Investment bank intern dies after pulling three all nighters in a row

[HVC]

The unit price is only entered into the system once when it is negotiated. All release orders against the blanket order just pull the price from there. So you just need to be careful when entering the price once. The goods receipt being messed up is of course a possible weakness, but especially if you actually buy goods that go to a warehouse, the goods receipt process can be automated with RFID or scans too, so there is very little room for error. If it is goods or services that are delivered to an office or so without a warehousing process, there is obviously more room for error.

never underestimate the ability of receiving to fuck up

[alfred russel]

The unit price is only entered into the system once when it is negotiated. All release orders against the blanket order just pull the price from there. So you just need to be careful when entering the price once. The goods receipt being messed up is of course a possible weakness, but especially if you actually buy goods that go to a warehouse, the goods receipt process can be automated with RFID or scans too, so there is very little room for error. If it is goods or services that are delivered to an office or so without a warehousing process, there is obviously more room for error.

Obviously I'm on the losing side of this, but...

Suppose there is a negotiated price reduction at some point. I don't know where you work, but there is a big problem with capturing agreement information. If an invoice is sent, it requires 2 to actively miss the change, where as otherwise the roles become passive.

Also, even if you automate goods receipt, there has to be a manual override. Otherwise, your shipment with the scuffed bar codes or that arrives when the system is down will need to be sent back.

[HVC]

And how does an audit work with no invoice back up?

[MadImmortalMan]

And how does an audit work with no invoice back up?

I refer you to the Bullshit Jobs thread. 

[Zanza]

Suppose there is a negotiated price reduction at some point. I don't know where you work, but there is a big problem with capturing agreement information.

When the price is changed, the blanket order is adjusted so all release orders against it will be created with the right price again. You can obviously define prices with validities, e.g. one price up to 30/8 and one starting 1/9, or one price up to 10 units, one up to 100 and one for more than 100. Making sure the blanket order is changed is the task of purchasing, meaning the person that actually negotiates the new price. The guys doing the scheduling in logistics don't have to care for that. They just order what they need to keep the machine running. Or the system orders it and they just confirm what the system calculated.

If an invoice is sent, it requires 2 to actively miss the change, where as otherwise the roles become passive.

I guess the rate of error is lower when you have one person entering the price in one place once instead of having lots of different people checking prices manually all the time.

Also, even if you automate goods receipt, there has to be a manual override. Otherwise, your shipment with the scuffed bar codes or that arrives when the system is down will need to be sent back.

In a warehouse scenario, when the system is down, the robots or forklift drivers wouldn't know where to put the shipment anyway so that should never, ever happen. But manual overrides will always exist.

[Caliga]

And how does an audit work with no invoice back up?

The dog at it, Mr. Auditor.

[alfred russel]

When the price is changed, the blanket order is adjusted so all release orders against it will be created with the right price again. You can obviously define prices with validities, e.g. one price up to 30/8 and one starting 1/9, or one price up to 10 units, one up to 100 and one for more than 100. Making sure the blanket order is changed is the task of purchasing, meaning the person that actually negotiates the new price. The guys doing the scheduling in logistics don't have to care for that. They just order what they need to keep the machine running. Or the system orders it and they just confirm what the system calculated.

I'm not concerned about some dude in scheduling working out a new price deal with a vendor during down time. I'm worried about (possibly external) legal working out a price discount to resolve a dispute with a vendor or a VP coming to some arrangement, and word not getting to the guy in purchasing that does data entry. Or purchasing not being aware of a price change of a vendor (say the contract was to buy aluminum at $10, unless worldwide prices fell to some level at which time the price would be $7).

I want to see a bill before I pay for something. Sure the menu says the item was $9.99, but maybe it was on special today and I didn't notice.

[alfred russel]

And how does an audit work with no invoice back up?

You can validate the electronic invoice: verify the goods receipt with a bill of lading or other shipping documents, and verify the price by reviewing the agreement with the vendor.