Digital Manufacturing Software for Sourcing Teams

Barton Phinney: Hello, everyone, and welcome to our Next-Gen Automation session, Cost Insight Source. My name is Barton Phinney, and I am a Senior Product Manager at aPriori. Before we begin a few housekeeping notes, the attendee’s lines will be on mute throughout the session. We will be taking questions throughout the presentation, but we’ll be using the chat panel on the event website. Please note that this is not the Zoom chat. Please enter any questions you have on the costinsight.com chat panel, and we will answer as many questions as we can during the session. You can also feel free to schedule a meeting with me via the meeting scheduler on the event website. On the event website, near the chat panel, choose people. Select my name, Barton Phinney, and schedule a meeting with me. Alternatively, I will share my email details at the end of our session, and you can contact me directly. We will also have uploaded a PDF of today’s presentation, which you can access in the files panel. Let’s get started.

How aPriori’s Manufacturing Insights Software Solution Transforms the Supply Chain

The role of aPriori in providing digital manufacturing data for sourcing is critical to supporting our customers’ procurement organizations. And while aP Pro and Cost Insight Design provide great insights to our experts in design engineering use cases, they are not as targeted to the specific needs of procurement. Therefore, we are currently developing a new cloud-based application that is specifically targeted toward procurement in order to enable more efficiency and greater value for our customers. So today, please join me as we review the vision capabilities and the future of Cost Insight Source. Just a little bit about me. Again, my name is Barton Phinney, and I’m a Senior Product Manager at aPriori. I have been with aPriori for about eight years now, five years I spent working with our customers, implementing our solutions, and helping our customers get value as part of customer success. And I’ve been in product management now for about three years or so, and I’ve mostly been focusing on strategic sourcing solutions for our customers.

So during our session today, we will discuss a few different areas, Cost Insight Source, our product vision, the capabilities we intend to release in the coming months, and then the future of our product and how we see it evolving. There are four main areas that comprise the vision for CI Source. Managing the components that need to be sourced can be a burdensome process. So one of the focuses we have is making it easy to create, manage, and delegate sourcing packages by providing special containers that make it easy to break large groups of components down into packages to be sourced. A big strength of the aPriori real-time platform is providing the data needed to find cost-saving negotiating opportunities. So analytics is another major focus of CI Source, particularly around finding opportunities for potential savings. Once those savings have been identified, helping our users realize those savings by providing the should cost estimate in a more consumable format and providing the assumptions that make up those costs so that they could be used in fact-based negotiation.

And then a major benefit of our cloud platform, in general, is collaboration, and we envision providing a rich collaboration experience, not just internally for the roles that support the sourcing organization but also the opportunity to collaborate externally with suppliers as well. So how do we plan to achieve that vision? Our first release of CI Source will be an early visibility release, approximately the end of January or so, for our customers to get a preview of Cost Insight Source and provide feedback to help us iterate to a generally available release that’s currently targeted for about the spring of 2022. Early visibility release will focus on providing a quote comparison view with a new sourcing cost taxonomy that lays out a more sourcing-centric view of cost, as well as the assumptions that make up those costs. It will also provide some limited user guidance to help our users get oriented in the application. It will also feature a mechanism to load quote data into the aPriori system so it can be compared against the aPriori estimate. Then the GA release will focus primarily on three different areas.

Streamline the Sourcing Process With Real-Time Manufacturing Cost Insights

The first is allowing the user to resolve differences they find when comparing the supplier quotes to the aPriori estimate by allowing them to make high-level overrides, such as cycle time, number of operators, manufacturing rates, et cetera. We would also allow for the user to enter in-line items of costs into the aPriori estimate so that they can account for those areas of cost that they’re seeing from the supplier that are not yet covered by the aPriori cost of models, such as specialized material handling charges or additional NRAs. Next, providing the ability for the user to find geometrically similar components to the one that they are currently sourcing so they can look up historical pricing and use that as another data point in their negotiation. And then, finally, providing more automated workflows by leveraging Cost Insight Generate. More to come on these in a minute, but before we get into the details of these features, some of the items we’re planning for post-GA are features to help with managing components such as containers, like the bid packages and projects, collaboration features to help customers collaborate with their suppliers, capabilities to help customers select suitable suppliers for the components they’re sourcing, and additional features to identify more opportunities when they are sourcing components.

So let’s look at a little bit more detail about the features we just covered that we are planning to release. The sourcing cost taxonomy is a shift from our traditional cost taxonomy and is more aligned with the information provided by suppliers. The new cost taxonomy consists of the following fields: Piece part costs, and total material costs, which is a combination of material cost and material overhead. Primary manufacturing costs which is the process cost for the primary processes used to create the part, and secondary manufacturing cost, which is the process cost for the secondary processes such as surface and heat treatments. Additional costs, such as logistics, packaging, and then this is also where users would enter in line items of cost, and then SG&A and markup. We’d also include a section for non-recurring expenses such as hard tooling and programming costs. These categories can then be expanded to see the primary assumptions that are driving each category and what the user should be verifying with their supplier. If more details are needed, the user can then click on the info buttons and then see details panels for things like routing and material information.

And the GA release will support editing. The operator should cost estimate in the following ways. We’ll provide the standard inputs for the aPriori cost estimate, such as production info, routing, and process setup options. We’ll also allow the user to make high-level formula overrides, such as the cycle times, labor times, labor rates, and the other kind of high-level items that a buyer might wanna override during a negotiation with a supplier. And then, we’ll also allow the user to enter in line item additions, which, again, are costs that aPriori is not calculating today but would need to be entered into the estimate to provide an apples-to-apples comparison. We would also provide similar part search, which is a new feature in the aPriori cloud platform that will allow stakeholders to find components that are geometrically similar to each other by matching their shape and size. This feature is still being designed, but the basic workflow would be the following:

The user would have a component open in the system and then click an action to perform the similar part search. The user can then set some criteria for the search, including the percent threshold for how geometrically similar the components can be, as well as some other filter options like process group, material, or soak form. A list of results is then displayed back to the user that is sorted by geometric similarity. And then, the user can keep this dialogue open while they work, or they can open a component from the results, or they could also select several components and then launch a new comparison. And then, really, the last main focus for the CI Source GA release is on automation and how we can leverage CIG to provide some automated workflows. We’re still considering which workflows we want to provide, but some of the ones that we’re looking at are creating a budgetary estimate on the PLM check-in from the engineer, automating the pull of supplier quotes by integrating with either a file or RFT management system, automatically grouping or kitting similar components.

This would require the use of the similar part search, and then also the container features that we’ve been talking about, regional and supplier, or make versus buyer recommendations based on an automatic check-in. And then as components are being checked in by engineering, triggering reports to procurement for what kinds of components, materials, et cetera, are coming down the pipe and flagging anything that’s special about them so that if there’s extra lead time that’s needed to source those components, procurement has the time to do that. As we continue developing Cost Insight Source, we’ll narrow in on the workflows we plan to support. So that does it for the GA release of CI Source. But where do we see our product evolving to? Let’s talk about some of the ongoing research and investigations we’re doing while we develop the first releases of CI Source. Well, we’ll likely be providing more static views of data in the GA release of CI Source. One of the things we’re keenly interested in providing is more flexibility to allow our customers to show the data that they value most. We’re currently investigating several areas of configuration within CI Source, but mostly configuring the sections of the comparison view and choosing what data is displayed.

Providing the ability to expose additional process outputs, both from an organizational and individual perspective, and then ultimately providing the ability for the users to create configured views of data that can then be saved and then shared throughout the organization, potentially even with suppliers in the future. Another area we believe we can provide great value to our customers is helping with supplier management and selection. We plan to provide the ability to store some supplier information in the aPriori system, particularly around capability, quality, and capacity. Using that information combined with the manufacturing requirements in the aPriori estimate, as well as historical data by using similar part search and capacity requirements, we can then match to the list of suppliers that’s stored and then recommend what suppliers are best suited based on the information available.

But as we turn our eyes to the future and where are we focusing, and where do we see our products going? Right now, we are focusing primarily on projects to better support collaboration between our customers and their suppliers. Why? So we’re seeing an industry trend that has been evolving for a while now, and it’s a shift from a traditional supplier ecosystem to a strategic supplier relationship system. A traditional supplier ecosystem refers to a procurement process where an RFQ is sent to multiple suppliers, and then you get the responses back, and then you negotiate and measure the responses against each other in terms of price, quality, and lead time. A strategic supplier relationship embeds the supplier in the product life cycle from start to finish, where they can collaborate from the inception of the product all the way through delivery. Not only is the industry itself changing to support this trend, but technology is as well. In a recent article by SAP on what procurement will look like in 2025, it states business networks will be the business-to-business marketplace of the future, allowing buyers and suppliers to collaborate with ease.

Streamline Procurement Business Processes With Collaborative Digital Technology

Hyper-connected ecosystems will enable business agility and essential capability for procurement to thrive in the future economy, and suppliers and external workforces will be invaluable business partners acting as extensions of the organization. So with that in mind, our research is really focused on two different areas: Identifying the ways that our customers want to collaborate with their suppliers and what are the pain points in that process that we can help solve. And then also, what is the technology that we need to be developing so that we can help support two-sided networks and enable our customers to collaborate in the ways they need to to support the future of procurement? If you’re interested in seeing more on CI Source, there are many ways that you can get involved and stay up to date on the latest developments during the conference. We’re running a CI Source Usability Lab where you’ll have the opportunity to discuss some of the challenges that you see in procurement today.

Try out a new CI Source prototype and review and give feedback on the GA and functionalities that we’ve reviewed today. To sign up, go to our costinsight.com website and follow the instructions for how to sign up on the Usability Labs. We’ll also be kicking off the CI Source early visibility program, currently targeted for about January, which will allow you to get early access to a pre-release version of GA. Get additional licenses for procurement and no charge access for existing cost authors, and provide feedback to help us refine and prioritize capabilities. If you’re interested in signing up for this program, please contact me after the session via email, and we can discuss how to get you involved. So that’s all we have today. Thank you for attending this session. Don’t forget if you are a customer of aPriori to write a review of aPriori on any of the leading software review sites, including G2, Capterra, and TrustRadius, to win some great prizes. Thank you, and have a great day.