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Understanding Purchase Concepts

A purchase in ServiceOps is a formal process for procuring assets, managed through two key documents: the Purchase Request (PR) and the Purchase Order (PO). This structured workflow provides control, visibility, and a full audit trail for all organizational spending.

  • A Purchase Request (PR) is the initial internal document used by an employee to request the purchase of goods or services.
  • A Purchase Order (PO) is the official, external document sent to a vendor to confirm the order. A PO is typically created after a PR has been approved.

Anatomy of a Purchase Order​

A Purchase Order is the central record for any procurement activity. It contains all the necessary details to manage the purchase from start to finish.

Core Details
  • PO Number & Name: A unique identifier and a descriptive name for the purchase.
  • Vendor: The supplier from whom the items are being purchased.
  • Requester & Owner: The individual who requested the items and the person responsible for managing the PO.
  • Addresses: Shipping and billing addresses for the order.
  • Attachments: The ability to attach quotes, invoices, and other relevant documents.
Line Items
  • Products: The specific items being ordered, often selected from a pre-configured Product Catalog.
  • Quantity & Cost: The number of units and the cost per unit for each item.
  • Financials: The PO automatically calculates the total cost, including taxes, shipping charges, and discounts.
Financial Codes
  • GL Codes (General Ledger): Associate each line item with a specific GL code for accounting purposes, ensuring that expenses are correctly categorized in your financial system.
  • Cost Centers: Allocate the cost of the purchase to the appropriate department or business unit for accurate budget tracking.

Key Components of the Purchase Ecosystem​

Effective procurement relies on a set of interconnected components that work together.

Vendor & Product Catalogs
  • Vendor Catalog: A centralized database of all approved suppliers. Each vendor record contains contact information, addresses, and other key details.
  • Product Catalog: A catalog of goods and services that can be purchased. Each product can be linked to multiple vendors, allowing for price comparisons.
  • Standardization: Using catalogs ensures that employees order approved items from preferred vendors at negotiated prices, which is key to controlling costs.
Approval Workflows
  • Custom Workflows: Design and enforce multi-level approval workflows based on criteria such as the total cost of the PO, the item type, or the requesting department.
  • Approval Types: Configure different approval rules, such as requiring a unanimous decision from all approvers, a simple majority, or just the first response.
  • Governance: Approval workflows are the primary mechanism for ensuring that all purchases are compliant with company policies and budgets.
Asset Integration
  • Automatic Asset Creation: This is the most powerful feature of the module. When an item on a PO is marked as "Received," the system automatically creates a corresponding asset record in the IT Asset Management module.
  • Seamless Handover: This feature bridges the gap between procurement and asset management. The asset record is pre-populated with details from the PO, such as vendor, purchase date, and cost, ensuring a complete and accurate lifecycle history from day one.
  • Reconciliation: For hardware assets, the newly created record can be automatically reconciled with data from discovery tools to ensure accuracy.

Best Practices​

  • Use the Product Catalog: Standardize your purchases by encouraging users to select items from the pre-approved product catalog.
  • Enforce Approval Workflows: Ensure every purchase goes through the proper approval chain to maintain budget control and policy compliance.
  • Link to Assets: Make sure that the integration with the asset module is configured correctly so that every relevant purchase results in a new, tracked asset.
  • Keep Vendor Info Current: Regularly update your vendor and product catalogs to reflect the latest pricing and offerings.