scope of services.
• These and/or their subcontractors may not be suitable to work at the Purchasers site?
• These contractors may pose a Health and Safety risk whilst on the Purchasers site.
• These contractors may engage staff who are not suitably qualified to carry out the contracted activity.
• These contractors may have serious breaches in respect of environmental matters.
• These contractors may not have signed a Non Disclosure Agreement (NDA) with the Purchaser to ensure confidentiality remains during the service duration.
• These contractors may jeopardise the Purchasers Intellectual Property rights.
• The Purchaser may not have carried out reference checks against unqualified contractors.
• No due diligence checks may have been conducted against unqualified contractors to ensure they are authorised to contract services with the Purchaser or that they are financially stable.
• The Purchaser does not know whether the contractor has a history of reneging on their contractual responsibilities and/or under performing the services provided by them.
• If no Terms and Conditions are agreed to prior to the Purchaser engaging the contractors services then the contractors Terms and Conditions govern the service.

• The Purchaser needs to define what their service requirements are for each contractor based on the complexity and total contract sums applicable to each service package, i.e. Minor Works/ Major Onsite Services.
• A Qualification process for contractors needs to be implemented.