One Keolis Project partners
Collaboration and alignment under
One Keolis How procurement successes born out of cross-company collaboration and sponsorship have become second nature to the business for Keolis NA, truly feeding into a One Keolis vision.
Written by
Dale Benton
Produced by
Richard Deane
C o l l abo rati o n and alignment under One Keo l i s
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Y
ou’ve heard it before. A procurement transformation journey is underway as
an organisation has come to realise that procurement is well and truly a key cog in its operations, if not the key cog. Procurement isn't simply cost savings or filing through the data and identifying some capital that could be clawed back to better serve the bottom line. Make no mistake, this is a core element of procurement, but there’s a lot more to it than that. A company has to simply let procurement capitalise on one of its biggest strengths: opportunity. Take Keolis for example. As one of the world’s leading public transport operators, Keolis has operations the world over from the UK and Sweden, to Australia, USA, Luxembourg and China. It goes without saying that a company of this size and scale has tremendous opportunity in
the job to reengineer our procurement
its procurement functions, the question is
process, to transform it to become more
whether it realises this?
profit-oriented for Keolis, and to consol-
In Keolis North America, CPO Abraham
idate our volume and rationalize the
Saxionis is the man in charge of all
supplier base, which has grown exces-
procurement operations. More specif-
sively high,” he explains. “We have over
ically, he’s spearheading a significant
3,500 suppliers which we do business
re-engineering of procurement for a
with and as we progress, we want to
company which, while smaller in size than
establish more strategic relationships
its parent group, is experiencing tremen-
with outside companies, ones that we can
dous growth.
consolidate more of our volume with and
“Just over a year ago now, I was given C o l l abo rati o n and alignment under One Keo l i s
consider long-term improvements in what
we provide to our end customer.” Simple enough on paper, but as any
early 2021, Saxionis can already point to significant successes that he has been
procurement professional will profess,
able to unlock together with his procure-
there are many steps to take even before
ment team.
one begins a journey like this. Most nota-
“Truth be told, in the past the company
bly, gaining the trust and the so-called
hadn't been tracking savings and
‘operational buy-in’ from the executive
reporting savings or even the impact of
board. Thankfully, Saxionis can boast of
procurement on profitability,” he contin-
being blessed with an executive team well
ues. “Through the initiatives we have
and truly behind this journey before he
undertaken, we have been able to save
even set foot in the business. This alone,
millions of dollars in this one-year period.
clears some of the initial hurdles that can
We can demonstrate this right down
often slow down progress.
to the nearest dollar and cent, and our
“I enjoy the sponsorship not just of the North American CFO, but also of our CEO of North America, and the CEOs of the
intent is to continue to do that as we move forward.” Saxionis, a seasoned procurement
different divisions out there, who all real-
professional with a wealth of experi-
ize the power of procurement,” he beams.
ence working with IBM, EY and the Bank
And why wouldn't they? As we speak in
of America, knows all too well of the
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growing significance of procurement. As
there is a need to improve profitability. It
a procurement professional, he’s known it
should absolutely be the first area that
all along and his experience coupled with
they try to reengineer or improve, but
an intense enthusiasm for procurement
it's typically an afterthought. Because
means he is well and truly the right man
while this is happening, suppliers are
for the job at Keolis NA. Not that there
enjoying the freedom of increasing
was any doubt. “I realized a long time ago
prices and making a profit that's typically
that there is a humongous opportunity
much higher than what we were doing
for any company when you're looking at
at the time.” This is where the company
something that has the effect of directly
follows the One Keolis principle. Keolis
increasing profitability. Clearly, you want
looks to no longer be defined by Division
to do more,” he says. “As I have worked
A, Division B, or Division C, rather it is
in over a dozen companies throughout
one company that integrates all of its
the years, personally, I have found that
resources, not just technologies, but also
procurement was always the last place
its people.
companies look at to reduce cost when
ELEVATE THE ROLE OF PROCUREMENT Our Procurement Performance Management platform enables teams to manage their sourcing pipeline — all while sharing their performance with Finance and stakeholders.
Keolis by its very definition is
“ Through the initiatives we have undertaken, we have been able to save millions of dollars in this one-year period. We can demonstrate this right down to the nearest dollar and cent...” — Ab ra ha m Sa xi oni s C hief Procurement Officer at Ke o l i s N o rth A m e ri c a
low-margin business which enters into
to the bottom line through automation
very competitive contracts and agree-
of manual processes. Procurement is
ments to serve the local governments,
the prime game for that, because of the
municipalities and so the company must
number of transactions that we support
always be looking to find ways to continue
on a monthly basis,” he says.”
to improve profitability in order to make
“We’re able to showcase the fact that if
those contracts sustainable over the long
we do a good job dealing with suppliers
term. The key to doing this speaks to a
while also gaining an understanding of
broader procurement conversation that's
the internal processes of the company,
happening the world over; the consoli-
bring ideas to the suppliers and part-
dation of, access to and analysis of data
ner with suppliers to improve internal
from both the external suppliers but also
processes of our own company, then
from internal processes.
will have a significant impact on the effi-
“It's no secret that technology has had a significant impact on how we do things. Where we were very manually intensive
ciencies and the effectiveness of internal operations.” An example Saxionis points to high-
in the past, we now have opportunities
lights is perhaps one that will strike a
to leverage technology to automate all
chord with many procurement profes-
those processes, and we have the ability
sionals. More often than not, indi-
to identify the opportunities for further
vidual commodities in which Keolis
improvements with significant impact
purchases from individual suppliers or 7
C o l l abo rati o n and alignment under One Keo l i s
manufacturers may end up being billed for individually. “We definitely don't want them to be billing us by division,” he laughs. “So one of our main objectives is to bring efficiencies to the company through vendor consolidation as well as invoice consolidation and summarization of what we do, including POs and all that kind of stuff, through data analysis.” Saxionis and his teams had to collect all the data that would enable them to perform the analysis and identify opportunities that represent the biggest return for the business so that procurement could also prioritize its efforts. In his experience, Saxionis has seen far too many people “put their jogging shoes on and run in the wrong, or even opposite, direction of where the end line is”. “For us, it was important from the beginning to know which direction to run once we put our sneakers on,” he says. “To assist in change management, we had an external consultant come in and perform an assessment of the different divisions, which yielded some insights that we were able to use as the springboard to launch a handful of initiatives that were fairly simple to target and undertake and which helped us score some early successes.” These initiatives were created in line with the overarching strategy of fostering collaboration among the divisions in order 9
“ We don’t just want to do business with the largest suppliers for the benefit of saving a dollar. We’re very community-oriented and so we award contracts to smaller businesses that are minority-owned” — A b ra h am S a xi oni s Ch i ef P ro cu rement Officer at Keolis N o rth A m e ri c a
C o l l abo rati o n and alignment under One Keo l i s
to get everybody to look at the same
stressed through working with us. We
data together and determine what the
want suppliers that are healthy and ones
most efficient way would be to improve
that can support us in our journey for
cost structure. This approach allowed
years to come. But at the same time, we
Saxionis to prevent the aforementioned
don't roll over and take the first price
individual bills per category per supplier
offered to us without consideration. We
per division. Having the data and the
have that understanding early on with our
collaboration meant that procurement
suppliers. We want a balanced relation-
could serve as a counterweight in the
ship, a fair handshake and to be able to
middle of the whole negotiation to make
both come out winners out of the partner-
sure the cost picture remains balanced.
ships we form. So long as you have the
“We want our suppliers to be profita-
data and you lay out the facts, there isn't
ble, by the way,” he interjects. “We never
much subjectivity that goes into the deci-
want our suppliers to become financially
sions at that point.” 11
So it’s clear, and of no surprise to anyone, that data-driven analysis is critical. Fact-based analysis is what creates success in procurement. Keolis, a relative newcomer to North America, was in a position where its procurement systems were not integrated. With an operating model built around acquiring transportation contracts either run by governments or other companies, turning around those businesses is critical to Keolis’ success. It's a strategic advantage for Keolis to bring in companies in which it can make a profit at the end to support its stake-
gathering capabilities presented in real
holders. Through this, Keolis also inherits
time. This implementation is geared
technology, which is then integrated into
around bringing consistency and integra-
its own ecosystem. “The processes, the
tion across the footprint to support not
basic systems and capabilities are not
only procurement, but the entire busi-
there for us to get the data. So we work
ness. This is where Keolis works closely
to understand how we can get to the data
with Per Angusta, a SaaS Procurement
and how we can integrate them into our
Performance Management Software.
reporting and analysis structure,” says
Designed so that Keolis can gain a clearer
Saxionis. “And that’s where the journey
picture as to the savings, budget plans,
was born as we realized that we cannot
targets and forecasts, Saxionis describes
continue on this path without a technol-
Per Angusta as “a great tool in our
ogy solution that would make all of that
toolbox”.
easier, more seamless, and more transparent for us, while improving controls.” And thus, towards the end of 2020,
“It brought a lot of discipline in our environment because it serves as the certified source of information for savings
Keolis began the process of select-
that we are generating,” he says. “We
ing and implementing a new ERP solu-
have closed the loop between procure-
tion across the entire footprint. Upon
ment and finance, where in the past, a lot
completion, Keolis will have better data
of things would fall through the cracks.
C o l l abo rati o n and alignment under One Keo l i s
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“ It gets to a point where, in order to continue to expand and to be able to take advantage of the value that the company brings to the table when dealing with customers or suppliers, we need to be more united. That’s the concept behind One Keolis” — Ab ra h am S axi oni s C h ief P ro cu rement Officer at Keolis N o rth A m e ri c a
C ol l a bo rati o n and alignment under One Keo l i s
It's both a method to capture initiatives,
the same causes we do. For example, if
but it's also a communicator tool in that
we take out trees and vegetation in doing
it allows us to integrate the fruits of our
something, we work with suppliers to see
labors and make them visible into the
if they could actually plant a tree and help
reporting of the business."
in that aspect of the business.”
As highlighted throughout, there is a
Elsewhere, Keolis works closely with
desire through procurement to improve
distressed business enterprises (DBE),
the financial and operational perfor-
smaller minority-led companies that can
mance of Keolis and while it’s clear that
be supported in order to grow. This is not
Saxionis subscribes to the school of
simply hearsay, as Saxionis certifies: “We
thought that it's not just about surviving
don't just want to do business with the
and making sure that the P&L is growing,
largest suppliers for the benefit of saving a
he also understands the societal respon-
dollar. We're very community-oriented and
sibility that rests upon Keolis’ shoulders.
so we award contracts to smaller busi-
This feeds directly into the procurement
nesses that are minority-owned. That's
reengineering journey.
another aspect that's also important to
Keolis operates with a “Think like a passenger” motto. A passenger is very conscious of safety, that’s undenia-
procurement. We have to take certain steps to meet our objectives in that area.” So Keolis is reengineering its procure-
ble, and Saxionis does highlight how
ment processes, implementing a new
the suppliers it works with must align
ERP system to gain a better understand-
with Keolis’ commitments to safety.
ing of both its internal processes and that
The modern day passenger is also very
of its suppliers, and indeed consolidating
conscious of the world around them and
those suppliers in order to unlock great
what businesses like Keolis do to make
efficiency and opportunity. This is all well
the world a better place.
and good, but what about the people
“Keolis is very focused on its impact
behind the scenes? A new process or
and is sensitive to its impact on the envi-
technology is nothing if it isn't powered by
ronment. Our discussions and our logic
people with the right skillset and know-
in dealing with suppliers is ensuring we
how to leverage these changes.
do the right thing for the environment,”
“We are in the process of form-
he says. “We're working with suppliers to
ing a shared services organization for
ask them to believe in and contribute to
procurement, and for other areas in 15
the organization,” says Saxionis. “As a company starts out and we begin to grow organically, we all are working more like independent businesses. It gets to a point where, in order to continue to expand and to be able to take advantage of the value that the company brings to the table when dealing with customers or suppliers, we need to be more united. That's the concept behind One Keolis.” Keolis is looking to establish a center of excellence and shared services environment at what Saxions refers to as the “platform level” or, headquarters to support the local needs of the divisions in a strategic manner. “This needs a lot of change management knowledge and skills to make it possible without disrupting the business by alienating the people who are already doing a fantastic job supporting their individual businesses,” he adds. As we speak in 2021, officially one year into this journey, Saxionis has already highlighted the demonstrable impact of the work he and procurement are doing to the bottom line of the company. Again he highlights that the bigger successes for procurement are the ones where cross-company collaboration and sponsorship has become second nature to the business, truly feeding into the One Keolis vision. This collaboration is the key C o l l abo rati o n and alignment under One Keo l i s
to success for Keolis overall, not simply for procurement. “There are so many times where you hear management saying one thing, but the troops are not following it. For us, it was very important to get the buy-in and the support of the people who actually do the work, the directors and their teams in each of the divisions to realize that they no longer should be working on their own when they are dealing with a particular vendor; they need to leverage the power of Keolis to succeed in what they do,” says Saxionis. “We have been able to demonstrate this through facts. That's the successful formula to use in this.”
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