Miraculum, the multi-million rand e-procurement company, is being powered by Oracle Corporation`s leading B2B exchange platform and technology to enable online auctioning, reverse auctioning, contract and spot buying capabilities.
This enables Miraculum to deliver an electronic procurement solution to meet SA market demands. Miraculum.
Miraculum is South Africa`s business-to-business (B2B) e-marketplace (e-procurement) operator, involving three major listed groups. Miraculum is a joint venture owned by Dimension Data, Nedcor, Old Mutual and J&J (a services and e-commerce company founded by Jay Naidoo and Jayendra Naidoo).
The company is geared to offer significant cost savings and purchasing efficiencies to its corporate and SMME clients, as well as to government and empowerment initiatives. It electronically brings buyers and sellers together facilitating the flow of information and procurement orders. Subscribers to the service can maximise supplier leverage and minimise processing costs.
Miraculum is making best-of-breed e-procurement practices and facilities available to SMMEs. "By aggregating their buying power, SMMEs can access value-added services at a reduced rate.
Miraculum gives SMMEs access to new buyers and markets and in this way stimulates economic activity," says Miraculum MD Brandon Spear.
Effective and efficient cataloguing is key to the success of any electronic procurement marketplace. Consequently Miraculum has also forged an alliance with catalogue specialist, LOG-TEK, a deal geared to provide users of the Miraculum Xchange with unprecedented flexibility and added value, including the ability to track purchasing spend with `designated group` entrepreneurs to comply with government tender requirements.
The need
To succeed in the Internet economy, organisations need to quickly communicate and share information with their trading partners in real time.
Prior to the advent of exchanges, companies used traditional means of communication, preventing them from being able to respond adequately to rapidly changing market conditions, and from taking advantage of new opportunities as they arose. Traditional point-to-point legacy system integration between a limited number of trading partners is a costly and time-consuming endeavour.
With the introduction of online exchanges, companies have the ability to reach a global market without worrying about integrating with their trading partners` ERP systems. They can now do business more quickly and efficiently than before.
Business-to-Business (B2B) Exchanges are online, collaborative environments that enable companies to come together and conduct business over the Internet. The business activities can range from buying and selling, to supply chain planning, or product design and development. Companies can significantly reduce costs and increase profitability, while extending market reach and streamlining their supply chains.
Spear says major SA corporates spend tens of millions each year on procuring non-core products and services, such as office supplies, PCs, copiers, travel and insurance. "Industry benchmarks show an organisation can save up to 20% of its procurement costs by implementing an e-procurement system."
Choosing a partner
Only Oracle offers the complete platform, applications, and services necessary to help companies and entire industries transform to e-business. All other solutions focus only on web-based purchasing, ignoring the benefits of moving the entire supply chain to the Internet.
Companies that use multiple point solutions are forced to cobble them together, facing an integration challenge that is costly and time consuming.
Oracle is also the global leading vendor of corporate Internet based procurement products.
"Oracle`s technology is the broadest and most comprehensive available. This aligns well with our overall strategy to develop business-oriented Applications Service Provider (ASP) services," says Ray Krut, IT and Services director at Miraculum.
"We believe that Oracle has a scalable solution which is both sustainable and the most comprehensive offering in the market today.
"Oracle`s global coverage allows us to understand what is happening in markets around the world. This adds great benefit to Miraculum in terms of what will be important in the local market into the future. "
Oracle Exchange, Oracle`s electronic marketplace solution is being adopted by the world`s leading B2B online exchanges. For example, Oracle is working with GlobalNetXchange, a global retail exchange that initially focuses on the US$80 billion supply chain purchases of global retail leaders Carrefour and Sears; and RetailersMarketXchange, being established by Chevron and McLane for the US$200 billion convenience store industry in the US.
The solution
Miraculum has chosen Oracle`s Exchange platform as its business-to-business hub, allowing Miraculum`s online community to trade freely on this hub called Miraculum Xchange.
Miraculum is also deploying Oracle Internet Procurement, part of Oracle`s e-Business Suite, and Oracle Applications Release 11i ERP suite, provided by Oracle SA.
Oracle is the sole-source provider of Oracle Exchange proven Internet technology, infrastructure platform, and hosting services. It`s the first choice for companies, like Miraculum, that want to create global, online marketplaces and connect their supply chains via the Internet.
Oracle Exchange offers the only full-suite of acclaimed products and services to build functionally rich business-to-business exchanges, leveraging Oracle`s reputation for world-class security and infinite scalability.
Oracle Exchange helps enterprises improve the efficiency of critical, business-to--business processes, and enables them to conduct business rapidly and efficiently over the Internet. It also enables organisations to effectively collaborate in real-time to deliver lower cost, higher quality products and services to the market faster.
Oracle`s exchange platform is based on Oracle 8I, the world`s most powerful, scalable and secure database for the Internet. Not only is it capbale of ensuring the privacy and security of data for all exchange participants, but is also capbale of manging the hundreds and millions of transactions annually that be processed on Exchange.
The Oracle E-Business Suite consists of more than 75 software modules that can help companies transform their business into an e-business. As an integral part of this powerful suite, Oracle Internet Procurement is specifically designed to streamline procurement processes and enable companies, like Miraculum, to purchase goods and services at the best value, based on price, quality, delivery, and customer service.
Organisations can potentially spend over 60% of their total revenue on the procurement of goods and services. Oracle Internet Procurement enables organisation to save up to 20% on all types of purchases, which translates into rand-for-rand improvements.
Leveraging the combined power of Oracle Internet Procurement, and Oracle Exchange companies can buy all types of goods and services at the best value, make better strategic decisions, and improve the bottom line. These offerings automate and centralise procurement functions such as sourcing, approval routing, and payments while decentralising the requisitioning and receiving process.
This frees up procurement and accounting professionals to engage in value-added tasks such as analysing total spend and managing supplier relationships. Oracle Internet Procurement supports all types of purchases-production, non-production, capital, maintenance, repair, and overhaul (MRO), service and administrative systems.
A bird`s eye-view
"We have integrated the functionality of Internet Procurement with the functionality of Miraculum Xchange to offer a broader solution to our clients," explains Krut. "We built the procurement product to meet the standard procurement needs of most companies."
"Companies which want a procurement solution now have the functionality and benefits of both Oracle`s products."
He advises that Miraculum is selling Oracles solutions (Internet Procurement integrated into Miraculum Xchange) as a procurement solution to its clients, but instead of clients having to take risks with up-front purchase costs, Miraculum is developing a hosted version of the procurement solution. "In other words Miraculum`s customers rent this service from Miraculum on a monthly basis."
Krut says Miraculum will provide users of Miraculum Xchange with a supported and maintained environment. This includes comprehensive business and technical support. Backing this up, Oracle has created an environment to enable it to support global exchanges.
Spear notes that there`s likely to be a proliferation of e-procurement service providers in the future. "But, as was the case with cellphone service providers and Internet service providers when these technologies first came to the fore, few will survive in the longer term.
"A major differentiator for us is that our solution is a combined exercise between procurement and technology specialists.
"We incorporate expertise in both the quality-of-service virtual private network (VPN) and Internet arenas through OmniLink and The Internet Solution (IS), companies jointly owned by Dimension Data, Nedcor and Old Mutual. This is backed by the know-how of experts from the Nedcor and Old Mutual buying departments. "
Spear says the e-procurement service will be targeted at the current 70 corporate users of the OmniLink VPN as well as the 1700 corporate and business clients of IS.
"This will enable us to meet the quality-of-service requirements of businesses on the VPN as well as the needs of customers with Internet access that would like to become part of a secure, e-procurement marketplace.
"Our aim is to provide a robust business platform which reduces the cost associated with procurement and allows companies to better leverage their expenditure with suppliers. The company will initially focus on MRO goods before expanding into other products and services, " Spear concludes.
Benefits
Krut says the benefit of integrating Internet Procurement with Miraculum Xchange is to provide a wider value proposition to Miraculum`s clients.
"In the longer term it will also facilitate collaborative supply chain planning and product design functionality, allowing accurate capacity and demand planning for participating suppliers," comments Krut.
"Internet Procurement as the front end allows us to electronically procure purchase orders. It`s a proficiency tool which enables vast savings.
"Our hosted version of the procurement solution means our clients can outsource with ease to Miraculum, avoiding capital outlays and the costs of maintenance and support."
In particular Oracle`s exchange platform will provide other benefits to companies like Miraculum, according to Deon Els. Exchange and ASP Business Development Manager at Oracle SA. These include:
Obtain real time access to a global base of suppliers; * Buy all goods and services at lower cost with new Internet-based business practices such as reverse auctioning; * In the future, share product design information in real-time, enabling trading partners to collaborate to reduce new product rollout cycles;
Gain access to new markets with no start-up cost;
Reduce the cost of retaining existing customers and acquiring new ones;
Gain access to demand information from buyers to optimise resources and provide the lowest cost, on-time delivery of high quality products and services;
Increase sales revenue and profitability;
Reduce costs and streamline internal processes;
Squeeze time out of the supply chain by optimising resource use and improving scheduling and cycle times, and by reducing inventory with better material planning and purchasing;
Reduce new product rollout cycles and enhance design for manufacture and serviceability with real-time; and
Collaborative engineering design and concurrent engineering.
Into the future together...
"Presently, we will focus on Internet Procurement. In the future it is intended that we develop a wider range of hosted Oracle applications," says Krut.
Powered by Oracle technology, it is anticipated that Miraculum Xchange`s capabilities will be extended to other initiatives such as, online electronic workplace tools, for example, management of human resources, expense claims, asset management and other financial services.
"Oracle, in alliance with Miraculum Xchange, will become the e-business backbone that ultimately connects entire supply chains together," Krut adds.
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