Cost Analytics @ GEP
Redesigning the user experience of conducting activities pertaining to cost analysis to empower cost engineers and enable tight collaboration between sourcing teams
Role
UX Design Intern
Team
3 person interdisciplinary remote team
Methods
Scenario mapping, Heuristic evaluation, Stakeholder collaboration, Market benchmarking, Agile workflow
Tools
Figma, FigJam, Jira
Duration
June - August 2023
Context
In an industry where business applications are frequently hampered by outdated legacy systems, our project sought to break new ground. Unencumbered by legacy constraints, we seized the opportunity to redefine cost analytics. Our primary motivation stemmed from the prevalent issue of poor user ratings in existing tools, which highlighted a significant gap in user satisfaction and functionality. Inspired by the user-friendly nature of B2C applications, we embarked on a journey to infuse these principles into our cost analystics software.
Business Challenges
Complex Interfaces
Complex, user-unfriendly interfaces lead to cost engineeers tolerating the software
Lack of Context
An inability to provide users with necessary context was impeding the ability of cost engineers from making effective decisions
Inability to visualise trends
Presenting data as tables hampered the ability of cost engineers to make effective time-dependent decisions
Unrealised Functional Potential
There was an opportunity to increase the functionality of the product through close collaboration between product, design and development teams
What is
Sourcing
Sourcing is the process used by companies and organisations to identify, evaluate, and acquire the goods and services they need to conduct their operations. The formative information is used to effectively negotiate contracts that a mutually beneficial to all parties.
When an organisation decides to manufacture a new product, there is a need to get an understanding of the market for materials the product will need. If we take the example of a pencil, the organisation will need to understand what materials they will need, who can provide it to them, and what the costs involved in this endeavour would be.
In order to get an understanding of the space, the organisation requests tenders from suppliers of the materials, which allows them to figure who can supply which materials. Following this, the suppliers are asked to submit quotations. This process of knowledge building to negotiate the best prices comes under the blanket of sourcing.
Request for information
Request for bids
Negotiation with selected vendors
Contracts awarded
But what’s a good price?
Cost Analysis
Cost analytics is a comprehensive approach to understanding and managing the costs associated with a business’s operations, products, or services. It enables organisations to have a competitive edge during negotiations by ensuring all decisions taken are well informed.
As the bids are submitted by suppliers, the organisation now has a decision to make. They need to not only choose a supplier for supplying the materials, but they also need to negotiate with them for a good deal. But how do organisations that haven’t previously procured the materials know what a good deal is? What really is a bargain without historic information?
This is exactly what Cost Analysis is for. Cost Engineers leverage market indices and price libraries, simulate all potential cost drivers to determine what a product should cost. This value is then used by Category Managers to negotiate with potential suppliers, allowing the organisation to stay in control of their budgets and margins.
Scenario
How did it all come together?
Collaboration process
Leveraged preliminary product roadmap to understand Supply Chain Management and cost analytic’s role in the process. Evolved my work style to take advantage of the dynamic cycle where business requirements shaped research, personas and jobs, which in turn guided the design goals and outcomes.
A preliminary product roadmap for the release of various features was created by the product team before the start of the internship. Once I was onboarded, I was able to use the roadmap to get a better understanding of the space. Since Supple Chain Management was a brand new field to me, I had to understand the processes involved in the field and create a map of the people involved in the specialised niche of Cost Analysis.
This lead to a cycle where the business requirements informed the research I did, which augmented the user personas and jobs to be done statements. All of these influenced the outcomes we were targeting through the design requirements.
Overarching goal
Make the complex B2B experiences more user friendly, such that a first time user would also be able to seamlessly use the product, while incorporating all the elements that made the design functional.
This was the goal the entire design team was working towards.
Who are involved?
Stakeholders
Cost engineers, our primary users, enable data-driven decisions for category managers and suppliers, streamlining the contract awarding process in our cost analysis ecosystem.
The primary stakeholders involved in the cost analysis process are the cost engineers. They are the one’s who will be using the product in order to support decisions category managers intend to take. Category Managers are the secondary stakeholders. They are the ones in drawing up contracts to be handed to the suppliers.
Suppliers are the tertiary stakeholders. They are the ones who submit bids in the hopes of being awarded the contracts. The role of the cost engineer is to support the category managers with price data so that an informed decision can be taken regarding whom to award the contract. The steps involved in this process has been outlined below.
Problem statement
How can we enable Cost Engineers to effectively support various Category Managers in their decision making processes?
Gaps identified
A usability evaluation of the product revealed certain gaps between the outcomes desired by the cost engineers and output delivered by the product.
Vendor Negotiation Tools
Further development was required when considering tools for comprehensive preparation for vendor negotiations
Market Trend Insights
A gap existed in integrating more robust real-time market trend analysis to enable cost engineers to take proactive decisions
Contingency Planning Features
There was a need to enhance the software's capabilities for cost engineers to effectively plan for adverse scenarios
Alignment with Financial Strategies
Cost engineers needed a solution to monitor the most important cost sensitive factors and help other internal stakeholders stay aligned with the financial direction
Products surveyed
Since our implementation of the cost analysis product was utilising a combination of features found in cost modelling tools, cost prediction tools and indexing tools, a range of products were surveyed for a variety of offerings and processes. These were then adapted carefully to seamlessly blend together to provide the users with maximum value with minimum effort.
What did we ship?
Final Solution
The designs we shipped were a four part solution that targeted the gaps we had identified in the product. Each section complemented the other to bring together a holistic solution for all cost related decisions an organisation would have to take. In order to situate the designs, I will continue using the analogy of an organisation that wants to get into pencil manufacturing.
Keep up with the markets
In order to manufacture a pencil, the organisation needs to know what the historic prices of the materials they need to purchase have been. Materials such as wood and carbon are listed on a variety of indices, with the month on month fluctuations available for all to see. The decision the cost engineer needs to take is where is the best to source a material from, thus playing a part in making the decision about which vendor is awarded the contract.
Bright visualizations
Highlighted deviations
Setting up alerts
Once the category managers and the cost engineers have agreed upon where they will source the materials from, the cost model can be created with costs such as materials, logistics, administrative, and others giving an idea about what the cost of a product should be. But indices fluctuate and it becomes important to know when it is no longer commercially viable to manufacture the product.
This is what Alert setup allows a cost engineer to determine. Through predictive analysis, a cost engineer is able to determine how an organisation should purchase materials, either by buying more when the market conditions are favourable, or by delaying the purchase when conditions are not commercially conducive.
Fluctuations presented upfront
Timely Notifications
Semantic highlighting of deviation
What-if planning
Plan A can work only if one is incredibly lucky. Organisations need to have contingency plans in case conditions suddenly become unfavourable, such as when a war breaks out and increases global shipping prices.
What-if scenarios is developed specifically with this purpose in mind. Cost engineers can add various cost elements from a cost model such as wood or the logistics, manipulate each cost driver, and see how each scenario changes the the expected should costs of the product, and helps the organisation be more robust.
Task based segmentation
Play and explore scenarios with ease
Utilitarian dashboard
The dashboard brings all the pieces together. The cost engineer can monitor the market indices, quarter on quarter fluctuations of should costs, and get a breakdown of individual cost drivers to make time sensitive decisions.
But a lot of graphs can get overwhelming. To prevent this, we used internal AI tools to summarise the most important changes in costs as a Morning Brief. This enables the cost engineer to make timely decisions and effectively support the category managers.
Smart daily debriefs
Cost Metrics highlighted
Did the changes work?
Impact
The product entered development two weeks after each design sprint delivered. Business impact was instant, with existing clients preferring the newer experiences. We also observed an increase in product usage when the new designs were introduced.
Business impact
16%
Improvement in likability scores
500+
New cost models created within 2 weeks of launch
⏫
Improved stickiness of product
🆕
Potential new customers
How did I grow?
Learnings
Verifying assumptions
It saves a lot of time and effort to verify assumptions before designing a solution. (Card for cost model)
Accepting ambiguity
Being comfortable not knowing everything about your user, and being able to revisit a feature to make the necessary changes based on updated understanding is critical
Simple... yet complex
Creating simple designs is essential to designing highly functional products. But it is important to know when adding certain amount of complexity can help with the functionality.
Context
Understanding the context within the which the product is used is key to designing novel, yet familiar experiences. Understanding the field, the way information arrives, and the way competitors build their products contributes to a highly contextual understanding.
Differentiation
Finding the one singular factor that defines the problem is of utmost importance, as tackling this can elevate the experience and help differentiate the design from competitors.
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