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19 Define Procurement Contracts Configurations

This chapter contains the following:

Specify Supplier Contract Management Business Function Properties

Supplier Contracts Business Unit Setup: Explained

Using the Specify Supplier Contract Management Business Function Properties task, available by selecting Setup and Maintenance from the Tools menu and searching on the task name, you can specify a variety of business function settings for supplier contracts in a specific business unit.

The selections you make for these business functions impact how the Contract Terms Library behaves during supplier contract authoring.

Managing Contract Terms Library Setup Options

The setup options available for the Contract Terms Library are applicable to both customer and supplier contracts, and are described in the business unit setup topic for the Contract Terms Library. That topic is available as a related link to this topic.

Contract Terms Library Business Unit Setup: Explained

You can specify a wide variety of Contract Terms Library settings for either customer or supplier contracts within each business unit, by using either the Specify Customer Contract Management Business Function Properties or the Specify Supplier Contract Management Business Function Properties tasks. These tasks are available by navigating to the Setup and Maintenance work area and searching on the task name.

For the Contract Terms Library in each business unit, you can:

Enable clause and template adoption.
Set the clause numbering method.
Enable the Contract Expert feature.
Specify the layout for printed clauses and contract deviation reports.

Enabling Clause Adoption

If you plan to use clause adoption in your implementation, then set up the following:

Specify a global business unit
You must designate one of the business units in your organization as the global business unit by selecting the Global Business Unit option. This makes it possible for the other local business units to adopt and use approved content from that global business unit. If the Global Business Unit option is not available for the business unit you are setting up, this means that you already designated another business unit as global.
Enable automatic adoption
If you are implementing the adoption feature, then you can have all the global clauses in the global business unit automatically approved and available for use in the local business by selecting the Autoadopt Global Clauses option. If you do not select this option, the employee designated as the Contract Terms Library Administrator must approve all global clauses before they can be adopted and used in the local business unit. This option is available only for local business units.
Specify the administrator who approves clauses available for adoption
You must designate an employee as the Contract Terms Library administrator if you are using adoption. If you do not enable automatic adoption, then the administrator must adopt individual clauses or localize them for use in the local business unit. The administrator can also copy over any contract terms templates created in the global business unit. The clauses and contract terms templates available for adoption are listed in the administrator's Terms Library work area.

Setting Clause Numbering Options

You can set up automatic clause numbering for the clauses in the business unit by selecting Automatic in the Clause Numbering field and entering a Document Sequence Category you previously set up in the Clause Sequence Category field. If clause numbering is manual, contract terms library administrators must enter unique clause numbers each time they create a clause.

You can choose to display the clause number in front of the clause title in contracts by selecting the Display Clause Number in Clause Title option.

Enabling Contract Expert

You must select the Enable Contract Expert option to be able to use the Contract Expert feature in a business unit. This setting takes precedence over enabling Contract Expert for individual contract terms templates.

Specifying the Printed Clause and Deviations Report Layouts

For each business unit, you can specify the Oracle BI Publisher RTF file that serves as the layout for:

The printed contract terms
Enter the RTF file you want used for formatting the printed clauses in the Clause Layout Template field.
The contract deviations report

The RTF file you select as the Deviations Layout Template determines the appearance of the contract deviations report PDF. This PDF is attached to the approval notification sent to contract approvers.

Contract Deliverables: How They Work

Contract deliverables make it possible for you to track goods, services, reports and other deliverables you are purchasing in buy-intent contracts. Depending on the type of contract you are creating, you can use contract deliverables to initiate the creation purchase orders or purchase agreements within Oracle Fusion Purchasing or in other integrated purchasing applications and monitor their fulfillment from within the contract. This topic explains how you create and work with contract deliverables.

This figure illustrates how you can create and work with both contractual and noncontractual deliverables and how you can initiate purchasing activity from those deliverables:

You can create a deliverable either on the contract header or on individual contract lines by selecting either the Autocreate Deliverable or the Create Deliverable actions. The Autocreate Deliverable action creates the deliverable and copies the basic header or line information to the deliverable so you do not have to enter it manually.
Selecting the Autocreate Deliverable action from the header automatically creates one deliverable per contract line. If there are no contract lines, then the application creates one deliverable based on the header details provided the contract types is of class Purchase Agreement. You cannot autocreate deliverables for contracts without contract lines if the contract type class is Enterprise Contract.
Review the notifications that are sent automatically to interested parties regarding deliverable progress and deadlines. The contract type can be set up to automatically specify who gets notified and when. You can change and add additional notifications for the contract.
If you are using the deliverable to initiate the purchase of goods and services using the integrated purchasing applications, then you must enter the required purchasing details. For autocreated deliverables, these details are copied automatically from the corresponding lines.
When the contract is approved and becomes active, you can initiate the creation of the purchasing documents in one of the purchasing applications. When you do, the application validates the information you entered to make sure it meets all the requirements of the purchasing application and creates the purchasing document. If it does not you must edit the deliverable to enter additional information.
After the purchasing document is created in the purchasing application, you can monitor the progress of its execution.
You can mark a deliverable as complete after execution of the purchasing document is completed.

This figure outlines how you work with
contract deliverables.

Creating a Contract Deliverable

If the deliverable you are creating is related to the information entered in the contract, then you can select the Autocreate Deliverable action to create a deliverable in either the contract Header tab or the Lines tab. Using Autocreate Deliverable on the contract header creates a single deliverable for each contract line. On the Lines tab, you can select individual lines where you want to create a deliverable.

Select the Create Deliverable action in the Deliverables tab to create a completely new deliverable.

Tip

You can create multiple deliverables for a single line if you need the line items to be shipped to different destinations, for example. This is accomplished by autocreating a deliverable, duplicating it, and then editing the deliverable information.

Setting Up Deliverable Notifications

You can specify which internal contacts are automatically notified about contract deliverable milestones and when.

You can notify internal contacts:

A specified number of days before or after the deliverable due date
When the deliverable is placed on hold
When a purchasing document is created from a deliverable
When purchasing document creation fails for the deliverable
When purchasing activity is complete on a deliverable

Different notification types are available for different deliverable types. Some notifications may already be specified for you by the contract type you selected to create your contract.

Creating the Purchasing Document

Before you initiate the purchasing document by selecting either the Create Purchase Order or Create Purchase Agreement actions, you must enter all purchasing information required by the purchasing document you are creating and wait until the contract is approved.

You can create one purchase document from multiple contract deliverables. For example, selecting all the deliverables created from contract lines when creating a purchase order, creates one PO with lines corresponding to each of the deliverables.

The application validates your entries to make sure you have entered all the required information. You must correct any errors you receive and resubmit you request. You know that the purchase document is successfully created when the deliverable status changes to the PO Created or Agreement Created status.

Note

Purchase orders are created automatically in Oracle Fusion Purchasing, but agreements are created only when you run the Import Blanket Agreements and Import Contract Agreements processes from the Purchasing work area as described in a related topic.

Monitoring Purchasing Activity

You can monitor the status of the purchasing activity for the deliverable on the Purchasing Activity tab.

Note

For all agreements and purchase orders created in Oracle Fusion Purchasing, the tab information is updated each time you run the Track Purchasing Activity process as described in a related topic.

Specifying Purchasing Activity for a Deliverable is Complete

You can specify the purchasing activity on a deliverable is complete by selecting the Complete action on the Deliverables tab. You also use this action to indicate deliverables with no purchasing documents are complete.