PIDX Implementation Case Study

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PIDX Implementation Case Study

• Chris Welsh
• Customer e-Procurement Project Manager
• April 19th 2005

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Hughes Christensen
Provides best-in-class products and services to
drill, evaluate, complete and produce oil and gas
wells.
INTEQ
Baker Atlas
Baker Oil Tools
FY2004 Revenues 6.1 billion 65 international
26,900 employees Facilities in 72
countries Operates in 90 countries
Centrilift
Baker Petrolite
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Services
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E-Procurement Landscape
E-Field Ticket Capture
Fulfillment
Sourcing
Ordering
Manual E-Invoice Submission
E-Tender Submission
E-Invoice Submission (Simple Catalog)
Plan Purchase Services (Complex Catalog)
ManualPurchase Order Receipt
Invoice Submission (EDI Delivery)
Request for x (RFx) E-Tendering Auctions Electron
ic Catalog
RFx Purchase Order Punch-out Electronic Catalog
Field Ticket Invoice Electronic Catalog
PIDX Purchase Order Integration
PIDX Invoice Integration
BakerHughesDirect.com Quote Generation Punch Out
Catalog
Pre-Contract
In-Contract
Rich Technical Data
Basic Commercial Data
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Customer Variation Complexity
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Some Tenets of e-Procurement

• In this world of SOX
• Transaction amounts remain unchanged from
  original
• Buyer and Supplier systems to remain accurate and
  whole
• Keep transactions whole, do not change, reject
  and resubmit
• No on-behalf of invoices
• Transaction information and data (including
  aggregated data) are confidential to the Buyer
  and Supplier
• Parties responsible for their own costs to
  process industry-standard (PIDX) documents
• Parties responsible for their own costs to
  analyze financial data
• Security audit requirements still developing

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Customer E-Procurement

• BHI Corporate Role
• Manage the corporate interface with Customers
• Collect E-Procurement requests from Customers
• Collaborate and assemble relevant BHI resources
• Share information on past engagements
• Help initiate and co-ordinate required activities
• Also say NO to Customers when appropriate
• Develop implementation procedures

Coordinate BHIs response to its Customers
E-Procurement initiatives with global solutions
implemented once for all Customers
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Customer E-Procurement

• Approach
• Use OFS-Portal and share costs
• Selectively engage with Customers
• Evaluate and learn, both process technology
• Understand value proposition for BHI the
  Industry
• Predict and prepare for future business models
• Provide coordination point for BHI Divisions
  Customers
• Support and implement PIDX standards

Implement Permanent Business Change
Determine Internal Capability
Assess Customer Requirements
Pilot Review
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Internal complex environment

• Seven operating divisions
• Distributed billing in most regions
• Central credit collection by region
• Three main ERP systems ( many legacy systems)
• Two EDI VANs in North America
• PIDX XML invoicing delivery

Calgary
Denver
Centrilift
Houma
Baker Petrolite
Centralized Credit Collection
Customer A
Pansophic
EDI VAN 1
Baker Oil Tools
INTEQ
PRISM
Customer B
Medicine Hat
EDI VAN 2
Baker Atlas
PIDX XML
SAP
Supplier A
Drilling Fluids
Lafayette
Hughes Christensen
Worland
Bakersfield
Implement common solutions catering for complexity
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EDI Invoice Process
Returned Status
Returned Status

• BHI EDI VAN
• Transform EDI 3030
• Route
• Status

SAP PRISM Pansophic
Customers EDI VAN
Invoice
Customers ERP
Field Ticket
Customer Accounts Payable
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Transaction Routing Transformation

• Requirements
• Use OFS-Portal competency center
• Support BHIs complex environment
• Support the complexity and variation of our
  Customer environment
• Avoid customization to the back office
• Leverage industry expertise in B2B transaction
  processing
• Low cost, low risk entry point
• Result
• OFS-Portal sourced transaction routing
  transformation services for its oilfield service
  company members

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PIDX XML E-Invoicing Solution
Customer Accounts Payable
Alternate Customer
EAI Tool
Returned Status
Returned Status
SAP PRISM Pansophic
Invoice

• OFS-Portal
• Transform PIDX XML
• Attach F.T.
• Envelope Route
• Status Handling

Customers System
AS2 Package
RNIF PIDX XML
Documentum
Returned Status
Field Ticket
Field Ticket
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PIDX XML Workflow
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Single Connection Methodology
Supplier C Materials Provider
Customer A Upstream
Customer B Upstream
PIDX XMLStandards
Supplier A Travel Services
PIDX XMLStandards
Travel Industry XML Standards
Traditional EDI VAN
Baker Hughes Back Office 1
Transaction Routing Service (Transformation
Routing)
Supplier B Computer H/W
Baker Hughes Back Office 2
Electronics Industry XML Standards
BHI Standards
Customer E Upstream
PIDX XMLStandards
Market Place A
Baker Hughes Back Office 3
Traditional EDI VAN
Baker Hughes Area of Responsibility
Customer C Downstream
Customer F Upstream
CIDX XMLStandards
Customer D Downstream
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PIDX Implementation Notes

• The Good
• Customers and Market Sites experienced in
  implementation
• Variety of technical options emerging
• Adoption continuing to grow rapidly
• Willingness to collaborate between Buyers and
  Suppliers
• Beach head established

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PIDX Implementation Notes

• The Not So Good
• Each implementation is a separate map (5
  variability)
• Unique data requirements mapped into arbitrary
  fields hijacking tags
• Incomplete choreography for PO, Invoice,
  Disputes, Credits processes
• Missing business messages such as invoice
  response
• e-mail is not E-Commerce
• Networks not consistent in technical
  acknowledgements between trading partners
• Failing to engage the business or operations -
  Change Management
• Separation in the products and services buying
  process
• Effect
• Increased (and unnecessary) cost of implementation

To maintain the increased adoption rate and
control costs the PIDX committee should tackle
these implementation issues as a priority over
extending the standard
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PIDX XML Invoice Adoption Projection
Current ERS Capable Customers North America
PIDX XML Capable
Avg. Paid Invoices/Month
PIDX XML
Convert to EDI
EDI
EDI
Manual Entry
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PIDX Next Steps

• Whats Needed
• Increased participation from Operators
• Standardize passing of variable data
• Collaboration on implementing complete end to end
  message choreography (PIPs)

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Questions?

• Chris Welsh
• Customer e-Procurement Project Manager
• April 19th 2004