streamlining contractor management with …...regulatory requirements that may affect the...

learn more: ibm.com/blockchain/think

StreamliningContractor Management with Blockchain

1


Please noteIBM’s statements regarding its plans, directions, and intent are subject to change or withdrawal without notice and at IBM’s sole discretion.

Information regarding potential future products is intended to outline our general product direction and it should not be relied on in making a purchasing decision.

The information mentioned regarding potential future products is not a commitment, promise, or legal obligation to deliver any material, code or functionality. Information about potential future products may not be incorporated into any contract.

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Performance is based on measurements and projections using standard IBM benchmarks in a controlled environment. The actual throughput or performance that any user will experience will vary depending upon many factors, including considerations such as the amount of multiprogramming in the user’s job stream, the I/O configuration, the storage configuration, and the workload processed. Therefore, no assurance can be given that an individual user will achieve results similar to those stated here.

2Think 2018 / March 3, 2018 / © 2018 IBM Corporation


Think 2018 / March 3, 2018 / © 2018 IBM Corporation

Alex Rosen | IT People CorporationBusiness Development, Blockchain [email protected]

Vishnu Tadepalli | IBMProgram Manager, IPS Blockchain Solutions [email protected]

Burton Buffaloe | IBMCIO, Blockchain Squad [email protected]

mailto:[email protected]




Experts in Leading Enterprise Blockchain Platforms

• Focused on Permissioned Blockchains for Enterprise

• Key contributor with IBM to Hyperledger Fabric platform

• Multiple projects on IBM Blockchain and Ethereum/Parity

Production Solutions in Financial Services and Supply Chain

Proven Approach and Components

• Blockchain-specific analysis method, reference model, and reference architecture

• Library of pre-built, common components to accelerate solution development

Bringing together the world’s most advanced expertise, technology and ecosystem to transform industries

Tapping into the right expertise

A platform that’s open,

secure, & scalable

Access to the right ecosystem

Over 40 Consultants, Architects & DevelopersFocused on Blockchain



Blockchain & Business Transformation

5Think 2018 / DOC ID / Month XX, 2018 / © 2018 IBM Corporation

In this solution, we…§ Improved integration, reduced

disputes, streamlined process§ Used smart contracts to implement

logic§ Started a process transformation

Going forward, we will…§ Rearchitect existing landscape§ Reimagine processes and roles§ Enable opportunities in finance,

analytics and other servicesFoundation

Transformation

Innovation

Business Model InnovationIncrease Revenue and Profits§ Platform Business Models§ Analytics/Cognitive Products§ Virtual Intermediaries

Smart Contract FocusImprove Service and Agility§ Simplify/Refactor Architecture§ Transform Processes§ Streamline Processes

Data FoundationReduce Costs§ Reduce Disputes§ Improve Integration§ Automate Capture


Contractor Labor Market Dynamics


*SIA (Staffing Industry Analysts) benchmark

** IBM global procurement benchmark

Average cost for invoice processing

(onshore)

$21

*** Human workforce management benchmark

***

Percentage of Tech services that result in

blocked Invoices (requires an average $

250 to resolve each dispute)

5-9%

Percentage of spend that is non-compliant

due to rate card, hours billed and tax mismatches

2% ***

learn more: ibm.com/blockchain/think7

“I need additional resources to meet

my deadlines”

“I’ll help you find the right resources

at a good price”

“I’ve selected the best resources to fulfill

your needs”

“I’ve submitted my work hours”

“Thanks, I’ll validate against the contract terms and submit

payment”

Project Manager

ProcurementLabor

Supplier ContractorAccounts

Payables/ Receivables

Contractor Sourcing Business Process

Creates SOW(Statement of

Work) and secures funding

Creates PO (Purchase Order)

Provides contractor details to Client

Logs Hours Invoice sent from Labor Supplier to Client based on Hours logged



Today Tomorrow

Procurement

Admin

Project Manager

Labor Supplier

Contractor

Time Record Approver

Admin

Project Manager & Time Record Approver

Procurement

Labor Supplier

Time Record Approver

Today and Tomorrow…

• Blind spots and Lack of Trust• Manual invoice reconciliation and delayed payment penalties • Expensive home grown applications• Dispute resolution requires back office

• Single source of the truth for timesheet

• Increased transparency and auditability

• Payment term compliance with smart contracts


• I need multiple back office resources

• Invoice not paid yet

Is the Contractor on-boarded ?

Process duplicationOrder status

• Hours billed aren’t the actual hours recorded

• Invoice hourly rate not accurate

IBM

IBM

SupplierSupplier

• 100% compliance to payment terms

• Zero underfunded PO’s

• Limited back office resources• Zero invoice reconciliations and delayed payments


DEMO


Q1 ‘17

Q4 ‘16

Q2 ‘17

Q3 ‘17

Q4 ‘17

Q1 ‘18

Q2 ‘18

Hill 1 Hill-2 Hill-3

Valley Valley Valley Valley

External Partner Commitment

Design Thinking

Design Thinking

Our Journey

MVP - Shared Ledger, Smart Contracts, Consensus & Privacy

1.0

System Integrations

Pilot Simulation on External Network

parallel business process (35)

Migrate to IBM’s Blockchain Platform

(HLF 1.1)

Design Thinking

Investment

Accounting System Integrations

Launch Active Network w/ External Partner

(Limited Scope)primary business process

Associate Remaining Contractors (Suppliers)



Solution Architecture


Contractor

Supplier AccountManager

Supplier RelationshipManager

Project Manager &Time Record Approver

Admin Roles

IntegrationsWebserver

www.


Operational Today

ü Immutable distributed ledger

ü System integrated E2E solution from PO (Purchase Order) release to Contingent Labor consumption

üAPI’s to support offline (SOR) System of Record updates (Time records, Payroll, Customer Billing and Invoice Creation)

ü 5 Smart Contracts

ü 7 Active Persona Roles

ü Smart Filter and Role Delegation capabilities


q Accounts Payable Interface

q Self billing and payment generation

q Mobile capabilities

q Robust Reporting / Predictive Analytics

q Cognitive capabilities

In Design/ Development

13IBM Procurement// © 2018 IBM Corporation

OutcomesWhen applying Blockchain to Contingent Labor Management, Clients can expect full compliance to payment terms and elimination of blocked invoices and disputes, resulting in significantly reduced cycle time for onboarding and cost per invoice.

100%Elimination

of blocked Invoices, supporting resources, legacy systems and

dispute resolutions

100%Compliance

to contracting payment terms, eliminating profit leakage

30-50%Reduction

in cost per Invoice depending on on-shore/off-shore

50+%Reduction

in cycle time for onboarding an individual


Questions? Tweet us or go to ibm.com/blockchain

@IBMBlockchainIBM BlockchainIBM Blockchain

What will we solve together?Alex Rosen | IT People CorporationBusiness Development, Blockchain [email protected]

Vishnu Tadepalli | IBMProgram Manager, IPS Blockchain Solutions [email protected]

Burton Buffaloe | IBMCIO, Blockchain Squad [email protected]





Notices and disclaimers


© 2018 International Business Machines Corporation. No part of this document may be reproduced or transmitted in any form without written permission from IBM.U.S. Government Users Restricted Rights — use, duplication or disclosure restricted by GSA ADP Schedule Contract with IBM.Information in these presentations (including information relating to products that have not yet been announced by IBM) has been reviewed for accuracy as of the date of initial publication and could include unintentional technical or typographical errors. IBM shall have no responsibility to update this information. This document is distributed “as is” without any warranty, either express or implied. In no event, shall IBM be liable for any damage arising from the use of this information, including but not limited to, loss of data, business interruption, loss of profit or loss of opportunity. IBM products and services are warranted per the terms and conditions of the agreements under which they are provided.IBM products are manufactured from new parts or new and used parts. In some cases, a product may not be new and may have been previously installed. Regardless, our warranty terms apply.”Any statements regarding IBM's future direction, intent or product plans are subject to change or withdrawal without notice.

Performance data contained herein was generally obtained in a controlled, isolated environments. Customer examples are presented as illustrations of how thosecustomers have used IBM products and the results they may have achieved. Actual performance, cost, savings or other results in other operating environments may vary.References in this document to IBM products, programs, or services does not imply that IBM intends to make such products, programs or services available in all countries in which IBM operates or does business.Workshops, sessions and associated materials may have been prepared by independent session speakers, and do not necessarily reflect the views of IBM. All materials and discussions are provided for informational purposes only, and are neither intended to, nor shall constitute legal or other guidance or advice to any individual participant or their specific situation.It is the customer’s responsibility to insure its own compliance with legal requirements and to obtain advice of competent legal counsel as to the identification and interpretation of any relevant laws and regulatory requirements that may affect the customer’s business and any actions the customer may need to take to comply with such laws. IBM does not provide legal advice or represent or warrant that its services or products will ensure that the customer follows any law.


Notices and disclaimerscontinued

16

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Thank You !



Back-Up Slides



2017 Blockchain Pilot


Persona Representation

§ Contractors across GBS, GTS and Cloud business areas

§ Project Managers§ Supplier Relationship Manager§ R & CM Centre team members§ Procurement Relationship Manager

Tool Function

§ Delegation§ Smart Filters§ Approval process§ Interim Contract Update function§ ILC integration§ Supplier Tool integration§ Persona function

Scope

§ Pilot ran for 8 weeks.§ New and current process was ran in parallel§ Results were compared from each process

o Timesheet entryo ILC entryo Invoice content

Results

§ Confirmed data sent correctly to ILC§ Confirmed data accessible via REST API§ Confirmed data sent correctly into Supplier Tool§ Confirmed invoices matched Blockchain record for the

pilot period§ All Persona’s functioned as expected§ Persona feedback was positive

o “Landing pages for Persona’s looked contain data required”

o “Information available was what persona’s sought...No major misses"

| I B M CONF I DEN T I A L

Benefits to Buyers and SuppliersPain Points Benefit Buyer Supplier

Non compliance among hours worked , hours recorded and hours invoiced, Billing rates , expense info and taxes

BC will provide a single source of truth of the hours trail and the smart contracts feature will ensure the adherence to the contracting terms such as hourly rate, taxes ,expenses, etc…

Long turnaround times in resolving resolving blocked invoices As the network buyers and suppliers have access to the similar data on blockchain, disputes will/can be resolved right away.

High cost of processing Contingent labor invoice Blockchain automatically triggers an invoice payment notification to both the buyers account payable and seller’s account receivable system, drastically reducing the cost of invoice processing

Limited to No insights to the average labor market price trends and benchmarking data

Cognition capability of Watson will look through web and other trusted market intelligence data and provide actionable insights

Digitalization of the manual invoices Manual invoicing will be digitalized, as automatic invoice input is sent to both the buyers account payable and seller’s account receivable system,

Limited visibility / traceability leads to underfunded purchase orders

Provenance feature of Blockchain provides visibility into the PO and end to end lifecycle of a contractor during the course of project

Process duplication in time recording, invoice investigations and invoice reissue processes.

Shared ledger on the blockchain removes the process duplication

Dispute resolution requires hundreds of back office resources Provenance , shared visibility and digitization will lead to smaller and no dispute resolution teams


learn more: ibm.com/blockchain/think21

Network Collaborators

(Personas)

Assign Role Personas

Assign Contractor Record to

Purchase Order

Approve Contractor

Record

Complete Time record

Approve Time Record

Create Interim Contract Updates

Approve Interim

Contract Updates

Invoice Payment

Verification Notification

IBM Project Manager

( PM ) - D V S V V S V D D V VSupplier Account

Manager ( SAM ) - D V S V V S V D S V -Contingent

Labor Resource ( Contractor ) - - - D - - - -IBM Supplier Relationship

Manager ( SRM ) - V - - - - D V -Time Record

Approver ( TRA ) - - - V S V - - -Contract Record

Admin (CRA ) - D V - - - - - -System Admin D - - - - - - -

Application Personas

V – View Asset

D – Data Update

S – Status Update



Purchase Order Invoice

Buyer BankStaffing Provider

Contractor

Buyer Supplier

Payment

Dispute Resolution

Order status

Is the Contractor on-

boarded ?

Process duplication

Hours billed aren’t the actual hours recorded

I need multiple back office resources

Invoice not paid yet

Short payment / Dynamic

Discounting Inefficiency

Trust

Invoice hourly rate not accurate

Visibility / Risk

Reconciliation Reconciliation

Hours Worked

Process DetailsLack of visibility and trust, plus inefficiencies in the process result in extra effort and higher costs.

22



Payment toSupplier

Blockchain System of Record

Validate Available FundsPseudoInvoice

Supplier Systems of Record

Buyer Systems of Record

• Inconsistent information and “blind spots” throughout the process hinders compliance

• Process duplication in time recording, invoice investigations and invoice reissue processes

• Time consuming, manual invoice reconciliation tasks ; Delayed payment penalties

• Costly home grown applications used for dispute resolution

• Limited visibility / traceability leads to underfunded purchase orders

• Dispute resolution requires hundreds of back office resources

• Single source of the truth for hours worked and assurance of the authenticity and immutability of time sheets

• 100% assurance of adherence to payment terms through smart contracts

• Zero invoice reconciliations, delayed payment penalties, underfunded PO’s

• Increased transparency / auditability

Current

Future

Hours billed aren’t the actual hours recorded

Purchase Order funds unavailable

PaymentTriggered

Contractor

Contractor

Hours billed are not tracked against PO

Invoice hourly rate not accurate

Process Duplication

Manual Reconciliation

Contractor not associated with Purchase Order

Delayed Payments and Penalties


TuesdayMarch 20th

25

8:30am - 10:00am. Welcome to ThinkLocation: Mandalay Events Center

10:30am – 11:10am. Client Speaker Sessions: Protecting Crown Jewels with Pervasive Data Protection from Data Passports on z14 and IBM BlockchainLocation: Infrastructure Campus – Reef Ballroom C

10:30am – 11:10am. Client Speaking Sessions: Mizuho Financial Group is Revolutionizing the World of Trade Finance Using IBM BlockchainLocation: Cloud Campus - Level 2, Lagoon C

11:30am - 12:10am. Client Speaking Sessions: Megawatts to Megabucks: Blockchain and Renewable Energy Markets - InteracLocation: Cloud Campus – Level 2, Lagoon C

11:30am – 12:10pm. Client Speaking Sessions: Start Fast and Plan Big with Blockchain -Cognition FoundryLocation: Infrastructure Campus - Reef Ballroom A

12:30pm - 1:10pm. Client Speaking Sessions: How Blockchain Technology Can Solve Digital Identity and Eliminate Data Breaches from Our Vocabulary - SecureKeyLocation: Cloud Campus - Level 2, Lagoon C

1:30-2:10pm. Reimagine Professions and Industry in the era of AI KeynoteLocation: Mandalay Ballroom. Speakers: Bridget van Kralingen and Mark Foster

1:30-2:10pm. Client Speaking SessionsLocation: Business Reinvention Panel with MetLife, USAA and AAIS

1:30-2:10pm. Client Speaking Sessions: The Autonomous Car Which Pays for Itself - eWalletLocation: Business Reinvention, Lagoon B



WednesdayMarch 21st

26

8:30am - 9:10am. Blockchain Keynote: Rewire business with blockchain to derive new valueLocation: Mandalay Bay Ballroom

9:30am – 10:10am. Client Speaking Sessions. Restoring Trust in Trade - Latin America’s first blockchainfor exchanges – Bolsa SantiagoLocation: Business Reinvention Campus

9:30am - 10:10am. Business Reinvention Core 2: Digitizing a global supply chain and breaking down barriers with blockchain – Maersk JVLocation: Business Reinvention Campus Theater

9:30am-10:10am. Innovation Talk: David Katz/ The Plastic BankLocation: Think Theater, Bayside E.

12:30pm - 1:10pm. Innovation Talk: How Blockchain will Radically Transform the EconomyLocation: Think Theater, Bayside E Speaker: Bettina Warburg/Animal Ventures

1:30pm - 2:10pm. Blockchain Open Forum: Learning’s from Building Active NetworksLocation: Think Theater, Bayside E. Speaker: Marie Wieck/IBM

2:30pm - 3:10pm. Cloud Core Session: Unleashing the Power of your Group - InteracLocation: Cloud Theater

2:30pm-3:10pm. Client Speaking Sessions: Transforming global food safety with BlockchainLocation: Business Reinvention Campus

2:30pm-3:10pm. Client Speaking Sessions: How KEB-Hana Bank Achieved Business Transformation with Blockchain on Its Global Loyalty NetworkLocation: Cloud Campus

2:30pm – 2:50pm & 3:00pm – 3:30pm. Security Think Tanks. Meet The Experts: Know Your Digital Customer in the Identity Theft Era.Location: Mandalay Bay South, Level 1, Bayside C, Think Campus – Security and Resiliency Campus

4:30pm – 5:10pm. Client Speaking Sessions: An Innovative Way of Buying and Selling Tickets on a Blockchain/Distributed Ledger Platform - CronosLocation: Cloud Campus



Thursday March 22nd

27

8:30am-9:10am Client Speaking Sessions: Managing Transactions and government regulations with Blockchain Solutions – DLT LabsLocation: Cloud Campus

8:30am -9:10am.Client Speaking Session: Procurement Transformation via a Practical BlockchainApplication – IT People Corp.Location: Business Reinvention Campus

9:30am - 10:10amInfrastructure Core Session: Running an active blockchain network with required security, performance and scalability – CLSLocation: Infrastructure Theater

9:30am – 10:10amClient Speaker Sessions: Blockchain integration with existing systems of record: Going the “extra mile” – Intellect EULocation: Business Reinvention Campus – Lagoon K

12:30pm – 1:10pmClient Speaking Sessions: How Blockchain Can Transform the Use of Electronic Medical Records - CDCLocation: Infrastructure Campus


streamlining contractor management with …...regulatory requirements that may affect the...

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