Postal Service creates online purchasing program
Postal Service creates online purchasing program
USPS officials estimate that the transaction cost per purchase could drop as low as $10
By Shruti Dat'
The Postal Service projects its new internal Web self-service ordering application will reduce the average transaction cost per purchase'currently $150 to $300'to as low as $10. The return on investment is estimated at 300 percent.
The key element of the Web-Based Purchasing application is the cost reduction, said Jerry McClure, USPS purchasing and materials manager of systems integration.
The application also will reduce manual transactions and approval time, and capture extensive data to track spending and performance, McClure said.
WBP, created with Anteon Corp. of Fairfax, Va., provides a catalog management capability, a multicatalog search, self-service ordering, workflow and approval processing, order status and receiving functions, said Mark Mittelman, Anteon program manager.
If orders are placed with a supplier outside of WBP, users can still upload the data from the vendor into WBP.
The application will serve up to 100,000 Postal Service employees, who will purchase everything from pencils to high-end servers on the USPS intranet site from pre-negotiated supplier catalogs. The catalogs will be hosted on an intranet for security and performance reasons, Mittelman said.
Users will access the site through Netscape Navigator or Microsoft Internet Explorer. The application requires no software to be uploaded or downloaded to users' systems.
The project team is considering digital certificates, Secure Sockets Layer or a combination of the two, among other methods, to secure transactions through electronic data interchange and other application-related files between WBP and suppliers.
'We have several options worked out that will ensure communication between the USPS'i.e., WBP'and the external suppliers is efficient, secured and reliable,' Mittelman said.
Users can log on to the system with user identifications and passwords to search online catalogs. USPS plans a phased approach for the WBP implementation.
The corporate office supply catalog for items from Boise Cascade Corp. of Boise, Idaho, will go online in November, and a catalog of computer equipment from Compaq Computer Corp. is scheduled to be available by January.
Users will send orders to authorized approvers. Offices and divisions within the Postal Service can configure the application depending on individual workflow processes.
Each order is electronically certified and transmitted to the supplier, who sends an electronic acknowledgment, shipment status and electronic invoice. When a supplier sends an electronic invoice, an automated process certifies the invoice and sends it to the USPS accounts payable system for payment. Programmers built an interface to the Postal Service financial system, which electronically pays the vendor, Mittelman said.
If there are errors in the invoice based on this automatic certification, USPS electronically sends the invoice back to the supplier.
The project team tailored CommerceXpertSuite from iPlanet E-Commerce Solutions of Mountain View, Calif. The company is a strategic collaboration between Sun Microsystems Inc. and Netscape Communications Corp.
The Postal Service is using two products from this suite: BuyerXpert 3.01 SP1 for the front end and ECXpert 3.0 SP1 for the back end to transfer information via EDI.
Cadis 4.0, an integrated product from Aspect Development Inc., also of Mountain View, provides the catalog management function. An Oracle8 Release 8.06 database stores WBP data.
The suite runs under SunSoft Solaris 2.6 on a server cluster located in the Minneapolis Postal Service computer operations service center.
A Sun Microsystems Enterprise 6500 houses BuyerXpert and Netscape Enterprise Server; it has 14 CPUs with 14G of RAM each. The Postal Service plans to move to BuyerXpert 3.01 SP2 and replace Netscape Enterprise Server with iPlanet Web 4.1.
The Postal Service will also use three Sun Microsystems Enterprise 4500 servers with four CPUs each and 4G of RAM each. The ECXpert and Cadis applications are housed on one Sun 4500. Another Sun 4500 houses the Oracle database and hosts reports created using Actuate 220.127.116.11 from Actuate Corp. of San Francisco.
The third Sun 4500 houses a standalone Oracle database used for end-user reporting and data warehousing. This standalone unit will store information replicated from the WBP Oracle database, which maintains real-time, online information on all transactions within WBP.
The Postal Service will install the iPlanet Web server to avoid any system clogs when users want to run ad hoc and data analysis reports. The agency will complete hardware installation by November.
'We will allow workflow and approval [processes] to be tailored by the organization and within certain depths of the organization,' Mittelman said.
The customization, however, is limited. USPS tried to keep the configuration changes within the bounds of the commercial product.
'Whenever we implement [off-the-shelf] products, we are careful to insulate changes we need to the product from any issues that might affect warranty or our upgrade path to new releases,' Mittelman said. 'However, we have found that no products in this area fully met our needs here at USPS.'
Consequently, the project team must configure and slightly customize the products and build extensions to the iPlanet products.
Mittelman said the online catalog idea emerged in 1997, but it did not take shape because of the immaturity of technology. There were also concerns about network performance, and the robustness of workflow processes, security and Java standards.