Case N° 3

COMMODITY SOURCING PROCESS REDESIGN 

 

Business Case

Our customer was struggling to master his contract compliance for indirect goods. A great amount of time and effort was spent centrally on data collection, tenders and negotiations. But the hybrid organization combining central coordination and delocalised business centers was making contract compliance difficult. Most individual locations used the supplier and ordering process of their choice. There was little consistency to work with contracted suppliers, no real commitment to suppliers and no real common processes. The result was a loss of efficiency, savings leakage, multiplication of small suppliers, loss of leverage for negotiations and waste of time at many levels.

 

Requirements

We are asked to design a model that could enforce contract implementation, rationalize suppliers, drive savings and simplify data collection.

 

Solution

We helped our customer to strengthen his category procurement process and central team leadership. We mapped existing for processes for each business center and built up common process, aligning organization and technology. We helped our customer to implement the new technology solution (SAP functionality), by testing the tool with contracted suppliers and pilot sites and by training the end-users over Europe.

 

Value created

• Consistent processes across all business units.

• Time and resources saved by using common ordering processes, standard techniques.

• End user knowledge and practices improved by trainings.

• Commitment to suppliers made suppliers rationalization easier.

• Common tools facilitated data collection, increased negotiation leverage and savings visibility.