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Enterasys Networks is using cloud-based Coupa software to automate its purchase order and approval process, a move that gives it greater control over its procurement spend and drastically cuts the time needed for approvals.
"We've gained efficiency, we have more flexibility and more control," said Chris Lavoie, director of application development and ERP at Enterasys Networks Inc. "We're doing more with less."
The company, based in Salem, N.H., provides services and equipment for wired and wireless networks. It also manufactures a line of networking products and components, including routers, switches and other equipment. It has roughly 1,200 global employees and does approximately $350 million in business annually.
A longtime SAP customer, Enterasys is now running SAP ERP ECC 6.0, having upgraded from R/3 3.1i several years ago, according to Lavoie. While Enterasys doesn't run SAP Human Capital Management (HCM), it does use SAP financial and supply chain operations software.
Lavoie said the move to Coupa began as result of rolling out Microsoft SharePoint environment for the company's support portal in 2007. That in turn required significant changes in data storage and in how the company was virtualizing some of its infrastructure.
"That took two man years, with multiple people working on it, and it [only] gave us six new features," Lavoie said, adding that the amount of time being spent on the company's infrastructure prompted questions. "Our CIO began thinking there had to be a better way."
SAP purchase orders move to the cloud
Over time, those discussions lead to following a "cloud-first" strategy wherever possible, he said. Since then, the company has replaced a few on-premises applications. As part of the effort, Enterasys also scrapped Microsoft Outlook Exchange, and began using Google Gmail as the new backbone for its email operations.
Enterasys also turned the knife on its internal purchase order (P.O.) workflow software, a legacy system it ran on-premises.
"The routing engine had no intelligence," Lavoie said. "It relied on the person approving the [requisition] to send it over to the next person. They had to know who to send it to, and where it needed to go, and when. It was very error prone."
In the over 10 years it was used, the application had sunk under layers and layers of "spaghetti code," according to Lavoie. "It was one of the applications that were ripe for replacement."
A short road to Coupa
Lavoie said the company looked at a few options, including modifying the existing SAP ERP to better automate the P.O. process. "The rules engine was very overly complex, or so it seemed to us," Lavoie said. "If we were to do that with SAP, it would require technical resources. It would require a larger investment."
Enterasys also flirted with Ariba but ended up with Coupa Software Inc., an e-procurement and spend management platform that also includes functions for invoices and P.O.s. "[It] resonated with us early on in the process."
Coupa met all the company's requirements when it came to ease of use, being a multi-tenant application able to handle requisitions in bulk, and highly automated, he said. It could also be easily integrated with the company's SAP back-end system, and since the software is cloud-based, employees could submit orders on their mobile devices.
Enterasys went live with Coupa in May of 2011.
Integrating with SAP
Coupa's back-end SAP integration works as advertised, according to Lavoie.
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In the new system, the P.O. is created in SAP -- where it serves as the "record of truth," according to Lavoie. The order is then passed to Coupa so that anybody that doesn't have access to SAP -- which is most of the company -- can see their "spend," get the SAP purchase order number, and work with the supplier, and have all the information they need in Coupa, he said.
"Coupa is the interface for all of the employees at Enterasys, when they need to spend money for whatever reason," Lavoie said. "It's then consolidated, reviewed, approved, received and managed through Coupa and then pushed over into SAP to complete the P.O.-to-receiving process."
Complaints about the usability of the security module
Despite the company's satisfaction with the software, the security module is not as easy to use as it should be, especially compared with Salesforce.com, which Enterasys employs in its sales operations, according to Lavoie.
Doing basic provisioning based on roles is easy, he said, but getting to a finer level of control based on details about responsibilities is more difficult. "It typically requires working with Coupa directly to get that set up," Lavoie said.
Despite those drawbacks, Enterasys is looking to do more with Coupa for invoicing, accounts receivable and supplier management.
"We see it as a platform that we can grow into," Lavoie said. "[Right now,] we're using a subset of all that's available to us."