Procurement at Mondelez: Fearless Business Leaders and Trusted Partners who bring The Outside in to Win
P R O J E C T PA R T N E R S
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Procurement at Mondelez: Fearless Business Leaders and Trusted Partners who bring The Outside in to Win Alexandre Turolla, VP Procurement Global Raw Materials at Mondelēz International, explores how procurement at Mondelez can drive real change for the business and the world around us...
WRI T T EN BY PRODUCED BY
D al e Bent on Hey kel Ouni
8
W
hen we talk about the evolu-
the business and becoming an enabler
tion or transformation of
to what the business wants to do. This
procurement, we often
has really opened up a large avenue for
speak in broad terms. “Procurement has
procurement that was never there before.”
‘moved from a back-office function’, or it has obtained a ‘seat at the table’, and
Procurement and Mondelēz
while these sentiments are, in fact, true,
So, what does procurement mean to
they often diminish the real change in
Mondelēz? As the global conversation
procurement,” says Alexandre Turolla –
continues to be defined by stories of
VP Procurement Global Raw Materials at
companies recognizing (at last) that the
Mondelēz International.
function can and should be a key strate-
“The real change in procurement is
gic driver of growth, on what side of that
about how we can do that together with
conversation does Mondelēz find itself?
9
M O N D E L E Z I N T E R N AT I O N A L
“Mondelēz procurement has always been highly valued. Since my very first day, I have experienced a company which
and looking for the next stage of evolution.” Mondelēz was created as a spin-off
really understands the value of the func-
from Kraft Foods in 2012, with a clear
tion and brings it along with a high degree
vision to be a ‘growth engine’. The first
of appreciation. The function’s relevance
years of the journey were focused on
to the business comes from its ability to
getting the organization fit to win. Every
connect and steer both the supply land-
process and spend was streamlined
scape and Mondelēz business as part of
and benchmarked against the best in
a two-way value creation. It keeps evolv-
the market. 100% of the company spend
ing, and this is the exciting part of being at
was managed through a process called
Mondelēz Procurement,” says Turolla.
“ZBB – Zero-Base Budget”. Robust
“We are always positively dissatisfied
category management processes and 10
Driving Change, Delivering Advantage Will Rook, Director of Refined Sugar, Ingredients and VIVE at Czarnikow, talks about how to drive change and deliver advantage across supply chains. Czarnikow has a legacy spanning over 150 years in the food ingredients industry, bringing strong relationships and a wealth of experience to its modern supply chain service offering.
CLI CK TO LE A R N M O R E
www.czarnikow.com www.viveprogramme.com
What is the most important element in optimising supply chains? The reality is that there is no single solution. As a supply chain encompasses many stages, processes and people, it’s important that a range of solutions can work together to optimise it. But in order to do this effectively, it is important to have a team of people who are willing to invest time understanding a client’s business, and then working creatively to implement a bespoke plan to really drive change; recreating the status quo is never an option for us. Czarnikow recently expanded its product portfolio – what was the rationale for this? While best known for sugar, Czarnikow has expanded its product offering to include other food ingredients, packaging and renewable energy. It was actually our clients who asked us to do this – the expansion gives us the ability to implement our service offering across a portfolio of over 50 products, allowing clients to build a richer relationship through a single service provider.
“ Sustainability is absolutely critical for all businesses to thrive and is increasingly present on the global agenda” What role does digitisation play in ensuring supply chain efficiencies? Digitisation is vital for any organisation’s ability to communicate directly with clients and partners, and to facilitate trade in an efficient manner. At Czarnikow, we have built our own proprietary operations software which allows us to seamlessly integrate with client systems
where needed. We also launched Czapp, a mobile app that enables users to share the company’s unique market view and generate the latest prices, explore our product offering and track current trades. What role does sustainability play in successful supply chains? Sustainability is absolutely critical for all businesses to thrive and is increasingly present on the global agenda. Through the VIVE Sustainability Programme, Czarnikow is able to facilitate fully sustainable supply chains, through our continuous improvement and commercially-driven programme.
With global supply chains comes increased complexity – how do you manage working across so many countries and cultures? We certainly think that local knowledge is crucial. Czarnikow has ten global offices and a local presence in a further six countries, and we have ambitious plans to increase our presence in a number of other important markets – all to give us a vital on-the-ground presence to support our clients. The ability to manage this is strengthened by what we have previously discussed: a diverse service, digitisation, strong client relationships and sustainable development.
structure were implemented to achieve an impressive 650 BPS margin improvement and 60+ days improvement on Cash Conversion Cycle. “We are finally ready to grow and win. We needed the fuel to climb the summit,” beams Turolla. In 2018, Mondelēz launched the current “Snacking Made Right” strategy, based on three key foundations: growth, execution and culture. For Turolla, it was important to recognize that Procurement not only played a fundamental role during the margin expansion phase but continues to play an equally important role in growth and “is deeply embedded into the three pillars of our Snacking Made Right strategy,” he says. Turolla highlights that the procurement function is guided by its mission statement
ordinary,” explains Turolla. “We try to make
(launched in 2017) of becoming “Fearless
a connection with business performance
Business Leaders and Trusted Partners
and the personal growth of our people.
who Bring the Outside in to Win.” As a
The idea is to ask ourselves: How to have
procurement man at heart, having forged
fun in going beyond our comfort zone?
his career in various procurement and
What is in it for the people? By stretching
supply chain disciplines, Turolla knows
our limits, one can become better, learn
well the value of the function and insists
new skills and push to go beyond. “We
that communicating this in a broader busi-
have only one career. Do you know what
ness language is an ever-evolving chal-
to do with yours? We do,” adds Turolla.
lenge for any CPO. So, what does it mean to be “Fearless” in Procurement at Mondelēz? “Simply put, it’s about going beyond the 13
M O N D E L E Z I N T E R N AT I O N A L
Fearlessness comes from moving away from the traditional incremental approach to change. Turolla leads by example and is always looking for the next “Thinking
Big” idea or opportunity and invites the
wins in the end, these are the best games
team to join. The secret is to invest in the
and the ones we learn the most because
change management required to excite
you pushed and pushed hard.”
the team to enable them to focus on the possibilities ahead. “We don’t just jump on target-setting, we invest precious time on
Establishing and maintaining a position of true “Business Leaders”
creating a joint ambition at the start,” says
Procurement is transitioning from func-
Turolla. “What do I and others gain from
tion excellence to become a true busi-
that? Increased capabilities. We get to
ness partner. Cementing this position is an
work with exciting people that challenge
ever-pressing challenge and Turolla is no
and support each other, ever expanding
stranger to this.
the boundaries. “It’s like sport, when the
The business landscape and consum-
game finishes on a tight six to five and
ers exigences continue to evolve. Turolla
you sweat like crazy, regardless of who
believes that what once was competitive 14
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will no longer be affordable in the future.
procurement always starts with the busi-
At the same time, speed and agility have
ness and not with the function itself,” he
fast become the essence of success. No
says. “I normally use the analogy of a
company will be able to address or afford
bridge. Imagine that we have a bridge
to develop and maintain a consumer
between suppliers and the business. We
winning proposition on its own. “Forget
need to cross that bridge and hold the
about reinventing the wheel. You need
business’s hands. We then invite them to
to be with the best suppliers and hold
cross the bridge back together. It’s about
hands with the people who will keep the
being genuinely interested in the stake-
momentum going,” says Turolla.
holder’s agenda, opportunities, dilemmas
On paper, this may seem easy but Turolla is keen to stress the importance
and pain points.” These conversations and the actions to
of investing in fostering and maintain-
create “that bridge” speak to the “Trusted
ing effective connections with the busi-
Partners” component of the mission
ness leaders and suppliers alike. “Good
statement. Trust and credibility are often
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M O N D E L E Z I N T E R N AT I O N A L
recognized as the most significant compo-
getting to know people we deal with.
nents of a successful leader. Mondelēz
Then we can be more flexible and more
certainly recognizes it and uses its own
forgiving of the not so good moments
approach to nurture and improve trust.
and inspired by the good ones.” Turolla notes that all these good
The “Trust Equation”:
intentions and investments can easily
“Our Credibility has been built over
fall down the drain if perceived as
the years by being able to deliver and
driven by the wrong motivation; “We
to thrive when we are needed,” says
need to be clear and loyal to what
Turolla. “Reliability is about putting your-
makes us thrive and what our purpose
self in the shoes of others. Do what you
is and keep it front and center as our
said you would be doing; always think-
motivation.”
ing about how to enhance the work and potential of others.” “When it comes to Intimacy, it’s about
Bringing the best of the “Outside In”: Procurement is an open door to the
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“ The function’s relevance to the business comes from its ability to connect and steer both the supply landscape and Mondelēz business as part of a two-way value creation. It keeps evolving, and this is the exciting part of being at Mondelēz Procurement” — ALEXANDRE TUROLLA, V P P R O C U R E M E N T G L O B A L R AW M AT E R I A L S AT M O N D E L Ē Z I N T E R N AT I O N A L
outside world. Turolla and his team
Mondelēz chooses who and how to invest
strongly believe in the power of co-cre-
its resources. “We invest heavily on the
ation and leveraging the complementary
partners that are aligned with our vision
capabilities of its suppliers and partners
and we hold each other accountable for
together with the Company to arrive at
driving mutual value,” adds Turolla.
the best outcome. A genuine interest
“Through our Supplier Partnership
and investment in the suppliers is a must,
Excellence program, we develop a mutual
understanding them better and a realiza-
value program and review it periodically.
tion that Mondelēz simply cannot do it all
Are we growing with the right partner?
alone.
How many projects have we developed successfully? How well are we aligning
“To Win”
our future supply chain needs? How are
The final part of the mission statement
we progressing on our service and quality
is perhaps the most important and most
excellence program? The ever-evolving
fluid. “Managing our holistic value chain
quest for the cost leadership and the joint
as one, from shelf to field, is the key to
sustainability complement our ambition.”
success,” says Turolla. “We try hard to
This approach allows the suppliers and
foster greater relationships and to under-
Mondelēz to openly and honestly give
stand a uniqueness and sweet spot
each other the chance to feedback and
between Mondelēz and our suppliers,” he
react to the positives and negatives.
says. Through supplier segmentation,
Innovation plays a key role in Mondelēz’s Supplier Partnership w w w . c p o s t r a t e g y. c o m
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Excellence (SPE) supplier proposition and
more attractive, catching the attention of
it has pioneered a number of approaches
our suppliers, start-ups and innovators.
that deliver bold results:
Likewise, the suppliers also adopted the new approach, using highly effective short
Ecosystem Approach:
videos that easily reach different decision
“We teamed a few SPE suppliers with
makers at Mondelēz globally.”
complementary capabilities and raised a
For Mondelēz, Turolla notes that the
business challenge,” says Turolla. “From
winning is when the wheel is spinning in
more than 100 ideas that were presented,
the right direction. “It’s about ensuring that
11 new products are on the launch pipe-
all the connections are working in a way
line spread over three years, starting from 2020.”
One complementary Network footprint (make vs. buy) “We started to holistically manage our manufacturing footprint with our SPE suppliers, generating several improvements to eliminate inefficiencies and optimize assets on the combined (Mondelēz + SPE suppliers) footprint.”
Innovation fairs “Through multiple innovation fairs, SPE suppliers had a stall at Mondelēz offices to present their capabilities applied to real specific open opportunities.”
Digital platform for innovation “We learn with the influencers how to be “catchy” and make business briefings
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M O N D E L E Z I N T E R N AT I O N A L
that enable success for all involved,” he adds.
“Our global food system is facing numerous challenges and calls for solutions that require coordinated efforts
Sustainability and Mondelēz
by governments, industry and scien-
When discussing how winning is defined
tific, social and environmental experts.
by Mondelēz, it opens the door to the
Smallholder farming communities need
Sustainability conversation. The compa-
support to increase their resilience.”
ny’s sustainable snacking vision is focused
“The Sustainability agenda grew from
entirely on creating a future where people
being the cherry on the cake to become
and the planet thrive and win.
the cake itself,” shares Turolla. “It is a
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M O N D E L E Z I N T E R N AT I O N A L
fundamental component of every sourc-
us at the leading edge of technology and
ing strategy and we are leveraging our
partnerships. These experts in turn build
market presence and relevance to foster
sustainability into the core competence
the right attitude, actions and responsibili-
of our buyers. As a result, our buyers are
ties from all payers in the value chain.”
sustainable sourcing experts who seam-
Mondelēz recently updated its “Snacking Made Right Report” that each
lessly blend sustainability and commercial strategy into sourcing.” We would be remiss to explore the
year tracks the progress made against its ESG (environmental, social and govern-
procurement journey of Mondelēz and not
ance) strategy, objectives and programs..
look at the role that digital and data solu-
Its signature community program
tions are playing. Turolla is first to admit
“Cocoa Life” is a great example of
that there is still a lot of testing and learn-
Mondelēz engagement with communi-
ing on this front but make no mistake that
ties at the origins. “We are committed
for Mondelēz the digital journey is fast
to working with the suppliers that share
gaining space and enhancing success. While Mondelēz leverages digital solu-
our values and thrive by doing things the ‘right’ way; fighting climate change,
tions in cost modeling, recipes compari-
preserving forests, improving water and
son, and complexity, spend and revenues
energy efficiency, and respecting human
simulations and market insight to equip
rights,” says Turolla.
procurement for better decision-making,
“To accelerate our journey, we have
Turolla is keen to stress that he is much
a small team of sustainability experts
more interested in approaching the digi-
embedded within Procurement who keep
tal equation in reverse. “We spend time at
“ It [sustainability] is a fundamental component of every sourcing strategy and we are leveraging our market presence and relevance to foster the right attitude, actions and responsibilities from all payers in the value chain” — ALEXANDRE TUROLLA, V P P R O C U R E M E N T G L O B A L R AW M AT E R I A L S AT M O N D E L Ē Z I N T E R N AT I O N A L
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the problem stage first,” he says. “Only when we clearly define the
plan in place, expediting deliverables and qualifying and booking alternative
Problem Statement, we move to create
suppliers. Through a massive cross
fit-for-purpose analytics and dashboards.
functional endeavor, Mondelēz success-
Once those are created, we push hard
fully executed >200 BCPs (Business
on democratizing the data to all buyers
Contingency Plans), monitored supplier
and R&D researchers. This means making
performance, OTIF and managed to antici-
reporting tools simpler and more effective
pate tier-2 disruptions ahead of time, gain-
for the category and research managers,
ing precious days to react as well as rais-
as well as looking further into the realms
ing inventory for critical unique materials.
of artificial intelligence for data analytics.”
These decisions were driven by data,
There is no better example to illus-
focusing on origination from turbulent
trate the Mondelēz digital journey than
areas and suppliers with difficult upward
its Covid-19 crisis management. Within 48
chain or constrained supplies. In taking
hours of the COVID-19 outbreak in China,
these steps, Mondelēz avoided disruption,
Mondelēz was able to map all materials
securing particularly admirable service
originated in China and delivered to all
levels throughout the crisis. “The Covid-
other countries and put a contingency
19 crisis accelerated the way we leverage w w w . c p o s t r a t e g y. c o m
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“ Be curious about the world around you, have courage to operate out of your comfort zone and the confidence to lead the change then add a bit of self-confidence” — ALEXANDRE TUROLLA, V P P R O C U R E M E N T G L O B A L R AW M AT E R I A L S AT M O N D E L Ē Z I N T E R N AT I O N A L
data and analytics,” says Turolla. “We are moving fast on our digital transformation and we are only at the beginning. The value creation of a digitally enabled category management and sourcing strategy is immense.” Since joining Mondelēz, Turolla has witnessed an incredible amount of success and growth as part of this procurement journey and he excitedly beams that the best part is that Mondelēz are “only half way through it”. For him, the next phase of procurement is all about moving from functional excellence to living and breathing the business agenda, bringing all the different elements of excellence together to form a truly integrated approach from shelf to field. “We want to be agents of change for a thriving ecosystem,” he says. “This makes a good link to our renewed commitment to fully integrate supplier diversity and economic inclusion into Mondelēz Global strategies,” “We believe that healthy thriving communities need to include everybody and so we are expanding our business to small, diverse suppliers that have often been 27
M O N D E L E Z I N T E R N AT I O N A L
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disadvantaged in the opportunity to
says. “It’s an ever-changing world.
engage with multi-national and/or other
Get excited to be out of your comfort
mid to large corporations.”
zone.” In order to achieve this, Turolla
In a world where obsolescence is happening faster and faster, success
has his very own formula. “It’s all about the three Cs and one S,”
is no guarantee. But Turolla reflects
he adds. “Be curious about the world
on the original mission statement of
around you, have courage to operate
procurement at Mondelēz, particu-
out of your comfort zone and the confi-
larly when it comes to being fearless.
dence to lead the change then add a bit
“Think big, don’t think ordinary,” he
of self-confidence. This formula will give
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M O N D E L E Z I N T E R N AT I O N A L
Alexandre Turolla VP Procurement – Global Raw Material Mondelez International Alex leads the procurement function for global Raw Materials ($6.1Bn spend). He joined MDLZ in 2010 as the LATAM Procurement Lead and moved to different global positions co-creating the current globally-led and locally-executed procurement function that saw the connection with the Business Units and suppliers strengthened. An evolving data driven agenda, together with sustainability, has moved to the centre of the sourcing strategies. Prior to MDLZ, Alex held several positions in Procurement and Supply Chain at Unilever, Bitron Electronics and General Electric. Alex has a dual Brazilian and Italian citizenship, lived and worked in Brazil and France and is you a lot of fun creating the
currently based in Zurich, Switzerland.
future and keeping obsoles-
Alex earned an MBA from Fundação
cence far out of your way.”
Dom Cabral, a specialization from Kellogg and Insead Business School and an Engineering degree from the Federal University of Rio de Janeiro. He was born in Rio de Janeiro, is married and has a 17-year-old daughter
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www.mondelezinternational.com