Dynamic Sold-To Entity Determination in Procurement
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Solution Overview
Problem
Existing purchasing systems fail to dynamically determine the sold-to legal entity for financial documents like purchase orders, leading to sub-optimal supply chain financial orchestration flows and requiring unnecessary setup records, especially in complex global procurement scenarios.
Innovation Solution
A system that dynamically determines the sold-to legal entity by selecting a supply chain financial orchestration flow based on programmable business rules and qualifiers, such as supplier country, asset item indicator, and profit center business unit, allowing for flexible and efficient assignment of liability across multiple legal entities.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If a purchasing system uses static setup records to determine sold-to legal entities, then the system structure is simple, but it cannot handle complex global procurement scenarios and requires extensive setup records
Solution Approach 1:
The patent implements dynamic determination of sold-to legal entities by evaluating multiple qualifiers (profit center business unit, supplier country, asset item indicator) at runtime rather than using static setup records. This allows the system to adapt to complex global procurement scenarios dynamically without requiring extensive pre-configured setup records for every possible scenario combination.
Solution Approach 2:
The system changes from a static configuration approach to a dynamic parameter-based approach. By using qualifiers such as profit center business unit, supplier country, and asset item indicator as changing parameters, the system can determine the appropriate sold-to legal entity based on the specific characteristics of each procurement scenario, enabling versatility without proportional increase in system complexity.
2Productivity
If a purchasing system manually determines sold-to legal entities, then setup records are simple, but user productivity decreases due to extensive setup requirements
Solution Approach 1:
The system performs self-service by automatically determining the sold-to legal entity through evaluation of qualifiers associated with the purchase request. This eliminates the need for users to manually select from extensive setup records or for system administrators to maintain complex setup configurations, thereby improving user productivity while keeping the underlying system structure manageable.
Solution Approach 2:
The system uses feedback from multiple qualifiers (profit center business unit, supplier country, asset item indicator) to dynamically determine the appropriate sold-to legal entity. This feedback mechanism allows the system to automatically adapt to different procurement scenarios without requiring extensive pre-configured setup records, improving productivity while maintaining system simplicity.
3Measurement precision
If a purchasing system uses dynamic determination based on multiple qualifiers, then accuracy of liability assignment improves, but the complexity of determining the correct entity increases
Solution Approach 1:
The patent segments the determination process into distinct evaluable qualifiers (profit center business unit, supplier country, asset item indicator) rather than using a single complex determination rule. This segmentation allows the system to evaluate each qualifier independently and combine their effects to accurately determine the sold-to legal entity, improving precision while keeping the determination process manageable through modular evaluation.
Solution Approach 2:
The system employs dynamic evaluation of multiple qualifiers to determine the sold-to legal entity, allowing the determination process to adapt to the specific characteristics of each procurement scenario. This dynamic approach improves accuracy by considering relevant factors only when needed, rather than requiring a fixed complex rule set for all possible scenarios.
4Adaptability or versatility
If a purchasing system requires extensive setup records for each scenario, then coverage of all procurement models is complete, but the time to configure and maintain the system increases
Solution Approach 1:
The patent implements a universal determination mechanism that handles multiple procurement models (local, global, hybrid) through a single dynamic evaluation process based on qualifiers. This multi-functional approach allows the system to cover all procurement scenarios without requiring separate setup records for each model, reducing configuration and maintenance time while maintaining complete coverage.
Solution Approach 2:
The system uses parameter-based qualification (profit center business unit, supplier country, asset item indicator) that can change based on the specific procurement scenario. This allows a single flexible determination mechanism to cover all procurement models dynamically, eliminating the need for extensive static setup records and reducing the time required for system configuration and maintenance.
Data Source
AI summary
A system is provided that dynamically determines a sold-to legal entity associated with an electronic financial document. The system receives a request to generate the electronic financial document and qualifiers including attributes of the electronic financial document. The system further selects a supply chain financial orchestration flow based on programmable business rules and the qualifiers. The system further selects a sold-to legal entity that is defined by the selected supply chain financial orchestration flow. The system further generated the electronic financial document comprising the selected sold-to legal entity.