In the modern B2B landscape, procurement efficiency and accuracy are crucial aspects of the purchasing lifecycle. One way to achieve higher rates of productivity is through electronic order transmissions via cXML.
As a matter of fact, one of the top ten priorities for buying organizations in 2024 is the modernization and digital transformation of eProcurement processes. The Hackett Group reports 52% of companies have adopted eProcurement on a large scale with 24% currently in pilot programs. The adoption of cXML order automation is expected to significantly increase as businesses seek ways to cut costs and improve purchasing workflows.
For years, suppliers have been approached by their clients, requesting them to offer punchout functionality and accept cXML order automation (POs, ASNs, and Invoicing).
A survey conducted by Verified Marketing Research indicates the rising need for procurement automation and the emergence of eProcurement technology are significant drivers in the digital market.
While integrating might seem like an obligation at first, it presents an opportunity to enhance operations and expand business reach. Let’s explore what electronic documents are, their benefits for both suppliers and customers, and how to leverage this requirement for business growth.
Why Do Customers Request cXML Electronic Order Transmission?
Electronic order transmission has existed for over 30 years, initially through Electronic Data Interchange (EDI). EDI was primarily used in manufacturing, transportation, and grocery industries and later expanded to others as encryption standards improved.
In 1999, Ariba introduced cXML (Commerce eXtensible Markup Language) to facilitate document exchange in procurement systems. cXML, an XML-based protocol, includes specific schemas for different documents, ensuring proper validation and seamless integration. The standard encompasses various eCommerce features like Punchout catalogs, order confirmations, POs, and electronic invoices, enhancing the efficiency of procurement processes.
Customers may ask for electronic order submission to gain efficiencies during order processing. If your customer can transmit orders electronically, the supplier can easily import those orders into their ERP instead of manually keying them. This automation allows for faster order processing and error reductions.
Comparing Methods of Order Transmission
When customers request the electronic transmission of orders, they might already have methods in place, like website submissions or email attachments. However, these methods have limitations compared to cXML.
Website Order Submissions:
Customers submitting orders via websites must manually enter order details into their procurement system, which can lead to potential errors and inefficiencies. The manual entry of order data has an estimated error rate of 1% to 4%, which can cause significant processing delays down the line. Additionally, verifying PO numbers and other approval requirements can be cumbersome.
Email with PO Attachments:
Email POs can get lost or blocked by spam filters, causing delays and uncertainty about order receipt. Customers need more visibility into the order status once they receive confirmation, leading to frustration and inefficiencies.
cXML Advantages:
Using cXML for B2B purchasing means orders are automatically converted and transmitted to the supplier’s system. This method ensures standardization and immediate acknowledgment of the order receipt, providing full visibility to both parties. This seamless integration reduces errors, enhances order accuracy, and streamlines the procurement process.
Implementing cXML: Steps and Considerations
To start accepting cXML POs, suppliers may need a cXML gateway system, such as Greenwing Technology’s e-Procurement Hub. Integration work might also be necessary to import POs into the order processing system. Here’s how to get started:
Identify Customer Information:
cXML is a standardized format, but the specific data sent can vary. Common data includes PO numbers, part numbers, quantities, and prices. However, variations like custom accounting codes or department codes may require special handling. The Greenwing Technology team of expert developers are highly skilled at addressing each unique case and mapping accordingly.
Establish a Timeline:
Customers might have urgent timelines, but setting realistic expectations is essential. Implementation can range from one week to several months, depending on the complexity of the project. It is important to define roles, responsibilities, testing plans, and go-live dates to ensure a smooth process.
Prioritize Customer Requirements:
Initially, you should focus on meeting customer requirements. If a buying organization expects cXML punchout and purchase orders, it’s the supplier’s responsibility to provide those services.
Situations can arise where the supplier only offers punchout in the beginning but plans to initiate cXML automation later. It’s not uncommon for some purchasing processes (POs and e-invoicing) to remain manual until the move to full automation can be implemented. Overall, ensuring customer satisfaction and contractual agreements are met from the outset is crucial for successful integrations.
Turning Compliance into Opportunity
Once you’ve successfully implemented cXML for one customer, leverage this capability to attract more business. Here’s how:
1. Expand to New Customers:
With the infrastructure in place, adding new punchout customers becomes easier. Smaller customers might appreciate the efficiency of electronic order transmission, potentially increasing their order frequency.
2. Optimize Internal Processes:
If you have staff manually entering orders, consider automating this process. Inquire if customers can send data electronically, reducing manual workload and improving accuracy.
3. Market Your Capability:
In marketing materials and discussions with potential clients, highlight your ability to accept electronic orders. This capability can be a significant differentiator, showcasing your commitment to efficiency and modern procurement practices.
Conclusion: Embracing cXML for Business Growth
Accepting cXML POs, order confirmations, ASNs, and invoicing is more than just meeting customer requirements—it’s an opportunity to enhance your business operations and expand your customer base. By understanding the benefits of electronic order transmission in eProcurement, implementing the necessary systems, and leveraging these capabilities, you can position your business for growth and success.
Get Started with Greenwing Technology:
Interested in learning how our solutions fit into this equation? Contact Greenwing Technology today to discuss your needs and explore how we can help streamline your procurement process with cXML punchout catalogs and order automation.