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In order to provide you information regarding these changes, the following Frequently Asked Questions section has been prepared. We hope that the information answers most of your questions. If not, you are invited to contact VALE Inco with additional questions.
ELO
What is ELO?
ELO is a Brazilian Portuguese term meaning connection, bonding and linkage.
The ELO system is a VALE strategic initiative for the implementation of a Global Enterprise Resource Planning system (ERP). It integrates information and automates processes in real time, which enables the connection of the business areas of the Company.
Who at VALE Inco will be implementing the ELO Model?
The ELO model has been adopted by the following operations:
- Corporate Office
- Ontario Operations
- Manitoba Operations
- VALE Inco Newfoundland and Labrador Limited (VINL)
- VALE Inco Technical Services Limited (VITSL)
- VALE Inco Atlantic Sales Limited (VIASL)
When is VALE Inco Limited implementing ELO?
ELO is scheduled to go live on August 6th 2008.
Your systems will be Blacked Out for several days during the conversion to Oracle. What happens during that time?
Our systems are scheduled to be unavailable from July 31st to August 6th 2008. During that time the Procurement Department will not be able to create or issue any Purchase Orders using our normal systems. We have developed contingency procedures for the Blackout Period and will be asking our Suppliers to fill form based Orders they receive from the VALE Inco Procurement Department. Orders will be input into our systems once they go live and the Order information will be provided to our Suppliers.
What should I expect after you turn on your systems?
Considerable work has gone into attempting to anticipate all the problems and challenges that may arise, but with projects of this size, one can expect the occasional surprise that was not expected and therefore not planned for. As a result we ask for your patience and understanding in advance and we commit to dealing with whatever challenges that arise in an efficient and professional manner.
Supplier Status Information
What happens to my Supplier Status?
If you are an approved Supplier to a VALE Inco today, your status as an approved supplier will continue after ELO launches. As we move forward with the ELO implementation, suppliers will be required to meet new requirements to maintain their Approved Status.
How do I maintain my Supplier Status?
In order to maintain Approved Status as a Supplier, a Supplier is expected to deliver excellence in the areas of safety, quality, scope, schedule and cost. In addition to this, sSuppliers will also be required to join Quadrem, VALE Inco’s electronic commerce partner, to receive orders and supply pricing. It is VALE Inco’s intention to continue leveraging ecommerce and exchange additional document types with suppliers in the future. Quadrem’s supplier applications (SupplyCentre™ and Quest™) are accessed through the Internet enable the necessary functions for suppliers.
Approved Suppliers will also be required to update their prequalification documentation periodically in order to maintain their Approved Status.
How do I become a VALE Inco Limited Supplier?
Suppliers are required to get in touch with their local VALE Inco Procurement Department and get information regarding specific pre-qualification requirements. The Procurement Department will evaluate pre-qualification documentation and if a company meets VALE Inco requirements, the vendor will be invited to become a Supplier to VALE Inco.
Visit the “Contact Us” section to get in touch with VALE Inco’s procurement department.
Current Orders Status
What happens to my current contracts and PO’s?
Current contractual obligations will continue until they are fulfilled. All current and open Standard PO’s will be transferred to the new system. A Supplier will be able to reference old PO numbers until those PO’s expire.
If a Supplier has an existing Standing Order, it will not be automatically transferred to the ELO system. A new order will have to be created. That information will be communicated to Suppliers by VALE Inco’s Procurement Department.
What happens to the orders I have not accepted?
All Standard Purchase Orders requiring acceptance that have been sent to the Supplier via Quadrem™ from our Legacy Systems will be converted to Purchase Orders in our new systems.
When can I get my invoice paid?
All invoices loaded into the Legacy Systems will be paid on July 29th, 2008
The ELO Supply Process
How will I receive Purchase Orders?
All Standard Purchase Orders for Goods will be issued via Quadrem™. All Standard Purchase Orders for Services will also be issued via Quadrem™. If a Planned Purchase Order or a Blanket Purchase Agreement is issued for a Service, the Procurement Department must communicate that information directly to the Supplier. Once a Planned Purchase Order or Blanket Purchase Agreement has been issued, a Supplier will receive Release Orders via Quadrem™ notifying the Supplier of approval to invoice for work performed.
How do I accept a Purchase Order?
All Purchase Orders that require the Supplier to accept them must be accepted via the Quadrem™ interface.
How will I get paid?
Goods
If you are a Supplier of Goods, you will receive your orders via Quadrem™. When you receive an order, complete the order and provide an invoice to your regional VALE Inco Accounts Payable Department. When the material is received and the invoice matched to the order, payment will be issued in accordance with the terms of the purchase.
Evaluated Receipt Settlement
Selected suppliers that have high transaction volumes with VALE Inco and are currently participating in the Vendor Held Stock (VHS/Stockless) ordering and payment process will continue to receive payment in accordance with pre-established terms of purchase. Current ERS Suppliers can be viewed by clicking on this link.
Services
If you are a Supplier of Services, you will receive your order number from the Contract Administration Department. When you receive this order number you are authorized to perform work outlined in the Scope of Work.
Payment for that Service is a two-step process:
- Once the work is completed or a progress payment is required, the Supplier will provide a Pro forma invoice to the Plant Representative or Project Manager responsible for the work. The Pro Forma invoice should provide enough detail and supporting documentation to allow the Plant Representative or Project Manager to confirm the work was performed and input an order for payment into VALE Inco’s systems. This order is known as a Release Order and will be sent to the Supplier via Quadrem™.
- When a Supplier receives a Release Order via Quadrem™, the Supplier is authorized to send in a Finalized Invoice, which identifies the Release Order, to the regional Accounts Payable Department where the invoice will be inputted for payment. All supporting documentation must accompany the Finalized Invoice. Accounts Payable will verify the Finalized Invoice matches the order and will then input the invoice for payment. Payment will be made in accordance with the terms of the agreement.
Invoices
Invoices should match the structure of the order and items must be listed on the invoice as they are shown on the order.
Invoices must match the line value and total order value as indicated on your order, delivered via Quadrem™, to be paid.
How are payments made?
VALE Inco Limited’s bank will issue EFT Remittance advice or a cheque depending on your payment status. All payments are now controlled in Toronto but queries regarding payment should continue to be directed to the regional business units.
Please note cheques will no longer be issued at any of VALE Inco’s regional sites. All cheques will now be created at the Corporate Head Office in Toronto.
When can I get my invoice paid?
All invoices loaded into the Legacy Systems will be paid on July 29th, 2008. Payments will subsequently be suspended during a Blackout period as VALE Inco transitions to the ELO system. New payments will not be issued until August 8th, 2008, at the earliest. Payments will then be scheduled on a daily basis by VALE Inco’s Treasury Department in accordance with the terms of the purchase agreement. Invoices must be loaded into the systems by the Wednesday of the previous week to be eligible to be paid in the current week.
Is the Holdback Process going to change?
Yes. We currently ask our Suppliers to invoice us at Net less the value of the holdback and ask for a Holdback invoice at the end of the work. With our new systems, a Holdback term can be applied to the Purchase Document and the system will do the calculations automatically. We will be asking our Suppliers to invoices us at full value because a Holdback invoice will no longer be required at the end of the process.
Can I reference a Requisition Number on an invoice to get paid?
No. A Requisition is not a valid Purchasing Document and in some cases does not even correspond to a Purchase Order Document in our systems. Invoices that reference a Requisition number will be rejected and sent back to the Supplier.
With the implementation of the ELO Model some roles and responsibilities are shifting. Who is responsible for what at VALE Inco Limited?
The Procurement Department is now responsible for:
- Sourcing Suppliers, Tendering Work, Evaluating Bids, Awarding Work
- Entering into Agreements
- Issuing Contracts and Change Orders
- Creating Purchase Order Documents and getting them approved
- Maintaining the Purchase Order Documents
- Releasing the Holdbacks
The Plant/Operations/Projects are now responsible for:
- Preparing scope of work/technical specifications
- Receiving and incorporating materials into the work
- Coordinating work activities
- Coordinating/communicating the need for Change Orders to Contracts with the Purchasing Department
- Approving invoices by creating requisitions or Releases against an approved Blanket Agreement
- Confirming project completion to release the Holdbacks
To whom do I provide a quote?
All quotes for the purpose of purchasing goods or services must be received by the Procurement Department. Plants, Operations and Projects may contact Suppliers for Quotes to be used for budgeting purposes but these Quotes are not valid for the procurement of Goods or Services.
How will I provide a Quote to the Procurement Department?
Quoting activities will be performed by our Procurement Department via Quest™ (powered by Quadrem™) or via Oracle Sourcing accessed via Quadrem™’s SupplyCentre). Some basic quoting activity may also be performed via phone and fax. Amounts quoted will be exclusive of tax.
When am I authorized to supply Goods or Services?
Suppliers can only provide Goods or Services if they receive Purchase Order Information from the Procurement Department. This information will be sent in the form of a Standard Purchase Order delivered via Quadrem™ or via other methods of communication after the Procurement Department has approved a Purchasing Document. This type of communication is usually accompanied by a contract.
Who at VALE Inco can enter into a Contractual Agreement?
Only the Procurement Department can create and enter into an agreement with a Supplier. Contracts can only be altered by a Change Order Document that is prepared and approved by the Procurement Department.
What about Rentals?
Rental orders will be issued as Standard PO’s, based on an end date that must be adhered to. If rental equipment is being returned before/after the original end date, the Procurement Department must be advised and the Purchase Order changed so that it matches the value of the rental. A new order will be sent to the Supplier for this change via Quadrem™.
What about Freight?
Freight is now considered a Service under the ELO model and must adhere to the guidelines for providing services, including the issuance of Purchase Documents and payment. Carriers will now provide Pro Forma invoices to the Plant Representatives or Project Managers so that a Release Order can be prepared and approved. Carriers will now receive their orders through Quadrem™.
Quadrem
Do I have to register with Quadrem™?
Yes. To retain your Status as an Approved VALE Inco Limited Supplier, you must be registered with Quadrem™ to receive and transmit purchase process related documents from VALE Inco companies.
Why do I have to register with Quadrem?
As VALE was growing it identified that it required a single global Internet application to enable Suppliers to receive purchasing documents, generate quote responses and securely transmit information to and from Suppliers for approval. VALE chose Quadrem™ to be its electronic commerce partner that would provide the services required to make VALE and VALE Inco successful.
Who is Quadrem?
Quadrem™ is the leading provider of global e-business solutions with a secure network that connects Buyers and Suppliers to maximize supply chain efficiencies. Using Internet applications and direct integration tools for Buyer and Supplier systems, Quadrem helps automate supply chain document and information exchange.
By centralizing on one common electronic channel, VALE Inco and your organization will reduce or eliminate the fax, email and/or paper-based methods in use today. Further information on Quadrem solutions may be found at www.quadrem.com.
What are the advantages of registering with Quadrem™?
Once you register, you are a valued client of Quadrem™. Quadrem™ provides web applications (SupplyCentre™ and Quest™) for you to manage your VALE Inco purchasing and quoting documentation electronically, providing a safe & secure network for this mission-critical information. A world-class 24x7 customer care team is available to support your organization with this comprehensive program.
Automation via Quadrem™ will dramatically reduce purchase order and quote follow-up activities via one electronic channel. Furthermore, Quadrem™ solutions should reduce your existing order management, quoting and follow-up costs.
Your business relationship with VALE Inco does not change - how you manage the administration of VALE Inco purchasing and quoting improves.
How do I Register with Quadrem?
Please contact the VALE Inco Limited Supplier OnBoarding Team at VALEinco@quadrem.com or 905-306-2779.
© Vale Inco 2007
Last Updated: June 15, 2008
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