Q9-2 How Does the Procurement Process at CBI Work Without SAP

Question 1

What is the procurement process at CBI without SAP?

Answer 1

The procurement process at CBI without SAP involves manual steps where Wally (Warehouse Manager) is responsible for ordering and receiving raw materials, and Ann (Accountant) handles payments.

This process uses multiple databases that are difficult to share across departments.

Question 2

What is the first step in the procurement process without SAP?

Answer 2

The first step is “Pre-Order Actions,” where Wally checks if an item is below its reorder point, reviews previous purchases, and determines the order quantity.

If necessary, he creates a purchase order.

Question 3

What is a three-way match in the procurement process?

Answer 3

A three-way match is a process where the data on the invoice, purchase order, and goods receipt are matched.

If all the data matches, the payment is made.

Question 4

What are the key documents involved in a three-way match?

Answer 4

The key documents in a three-way match are the purchase order, receipt for goods, and invoice.

Question 5

What is lead time in the procurement process?

Answer 5

Lead time is the time required for a supplier to deliver an order. It ends when the order arrives at the warehouse and the goods are received.

Question 6

What are the challenges with using multiple databases in the procurement process?

Answer 6

The use of multiple databases (in sales, warehouse, and accounting) creates information silos, making data difficult to share across departments.