System and Method for Contract Execution Against Expressive Contracts

• US 20100106653A1
• Filed: 10/26/2009
• Published: 04/29/2010
• Est. Priority Date: 10/24/2008
• Status: Active Grant

• Current Assignee: SciQuest Incorporated
• Original Assignee: Combinenet Incorporated (Jaggaer LLC)
• Inventors: Mercier, Luc H., Brown, Jason J., Sandholm, Tuomas, Parkes, David C., Boutilier, Craig E., Suri, Subhash
• Granted Patent: US 8,732,047 B2
• Time in Patent Office: Days
• US Class Current: 705/80
• CPC Class Codes: G06Q 10/04 Forecasting or optimisation specially adapted for administrative or management purposes, e.g. linear programming or "cutting stock problem" market predictions or forecasting for commercial activities G06Q30/0202
• CPC Class Codes: G06Q 10/067 Enterprise or organisation modelling
• CPC Class Codes: G06Q 10/103 Workflow collaboration or project management
• CPC Class Codes: G06Q 30/0202 Market predictions or forecasting for commercial activities
• CPC Class Codes: G06Q 30/0282 Rating or review of business operators or products
• CPC Class Codes: G06Q 30/06 Buying, selling or leasing transactions
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes
• CPC Class Codes: G06Q 40/12 Accounting
• CPC Class Codes: G06Q 50/182 Alternative dispute resolution
• CPC Class Codes: G06Q 50/188 Electronic negotiation

Abstract

In a computer-implemented method of contract execution, data about contracts is stored in a computer storage accessible to a processor of a computer along with data about a procurement plan and data about a purchase request that includes information about a first quantity of at least one good or service. The processor determines a second quantity of the one good or service and a second contract against which to complete the purchase request based on the procurement plan, the data about the contracts, at least one purchase made against one of the contracts, a trigger condition and associated effect, and the quantity of at least one good or service. In response to the second contract and the second quantity being approved, the processor causes a purchase order for the second quantity of the one good or service to be placed to the supplier associated with the second contract.

Claims

1. A computer-implemented method of conducting contract execution against expressive contracts comprising:

(a) storing in a computer storage accessible to a processor of a computer data about a plurality of contracts, wherein the data about each contract specifies at least the following;

one good or service associated with the contract;

a payment rule to determine a payment for the purchase of at least one quantity of at least one good or service under the contract; and

a seller under the contract; and

wherein the data about a first one of the contracts also specifies information about a plurality of purchases made against the contract, and a trigger condition and associated effect, wherein the trigger condition is based on information about the plurality of purchases, and the effect causes either;

a payment to occur, a payment associated with a purchase transaction to change, a future payment or a future payment contingent on a future purchase transaction to change, or a constraint on allowable purchases to change;

(b) storing in the computer storage data about a procurement plan;

(c) storing in the computer storage data associated with a purchase request, wherein the purchase request data includes information about a first quantity of at least one good or service;

(d) the processor of the computer determining a second quantity of one good or service and a second contract against which to complete the purchase request based on the following;

the procurement plan in step (b), the data about the plurality of contracts, the trigger condition and associated effect, the plurality of purchases made against the first one of the contracts in step (a), and the quantity of at least one good or service in step (c);

(e) in response to the processor automatically approving the second contract and the second quantity in step (d) subject to one or more predetermined rules or the processor receiving an approval of the second contract and second quantity, the processor causing a purchase order of the second quantity of the one good or service to be placed to the supplier associated with the second contract in step (d).

2. The method of claim 1, wherein the second quantity in step (d) is the same as the first quantity in step (c).

3. The method of claim 1, wherein the procurement plan in step (b) includes at least one of the following:

a target quantity for at least one good or service to be purchased in connection with a contract during a time interval;

a target quantity fraction for at least one good or service to be purchased in connection with a contract during a time interval relative to all purchases of the same or substitutable good or service;

a target monetary amount for at least one good or service to be purchased in connection with a contract during a time interval;

a target monetary amount fraction for at least one good or service to be purchased in connection with a contract during a time interval relative to all purchases of the same or substitutable good or service;

a specification of at least one purchase order wherein, when the purchase order occurs, then procurement against a particular contract is mandatory;

a specification of at least one purchase order wherein, when the purchase order occurs, then procurement against a particular contract is recommended;

a specification of a plurality of purchase orders and an alternation, wherein, when the plurality of purchase orders occurs, then procurement of each purchase order against an alternation between a plurality of contracts is mandatory; and

a specification of a plurality of purchase orders and an alternation, wherein, when the plurality of purchase orders occurs, then procurement of each purchase order against an alternation between a plurality of contracts is recommended.

4. The method of claim 1, wherein at least one of the plurality of contracts is stored in the computer storage by the processor in response to a sourcing event that is run under the control of the processor, wherein the sourcing event includes a plurality of sellers competing through an electronic bidding process that is under the control of the processor to enter into at least one contract with the buyer for future procurement of at least one good or service.

5. The method of claim 1, wherein the procurement plan in step (b) is stored in the computer storage by the processor in response to the determination by a processor on the computer of a procurement plan that depends on at least the following:

a business rule, a forecast of a future quantity of at least one good or service to be purchased, and the plurality of contracts in step (a).

6. The method of claim 1, where:

in step (d), the processor further determines a third contract a third quantity of the same good or service as for the second quantity, and

in step (e), in response to the processor automatically approving the third contract and the third quantity from step (d) subject to one or more predetermined rules or the processor receiving an approval of the third contract, the processor further causes a purchase order of the third quantity of the same good or service as for the second quantity to be place with the supplier associated with the third contract.

7. The method of claim 1, wherein:

step (c) includes the processor storing in the computer storage data associated with a plurality of purchase requests, wherein the data for each purchase request includes information about at least a quantity of at least one good or service; and

when the processor of the computer determines in step (d) at least one second contract to which a second plurality of purchase requests selected from the plurality of purchase requests is associated, and when in step (e) the processor automatically approves the second contract subject to one or more predetermined rules or the processor receiving an approval of the second contract, the processor causing a purchase order for at least one quantity of at least one good or service to be placed with the supplier associated with the second contract.

8. The method of claim 1, wherein the second quantity of the, one good or service in step (d) is different than the first quantity of the same good or service in the purchase request in step (c).

9. The method of claim 1, wherein, the second quantity of one good or service in step (d) is for a good or service that does not appear in the purchase request data in step (c).

10. The method of claim 9, wherein the second quantity of the one good or service is determined based on at least one trigger condition and effect in the second contract.

11. The method of claim 8 where the second quantity of a good or service depends on at least one trigger condition and effect in the second contract.

12. The method of claim 1, wherein the second contract against which to complete the purchase request based on the procurement plan in step (b) and the data about the plurality of contracts and the first one of the contracts in step (a) is determined based on a forecast of a future quantity of at least one good or service to be purchased stored in the computer storage.

13. The method of claim 12, wherein the processor determines the second contract and the second quantity of one good or service subject to at least one of the following objectives:

minimizing the estimated total payment made by the buyer for the forecast of a future purchase of goods or services to be purchased; and

maximizing the estimated total value to the buyer, net of estimated total payment, for the forecast of future purchase of goods or services to be purchased .

14. The method of claim 1, wherein the processor determines the second contract and second quantity against which to purchase the at least one good or service of the purchase request in step (c) subject to the objective of minimizing the difference between the purchase request and the procurement plan in step (b).

15. The method of claim 8, wherein the processor determines the second quantity of one good or service subject to at least one of the following objectives:

minimizing the estimated total payment made by the buyer for the forecast of a future purchase of goods or services to be purchased; and

maximizing the estimated total value to the buyer, net of estimated total payment, for the forecast of future purchase of goods or services to be purchased .

16. The method of claim 9, wherein the processor determines the second quantity of one good or service subject to at least one of the following objectives:

minimizing the estimated total payment made by the buyer for the forecast of a future purchase of goods or services to be purchased; and

maximizing the estimated total value to the buyer, net of estimated total payment, for the forecast of future purchase of goods or services to be purchased .

17. The method of claim 1, wherein the processor determines the second contract subject to the purchase request in step (c) not being split across more than a maximum number of alternate contracts.

18. The method of claim 1, wherein the trigger condition and effect associated with the first contract received in step (a) includes at least one of the following:

an across-order multi-item dollar-volume anticipated discount,

an across-order multi-item dollar-volume state-based discount,

an across-order multi-item dollar-volume rebate,

an across-order multi-item quantity-volume anticipated discount,

an across-order multi-item quantity-volume state-based discount,

an across-order multi-item quantity-volume rebate,

an across-order multi-item market share anticipated discount,

an across-order multi-item market share state-based discount,

an across-order multi-item market share rebate,

an across-order multi-item growth-based anticipated discount,

an across-order multi-item growth-based state-based discount,

an across-order multi-item growth-based rebate

19. The method of claim 1, wherein the trigger condition includes at least one of the following conditions:

the volume quantity of at least one good or service, summed over a set of at least one purchase transaction associated with the first contract, exceeds a quantity threshold;

the monetary value of at least one good or service, summed over the payments of each purchase transaction of a set of at least one purchase transaction associated with the first contract, exceeds a value threshold, where the payment in a purchase transaction is specified in a purchase transaction or determined by the payment rule associated with the first contract;

the volume quantity of a first set of at least one good or service, summed over a first set of at least one purchase transaction associated with the first contract, when calculated as a fraction of the volume quantity of a second set of at least one good or service, summed over a second set of at least one purchase transaction, exceeds a fractional-quantity threshold; and

the monetary value of a first set of at least one good or service, summed over a first set of at least one purchase transaction associated with the first contract, when calculated as a fraction of the monetary value of a second set of at least one good or service, summed over a second set of at least one purchase transaction, exceeds a fractional-value threshold.

20. The method of claim 1, wherein the effect includes at least one of the following:

a one-time payment due by the buyer to the seller associated with the first contract or from the seller associated with the first contract to the buyer;

a one-time payment between the buyer and the seller associated with the first contract, where the amount and due date of this payment are based on the history of purchases made in connection with the first contract;

a one-time payment between the buyer and the seller associated with the first contract, where the amount and due date of this payment are based on the history of purchases made in connection with the first contract and on external data whose origin is specified within the first contract;

a change of a payment for future purchases on at least one good or service;

a change of a payment for future purchases on at least one good or service based on a payment amount for the good or service when the trigger condition is satisfied and on a history of purchases made in connection with the first contract;

a change of a payment for future purchases on at least one good or service based on a payment amount for the good or service when the trigger condition is satisfied, on a history of purchases made in connection with the first contract, and on external data that is specified within the first contract;

a change of a payment to be made for a purchase transaction that is associated with the trigger condition; and

a change of a capacity constraint that limits the quantity volume that a buyer can purchase on at least one good or service for future purchases.

21. The method of claim 20, wherein the external data whose origin is specified within the first contract is either a price index, a tariff, or a financial index.

22. The method of claim 1, wherein at least part of the data stored about the first contract in step (a) is determined by the processor and depends on at least one of the following:

a supplier master list,

an item master list,

an suppler item price catalog,

an index price.

23. The method of claim 1, wherein the information included in the data associated with the purchase request in step (c) is determined by the processor and includes at least one of the following steps:

data validation,

data cleaning.

24. The method of claim 1, where the one or more predetermined rules in step (e) include at least one of the following:

a difference between (i) an estimated total payment made by the buyer for the forecast of a future purchase of goods or services to be purchased under the procurement plan subject to the first quantity of one good or service in step (c) being purchased from the seller indicated in the purchase request and (ii) an estimated total payment made by the buyer for the forecast of a future purchase of goods or services to be purchased under the procurement plan subject to the second quantity of one good or service in step (d) is purchased from the second contract in step (d); and

a difference between (i) the estimated total value to the buyer, net of estimated total payment, for the forecast of future purchase of goods or services to be purchased under the procurement plan subject to the first quantity of one good or service in step (c) being purchased from the seller indicated in the purchase request and (ii) the estimated total value to the buyer, net of estimated total payment, for the forecast of future purchase of goods or services to be purchased under the procurement plan subject to the second quantity of one good or service in step (d) is purchased from the second contract in step (d).