Procurement Magazine - November 2021 by procurementmag

November 2021 | procurementmag.com

Strategy: Future Procurement Strategies must be Digital CSCO Leaders Celebrating Leading Individuals Blazing Trails in the Industry

Diversity in procurement is a Social and Economic Advantage Technology: Adopting an Effective Procurement Platform 101

PROCURING DIVERSITY:

THE BENEFITS OF BALANCE Sanja Cancar-Todorovic, Enterprise Procurement, Outsourcing & Vendor Management Leader at Home Trust, talks about diversity and why balance is best for productivity

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CM GROUP

MICROSOFT

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SirionLabs’ smart contract lifecycle management technology and expertise are a powerful tool in supporting Vodafone’s business objectives Vodafone first engaged with SirionLabs when the US-based contract lifecycle management (CLM) company was still in the startup stage. The telecoms giant was reshaping its CLM throughout the business. “We had a blueprint about what we wanted to achieve,” says Reinhard Plaza-Bartsch, Global Head of SCM Development, Operations & Digital, Vodafone. “And SirionLabs came incredibly close to matching that blueprint with technology.” Since the implementation of SirionLabs’ technology, Vodafone has on-boarded more than one thousand contracts to the platform enabling them to improve contract compliance and performance. Plaza-Bartsch says: “We have also expanded the end-to-end process from post right to pre-signature. We’re now able to see the endto-end process, and therefore that made us more effective and efficient in terms of how we operate.” The platform has given Vodafone enhanced abilities to monitor performance and compliance within the business, and take action where necessary. “As a result, there has been quite a significant benefit in terms of time freed up and given back to the business to focus on more value-add activities,” PlazaBartsch says. That platform integrates with the suite of in-house and managed digital solutions already in use across Vodafone’s supply

chain organisation. “When we make these technologies available to our user base, it is crucial to us that they see it as one simple user journey. The degree to which Sirion integrates into our wider landscape is so important to provide that simple user experience across the board.” It has been an evolving success story for both parties, and Plaza-Bartsch says the collaboration goes far beyond just the technology, important as it is. “One critical aspect for us in working with Sirion was the contract management expertise in the contract management space that resided within the organisation. They understood what we were after, and that was crucial in helping us build the capability much faster. “We really value to work with companies that beyond their technology, have a sound understanding of our business and priorities, and take a further step to incorporate these into the plans and roadmaps.” Explore smarter contracting solutions

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The Procurement Team EDITOR-IN-CHIEF

GEORGIA WILSON DEPUTY EDITORS

RHYS THOMAS EDITORIAL DIRECTOR

SCOTT BIRCH

PRODUCTION DIRECTORS

GEORGIA ALLEN DANIELA KIANIČKOVÁ PRODUCTION MANAGERS

OWEN MARTIN PHILLINE VICENTE JACK THOMPSON JANE ARNETA

PRODUCTION EDITOR

JANET BRICE CREATIVE TEAM

OSCAR HATHAWAY SOPHIE-ANN PINNELL HECTOR PENROSE SAM HUBBARD MIMI GUNN JUSTIIN SMITH REBEKAH BIRLESON DUKE WETHERILL JORDAN WOOD VIDEO PRODUCTION MANAGER

KIERAN WAITE SAM KEMP

DIGITAL VIDEO PRODUCERS

EVELYN HUANG HABBIE AMOS JACK NICHOLLS MARTA EUGENIO ERNEST DE NEVE MOTION DESIGNER

TYLER LIVINGSTONE MARKETING MANAGER

KAYLEIGH SHOOTER PROJECT DIRECTORS

TOM LIVERMORE MIKE SADR

MEDIA SALES DIRECTORS

JASON WESTGATE JAMES WHITE EXECUTIVE ASSISTANT

JORDAN HUBBARD MARKETING DIRECTOR

ROSS GARRIGAN

MANAGING DIRECTOR

LEWIS VAUGHAN

CHIEF OPERATIONS OFFICER

STACY NORMAN CEO

GLEN WHITE

FOREWORD

A Procurement High! Procurement Magazine celebrates the return of in person networking, the industry’s response to COVID-19, and its rapid transformation

“We are consistently seeing both in the news and in our business how fragile just-in-time delivery can be [...] procurement departments have never faced a more challenging and competitive fight” - Simon Patteson, VP of Northern Europe, Icertis PROCUREMENT MAGAZINE IS PUBLISHED BY

Basking in the afterglow of Procurement & Supply Chain Live, where industry leaders came together, many for the first time, in person, to debate a range of topical subjects from pain points in procurement, and supply chain transformation, to the growing diversity and inclusion in the sector and the successes of the gargantuan project, Test & Trace. Procurement Magazine brings to you this month an issue jam packed with insights, thought leadership, and brand new content from its debut event that celebrated the industry’s transformation! Procurement’s Time to Shine! Taking a step into the spotlight, the disruptions over the last two years have brought procurement and supply chain functions to the forefront. Whether it be sustainability, resilience, supplier management, shortages, or digital transformation, it's certainly procurement’s time to shine, with organisations recognising the function’s role in restoring growth and ensuring resilience. In order to succeed in this challenging environment, “businesses and procurement teams need to make instant decisions and utilise those decisions at all times. This means building a closer connection than ever between procurement, business stakeholders, sales and legal, and fully understanding existing commitments and obligations within contracts and the impact of new contractual conditions,” says Simon Patteson VP of Northern Europe at Icertis. To watch the Keynotes from Procurement & Supply Chain Live, click here.

GEORGIA WILSON

georgia.wilson@bizclikmedia.com

procurementmag.com

CONTENTS

Our Regular Upfront Section: 10 Big Picture 12 The Brief 14 Timeline: The Rising Prices of Construction Materials - Timber 16 Trailblazer: Kelly Bengston 20 Five Minutes With: Robert Copeland

Strategy

Future Procurement Strategies Must be Digital

Home Trust

Procuring Diversity: The Benefits of Balance

University of Massachusetts Unifying Procurement to Drive Change

92 ESG

Diversity in Procurement is a Social and Economic Advantage

Technology

Adopting an Effective Procurement Platform 101

78 76

100

Broadens Horizons Iron Mountain Data Centers and Web in Pandemic Werks Data Centers: Growing Together

The Journey to Sustainable Transport

Losberger De Boer Iron mountain

Go-Ahead Group

Interos maps supply chain in 3D and real time. You can know every single thing about how all your partners do business. Or you can read it in papers.

112

CM Group

We Discuss the Role of Procurement with CM Group's Karen Hodson

136

Microsoft

Microsoft Israel: Global action, local results

150

BI Group

Rises to Medical Challenges in Central Asia

124 Top 10

CSCO Leaders

158

Spring Branch

Driving Cost Savings Through Diverse, Innovative Procurement

BIG PICTURE

Procurement’s Perfect Storm London, UK

Gone are the days of procurement and supply chain existing in the shadows; global disruptions have shone a spotlight on our vital function. However, these disruptions have created “the perfect storm of problems that have suddenly made people realise how fragile supply chains are,” according to Robert Copeland, CPO, G4S at Procurement and Supply Chain Live. For procurement resilience and to mitigate risk, seven key areas require attention: spend accuracy,

November 2021

closed-loop value delivery, end-to-end value-chain cost management, supplier collaboration, organisational agility, next-gen capabilities, and digital adoption and data analytics. “We can't forget the tough times that everyone has been through. [COVID-19 has] certainly elevated the discussion, and I think it's a board-level discussion about the resilience of your organisation,” added Ninian Wilson, Global SCM Director & CEO, Vodafone Procurement.

procurementmag.com

THE BRIEF “OUR REAL ETHOS IS TO INVITE SOMEONE ELSE IN FOR A DISCUSSION BEFORE WE RUN A TENDER” Glyn Watts,

Group Head of Procurement, The Go-Ahead Group READ MORE

“Having one procurement allows the organisation to get an overall broad view of what is happening on the purchasing side of the business”

BY THE NUMBERS According to The Hackett Group, the experience of stakeholders is one of the greatest business values that Digital World Class organisations can provide. Those with a performance edge over their peers in customer perceptions are:

19% 85% more likely to be considered a valued business partner

more likely to more likely to be be viewed by viewed as having stakeholders, as effective business taking a proactive knowledge skills approach to supply risk mitigation

Karen Hodson,

EDITOR'S CHOICE

Procuring a contract with the likes of NASA is bound to feed into the company ego. AECOM is no doubt honoured to be awarded the US$300mn deal to provide NASA with architectural and engineering services.

Chief Procurement Officer, CM Group

AECOM US$300MN DEAL WITH NASA

“CYBERSECURITY AND INFORMATION SECURITY IS ONE OF THE MOST IMPORTANT RISKS THAT WE CONTINUOUSLY LOOK TO IMPROVE” Sanja Cancar-Todorovic,

Enterprise Procurement, Outsourcing & Vendor Management Leader Home Trust READ MORE

November 2021

MARS’ NEW NET-ZERO ROADMAP

Mars, Incorporated has announced plans to reach net zero greenhouse gas emissions by the middle of the century. The company has joined the Science Based Targets Initiative's Business Ambition for 1.5C pledge. READ MORE

NETFLIX’S ROALD DAHL ESTATE As we emerge the other side of seemingly never-ending lockdowns, Netflix is desperate to hang on to its expanding customer database. The streaming service has forked out US$1bn to acquire the works of classic British author, Roald Dahl. READ MORE

Honda hondanews.eu

IBM to Manage Procurement Operations for Honda Motor Europe Honda Motor Europe is to hand the keys to its European procurement and finance operations to IBM in a five year deal, with a view to integrate both functions for a zero touch future. IBM Global Business Services will manage both procurement and finance for the automotive company to deliver an integrated end-to-end service that maximises cost-saving opportunities, improves efficiencies and standardises processes. Joe Crump, General Manager, Business Administration, said Honda Motor Europe has “a strategic need to transform our finance and procurement operations into the very best in the world”. "We have a proven excellent working relationship with IBM, which has become a trusted partner and I'm confident will bring enormous expertise to help us make the changes needed to respond to the industry's challenges and emerging opportunities,” he added. Under the agreement IBM will standardise and simplify core procurement functions, including sourceto-pay, as well as record-to-report and order-to-cash financial processes. The company says it will deploy the latest automation technology to deliver further cost and qualities improvements, with an integrated system across both procurement and finance. "We look forward to bringing our business process experience, technology and transformation methodologies to help Honda Motor Europe bring its zero touch ambitions one step closer," said Dave Miller, IBM Managing Director for Honda Global Account. "We plan to bring together people, processes and solutions into intelligent workflows through an optimised managed services approach that can enable Honda Motor Europe to enhance its finance and purchasing operations and become the partner of choice to its network of dealers and suppliers.”

 DHL DHL Group has set an accelerated roadmap to decarbonisation, deciding on Science-Based Targets, investing 7bn Euro in climateneutral logistics until 2030

 GEP GEP named as leader in strategic sourcing application by Quadrant Knowledge Solutions, for its procure-to-pay and AI-based sourcing.

 SHELL In a landmark court ruling, Judge Larisa Alwin ordered Royal Dutch Shell to take responsibility for its CO2 emissions throughout its supply chain .

 NAVAL GROUP

Australia left France feeling shunned after the country ditches their €31bn ordinary submarine deal in favour of a nuclear programme with the US and UK. The French company, Naval Group, was left feeling betrayed.

W A Y U P NOV 21

W A Y D O W N

procurementmag.com

TIMELINE THE RISING PRICES OF

CONSTRUCTION MATERIALS:

1997 -

Present

JAN 2020

Rising Construction Activity

BREXIT

Reported by the Timber Trade Federation (TTF), since 1997, overall construction activity has expanded at a fast rate. UK sales alone in Q1 of 2020 were up 30.5% compared to 2019.

With most timber for construction in the UK imported, the Royal Institute of Chartered Surveyors (RICS) reported that “the world demand is exceeding supply. The Timber Trade Federation currently suggests that UK demand will outweigh supply in 2021.” Prices rose sharply following the UK’s exit of the EU, due to increased administration, shipping costs, and temporary surcharges.

November 2021

Faced with backlogs, shortages, stockpiling, delays and BREXIT, the global construction industry is facing rising prices for procuring vital materials, like timber

MAR 2020

SEP 2020

NOV 2021 +

COVID-19

Skills Shortages

Prices Decreasing?

Despite key workers globally remaining operational during lockdowns, the surge in home renovations and restrictive production capabilities resulted in materials shortages and the inability to meet demand. In the US alone, the price of lumber per thousand board feet rose from US$400 in February 2020, to an all-time high of over US$1,600 in May 2020. Prices have since fallen to around US$800. RICS commented: “Despite the overall optimism, rising material costs have been highlighted [...] this trend is being seen across the globe, with the pressures intensifying going forward due to bottlenecks in the supply chain and an upsurge in demand continuing to drive costs higher.”

What appears to have started as an issue for the UK, has spread to other countries in Europe. Currently the UK has an estimated shortage of 100,000 HGV drivers, with a backlog of around 54,000 waiting to take their tests. Meanwhile Poland has a shortage of 124,000; Germany between 45,000 and 60,000; France 43,000; Italy 15,000; Spain 15,000; and Scandinavia 10,000.

While the US is starting to see a decline in timber prices, Japan continues to face lumber shortages and high prices, alongside the UK, Europe, Australia and Russia. Will the industry recover? Time will tell, but current predictions expect the shortages and high prices to continue well into 2023.

procurementmag.com

TRAILBLAZER

KELLY

BENGSTON A Problem Solver, Focused on Delivering Solutions

Senior Vice President, Chief Procurement Officer, Global Sourcing Company: Starbucks

roud to have held the role of Senior Vice President, Chief Procurement Officer and Global Sourcing of Starbucks since 2018, Kelly Bengston is responsible for enhancing Starbucks enterprise-wide functional strategic sourcing and supplier relationships, creating global processes, developing a talent management program and building a values-based approach to work with suppliers. The team she works with was formed under her leadership to support the company’s supply chain aspirations of becoming digitalised, strategically aligning resources against priorities, and building capabilities with longterm capacity planning and supply chain intelligence. “I am fortunate to have an amazing job, working for an amazing company. My day-to-day is filled with connecting with great partners and suppliers to deliver products and services to our stores and customers,” said Bengston.

November 2021

procurementmag.com

Trailblazer

However, This isn’t where Bengston’s Career at Starbucks began. She first joined 11 years ago in 2010 in Supply Chain Commercialisation. In her time at Starbucks, Bengston has held numerous leadership roles including direct and indirect sourcing, store development, and commercialisation. Prior to Startbucks, Bengston worked for the likes of Macy’s, Bensussen Deutsch, and Cranium and Hasbro gaining experience in packaging, product development and management, and manufacturing. Working for more than 20 years in supply chain and procurement industries, Bengston expresses her passion for the industry, wishing that people fully appreciated that sourcing professionals are problem solvers focused on delivering solutions. 18

November 2021

“The work is really fun! [...] We get a reputation for only thinking of cost, but cost is just one small part of what we negotiate on behalf of our companies,” said Bengston. Holding a B.S. in Management from Central Washington University, Bengston gives back to the university serving on its foundation board and chairing the board development committee. “I love to say that sourcing found me. My education is in management and my intent was to have a career in retail and store operations (which I did for a while). I was given the opportunity to begin getting involved in product development and factory management and never looked backed. Sourcing allows me to be creative, work with interesting people and solve problems,” said Bengston.

Favourite Starbucks drink: Nitro Cold Brew Joined Starbucks: 2010 Became Senior Vice President, Chief Procurement Officer, Global Sourcing: 2018 Bengston attributes her success in her career so far to her ability to create flexible, high-functioning, and creative teams to unlock value through relationships, crossfunctional collaboration, autonomy, and supply chain management excellence. “My career has had many high points, some lows and some flat moments and that is what has made it interesting,” said Bengston when reflecting on her career journey. If she could speak to her younger self, her advice would be, “to always follow your passion and don’t be afraid to take a risk. Every ‘risky’ position I have had has grown and developed me into who I am today.” To read the Supply Chain Digital, Top 100 Leaders where Kelly Bengston features at number two, click here. procurementmag.com

FIVE MINUTES WITH...

ROBERT COPELAND:

STRUCTURING THE UNSTRUCTURED ROBERT COPELAND, GROUP PROCUREMENT & SUPPLY CHAIN DIRECTOR OF G4S PROVIDES A FEW HELPFUL POINTERS FOR ORGANISATIONS LOOKING TO STRUCTURE THE UNSTRUCTURED

obert Copeland is a name that you may already know if you are in the procurement and supply scene. Having worked across numerous industries with a focus on cost transformation in the most challenging of environments, often low margin, multinational businesses. He has developed a playbook capturing the lessons from the hits and sometimes misses over the years, to enable teams to become agile and entrepreneurial in delivering positive commercial outcomes.

Q. HOW CAN PROCUREMENT ESTABLISH A REPUTATION AS AN EFFECTIVE AGENT OF CHANGE?

» For Procurement to establish its

reputation as an effective agent of change, it needs to be on the front foot. However you don’t need to be so far ahead you lose sight of ‘todays’ challenges faced by the business. Procurement must capitalise on its unique insight and help the business to gain a competitive edge, you must find time to start building credibility and business traction. We can do this by doing a ‘business or industry’ pulse check, to understand what will impact the business (externally and internally) in the coming months, years,

for which management will be looking for answers. How can procurement position itself as an enabler and not just a process to follow. Added to this, instead of just aligning to the business budget cycle as per traditional procurement, we should be represented at leadership meetings to know what’s going on, to be able to adapt, we must be done with waiting for the patient to come to us, we need to go to the patient, because often by the time the business comes to you it’s too late to add value or influence the outcome.

Q. WHY IS IT IMPORTANT TO MEASURE SUCCESS BASED ON WHAT YOU HAVE IMPLEMENTED AND NOT THE SOURCING EVENT?

» I have often seen highly experienced

procurement professionals fail in the eyes of the business, sometimes due to overconfidence in what they are doing but more often than not, because the business simply does not believe in what they say they have delivered. How many times have I seen buyers quantify their success on the

outcome of a tender or renegotiation, only for the business to reject such claims. It is critical that the buyer measures success not on the outcome of the Procurement process, but on the output of what was implemented and what actually changed in the eyes of the business. .

Q. INQUISITIVE, PERSISTENT AND NAVIGATE BARRIERS, WHY ARE THESE THREE TRAITS VITAL FOR ANY PROCUREMENT LEADER?

» “These are not the droids you are

looking for,” a famous Star Wars quote which resonated during my travels to meet stakeholders across the globe. I was often dumbfounded at how lossmaking Business units wanted to portray how efficiently and trouble free their supply chains were operating and that Procurement’s help to improve things was simply not needed and there was nothing for us ‘Storm troopers’ to see. Tactful digging beneath the surface often revealed a very different story. In a complex corporation there are vested interests, you must be inquisitive, persistent and able to procurementmag.com

FIVE MINUTES WITH...

navigate your way around these barriers. The lesson is that even if nothing seems wrong, don't assume everything is right.

Q. WHAT MAKES PEOPLE CRITICAL TO SUCCESS?

» People are the critical factor in the

success of a function. I have always found that with the right blend of attitudes, technical competence and enthusiasm, a Procurement team can be a real business enabler and a growth asset to the organisation. I formed effective teams by recruiting people with the right attitude, humility and certainly with the backbone of technical knowledge and skill. You can build knowledge, but mindsets are harder to change without emotional intelligence. Having the courage to shape a team early in a transformation is a key foundation to establishing a strong people pillar. A leader should never suffer fools on this one.

Q. HOW CAN AN ORGANISATION TURN WORDS INTO ACTIONS?

» In any Industry, it’s critical you

have a procurement function able to present clear solutions but also to have the willingness and credibility to lead and take ownership of implementing improvements and embedding sustainable change. By building a wide band value proposition, able to conceptualise, develop and implement true supply chain performance betterment I have found businesses far more willing to adopt change and align with the Procurement vision. But to do this, you need to understand the landscape and commercial imperative, be clear with your priorities, be a value facilitator and avoid becoming the ‘lazy buyer’. 22

November 2021

.Q. WHAT DO YOU MEAN BY THE

PHRASE: LIVE FOR TODAY, PLAN FOR TOMORROW?

» I have found that today’s problems will

very quickly be overtaken by tomorrow’s challenges. It is important to have the discipline and take time to invest and develop your function/team, otherwise you collectively will be ill equipped to face future challenges and opportunities.

“ I HAVE FOUND THAT TODAY’S PROBLEMS WILL VERY QUICKLY BE OVERTAKEN BY TOMORROW’S CHALLENGES”

Leadership focus: • 70% in the here and now, • 20% on developing the function • 10% professional development of team members It is key that you develop your team to anticipate and be abreast of the current business agenda and how procurement

aligns with the business’s objectives. It would be foolish to think that a business will continue to lavish investment on a Procurement function without delivery, no matter how good their visions, and ideas are. A successful leader must deliver for today and navigate their resources to focus towards solving future problems and enabling future opportunities through the supply chain. procurementmag.com

Get contract management expertise that you can bank on Digitization of contract management enabled Raiffeisen Bank International to work seamlessly on contracts with both external and internal business partners. Rich insights and robust regulatory compliance solutions from SirionLabs helped the bank further extract maximum business benefits. Learn more

Raiffeisen Bank: Smarter Contracts, Better Banking with SirionLabs Founded in 1886, Raiffeisen became a pioneering financial force in Austria before expanding its horizons beyond the country’s borders a century later into Central and Eastern Europe. Raiffeisen Bank International (RBI) today has 45,000 employees servicing 17.7 million customers. By partnering with SirionLabs, the bank has rolled out a 36,000-contract system across 14 countries in 18 months.

Better Banking: SirionLabs will allow the bank to refocus on more complex, forward-looking challenges. “Now, we have all the documents we need in that system,” Janssen explains. “We have a single source of truth for all of our contractual information. We have all relevant metadata including the complete relevant regulatory information stored in the system and we have the flexibility to add metadata if it is required.”

Smarter Contracts with SirionLabs: As Edzard Janssen, RBI’s Chief Procurement Officer, explains it, regulation in banking is ever strengthening and bringing more complexity also in the areas relevant to outsourcing risk management. This meant RBI needed a way to store its contracts and prove to Austrian and European regulators that it met the irrequirements by a) having complete visibility of contractual landscape, b) identifying and managing outsourcing relationship, c) ensuring ease of reporting. This may seem straightforward, but it’s slightly more difficult than it sounds. European regulators, after all, don’t differentiate between internal and external suppliers when checking for banking risks and compliance. In this regard, SirionLabs enabled RBI to track more than 1,000 internal suppliers in addition to its 36,000 external contracts. “In other words, SirionLabs provided RBI with a fully-fledged contract management system,” says Janssen. “With their Smarter Contracting Platform, we can report to all authorities in real-time – on whichever dimensions they decide to track. SirionLabs’ system is compliant by default.”

So far, Janssen has been highly pleased with how the contract management platform has unfolded. After all, SirionLabs excels at what it does. The company was named a Leader in the Forrester Wave for CLM, Q1 2021, a Visionary in the 2021 Gartner Magic Quadrant, and a Value Leader in the Spend Matters CLM Solution Map. But RBI and SirionLabs are good partners not only because they lead their respective industries but also because they’re aligned on final outcomes. “There are many contract management systems out there. The technology itself is not a differentiator. What is important to us is how much flexibility we have to adapt to changes in our banking environment. And here, SirionLabs helps us to solve specific banking challenges, specially in regard to compliance,” says Janssen.

HOME TRUST

Procuring diversity: The benefits of balance WRITTEN BY: JOANNA ENGLAND PRODUCED BY: GLEN WHITE

procurementmag.com

HOME TRUST

Sanja Cancar-Todorovic, Enterprise Procurement, Outsourcing & Vendor Management Leader at Home Trust, talks about diversity and why balance is best for productivity

ollowing a career that saw her spend 18 years in the male-dominated telecommunications industry, Sanja Cancar-Todorovic is no stranger to a diversity imbalance. But rather than simply endure the status quo, she is determined to bring about fresh change in her latest role at Home Trust, Canada’s largest independent trust company that offers a wide range of financial services including deposits, residential mortgages, commercial mortgages, and credit cards. “I head up the Enterprise Procurement Outsourcing and Vendor Management team here at Home Trust,” she explains, when asked to define her current role. “My team is driving enterprise procurement, contact centre outsourcing, and third-party risk management strategies to create value across the organisation while influencing behaviours and processes consistent with our policy, risk appetite, business strategies, best practices, all while mitigating the risks to the organisation.” Her work in the telecommunications industry has shaped her approach to procurement because 11 out of the 18 years spent in telcos were in strategic sourcing, outsourcing, and vendor management area. “From my experience, telcos are leaders in innovation, automation, and digitisation of processes, simply because they have to be due to the competitive landscape they operate in, and the fact that they support the infrastructure that IOT is built on.”

November 2021

HOME TRUST

procurementmag.com

HOME TRUST

“ I love being in a position where I have a frontrow seat to the new and innovative vendors and their products” SANJA CANCAR-TODOROVIC

ENTERPRISE PROCUREMENT, OUTSOURCING & VENDOR MANAGEMENT LEADER, HOME TRUST

Cancar-Todorovic says she is grateful for the time she spent in that environment because it taught her ‘everything’ about the importance of the customer experience, reliability, and sustainability of products and services, agile working environment with fast go-to-market mandates in order to remain on that competitive edge. But, she says, “The most importantly, telco experience instilled in me is that diversity is 30

November 2021

the key driver to innovation. And when I say diversity, I'm not talking about DEI (diversity, equality, inclusion) only, but also diversity of thought, diversity of the supply chain, diversity of suppliers through products, services, and offerings.” Diversity in business Diversity. It fosters creativity and generates the best ideas from our suppliers, partners, customers, and employees at all levels of the organisation, and incorporating them into our business, guarantees business success.” The only caveat, she believes, is to have a strong corporate culture, that encourages innovation. An agile approach to the implementation of new ideas also encourages people to try new things, in a controlled environment without the fear of failure. “And if they're not successful, they're able to fail small, fail fast, learn from it and try again, but this time with gained experience”

HOME TRUST

SANJA CANCAR-TODOROVIC

1977

TITLE: E NTERPRISE PROCUREMENT, OUTSOURCING & VENDOR MANAGEMENT LEADER

Year founded

Finance Services

LOCATION: CANADA With over 20 years of experience in large global organisations, Sanja is a passionate customer experience, strategy & transformation leader, specialising in driving technological innovation, agile digital transformation, corporate culture evolution and cost & quality streamlining via outsourcing, offshoring / nearshoring, global procurement, strategic sourcing, vendor management and third-party risk management.

Industry

700+

Number of Employees

Cancar-Todorovic says. So, in essence, celebrating the failures and successes of any innovative process only breeds more success and more innovation down the line.

In her current role at Home Trust, Sanja leads theenterprise procurement, outsourcing and vendor management function.

EXECUTIVE BIO

Women in procurement Though she feels lucky that her current role allows her to amalgamate all of her 20 years of experience, best practices, and lessons learned, into one role experience, Cancar-Todorovic says she never felt that her performance in the workplace was disadvantaged. She also takes a pragmatic approach to her environment, seeing it as an opportunity to make headway in a challenging setting. “I think the trick to that is really not to take things seriously and personally, and really use every interaction as a learning opportunity. Having a family was never up for debate for Cancar-Todorovic. She wanted to be both a mother and a respected corporate professional. She has certainly achieved that goal, but it hasn’t always been an easy ride. Ultimately, she acknowledges that working mothers face unique challenges. . “If you're out of sight, you are out of mind, and

Sanja holds an Executive Master of Business Administration (eMBA) degree, a Master of Management (MM) degree and an Honours Double Major Bachelor of Arts (BA(Hons.)) degree in Law and Political Science.

HOME TRUST

sometimes that translates into delayed career growth. If I could do it all over again, would I change anything? Absolutely not. I think people need to measure their happiness by how fulfilled their life is. And personally, I don't know that I would be able to ever feel fulfilled without having my family.” She is also adamant that ‘procurement’ in general, needs women because of the unique talents that they bring to the business table. “I think women have a very strong emotional intelligence, and that is crucial to being a great leader, strong negotiator, and a good business partner.” Diversity in the industry As part of her mission in procurement to increase diversity levels, Cancar-Todorovic has introduced the Corporate Supplier Diversity Program to Home Trust. The initiative was launched in January 2021 and has been instrumental in successfully forming a number of significant business relationships with certified diverse suppliers, which will be expanded upon. The current focus is on tier-1 suppliers, and as the company evolves there are plans to shift that focus to include tier-2 suppliers as well.

November 2021

“ All roads are pointing to the fact that we might be hit with another pandemic in our lifetime” SANJA CANCAR-TODOROVIC

ENTERPRISE PROCUREMENT, OUTSOURCING & VENDOR MANAGEMENT LEADER, HOME TRUST

Home Trust is now a corporate sponsor to the Canadian Aboriginal and Minority Supplier Council, which is the organisation that certifies Aboriginal and minority-owned businesses, as well as the corporate sponsor to Women Business Enterprise Canada, which is the organisation that certifies women-owned business. She explains, “A diverse and inclusive environment facilitates a broader exchange of perspectives and better reflects the true makeup of our society. So, choosing to do business with organisations that share the same values as us, and building a portfolio of viable competitive and diverse suppliers, allows us to make better business decisions while helping to create healthier communities and differentiate ourselves in the hearts and minds of our customers.” Cancar-Todorovic believes the procurement industry lends itself perfectly to meeting diversity objectives in the workplace as well as in business. “Over the years I have seen an increase in women coming into this industry, and it makes me happy,” she says. “I'm not surprised by it because this industry is

HOME TRUST

so dynamic. There is no other role in any organisation that gives you visibility across the entire organisation (as opposed to just your business unit), that is impacted by not just what’s happening in the organisation, but what’s happening on a global scale (from a geopolitical standpoint to weather and climate change across the globe), and it truly is never ever boring! It’s a great dynamic industry, and I'm glad to see that a lot more women are seeing the value in joining it and really thriving in it.” The general sphere of diversity is also changing, she feels. “DEI really became a hot topic in recent months. And while organisations spoke about it in the past, I think the advent of the last 16 to 18 months really put those words into actionable measurable

targets that most organisations are now reporting to their shareholders. So, as the saying goes, “What gets measured gets done,’ which is a good step in the right direction.” Risk mitigation and management Alongside her passion for diversity, Cancar-Todorovic is also an expert in risk management. The past two years have been challenging for companies globally. For many, “digital transformation was primarily driven by, not the CIO, but COVID. And the pandemic truly accelerated the fourth industrial revolution”. “A lot of organisations were tiptoeing around the concept of digital transformation until COVID literally just pushed them right into it. It's amazing to see the changes that procurementmag.com

HOME TRUST

“ It's a perfect storm when you have so many moving parts happening all at the same time” SANJA CANCAR-TODOROVIC

ENTERPRISE PROCUREMENT, OUTSOURCING & VENDOR MANAGEMENT LEADER, HOME TRUST

have occurred in such a short period of time. But with massive changes, you now have the exposure to massive risks that, if not mitigated properly, could be catastrophic to the organisation.” Cancar-Todorovic points to areas such as supply chain, vendor concentration,

November 2021

fourth-party risk management, information security, business continuity and says that all of those were points that were ticking-the-box exercises prior to COVID. But as a result of the pandemic, they're now part of the elevated third-party risk management process. “At Home Trust has partnered with some great vendors that enabld us to automate our sourcing process and ensure a robust third-party vendor management program that ensures a solid due diligence process, not just at the onboarding stage, but throughout the life cycle of the vendor relationships, including continues monitoring of our critical suppliers.” Attitudes to risk management have changed over the past two years too – and companies have had to find unique ways to respond to that. She explains that while both procurement and risk management might

HOME TRUST

have been seen as bottleneck functions within the organisation, the view has changed dramatically as a result of the pandemic. “The disruptions we all felt and continue to feel within supply chains, as well as the unprecedented reliance on IT Vendors for the business continuity, elevated the importance of the robust procurement and vendor management strategy. Home has taken this one step further, and shed the concept of the conventional vendor management practice, to partnership management, where vendors are not just the service or product providers, but are a critical part of our roadmap and continues success.” Cancar-Todorovic says the traditional measures of success for procurement were always based on savings or value for money. That outdated concept has now been replaced by the value of ownership. “We focus on strategic partnerships based on mutual

trust and respect, efficient operating models, financial stewardship, risk containment, supplier management, reliability, sustainability, appetite for innovation, and passion for customer experience.” Strategic partnerships in procurement Partnership roles have been essential in making sure the massive shifts that have occurred over the past two years have been dealt with smoothly. As an organisation Home Trust is in the final stretch of its IGNITE program, a multi-year, digital transformation initiative for the company. In addition to a significant SAP re-platforming, it involves numerous other strategic vendor partners. IGNITE drives significant improvements in Home’s ability to manage deposits, loans, treasury, and syndications, while allowing us to streamline financial operations, and enhancing our ability to deliver superior customer service. “Aside from IGNITE, which is an overarching program, we have numerous different initiatives of a transformative nature,” says Cancar-Todorovic. These include digital banking, credit cards, and contact centres, that all demand a strong and strategic sourcing strategy and a robust vendor management program. “Even within our own procurement team, we have engaged a number of vendors to help us automate our processes, making us more efficient, resilient, and adaptable to business needs. We have partnered with ServiceNow to ensure that we have a robust in-take process and embedded workflows, ensuring adequate controls are put in place in line with our organisational risk appetite.” Home Trust also partnered with DocuSign, a collaboration that has been instrumental in the sourcing business continuity, especially as the company moved to the work-from-home model in early 2020. procurementmag.com

HOME TRUST

Procuring diversity: The benefits of balance

“We are further looking to enhance that process by integrating DocuSign with our SharePoint central contract repository that was also launched earlier this year. Panorays is another vendor that we engage with on our third-party risk management transformation, in order to automate our third-party security management for vendor due diligence process, annual vendor attestations and vendor materiality assessments.” Scanmarket eSourcing tool is another strategic partnership, formed recently to help accelerate Home Trust’s go-to-market strategy by simplifying and speeding up the competitive bidding process that was previously done manually. Cyber initiatives for Home Trust With digital transformation now in full swing, cybersecurity is now an area of major concern. The footprint upon which criminals can attack has been widened by the work 36

November 2021

from home mandates. Strategy is key, says Cancar-Todorovic, and ultimately, the fortification of a company comes down to leadership, training, and a solid plan of action. “Cybersecurity and information security is one of the most important risks that we continuously look to improve. At Home, we do this by investing in our cyber resources and tools. We provide regular training and testing to all of our employees, and we have the governance processes around the operational risk committee. We always try to stay one step ahead of the threat, and that seems to be a secret sauce to our success thus far.” Home Trust enabled 98% of its workforce to work from home within two weeks of the pandemic being announced, without experiencing any service disruption. Cancar-Todorovic says the remote working mandate also shifted attitudes globally towards the security of the home

HOME TRUST

“ More than ever we are now dependent on our IT vendors, and that will just continue to be the case as we move to a more hybrid work-fromhome model” SANJA CANCAR-TODOROVIC

ENTERPRISE PROCUREMENT, OUTSOURCING & VENDOR MANAGEMENT LEADER, HOME TRUST

environment, and people’s ability to buy and keep their homes. The demand for mortgages and home loans skyrocketed. “While we were moving to a remote working model, we also had to launch and administer a deferral program to provide temporary financial support to many of our borrowers.” “It's a perfect storm when you have so many moving parts happening all at the same time. And on top of it all, it was important to update all the processes and documentation required to support mortgage lending and ensure the safeguard of the physical safety of our stakeholders and all the documents that were coming in, like appraisals, inspections, legal documents, and so on.” But unlike many companies that were caught short by sudden digital shift, Home Trust had already made strides towards digitisation. “Home has moved to paperless underwriting and funding, which prepared us well to enable our customers to achieve their homeownership goals in a remote workplace. But looking back now, the dependence on the IT vendors has not dropped.

“More than ever we are now dependent on our IT vendors, and that will just continue to be the case as we move to a more hybrid work-from-home model. Home has been able to keep our culture alive and thriving while continuing to meet our strategic objectives and deliver strong financial performance. This is evident in both our employee engagement scores, as well as the value we are creating for our shareholders.” Throughout the pandemic Home Trust also made a significant effort to provide people leaders with the new tools and resources, to manage and lead their teams remotely. These included seminars, workshops, guest speakers, and

HOME TRUST

“ Cybersecurity and information security is one of the most important risks that we continuously look to improve” SANJA CANCAR-TODOROVIC

ENTERPRISE PROCUREMENT, OUTSOURCING & VENDOR MANAGEMENT LEADER,HOME TRUST

HOME TRUST

the deployment of new and engaging collaboration tools. “We also work very closely with the mortgage broker community to serve our customers. And during the pandemic, we made broker engagement, education, and service a priority to ensure that they too could meet the evolving needs of their clients through these unprecedented times”. “We also provided direct-to-consumer solutions and we have been working to enhance their digital experience and the platform’s functionality so they can interact with us in a medium of their choice, through a variety of omni-channels, whether its voice, in-person or over the phone.” People value and mortgages The mortgage lending business is a peopledriven business and therefore the knowledge and expertise of Home Trust’s people, its partners, services, and relationships are critical to success in this industry. The company encourages a solution-oriented, entrepreneurial, and hardworking culture embedded in the foundation of a sustainable risk culture. In 2018, Home Trust introduced a new set of corporate values, which are part of everyday language, and govern every decision its employees make. “We regularly engage our employees to help make sure that Home is a great place to work by conducting regular employee town halls, surveys, feedback sessions,” says Cancar-Todorovic. “And we actually use the feedback that we get from those sessions to further improve where we are. So, it really doesn't come as a surprise that recently we had been awarded the Great Place to Work certification, and Home has also been named a Great Place to Work in Ontario.”

The future of procurement While diversity is obviously a key passion, she also believes the industry will have much bigger changes in store over the next five to ten years, and part of that will be its recognition as an essential profession. “Until recently, procurement as a term in a profession was not really given the recognition it deserved. It was often misused to describe a purchaser or a buyer. In the next five years, I think procurement will solidify its position as the key player and a trusted advisor to the business, recognised for its strategic process of product and service sourcing, market research, planning, negotiations, and thirdparty risk management.” The pandemic had motivated this period of maturation, she explains, because it revealed how unprepared the supply chain was for major global disruption. “Many might feel content with the changes that have been put in place so far. And I know it's not a popular opinion or belief, but all roads are pointing to the fact that we might be hit with another pandemic in our lifetime. And as such, this industry cannot get complacent with the transformation that has taken place so far and simply just take a break from this transformative journey that we are on. The way the industry has reinvented itself during COVID should only be the beginning and not the final destination.” And this time in history is the perfect point to embrace innovation, she adds, because change and dynamism are everywhere. “I love being in a position where I have a front-row seat to the new and innovative vendors and their products and services that really have the ability to change everything that we do.”

procurementmag.com

November 2021

FUTURE

STRATEGY

PROCUREMENT STRATEGIES MUST BE DIGITAL BCG’s Marcell Vollmer on digital transformation, preparing for the future of procurement and what Germans stocked up on during the pandemic WRITTEN BY: HELEN ADAMS

Marcell Vollmer, Chief Procurement Officer, Boston Consulting Group

he digital transformation - the way we are using the Cloud, how we collaborate - this is a very digital workplace”, says Marcell Vollmer, Chief Procurement Officer at Boston Consulting Group Digital transformations have shaken those in the procurement sector, but BCG stands tall. The company offers clients a sustainable competitive advantage and a chance to build on its vast experience of business strategy. Founded in 1963, Boston Consulting Global remains headquartered in the namesake city. One arm of the enterprise, The Bruce Henderson Institute (named after BCG’s founder) continues researching for answers to modern challenges in business. Henderson himself joined the oldest consultancy company, Arthur D. Little, after university, rose to the role of Senior Vice President in management services.

Some years later, a trusted colleague convinced Henderson to set up his own consulting department. Henderson took on the challenge and created The Boston Consulting Group. This is an almost identical route taken by Marcell Vollmer on his journey to Chief Procurement Officer of BCG, but this is not the only recruitment procedure used within the company. “I got asked by my boss to join BCG - it was a fantastic opportunity to get an offer as Chief Procurement Officer, where I could restructure and transform the procurement function”, Vollmer says of his appointment. “It was an amazing opportunity, to not only define the strategy for the core human function of the future, but also to continue in a leadership role, to see how procurement goes to the next level. This was definitely amazing for me! I was also looking into what

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STRATEGY

“ I was also looking into what the best systems were for the future, to really go for the next level in procurement” MARCELL VOLLMER

CHIEF PROCUREMENT OFFICER, BCG

the best systems were for the future, to really go for the next level in procurement.” At this point in his procurement journey, Vollmer moved to the United States. “I'm very thankful that I had this opportunity, probably a once in a lifetime opportunity to be a CPO.” Digital transformation The integration of digital technology across a business - known as digital transformation - alters forever how a business runs and how it responds to customer needs. Employees can be very resistant to change, but digital transformation at Boston Consulting Group has been positive. “I would say that

having access to great devices is amazing.” responds Vollmer enthusiastically. One argument against digital transformation is that it is a very lengthy process - from the installation to the staff training required. At BCG, things moved along productively. “BCG was really fast in thinking about how to provide the best digital set up, to consolidate things,” explains Vollmer. “BCG has around 24,000 people globally. It is absolutely key that people have tools to work effectively and efficiently together. Therefore BCG was already investing into the digital transformation. I've been with BCG for 14 months and what you see in some areas is change. What BCG has as of today, I think is amazing.” procurementmag.com

STRATEGY

Vollmer is willing to offer a nameless breakdown of the digital transformation work Boston Consulting Group has done for its clients. “To give you an overview, I'm sometimes really shocked about seeing how slow the digital transformation in the procurement industry works. “Let me start with a survey, what we did with The Institute for Supply Chain Management, the main operations in the United States. With 50,000 people in this organisation, it's the largest supply chain procurement organisation in the world - and also very big in China. A survey was done, we asked more than 1,100 professionals and we got feedback on the importance of digital transformation - and also the outlook. How important is digital transformation going forward? That was at 80% in the last year. This is the fifth time that we did this survey, in as many consecutive years.” However, Vollmer believes that the investments are preventing procurement from going to the next level, in becoming more digital. “What we see in procurement, is a little bit lacking behind what you see compared to other industries and other business functions”, explains Vollmer. “It varies on the industry side, but this is definitely something which supplies procurement and is not really evolving really fast here.” Transformation across industries In the automotive industry, it’s not just digital transformation that’s taking place.The shift from petrol to electric cars has begun and being German, Vollmer has a lot to say on the subject. “Number one from our client examples, is when you look at the automotive industry. Electric cars are on course for a fundamental change - that’s going on right now.” 44

November 2021

“You can imagine what this does to procurement, because this is a totally new setup”, says Vollmer. “It's also a mindshift in what the procurement industry needs to have, because the electric engine is no longer really a key differentiator, which it was in the past.” As countries set historic dates for an end to the sale of petrol and diesel cars, German engineering giants Volkswagen, MercedesBenz, Audi and BMW have all created electric vehicles, suitable for customers who are planning ahead. “When you look at the combustion engine from a technological

STRATEGY

“It is absolutely key that people have tools to work effectively and efficiently together” MARCELL VOLLMER

CHIEF PROCUREMENT OFFICER, BCG

advantage, in Germany we have lots of these car manufacturers, who are really very well known for their engineering and this is now shifting”, says Vollmer. “The requirements for procurement have fundamentally changed, such as small companies coming up with battery technology and energy management, things like that. Basically, this really needs a fundamental change in the way procurement teams do business.” In addition to thinking ahead of the petrol and diesel ban, customers are becoming increasingly focused on sustainability, with

some making the decision to partner with more expensive businesses, if they can prove their ethics are more than a PR stunt. “As a core human need, we must think about alternatives from a sustainable perspective, which is currently on the minds of many people”, says Vollmer. “Consumers also now want to know where their products come from. This shows how important it is for humans to react to industry changes and incorporate in buying decisions in the ways they do category management.” Customers aside, what are BCG’s clients looking to achieve in the future? procurementmag.com

STRATEGY

“All clients are basically looking for how to define the digital roadmap for the future in procurement,” says Vollmer. “Procurement has integrated itself as a part of the supply chain, as all companies have a supply chain. “There are different industries, financial services do not have a supply chain. They only have indirect spending. Our clients are really looking at: • How to go for the next level of contact solutions • How to define the digital gold map • Analytical insights for full visibility 46

November 2021

“Information is needed to define the demand and companies are also looking at what is the best way in engaging with suppliers? Supplier collaboration, how to drive innovations with suppliers is really important at this point in time. “The next level is also to continue investing in automation, not only invoice automation, but also using machine learning capabilities, to a much higher degree compared to what companies did in the past. CPOs need to upscale and develop some people”, concludes Vollmer.

“ We must think about alternatives from a sustainable perspective, which is currently on the minds of many people” MARCELL VOLLMER

CHIEF PROCUREMENT OFFICER, BCG

Transforming to the future of procurement Many businesses have used the challenges of the pandemic as lessons regarding the plague create a stronger business and more efficient team. What is the biggest lesson Vollmer has learned about procurement during this unanticipated time? “I learned in Germany that people were focused on getting wine, as there was a shortage in red wine. But more importantly, companies need to keep the

lights on with their production and really ensure that they can drive the goods. We have all seen what's happening. If we go into a supermarket and we see empty shelves, we think: ‘How involved is this supermarket with procurement?’ “However, I think the most important thing I have learned is that we are getting used to leveraging the digital tools that we have, to a much different extent. Honestly, it works pretty well. I have also seen the resilience of risk management and supply chains.” procurementmag.com

UNIVERSITY OF MASSACHUSETTS

November 2021

UNIVERSITY OF MASSACHUSETTS

UMASS: Unifying Procurement to Drive Change WRITTEN BY: RHYS THOMAS PRODUCED BY: GLEN WHITE

procurementmag.com

David Cho, Chief Procurement Officer and Managing Director, UMass

November 2021

UNIVERSITY OF MASSACHUSETTS

CPO David Cho on transforming the University of Massachusetts’ procurement functions, and the ‘better, faster, cheaper’ philosophy to deliver value

1863

Year Founded

24,163

Employees including students

18,615

Employees excluding students

$3.4bn Revenue

he University of Massachusetts is a world-class public research university committed to advancing knowledge and transforming lives. Through its world-class educational programmes, groundbreaking research enterprise, and its impactful community service and industry engagement activities, UMass harnesses the revolutionary spirit of Massachusetts to deliver an unparalleled student experience. With four comprehensive campuses, a top-ranked medical school and a missiondriven law school, each campus offers a dynamic educational experience in a uniquely Massachusetts location, from the coastal town of Dartmouth to the international hub of Boston, from the vibrant mill cities of Lowell and Worcester to the bucolic hills of Amherst. Though separated geographically, the campuses are unified through a central goal of preparing students to contribute to their communities, thrive in a new economy and change the world by providing a broad range of rigorous academic programs and opportunities. However, not everything shared this central spirit. Until 18 months ago, the university’s procurement function was fragmented, with each campus responsible for its own procurement, accounts payable, sourcing, and contract management activities. That began changing in fall 2019, when David Cho, who was the CPO of BlackRock, was recruited through a national search to join UMass as the first-ever system-wide Chief Procurement Officer. Hiring a CPO followed the recommendation procurementmag.com

WEI is an innovative, full service, customer centric IT solution provider.

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WEI: Value Added at Every Step of the Procurement Process Value-added reseller WEI strengthens its partnership with UMass and how it is empowering procurement organizations to unlock value beyond just price More than an IT solution supplier, WEI is a valuable problem solver and key supplier to the University of Massachusetts’ procurement organization. WEI has worked on several projects with the university’s newly appointed CPO David Cho. “I met David close to 18 months ago when he started,” says Greg LaBrie, VP of Technology Solutions, WEI. “The pandemic slowed that project down, but fortunately we were invited to participate in the UMass procurement process that we’re now involved in.” Cho unified the university’s procurement function and processes under the Unified Procurement Services Team (UPST), and enacted a new strategy to work more closely with suppliers to extract more value - a philosophy wholly aligned with that of WEI. “When organizations that we work with open up and collaborate with us, that’s when we’re at our best,” says WEI COO Todd Grubbs. “Now

we’ve created a regular cadence to meet with the UPST, and have a vision going forward that is not a hunt-and-peck type of model, but has a cohesive strategy. Our pre-sales group and our architects will meet with them frequently to discuss price, lead times, strategy and vision all at the same time. And that’s how UMass is going to get the technology solutions they’re looking for.” Together, WEI and the UMass procurement organization are unlocking value that goes beyond price, LaBrie adds: “UMass’ new vision, to standardize the procurement process, and standardize technology and procedures across the campuses, allows students and faculty to go from campus to campus and benefit from the same technology. That makes a big difference to their people, and it also provides all that data back to the procurement organization about the devices, people and how they’re leveraging the environment.” The partnership between WEI and UMass has also been an emphatic win for promoting spend with diverse suppliers, says Grubbs. “When UMass supports someone like us, who are a minority business enterprise, that helps us scale, that helps us hire from the minority community, and that helps us support minority suppliers ourselves,” he adds. “The effect of UMass making that commitment is exponential in the diversity community.”

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UNIVERSITY OF MASSACHUSETTS

of a comprehensive shared services plan, a collaborative, system-wide, cross-functional project that was released in April 2019 and endorsed by the UMass Board of Trustees. “The outcome was very similar for each of these separate functions at the campus level, but business was conducted in six different ways, with different operating procedures, and even the same technologies were configured differently,” Cho says. His first challenge was to unify these disparate organisations and harmonise a “patchwork” of policies, procedures and technologies into a standardised system for conducting business. The new centralised organisation driving procurement efficiency for UMass is known as the Unified Procurement Services Team (UPST). “The premise of this was to create a shared services environment to support the campuses,” says Cho, whose newly unified team now manages close to $1 billion in annual spend and more than 17,000 active suppliers. “The good thing is we had the opportunity to deepen the

procurement competencies of the folks in these legacy organisations, who can now go deeper, instead of being generalists,” he says. The team reduced in scope from 70+ to 50 specialists, but “we built competency frameworks specific to the function, and we can plan training paths for each individual and role to build more domain expertise”. With the mandate to create a functioning shared services organisation while still maintaining business-as-usual support for campus procurement activities, the UPST had their work cut out for them. Unfortunately, within three months of becoming operational they had to face the COVID-19 pandemic and its ripple effects on the system. UMass experienced a $240m revenue shortfall. They shifted their focus to supporting UMass in meeting specific short-term objectives, such as health and safety goods and services, and remote learning equipment, that needed to be addressed instantly. But when the initial dust of the pandemic had settled, so too did Cho’s focus. “Better, Faster, Cheaper” The procurement harmonisation project is underpinned by a philosophy to derive more value at every point, something Cho characterises as “Better, Faster, Cheaper.” “It’s about ensuring that we have more strategic partnerships, and that we're getting the best value in reducing operational risks,” Cho says. “We’re faster by using catalogues, for example, and pre-negotiating a lot of framework agreements so that people can point, click, and buy, just like we do every day in our personal lives. To be cheaper, we’re using market intelligence benchmarks that come not only in the form of price points, but operating procedures, best practices, and really using that market intel to its full extent.”

UNIVERSITY OF MASSACHUSETTS

“ We are now closer to being a datafirst organisation”

David Cho

DAVID CHO

TITLE: CHIEF PROCUREMENT OFFICER AND MANAGING DIRECTOR

CHIEF PROCUREMENT OFFICER AND MANAGING DIRECTOR, UMASS

EXECUTIVE BIO

COMPANY: UMASS Cho is the Chief Procurement Officer for the University of Massachusetts, Unified Procurement Services Team (UPST) that provides strategic sourcing, contracts, supplier management, procurement operations, accounts payable, travel services, and customer services to the various campuses within the UMass system. Before joining the UMass System, he was the former Global Head of Sourcing and Vendor Management at BlackRock where he led Sourcing and Vendor Management (SVM) for the World’s largest Asset Management firm. SVM covers all third-party sourcing for technology, HR, marketing, L&C, professional services, and corporate services. Over Cho’s 25+ years of work experience, he has maintained COO roles for emerging alternative asset management companies, and also provided strategy and operations management consulting services to regional, national, and global companies during his stint at KPMG, Archstone Consulting, IBM, Deloitte Consulting and JP Morgan Chase. Cho is a graduate of Boston College and completed the MIT Sloan Executive Program in Technology, Operations and Value Chain Management.

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UNIVERSITY OF MASSACHUSETTS

UMass: Unifying Procurement to Drive Change

“ We're capturing this low hanging fruit, but once we realise those recurring savings, we need to continue to optimise and extract costs and inefficiencies out of the system so that it's something that we can confidently harvest year over year” DAVID CHO

CHIEF PROCUREMENT OFFICER AND MANAGING DIRECTOR, UMASS

The results of Cho’s and the USPT’s efforts have been immediate. An initial target of achieving $16.5m in annual cost reduction was eclipsed within the first 18 months of operation. The UPST delivered $33.9m in savings through 100+ initiatives, within those 18 months, across each of the five UMass campuses. “The key to that is data, and we are now much closer to being a data-first organisation,” Cho says. “We are utilising techniques that private equity firms might use for optimising their portfolio companies. We're factoring in methods that you would use for mergers and divestitures, and all these different tools and approaches.” Cho expects to see twice the amount of financial benefits in the next year, but the ultimate goal of his initial five-year plan will not necessarily follow a linear path. “It doesn't mean we have to continue to double the output that we're getting from procurementmag.com

UNIVERSITY OF MASSACHUSETTS

a cost reduction standpoint,” he says. “We're capturing this low hanging fruit, but once we realise those recurring savings, we need to continue to optimise and extract costs and inefficiencies out of the system so that it's something that we can confidently harvest year over year. We may not necessarily maintain that growth trajectory annually, but I am confident that it's something that we're going to be able to benefit from on an ongoing basis.” 58

November 2021

Procurement with Purpose Beyond the mechanics of cost-saving, Cho and his team are driven by their contributions towards the UMass mission of providing affordable and accessible world-class education. This is procurement with purpose. “That’s why I think many of the leaders who joined us, particularly from the non-higher-education verticals, are so excited about this, because the mission really resonates,” Cho explains.

UNIVERSITY OF MASSACHUSETTS

MICHAEL E. DURKIN TITLE: DIRECTOR OF STRATEGIC PROCUREMENT Michael describes himself as a “dynamic procurement leader, educator, manager and coalition builder”. These attributes have helped him establish and grow the capabilities of the UPST strategic sourcing team which handles, category management, strategic sourcing, contracts and supplier management needs. He is passionate about adding value to people and processes through efficiency, effectiveness, and driving best business practices. Prior to rejoining the UMass System as a part of the UPST Leadership Team, he held a variety of leadership positions with the University System of New Hampshire, University of Massachusetts Lowell, Merrimack College, Stonehill College and with the National Association of Educational Procurement (NAEP) of New England.

BRIAN L. GIRARD

MEET THE TEAM

TITLE: DIRECTOR OF PROCUREMENT OPERATIONS Brian is a leader known to have the proven ability to influence and manage stakeholders, innovate and drive process improvements throughout the supply chain to capture optimised cost benefits and budgetary control. Brian continues to leverage his over 25 years of experience in Procurement and Supply Chain within both the public and private sectors, to lead harmonisation of UMass procurement operational processes.

He currently oversees the Procurement Operations function which encompasses Accounts Payable, Bank Card (Procurement Card Operations), Travel and Expense, Process Improvement, and Procurement Compliance teams. With his team, he continues to focus on streamlining internal business practices to ensure operational process efficiency and effectiveness.

AMANDA ONWUKA TITLE: DIRECTOR OF SERVICE & QUALITY Amanda’s focus is to ensure that UPST continues to put its best foot forward as it progresses in its maturity journey as the harmonised procurement services centre for the University of Massachusetts system. Within her UPST portfolio are the Customer Services, Procurement Technology, Data Analytics, and Training & Communications teams. They support the operationalisation of the harmonised processes while ensuring resources are available to support enhanced change and communications management. Prior to joining UMass system, Amanda worked as a management consultant with KPMG leading and providing strategy and business transformation services to global and national companies.

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“ We are utilising techniques that private equity firms might use for optimising their portfolio companies” DAVID CHO

CHIEF PROCUREMENT OFFICER AND MANAGING DIRECTOR, UMASS

Technology adoption and an overarching digital transformation have been crucial to UPST’s results. The organisation leverages tools like Jaggaer for daily procurement activities, Salesforce for case management,

and Tableau for business intelligence, among others. But in Cho’s mind, technology alone will only get you so far. More important is to prioritise, harmonise, and modernise policies and targets, upgrade procedures and processes to align with the policies, and ensure the team has the core competencies to operate within them. “When you have all those pieces together, the rollout of technology enablement becomes much more elegant, and it gets you to the outcomes and the output that you're looking for,” Cho says, pointing to ensuring applications are uniform across both desktop and mobile devices to enable flexible work, as an example. “The more important thing is being able to leverage your suppliers’ technologies, as well. We can't be

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UNIVERSITY OF MASSACHUSETTS

“ The good thing is we had the opportunity to deepen the procurement competencies of the folks in these legacy organisations, who can now go deeper, instead of being generalists” DAVID CHO

CHIEF PROCUREMENT OFFICER AND MANAGING DIRECTOR, UMASS

everything to everyone. It’s not just about building the catalogue, for instance, but how do we leverage their platform? Some of our partners’ data on the things we buy is better than the data we have in-house. So we can leverage that kind of intelligence.”

The Power of Partnerships A good example, Cho says, is the partnership with Huron, with which UMass’ investment has risen over the past 18 months. “They've been terrific in looking at where we are today and where we want to be tomorrow,” Cho says. “What’s really vital is that it's not just what they know, it's how they deploy. It's how the team we work with at Huron take in that input from us and understand the particular outcomes that we're looking for. To be able to factor in change management, very gracefully as part of the underlying sense of processes and services that they're delivering, has been tremendous.” Another key supplier, SupplyLogic, provides “intelligence that we can't build,” Cho says, which is helping the organisation towards its supplier diversity objectives. Taking print services as an example, the UPST can leverage SupplyLogic’s platform to discover veteran-owned suppliers, procurementmag.com

CONGRATULATIONS David Cho & The UMASS Procurement Team Thank you for your business over the last 35 years!

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UNIVERSITY OF MASSACHUSETTS

“ We're also incorporating inclusion and equity into all of our competitive processes” DAVID CHO

CHIEF PROCUREMENT OFFICER AND MANAGING DIRECTOR, UMASS

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minority-owned businesses, womanowned businesses, and other diverse partners in the local community. “This is really valuable to us,” Cho says. “That's an area where we can leverage our partners’ technologies to get that visibility, and to make those kinds of important decisions.” Enhancing the diversity of suppliers is a key objective of the University of Massachusetts, and by extension the UPST, and although the central procurement organisation is barely 18 months old, Cho is happy with the progress it’s already made. The university’s spending with diverse suppliers is “trending in the right direction,”

LISA A. CALISE TITLE: SENIOR VICE PRESIDENT FOR ADMINISTRATION & FINANCE AND TREASURER

EXECUTIVE BIO

COMPANY: UMASS Lisa A. Calise is the Senior Vice President for Administration & Finance and Treasurer for the University of Massachusetts. She has been with UMass since February 2017. In her role, Lisa oversees the University’s financial and operational departments including Treasury, Insurance and Operations, Budget and Planning, Enterprise Risk Management, Human Resources, Controller’s Office and the University-wide Unified Procurement Services Team (UPST). Lisa was most recently the Chief Financial Officer at Watertown-based Perkins School for the Blind, focusing on global services and education for those living with blindness and deaf blindness. Before joining Perkins in 2010, Lisa served the City of Boston for over a decade, most recently as the Director of Administration

with both a short and long-term plan to build a more robust diverse supplier base. “We're also incorporating inclusion and equity into all of our competitive processes,” Cho adds. “That’s not something that was mandated by any government programme. We have imposed those requirements on ourselves to build accountability. We're also pushing strategic providers that act as primes to provide more visibility into their second-tier level spend, so that as dollars flow to them, they also make their way to diverse suppliers. That is very impactful.” The UPST has performed above expectations throughout its first 18 months,

and Finance, and previously as Chief Financial Officer and CollectorTreasurer and Budget Director, implementing efficiency improvements and managing the City’s finances through challenging economic times. Prior to coming to Boston, Lisa served in the White House Office of Management and Budget as a budget examiner. A Massachusetts native, Lisa obtained her B.A. from Boston College and a Master's Degree in Public Management from the University of Maryland. She recently served as a member of both the MBTA Finance and Management Control Board and MassDOT Board.

UNIVERSITY OF MASSACHUSETTS

“ We're also incorporating inclusion and equity into all of our competitive processes” DAVID CHO

CHIEF PROCUREMENT OFFICER AND MANAGING DIRECTOR, UMASS

and as it matures further, Cho is confident that procurement will provide further savings, and reroute vital value and resources into the university’s educational programs. But Cho is quick to highlight that the work of UPST, its future ambitions, and its ability to deliver transformational results is a holistic effort, achieved through collaboration with various UMass stakeholders. “Being able to promote this level of change in coordination with the campuses couldn’t have been done without leadership sponsorship,” Cho says. “We've been 68

November 2021

empowered. We have UMass President Marty Meehan's backing, the support of all the campus chancellors, the campus Administration & Finance (A&F) Vice Chancellors and the UMass Senior Vice President for Administration and Finance (CFO) and Treasurer, Lisa Calise.” “I’m so proud of all that we’ve been able to accomplish in such a short time, and under such challenging and unprecedented circumstances,” says Calise. “The collaborative approach between the system and campuses, especially between

UNIVERSITY OF MASSACHUSETTS

the A&F leadership, has been paradigmshifting for the university, and enabled us to leverage the university’s buying power to benefit the campuses. Our team – driven by exceptional leaders like David – will continue to experiment, innovate and push the organisation to realise every efficiency and ensure that we are delivering on our mission in the most competitive manner possible.” According to Cho, the UMass campus leaders are “encouraging us to do more and continue to move the agenda forward. With 75,000 students and

24,000 employees, UMass is the largest university and third-largest employer in the state of Massachusetts. So there are many priorities, and being able to have that one vision that leadership endorses, is just tremendous. What really makes this incredibly powerful is that egos are checked at the door and it's all about just doing the right thing.”

procurementmag.com

TECHNOLOGY

ADOPTING AN

EFFECTIVE

PROCUREMENT PLATFORM 101

TECHNOLOGY

Alex Saric (Ivalua) & Simon Patteson (Icertis) discuss the role of platforms in effective procurement functions WRITTEN BY: GEORGIA WILSON

Alex Saric, Smart Procurement Expert, Ivalua

Simon Patteson, VP of Northern Europe, Icertis

ollowing the disruption of COVID-19, organisations are recognising procurement’s role in restoring growth and ensuring resilience. “Now we are seeing more investment in smart, cloud-based procurement platforms that help businesses pivot from survival to growth mode,” says Alex Saric, smart Procurement Expert at Ivalua. As procurement departments become increasingly digitally driven, using the likes of electronic CFTs, supplier collaboration, RPA, and catalogue buying, more and more companies are releasing the significance of digital transformation and the need to optimise their services accordingly. A key trend in the procurement space is the integration of a Contract Lifecycle Management Platform (CLM). While procurement platforms have made improvements in tracking purchasing activity against budgets and in running sourcing events, they have been unable to achieve the full potential of end-to-end digitisation. Contracts are at the centre of procurement, they define what a business buys and on what terms, including SLAs, specs, and pricing models. An advanced CLM supports compliance tracking, strategic sourcing, spend analytics, business intelligence and supply-chain data management, meaning it procurementmag.com

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TECHNOLOGY

“ Organisations should look to adopt a procurement platform at the earliest possible opportunity” SIMON PATTESON

VP OF NORTHERN EUROPE, ICERTIS

is the ideal pillar around which to deploy a holistic, digital approach to procurement to meet the demands of today’s marketplace,” explains Simon Patteson VP of Northern Europe at Icertis. When Should an Organisation Adopt a Procurement Platform? “Organisations should look to adopt a procurement platform at the earliest possible opportunity,” says Patteson. “The World CC report found that there is an increasing gap between organisations who do not prioritise procurement resources such as Commercial and Contract Management (CCM) platforms and those who do. Larger organisations – those with annual revenue of more than US$5bn – are

showing the greatest interest in improving CCM capabilities, with these sectors leading the way which may largely be down to risk,” he continues. “Plus, according to Forrester, CLM has emerged as a must-have technology for companies of all sizes. Manufacturing is a key sector that could see huge benefit from increased digitisation through a CLM platform, where production time and customer communication is of the utmost importance. With its digitisation and integrated technologies CLM has the potential to address an interface where there can be significant value leakage and risk accumulation when responsibilities are split.” Adding to Patterson’s comments, Saric details what it takes to achieve an effective transformation journey in procurement. “An effective transformation journey can only begin once an organisation has mapped out its digital maturity. Before adopting a procurement platform, procurement teams must review their company strategy, processes, structure, and technology against leaders in the procurementmag.com

TECHNOLOGY

“ As more and more organisations pledge to meet net zero by 2030, smart procurement platforms are helping to support sustainability goals” ALEX SARIC

SMART PROCUREMENT EXPERT, IVALUA

industry to gauge maturity and identify areas for improvement. “Pre-packaged solutions can be a great start, helping you to deploy effective procurement tools in just a matter of weeks. However, scalability and flexibility are also important to consider as it enables the solution to grow with the company and adapt quickly to both short and long term changes in the market. Smart procurement technology brings long-term cost and efficiency benefits to organisations. The added visibility given across the supply chain is critical for firms looking to stay ahead of the curve and make informed decisions, 74

November 2021

spot new opportunities, and manage risk. These platforms will give organisations a significant competitive advantage, so they need to be investing now – or risk lagging behind competitors, losing market share and missing vital chances to innovate.” The Benefits of Adopting a Procurement Platform in Your Organisation? “We are consistently seeing both in the news and in our business how fragile justin-time delivery can be. Thanks to the pandemic cutting production, growing consumer trends impacting traditional labour supplies, and regional challenges

TECHNOLOGY

Advanced Technologies to Enhance Procurement Platforms “Emerging technologies can be a powerful tool to help add value to supply chain management and make procurement more strategic. Technologies such as AI, blockchain, and IoT offer the potential to identify possible failure points in supply chains, improve traceability, and much more. AI in particular is being used to enhance procurement platforms by driving greater levels of automation in manual processes such as invoice processing – helping to save time, money, and resources. But AI can also assist decision makers by, for example, identifying untapped optimisation opportunities and recommending courses of action,” says Saric. Echoing Saric’s comments, Patteson adds: “with the rise of tools like artificial intelligence (AI) and machine learning, post-execution contract management has gained more attention as a way to accelerate, protect and optimise businesses. Applying AI to a pool of digitised data, transforms contracts

from static documents into live contracts which can interact with staff, systems and even other contracts. Advanced, AI-powered CLM software enables companies to digitise, structure, and connect contracts so organisations can quickly and efficiently analyse them for potential risk and performance– both before and after an agreement is executed.” Saric follows up by explaining that “organisations can develop their procurement platforms further by taking advantage of innovations in procurement analytics. This can help organisations to stay on top of supply chain disruption, flag ethical or sustainability concerns, and identify instances of fraud. AI-driven analytics can also formulate better insights in real or near real time, giving businesses complete visibility of the supply chain. Bringing actionable insights to users’ fingertips is more important as we tackle the supply chain crisis that is taking the UK by storm.” procurementmag.com

TECHNOLOGY

(such as the red tape from Brexit), means procurement departments have never faced a more challenging and competitive fight,” explains Patteson. In order to succeed in this challenging environment, “businesses and procurement teams need to make instant decisions and utilise those decisions at all times. This means building a closer connection than ever between procurement, business stakeholders, sales and legal, and fully understanding existing commitments and obligations within contracts and the impact of new contractual conditions,” he adds, identifying three key areas where the value is enormous: • Speed: “While supply is short, the value to act when opportunities arise could be the difference between maintaining production and plant closure. Organisations with CLM can achieve up to 80% reduction in an average cycle time from bid to signed agreement.” • Efficiency: “Ensure your procurement team is focused on negotiating the best terms rather than working on admin heavy tasks. With advanced CLM, procurement departments are supported in negotiation with valuable insights and less time wasted searching for past agreements.” • Align business objectives: “Linking performance measurement systems with contract management ensures that performance can continuously be monitored against promises agreed upon in the contract which saves time. Integrating contractual conditions in P2P/finance systems can prevent an unchecked issuance of work authorisation or supply orders outside contract terms.” 76

November 2021

Adding to Patteson’s comments, Saric says: “businesses that have full visibility across their supply chain are in a better position to identify and mitigate risk that could impact availability of supply or their brand reputation. They better understand potential risks in case of events such as COVID-19, allowing them to enact effective contingency plans. “Smart procurement platforms allow organisations to tap into innovation from the supply chain when developing new products and services, while also providing full visibility into risk factors. This transparency enables them to make better decisions when choosing suppliers – therefore building a more resilient, sustainable, and dependable supply chain.”

TECHNOLOGY

Becoming More Sustainable With the Help of Procurement Platforms “Companies today are no longer judged solely on what they do, but how they do it. Leading companies are already leveraging contracts for their efforts toward Environmental, Social, and Governance (ESG) commitments. It is becoming an increasing priority and procurement, with its control over company spend, has the power to drive positive change,” says Patteson. With this in mind, Saric adds that “as more and more organisations pledge to meet net zero by 2030, smart procurement platforms are helping to support sustainability goals. For instance, we’re now seeing more organisations opt for effective collaboration platforms to help share detailed goals

with their suppliers, share third party information, and gain a 360-degree view of their supply chain – enabling them to set automated action plans and hit important sustainability targets. “Without effective procurement platforms, a lot of sustainability initiatives fall short because procurement is the gatekeeper to all suppliers. But by leveraging cloud technology, organisations can work with stakeholders across the supply chain to drive green initiatives. Cloud platforms can also tackle the issue of sustainable supply chains by offering access to sub-tier suppliers, so that they can all share data on sustainability. This gives organisations a more complete view, which is vital to help them to meet pledges to net zero,” continues Saric. procurementmag.com

LOSBERGER DE BOER

November 2021

LOSBERGER DE BOER

LOSBERGER DE BOER BROADENS HORIZONS IN PANDEMIC

WRITTEN BY: DOMINIC ELLIS PRODUCED BY: TOM LIVERMORE

procurementmag.com

LOSBERGER DE BOER

1919

Year Founded

Events Industry

1,0005,000 Number of Employees

212mn Revenue in Euros (2019)

November 2021

LOSBERGER DE BOER

While Losberger De Boer remains focused on events, it has been busy targeting military, medical and industrial sectors in the pandemic

’ve been taken on a virtual round-theworld trip by Oscar Gersjes, Group Procurement Director at Losberger De Boer, as we hop from emergency shelters in Haiti and military camps in Mali, to the most well-known motorsports event in the world, a number of highly customized storage facilities and even find time in our one-hour Zoom meeting to discuss European cultural nuances. The breadth of work underlines two key messages: the company’s global presence and ability to pivot in the pandemic, broadening its business alongside its core events expertise. Rapid Deployment Solutions (RDS), Commercial and Event buildings are its key sectors, with rental space and special projects accounting for the largest slice of turnover. Perhaps surprisingly, given its events exposure during the teeth of the crisis, 2020 came in above budget although 2021 projections are currently a little below forecasts – although he is confident it will close the year hitting targets. Major upcoming projects include large scale racing and golf events. “Every change provides plenty of opportunities. At the moment there haven’t been many events but we’ve built a lot of commercial buildings in Europe, sport centres in France, and a wide range of medical facilities to help fight the pandemic all over the world, from temporary hospitals and triage centres to test and vaccination centres,” he said. procurementmag.com

LOSBERGER DE BOER

“ We try and change materials to more composites, they tend to be cheaper, lighter and environmentally friendly. The importance of weight reduction is getting more and more important” OSCAR GERSJES

GROUP PROCUREMENT DIRECTOR, LOSBERGER DE BOER

November 2021

The global events supplier – whose long client list includes the Mobile World Congress, G7 and G8 meetings, NATO summits, Wimbledon, Tour de France, and the Farnborough Air Show – has chosen to invest in product innovation during the pandemic, in order to expand its role as industry leader in the events sector when events are completely back, as well as re-inventing its product portfolio to not only keep up, but stay ahead of the changing times. Throughout 2020, the company has adapted its products to help the healthcare sector in dealing with the pandemic. Alongside healthcare professionals, a blueprint for an optimized temporary mass vaccination centre was developed, to allow large numbers of people to be vaccinated efficiently and safely. Structures that are normally used for events were transformed

LOSBERGER DE BOER

into triage centres or facilities that help businesses and institutions adapt to social distancing requirements, like temporary auditoria and canteens. The company used this knowledge for the events sector as well, creating blueprints for ‘covid-proof’ events. For German kitchen giant Nobilia, Losberger De Boer helped create a venue that could safely hold large numbers of people whilst complying with strict German covid-regulations. Tennis events like the Barcelona and Hamburg open were able to come back, partly because Losberger De Boer was able to adapt its facilities to meet the constantly changing restrictions. In case of the Porsche European Open in Hamburg, the entire venue was redesigned two weeks before the start of the tournament. In terms of product development, the company has invested in innovation. Last

Oscar Gersjes TITLE: G ROUP PROCUREMENT DIRECTOR LOCATION: NETHERLANDS

EXECUTIVE BIO

INDUSTRY: CONSTRUCTION Working for (Losberger) De Boer (LDB) over the last 15 years has been an excellent experience. New challenges “on the way” made this journey more than interesting and a reason to stay such a long period. With my passionate way of working, I created a strong preference for project orientated management. The dynamic environment of project orientated business and -management is completely different compared to process operated business as I experienced at SigmaKalon (PPG). Being in the position of Procurement Responsible of De Boer Structures B.V. I visited all main competitors and suppliers. Based on this knowledge an increase of efficiency and creativity are key to be seen as the leader in the markets. Getting processes improved combined with smart and functional products was always my passion.

procurementmag.com

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LOSBERGER DE BOER

year, it launched a structure that complies to the Eurocode, just like traditional buildings do, and that is still fully modular and adaptable, as well as quick to build. A new, lighter and highly sustainable flooring system was devised, as well as an innovative system that sets a new standard in terms of acoustics and insulation for events. In the final quarter of this year and throughout 2022, Losberger De Boer will introduce several new products as well as optimised parts for its existing structures. We speed onto Baku, where Losberger De Boer handled a challenging assignment for one of the largest racing events in the world. “We had to strengthen the roof of the parking garage, and build on top of the columns, and they weren’t equally spaced. This was specifically for the race cars,” he said.

“ Whether it’s discussing technical options, or negotiating big deals with customers – you have to go there and be on the same table” OSCAR GERSJES

GROUP PROCUREMENT DIRECTOR, LOSBERGER DE BOER procurementmag.com

LOSBERGER DE BOER

Losberger De Boer broadens horizons in pandemic

“There were supply issues too, with steel coming from Turkey, and wood from Latvia. We had major problems on the border – it was stressful as it was stuck for six days. It’s getting worse to source supplies. We try and change materials to more composites, they tend to be cheaper, lighter and environmentally friendly. The importance of weight reduction is getting more and more important.” While much of its work is on site, it is adopting the hybrid model for office-based staff. “The pandemic made us realise you can create a lot of efficiencies and also understand the limitations of zoom and teams. Whether it’s discussing technical options, or negotiating big deals with customers – you have to go there and be on the same table.” Today Losberger De Boer focuses strongly on Europe, Middle East and US, the latter presenting openings in the military sector. Sustainability is also providing untapped opportunities. 86

November 2021

LOSBERGER DE BOER

“ Everything starts with having good data, particularly when you’re working in different markets”

IMPORTANCE OF GOOD DATA Everything starts with having good data, particularly when you’re working in different markets.

OSCAR GERSJES

DID YOU KNOW...

GROUP PROCUREMENT DIRECTOR, LOSBERGER DE BOER

“If you want to have a clear, aligned strategy, you need a lot of data. We invested in a system called VendorLink, which we use for spend analysis, supplier contracting, certifications and e-signing, and we are also looking to extend it to include vendor rating. VendorLink has been invaluable to us for our procurement. “We have looked for a single system for a long time, but have yet to find an ERP system that covers all these functionalities, at least how I like it. That was another issue with the merger, as companies had different systems, and we are going to work with SAP on integrating – it’s very easy to link with Vendorlink.” “There are lot of interesting things with digital solutions. It’s important to make the right choice – you have to look at what will most add value. Big companies like Boeing and mobile operators want to see up front the result later on.” In future, a Vendor Rating is cited as a priority, and new technologies will be embraced when needed. “We are only in projects, so it’s essential we can rate quality. If the quality fails, costs go up considerably, and so that’s a key focus in the coming years.”

procurementmag.com

WE LOVE A GOOD CLIMATE! As an innovation leader in the fields of temporary heating, cooling and power supply, Helot has been a first classpartner for optimal air-conditioning supply -for every occasion and every temperature since 1949. In setting itself the goal of reducing CO2 and NOx emissions to a minimum, Helot offers the most efficient supply concepts with the lowest possible energy and resource consumption, among other things through the careful handling of fuels and the use of alternative fuels such as HVO and GTL. In addition, Helot makes an important contribution to permanently sustainable air conditioning concepts by constantly investing in the development of future-proof, climate-friendly technologies.

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New energy sector opportunities Companies such as TATA Steel are having big problems with external coal storage, and there is a good chance it will be forbidden – so you need huge structures to cover it, he adds. “That’s a new area of business. We have done it in Asia, we have good partners in Spain and US. “There are a lot of areas where you can make a difference – we’re changing more from truck to train, looking to source lighter, and negotiating with companies to have environmentally friendly trucks. We have events equipped with solar panels, and at our military sites, we built a big camp in Mali, which will operate for two-to-three years. It can provide half of the camp’s total energy consumption.

“ Last year the results were above forecasts. We see a lot of opportunities on the military side and think we’ll come in close to budget this year” OSCAR GERSJES

GROUP PROCUREMENT DIRECTOR, LOSBERGER DE BOER

procurementmag.com

LOSBERGER DE BOER

November 2021

LOSBERGER DE BOER

The panels are getting better, ultimately we hope to provide camps with all their electricity through solar so there isn’t a need for external electricity anymore. That’s probably around two or three years away.” He adds it is also working with big aluminium companies, and looking more to suppliers which can secure their own raw materials and have their own melting facilities, collaborating with a Turkish company and two Spanish suppliers. Cross Rental Services is key service provider, which pick up smaller projects – Losberger De Boer delivers the materials and they build it – and Helot is one of its climate solutions companies, which is strong in Germany. Other leading supplier partners include NEDAL Aluminium, Richter Aluminium and Top Events Exhibition (Furniture/Rental). Another big focus is modular structures, to extend its container business in Germany to markets such as the UK and Benelux, where housing shortages have led to high demand “We deliver home offices in Belgium and the Netherlands, which has also seen a spur in demand with the pandemic. The units are separate to your house with high insulation systems, and we combine it in a lease strategy – people can lease a small electric car and combine it with a home office.” Four years on from the merger, Gersjes, who joined De Boer as Procurement Director in 2006, describes the company as still “in transition”, which reflects the scale of the operation and challenges integrating its disparate entities. He concedes the merger “wasn’t smooth” but today, technology is helping improve efficiencies.

procurementmag.com

IN PROCUREMENT IS A SOCIAL AND ECONOMIC ADVANTAGE In allowing diversity to flourish in the procurement sector, the workforce is more efficient and competition is high WRITTEN BY: HELEN ADAMS

iversity in procurement looks much the same as it does in any other sector: a range of people with different skill sets, contacts and life experiences, which when put together, make an impenetrable foundation. If everyone thinks the same way, has been educated in the same institutions, has completed the same internships, knows the same people, culture and language blind spots are not covered, errors gape and clients are misunderstood. Ensuring an organisation is structured to accommodate diversity strengthens global businesses against competition. There are many different forms of diversity and most can be broken down into two groups: internal and external diversity. Internal diversity covers the components of one person which they do not choose, such as:

November 2021

• Race and ethnicity • Age • Ability (physical or mental) Externally diverse aspects are things a person can change about themselves, but which are certainly swayed by other people: • Their level of education and personal interests • Their physical appearance • Religious beliefs • Marital or relationship status There can be disadvantages to diversity. For example, in a practice known as tokenism, a business may choose to hire a person simply because they are different from the majority

ESG

procurementmag.com

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Creating Digital Communities in SupplyChain

ESG

“ You’ve heard of ‘Greenwashing’ but there are various forms of deception in the business laundry basket too” of their colleagues. This might be to make the business look more inclusive or to meet goals set by senior colleagues - but the individual has not been hired for their skills. Pinkwashing in procurement - it’s not pretty You’ve heard of ‘Greenwashing’ - but there are various forms of deception in the business laundry basket too. Social washing refers to the moral masks worn by businesses whose interest in, for example, human rights, slips when clients aren’t watching. A company complicit in blue washing is one which stands shoulder to shoulder with the UN, while hiding unethical business dealings.

But one term in particular creates a disservice to diversity, meet the ugly stepsister: ‘Pinkwashing’. This is not one red sock in a room full of fluffy whites, businesses guilty of pinkwashing overtly support LGBT+ diversity and inclusion, but only as a box ticking exercise, in front of cameras and customers. That’s a lot of diverse laundry to dry and fold, however, many procurement businesses have seen the clear impact of honest inclusion and open diversity - here’s some of the best: procurementmag.com

ESG

COMPANIES AMPLIFYING DIVERSITY IN THEIR PROCUREMENT SECTOR Amazon Founded: 1994, Washington, USA Revenue: $113bn The global garage warehouse Amazon has dedicated itself to diversity by: Vowing to double the number of Black leaders at Amazon, compared to figures from 2020 Senior and executive roles held by women will be increased by 30% “My support for diversity makes some followers come for a tweet & go for another,” tweeted Candi Castleberry Singleton, Vice President of Global Diversity, Equity, and Inclusion at Amazon. “I live unapologetically at the intersection of difference: abilities, faith, gender, generations, nationality, politics, sexual orientation.” Coca-Cola Founded: 1892, Atlanta, USA Revenue: $37bn This year, Coca-Cola has started working with Ebony/Jet, Revolt TV and My Cultura, minority-owned media businesses. Coca-Cola declared it is: “Committed to supplier diversity by maximising procurement opportunities and proactively engaging and building partnerships with diverse suppliers.” Procter & Gamble Founded: 1837, Ohio, USA Revenue: $70bn After recently including 21 diverseowned suppliers to its supply base, Procter & Gamble said they were ‘well on their way’ to spending $3bn with such businesses by 2030. A P&G statement read: “We will continue 96

November 2021

to add diverse companies to our supply base and help our suppliers diversify their own supply networks in the United States, as well as increasing our investment with womenowned businesses throughout the world.” Target Founded: 1902, Minnesota, USA Revenue: $93bn Target has partnered with veteran support groups, to ease military veterans back into the civilian workforce, regardless of the physical or mental health challenges they may face. Earlier this year, Target declared that it would spend $2bn with Black-owned businesses, by 2025. The retail giant has

ESG

laid a conscious plan to work with over 500 Black-owned businesses, from marketing agencies to construction companies. Virgin Media Founded: Reading, UK Revenue: $5bn As a part of Virgin Media’s Meaningful Connections Plan, the company has a sturdy plan to “create hundreds more employment

opportunities for people from underrepresented communities”. Simmons & Simmons Founded: 1987, London, UK Revenue: £437mn With a team across Europe and Asia, the group leads procurement dealings with diversity and inclusion at the forefront. “Simmons & Simmons have been a procurementmag.com

ESG

“ Giving equal opportunities to every size of company and segment of people, gives both the company and the supplier benefits” 98

November 2021

ESG

segment of people, like providing certain business supplies to minority groups, small and medium business enterprises, women’s enterprises, others such as LGBT owners as suppliers, this gives both the company and the supplier benefits. “Diversity helps companies to increase the competitiveness between suppliers, as well as increase the base of suppliers. The benefits are both social and economical.” Where to learn more about diversity in procurement • Embedding lesbian, gay and bisexual equality in the supply chain LGBT+ charity Stonewall has released a guide: ‘PROCUREMENT Embedding lesbian, gay and bisexual equality in the supply chain’ to better advise those who wanted to create a more inclusive environment for employees and clients

partner to Stonewall for many years and have a well-established commitment to LGBT equality”, said Ruth Hunt, Chief Executive at Stonewall.

• Procurement with Purpose eProcurement company Jaggaer has created a webinar series Procurement with Purpose: Protecting People, the Planet and Profit. Speakers include Peter Smith, Managing Director at Procurement Excellence and Justin Sadler-Smith, SVP Northern Europe at JAGGAER

Equal opportunities leads to business benefits Gurudev Singh, a Columbia Business School graduate based in New Delhi, India, is involved in sustainable procurement at Global Factory 365. He sees diversity in procurement as a positive, both socially and financially. “Most large companies believe in supplier diversity”, explained Singh. “Giving equal opportunities to every size of company and

• Breaking Barriers: Hire Ground The hosts of Breaking Barriers: Hire Ground detail their personal experiences of uncovering truths about different communities, from Cloe Guidry-Reed’s encounter with a women’s-only space, to Adam Moore’s exchange with a Korean police officer. The hosts explain how such knowledge has helped them to make more room for inclusivity in procurement. procurementmag.com

GO - AHEAD

THE JOURNEY TO

SUSTAINABLE

TRANSPORT

100

November 2021

COMPANY NAME

WRITTEN BY: RHYS THOMAS

PRODUCED BY: TOM LIVERMORE

procurementmag.com

101

GO - AHEAD

102

November 2021

GO - AHEAD

Go-Ahead Group is leveraging the power of its procurement function to spearhead a new sustainable future for passenger transport

o-Ahead’s passenger transport services play a vital role in connecting communities via road and rail. It is the largest bus operator in London and its regional bus services account for 11% of the wider UK market. It operates the busiest rail franchise in the UK – GTR – as well as holding international rail contracts in Norway and Germany. But Go-Ahead’s commitments extend far beyond delivering efficient, safe and affordable public transport. Sustainability has risen to the top of the agenda. In 2019 the group released its Sustainable Procurement Charter, a list of measures to make impactful contributions to climate change and to deliver greater value to all of its stakeholders. “That charter was our first deep dive into the sustainability agenda,” says Glyn Watts, Group Head of Procurement at Go-Ahead. “We recognised that, whilst we thought we were good at sustainability in the past, we actually weren’t that mature in our approach.” Despite the added pressures and challenges brought on by the COVID19 pandemic, Go-Ahead’s ambitions in sustainability and diversity have developed further in the intervening two years, with a target to be a net zero business by 2045. “Since the sustainability charter we have released the climate change strategy, which directs us in where we are heading as a business,” Watts says. “And this has been followed more recently by our SME strategy.” procurementmag.com

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The Journey to Sustainable Transport

Though a group-wide effort, the procurement function is a key enabler in these initiatives. Take, for instance, Go-Ahead’s most prominent asset: vehicles. In one regional transport service, the function procured a new type of bus with a specialised filter that cleans the air as it drives around the city. The company is in discussions for what has the potential to be the largest hydrogen bus order in the UK. These are the nascent stages of an overhaul of the auxiliary fleet as it moves towards sustainable fuels or electrification, and a vital step for the transport operator. However, procurement’s role goes beyond the directly passenger-facing facets of the business. “Every new tender is an opportunity to reconsider how we do that business,” says Watts. "So even the routine and the mundane, we’ll ask if there is a new way of doing it, or whether we even need that requirement anymore. Our ethos is to invite 104

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market entrants in for a discussion before we run a tender. It’s so important to do early market engagement, discover who else is out there, who's doing things differently, who’s innovative and, ultimately, who could bring some value to our operation.” The results have been surprising but enormously impactful. The first tender Go-Ahead ran under the new sustainability charter was for new ticket vending machines for one of its rail operations. Whilst the tender was ultimately cancelled due to a change in circumstances, it was worth noting that the supplier that came out on top commercially required the largest initial outlay and some of the more expensive service costs, which seems counterintuitive. But this assessment belied the long-term value. “If we'd run that tender several years ago, the supplier with the lowest up front and long-term service cost would have won the commercial section,” Watts says. "However,

GO - AHEAD

GLYN WATTS TITLE: GROUP HEAD OF PROCUREMENT INDUSTRY: TRANSPORTATION LOCATION: UNITED KINGDOM Glyn Watts leads Go-Ahead’s procurement function. Glyn developed and implemented the supply chain charter and SME strategy. He has brought a value driven and commercial approach to procurement, ensuring the business objectives are clearly understood and processes designed to meet them. Prior to Go-Ahead, Glyn held senior commercial positions within the Department for Transport and the Ministry of Defence. He led the Southeastern rail franchise procurement and was the lead negotiator for on-train wi-fi. At the MoD, he led large procurements for military equipment and services. Glyn holds MCIPs, a Business Degree from Nottingham Trent University and a post Graduate Diploma in Acquisition from Cranfield University.

“ Every new tender is an opportunity to reconsider how we do that business” GLYN WATTS

this time around we took into account energy consumption, and actually the supplier with the highest initial outlay but the lowest energy costs nudged ahead as a result of their energy efficiency. It is really great when that happens. It shows suppliers the value of investing in energy efficiency and demonstrates the value procurement can have in understanding the true financial and environmental cost of a product or service.”

EXECUTIVE BIO

GROUP HEAD OF PROCUREMENT THE GO-AHEAD GROUP

GO - AHEAD

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Europe’s largest parking operator, managing 1.6 million spaces across 13 countries including the UK

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APCOA Urban Hubs provides new opportunities to commercialise under-utilised parking spaces

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Proud to partner with The Go-Ahead Group, providing customer-centric solutions via sustainable innovation

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It is a marriage of both commercial and sustainable capability - and a positive trend illustrating how Go-Ahead is rethinking its relationships with suppliers to deliver greater value. A further example Watts highlights is APCOA Parking, a key supplier for Go-Ahead’s car parking provisions. Watts places the annual income from parking at between £40-50m, a substantial contract by any measure. But the use of car parks has changed. More passengers cycle as part of their commute, they require lockers, or they may benefit from a car washing service. In addition, the company wanted to think of ways to incentivise electric or hybrid vehicles through the charging structure over more polluting alternatives.

“ The supplier with the highest initial outlay but the lowest energy costs nudged ahead as a result of their energy efficiency” GLYN WATTS

GROUP HEAD OF PROCUREMENT THE GO-AHEAD GROUP procurementmag.com

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“ If we're going to develop for the future of transport, we need to be looking at innovative step-change technologies” GLYN WATTS

GROUP HEAD OF PROCUREMENT THE GO-AHEAD GROUP

“APCOA was bristling with these sorts of ideas, and ways to make these spaces more sustainable. And with that in mind, we were no longer looking for a good debt collection company, or even a supplier primarily focused on parking,” Watts says. “The result is we now have a partner in APCOA with which we can develop those ideas over a number of years. They were successful largely because of the amount of ideas they had, and how well they can develop those, particularly in the sustainability space where they have strong partners in electrical vehicle charging.” This mindset to balance innovation and cost has been codified in Go-Ahead’s recently published SME Strategy. With a roadmap of tenders published well in advance, Watts aims to give resourcelimited SMEs the time they need to prepare and meet Go-Ahead’s requirements, rather than being muscled out by market leading competitors that have the ability to throw resources at an issue at short notice. “Secondly, and probably more importantly, we're identifying SME-spendonly categories,” Watts says. “These are 108

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smaller categories of spend where we may currently use a big provider, but if there's a quality market there for SMEs, we're going to commit 100% of the time to using SMEs. As long as the safety risks are understood, we’re going to get the quality we need, and there are no other issues, we're going to have a blanket policy that they have to be SMEs. There’s still work to do there, but we think it could have a big impact.” Beyond Watts’ 17-strong centralised procurement team, a further 30 procurement professionals operate from

GO - AHEAD

Go-Ahead’s operating companies. Across the whole business Watts and his teams manages over 3,500 suppliers, covering nearly £2bn in annual spend. This is not “spend for the sake of it”, however, says Watts. “We're not just doing it for reputation; we strongly believe it supports our corporate strategy. If we're going to develop for the future of transport, we need to be looking at innovative stepchange technologies, which often come out of left field and sometimes not from our industry.”

Watts admits that these ambitions require dedication and hard work. Transformation at this scale is difficult, but Watts says the support from stakeholders is making the process a success. “I think everyone enjoys having an impact beyond cost and time,” adds Watts. "They are essential to the business of course, but it’s rewarding for procurement professionals and our stakeholders to think about other factors and drive positive change through elevating our sustainability priorities in the procurement process.” procurementmag.com

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“ It’s so important to do early market engagement, discover who else is out there, who's doing things differently, who’s innovative” GLYN WATTS

GROUP HEAD OF PROCUREMENT THE GO-AHEAD GROUP

Go-Ahead has come a long way in just a short period of time, but Watts believes the rate of change will accelerate even faster in the coming 12 to 18 months. “I like to think we would be much further along the road in our climate change strategy. One of the key pillars there is waste reduction and recycling targets. We’re currently running trials at Brighton Station and bus depots to find out the best way to achieve 90%+ recycling on a small scale, and then how to expand in a way that is commercially viable. “I'd also like to think we will be pulling more innovation from our supply chain. We're running a bus supply chain challenge across all of our existing suppliers. We’re asking, ‘What can you do for us?’ It could be on cost operations. It could be customer experience. It could be to do with the environment and climate change. I like to think that asking these questions will provide us with some strong results, but at the very least put our suppliers on notice that we are listening and we have an appetite for experimentation and change.”

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We talk the role of procurement with CM Group's WRITTEN BY: JAMES CLARK PRODUCED BY: MIKE SADR

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COMPANY CM GROUP NAME

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Karen Hodson, Chief Procurement Officer for the CM Group brings together a diverse group of email marketing platforms under a single umbrella

Karen Hodson Chief Procurement Officer

aren Hodson is the Chief Procurement Officer for the CM Group. The company brings together a diverse group of email marketing platforms, including Emma, Campaign Monitor, Delivra, Liveclicker, Sailthru, Selligent and Vuture under a single umbrella. She has been with the Company since its start in 2017, headquartered in Nashville, Tennessee. Prior to her position with the CM Group she started off in software startups and worked her way up the procurement ladder. “During a previous position I had done a great job on a contract and the CFO at the time said, do you like negotiating? I said yes, and his response was great you're in charge of procurement. At the time I didn’t even know what procurement was, but that’s how my career journey started,” explains Hodson. “The start of my journey involved figuring out what procurement was and what it meant for an organisation. My next task was establishing how I could make an impact and create centralised procurement at the company I was working with at the time. Once I had that worked out, I moved on to another company.” Hodson joined an organisation with a longer history to again focus solely on procurement. This provided her with the opportunity to get a much better understanding of what procurement in Example of larger operation involved. Although she an image a caption procurementmag.com

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Chief Procurement Officer CM Group talks platforms and people

learned a lot from the company, she missed having more involvement in different areas of the organisation. “I kind of missed the crazy fast paced world of tech startups and wanted to go back to it. I like getting involved in tech startups and building procurement, policies, processes and procedures. I’ve done it four times now.” Hodson has a really hands-on approach to procurement. She likes working with all the CM Group departments and has an understanding of all those back-office sort of functions that a lot of CPOs simply do not have the time to learn. She considers procurement to be a largely customer service-related role. “I’m customer facing in the sense that my co-workers are my customers. The employees within the CM Group come to me about a wide range of issues; everything from buying laptops and keyboards to making sure we're buying the right software and services to help us run our business. I also deal externally with all the 116

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different vendors that we engage with daily.” “I make sure that the relationship makes sense for both parties. We have multimillion dollar contracts, so it’s important to engage with the right vendors and really understand what the organisation needs to be able to run the business effectively.” Centralised Purchasing System She first joined the CM Group as it was being formed. “When I joined, we merged three companies together which was the beginning of the CM Group.” Hodson immediately identified that it was necessary to establish a centralised purchasing system to avoid a situation where the marketing department buys their own software, and the sales department purchase their own software. “I wanted to avoid a situation where different departments are purchasing the same services, from the same vendors and with two contracts. That really doesn’t make sense to me. It was imperative

CM GROUP

KAREN HODSON

CHIEF PROCUREMENT OFFICER, CM GROUP

KAREN HODSON TITLE: CHIEF PROCUREMENT OFFICER INDUSTRY: INFORMATION TECHNOLOGY & SERVICES LOCATION: UNITED STATES

EXECUTIVE BIO

“The start of my journey involved figuring out what procurement was and what it meant for an organisation. My next task was establishing how I could make an impact and create centralised procurement at the company I was working with at the time. Once I had that worked out, I moved on to another company”

Karen received a B.A. in Economics and Minor in Communications from Seton Hall University and her M.A. in Organisational Management from George Washington University. Karen has over 20 years of experience in operations, procurement and real estate management. She started her procurement career at a tech startup and has gained knowledge and experience building centralised procurement at 4 other companies since. She is a skilled negotiator and has an average savings of 20% on vendor contracts. Along with managing procurement, she also manages CM Group’s Real Estate portfolio, as well as corporate insurance and the corporate travel program.

to figure out first what made sense for the company and secondly how to implement it across the entirety of the organisation.” Hodson implemented Zip to manage the purchasing request process across the CM Group. Hodson is keen to speak further about the centralised system. “Having centralised procurement allows the organisation to get an overall broad view of what is happening on the purchasing side of the business. I facilitate different departments coming together to have a conversation. For example, sales may have a need and not realise that the marketing department has a tool in place already that the procurementmag.com

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sales team can use. They may just utilise it differently, but in the long run they are after the same solution.” “It’s my role to have these conversations and get everybody talking so that departments aren't just working in their siloed areas. This opens up the visibility on spend, and provides an understanding of what we're buying, by breaking down the silos and engaging other organisations to help us run our businesses while keeping every company involved safe.” GDPR, California CCPA laws and Security “It is important that procurement doesn’t just save dollars. Our job is also to reduce risk for the company and understand how we're exposing ourselves when we engage with other companies.”

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purchase, then that's where it is possible for us as a company to open the CM Group up for issues from a security perspective.” There is a lot more to the supplier ecosystem at the CM Group than simply spending money. Hodson is keen to discuss privacy compliance issues going forward and provides an evaluated vendor as an example. “I approached a new prospective vendor; it was a small organisation that didn't have the mechanisms in place to secure people's personal information that we wanted to share with them to deliver our orders. It’s not something that most of us think about when shopping on Amazon. We had no choice but to go with another company able to secure the information and comply with all GDPR and CCPA privacy regulations.” “And even with the right vendors and consultants we must have the correct legal paperwork in place that says that all parties are going to keep the information confidential and if for whatever reason they decide to not keep the personal information confidential they are made aware of the repercussions.” The CM Group is dedicated to being GDPR and CCPA compliant. “We are compliant as an organisation, but we also have to be able to make sure that the vendors we engage with are compliant with personal information. We also have to speak about security and understand the risks the engagement may bring to the organisation,” Hodson confirms. “Security is obviously a major concern for any organisation. And a question I am often asked is how secure are the online SaaS type tools that we use? I work closely with the security team to ensure that the software we purchase is not too risky for the business. If you are not diligent with evaluating your

“It is important that procurement doesn’t just save dollars. Our job is also to reduce risk for the company by understanding how we're exposing ourselves when we engage with other companies” KAREN HODSON

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“Receiving notifications reminding us that a contract is up for renewal in three months and sometimes as far as six months ahead makes sure that I don’t miss something. It gives me the time to reach out and have the correct conversations internally. Auto reminders are one of those amazing tools at my fingertips that keep everything flowing in the right direction” KAREN HODSON

CHIEF PROCUREMENT OFFICER, CM GROUP

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The Renewals Process Building new business relationships is clearly important to Hodson, but the focus doesn’t end there. She ensures that all vendors do what they agree to do and prefers to take a proactive approach rather than relying on an issue being flagged later on throughout the engagement process. “I have to rely a lot on our end users so I create relationships within each of our departments so I am aware of any issues that may arise from purchase engagement through to the renewals process.” “One of the things I try to avoid is getting stuck in an auto renewal which is a nightmare for any procurement person.” Having a system like Zip helps the CM Group stay on top of upcoming renewals.

“Receiving notifications reminding me that a contract is up for renewal in three months and sometimes as far as six months ahead makes sure that I don’t miss something. It gives me the time to reach out and have the correct conversations internally. Auto reminders are one of those amazing tools at my fingertips that keep everything flowing in the right direction. I rely heavily on them because it’s not always possible to remember all the details. I pride myself on remembering quite a lot, but not everything. This is where software, like Zip comes into play.” “When it is renewal time the teams are encouraged to have discussions internally. We'll then sit down and go through all points raised by them. It’s a great opportunity to procurementmag.com

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“I’m customer facing in the sense that my co-workers are my customers. The employees within the CM Group come to me about a wide range of issues; everything from buying laptops and keyboards to making sure we're buying the right software and services to help us run our business. I also deal externally with all the different vendors that we engage with daily” KAREN HODSON

CHIEF PROCUREMENT OFFICER, CM GROUP

discuss any challenges; for example: Has the vendor been able to provide everything that they said they would provide? Has anything been lacking? And is the product still meeting our needs? A lot of factors come into play. If a vendor is unable to provide us what we are paying for then it’s a good time to consider a new business relationship.” Hodson is keen to discuss how human interaction and software tools work hand-inhand to support the CM Group. To ensure that purchasing within the company is efficient all of the departments submit their request in Zip, CM Group also uses other SaaS tools to evaluate the purchasing landscape and complete the procure to pay process at the organisation. It’s important that each department answers standardised questions when submitting a request including how much it’s going to cost? How long are they going to require the item for? What department do they belong to? All of these questions need to be answered so the procurement team can assist with completing the purchase. She is keen to highlight the ever-growing procurement departments popping up

within organisations. “More organisations are understanding the value that centralised procurement can bring.” She believes that procurement is more than solely a money savings office. The department offers real time value across the company. “In the past, procurement was largely about checking boxes, processing papers and making sure that correct procedures were in place. These are a very important piece of the puzzle. But procurement brings a lot more to an organisation and people are beginning to understand the value that procurement can bring to a company by breaking down silos, reducing spend while reducing risk, increasing happiness across companies’ customers, and the employees within an organisation.” “I think the role of procurement is definitely expanding well beyond dollar savings. It’s also about how we make our employees happy, how we reduce risks and engage with the right vendors.”

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CSCO Leaders Discover Procurement Magazine’s list of 10 leading CSCO executives in the procurement industry WRITTEN BY: GEORGIA WILSON

elebrating leading individuals blazing trails in the industry, Procurement Magazine lists its top 10 Chief Supply Chain Officers from our annual list of Top 100 Leaders. Our Top 100 Leaders is following on from the success of our debut Top 100 Women that recognised the incredible and influential women in the industry, on International Women’s Day. “The success of that initiative encouraged us to recognise the Top 100 Leaders – individuals championing everything that we love about technology and embracing best practice that’s good for business,” says Scott Birch, Editorial Director, BizClik Media Group. Click here to read the full Top 100 Leaders list or the Top 100 Women list.

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Lynn Torrel

Chief Procurement and Supply Chain Officer

Flex

Being an innovative and solutionsoriented person, Lynn Torrel is well versed in managing complex customer and supplier requirements, as well as delivering improved financial performance and enhancing relationships. Joining Flex in October 2019, Torrel, is the Chief Procurement and Supply Chain Officer responsible for direct materials, indirect materials, transportation and logistics, business operations, materials management, and strategic supply chain management. Prior to Flex, Torrel has worked for Avnet, EBV Elektronik, and Wyle Electronics.

“Lynn Torrel is well versed in

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Arthur Valdez Jr

Executive Vice President, Chief Supply Chain and Logistics Officer

Target

Working for Target since 2016, Arthur Valdez Jr is a seasoned executive in the world of supply chain with direct-to-customer and direct-to-store experience. Prior to Target, Valdez worked for Amazon for 16 years, working in transportation, fulfilment, and logistics, as well as holding positions at Walmart and Kmart. Currently at Target, Valdez lead’s the company’s supply chain transformation, including planning, distribution, and transportation.

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“Pilz holds B.S. and M.S. degrees, as well as a doctorate in chemical engineering from the Karlsruhe Institute of Technology in Germany”

Antoine Simonnet

Chief Supply Chain Officer

Antoine Simonnet joined HP in 2001. With 20 years of experience working at the company, Simonnet started as the Director of Display Procurement, working his way up teh career ladder to where he is today as Chief Supply Chain Officer. In his role, he oversees HP’s global supply chain and leads the sustainability and social impact effort for the company around the world.Simonnet holds a degree in Electrical Engineering from Superlec Graduate School of Engineering in France, as well as an executive certification in Business Administration from the Instead Advanced Management Program.

Torsten Pilz

Chief Supply Chain Officer

Honeywell

Joining Honeywell in 2018, Torsten Pilz has been the Chief Supply Chain Officer at the business for three years. Prior to joining Honeywell, Pilz worked for the likes of SpaceX, Amazon and Henkel.In his role at Honeywell, Pilz is responsible for the integrated supply chain, including procurement and driving improvements in plant efficiency and working capital, as well as enhancing quality and delivery. Pilz holds B.S. and M.S. degrees, as well as a doctorate in chemical engineering from the Karlsruhe Institute of Technology in Germany. procurementmag.com

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Meet the Top 100 Leaders in SupplyChain

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Creating Digital Communities

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Kevin Brown

Dr. Randhir Thakur

Chief Supply Chain Officer

Intel Corporation

With a career spanning over 25 years, Dr. Randhir Thakur brought his experience as a hands-on innovator and business leader with expertise in global manufacturing to Intel Corporation, as well as research and development (R&D), and profitable P&L management. Thakur leads the development and growth of the company’s new foundry business, a significant part of the company’s IDM 2.0 strategy. Thakur’s team is committed to building a world-class service organisation with a strong focus on technology innovation and operational excellence.

Chief Supply Chain Officer Executive Vice President, Global Operations, & Chief Supply Chain Officer

Dell Technologies

Joining Dell Technologies in 1998, Kevin Brown has an extensive career in operations, technology and procurement leadership. During his career he has been dedicated to strategic and transformative initiatives, innovations, and partnerships to drive efficiencies, savings, and effectiveness. In his role at Dell Technologies, Brown leads an organisation of 7,700 team members across 23 countries, with a procurement budget of US$67bn.

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Alexis DePree

Chief Supply Chain Officer

Nordstrom

Working with talented teams to deliver incredible experiences for customers, Alexis DePree thrives on creating structure out of chaos, unlocking organisations’ potential. DePree loves working across business functions, creating organisational efficiency and improving customer experiences. “I’ve always been a problem solver. Throughout my career I’ve led critical, enterprisewide initiatives through strong collaboration, qualitative & quantitative decisionmaking, and engaging talent management,” says DePree. DePree joined Nordstrom in 2020 as EVP Supply Chain (CSCO), she is now the Chief Supply Chain Officer, executive team member. DePree has also been on the Female Founders Alliance since 2020.

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Sandra MacQuillan

Executive Vice President and Chief Supply Chain Officer

Mondelēz International

Joining Mondelēz International in 2019, Sandra MacQuillan brought 18 years of supply chain experience to the company. In her role as Executive Vice President and Chief Supply Chain Officer MacQuillan leads all aspects of the organisation’s global supply chain including procurement, manufacturing, logistics, engineering, sustainability, and safety. MacQuillan has a passion for the role supply chain plays to drive value to the business. MacQuillan is also a Chartered Mechanical Engineer and was appointed as a Fellow of the Royal Society of Arts in recognition of her work, encouraging young students, particularly women, into engineering.

TOP 10

Francesca DeBiase

Executive Vice President, Chief Global Supply Chain Officer

McDonald's

Francesca DeBiase has served in supply chain and sustainability roles under the ubiquitous Golden Arches for more than a decade, stepping up to Chief Global Supply Chain Officer in October 2020. She leads McDonald’s overarching supply chain vision and the $40bn spend across food, packaging, logistics and more, supporting 37,000 restaurants across the planet. High on her agenda is working in concert with suppliers to ensure delivery of essential goods and services while minimising the environmental footprint, a mission she has carried over from her former roles.

“ Francesca DeBiase has served in supply chain and sustainability roles under the ubiquitous Golden Arches for more than a decade” procurementmag.com

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Kathy Wengel, Executive VP of Johnson & Johnson

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“ Kathryn Wengel has served at Johnson & Johnson for close to 35 years, including 19 years with its pharma group Janssen”

Kathryn Wengel

Executive Vice President & Chief Global Supply Chain Officer

Johnson & Johnson

Kathryn Wengel has served at Johnson & Johnson for close to 35 years, including 19 years with its pharma group Janssen. Today she heads up all aspects of the company’s supply chain across its three core segments - consumer health, pharmaceuticals, and medical devices leading a global supply chain organisation of 56,000+ members, as well as partners and suppliers. A globally recognised business leader, Wengel also leverages her experience and influence to promote the advancement of women in the supply chain. Internally, she spearheads initiatives as the executive sponsor of the Johnson & Johnson Women’s Leadership & Inclusion (WLI) initiative, as well as the Johnson & Johnson Women in Science, Technology, Engineering, Math, Manufacturing and Design (WiSTEM2D) programme.

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MICROSOFT

Microsoft Israel:

GLOBAL ACTION, LOCAL RESULTS

WRITTEN BY: RHYS THOMAS PRODUCED BY: GLEN WHITE

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Moving procurement beyond a bureaucratic function delivers true value, says Eyal Nuhamovici, Sr. Procurement Engagement Manager, Microsoft in Israel

armony may not be the first word that springs to mind when describing the procurement organisation of a company employing hundreds of thousands of people and operating globally. With businesses of such scale and breadth, procurement leaders often face challenges like siloed information, global versus local objectives, and a variety of other issues to overcome. But Eyal Nuhamovici says Microsoft is different. As the Israel Procurement Engagement Manager at Microsoft, his tasks range from hyper-local to global, and often somewhere in between. “Even though our procurement organisation is spread out across the entire globe, we act as a harmonious team,” he says. “We complement each other.” Like many in procurement, Nuhamovici fell somewhat accidentally into his career. Fresh from military service, a mandatory first step into adulthood and independence for Israeli citizens, he took a buying position at a local SME. But it wasn’t long before Nuhamovici says he began to understand exactly what procurement was, and the impact of being able to “connect the dots' ' between departments to help them further their goals. “Procurement sees the organisation through a very wide angle, across HR, finance, the legal team, any manufacturing or development departments,” he says. “And when you begin to connect the dots

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“ Even though our procurement organization is spread out across the entire globe, we act as a harmonious team” EYAL NUHAMOVICI

SR. PROCUREMENT ENGAGEMENT MANAGER, MICROSOFT ISRAEL

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between departments, that’s when you can think about how to leverage procurement to bring the company to a better position.” This perspective is echoed in the procurement culture at Microsoft. Even in a company this large, Nuhamovici says he is able to make a difference. At the fundamental level, procurement of major categories, such as software, are centralised through Microsoft’s Redmond campus and headquarters in the USA. On the other hand, sourcing local development tools, local communications

MICROSOFT

EYAL NUHAMOVICI TITLE: SR. PROCUREMENT ENGAGEMENT MANAGER

contracts and other supporting services are handled by regional procurement experts on the ground. But even here, Nuhamovici says, there is always an opportunity to benefit from global insights. “If we are buying something for the company locally, why not benefit from the RFP and the activities we are doing to derive some more value for the wider company and the employees? You should always strive to secure global contracts, and then complement or supplement those with local services. It is a very balanced situation where

EXECUTIVE BIO

COMPANY: MICROSOFT ISRAEL Experienced procurement manager with vast experience from different organisations - large and small, local and global, large scope budgets and deals, team and matrix management. A proactive and creative person, with excellent negotiation skills, very organised and with high work ethics. Broad commercial perspective that exceeds the area in charge of, hence, bring managerial, economic, commercial and procedural advantages to the company.

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Microsoft in Israel: Global action, local results

I can be part of the activities that are led by headquarters’ procurement managers, while they might join and aid me in my activities.” To reconcile this approach to local and global sourcing, Microsoft employs the latest digital tools - unsurprising given the company’s leading position in both enterprise and consumer technology. “There is a huge emphasis on the topic of digital transformation in procurement at Microsoft, because we really understand the importance of innovation. We use our own technology and approach everything with a growth mindset, considering how to do things better, how to improve the dayto-day.” The earliest objective of Microsoft procurement’s digitalisation journey was to simplify and consolidate buying channels and promote procurement as a seamless experience for stakeholders. 142

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“The innovation comes in technology, by leveraging systems, but it also has to come from new ideas” EYAL NUHAMOVICI

SR. PROCUREMENT ENGAGEMENT MANAGER, MICROSOFT ISRAEL procurementmag.com

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Nuhamovici recognises that procurement is often considered as a function that people must engage with, not want to engage with, and we strive to change that. “So we minimise the pain points for shareholders, reduce the amount of buying channels and always think about how to do more with less. It’s about getting to the core of what is really needed. You also want them to spend less time on technical actions; even simple things like streamlining the process of entering a purchase order can improve the perspective of procurement in our stakeholders’ eyes. “They just want to get the work done. So by supporting them with the right tools, we’re accomplishing a lot. We can empower employees to do more by themselves, optimising the process for them, and fixing areas where they may encounter challenges or make mistakes. That’s where engagement is so important.” Better digitalisation both yields and requires more data. In analysing and leveraging that data, Nuhamovici sees the future of procurement moving from a costsaving, streamlining function into a position of predictive and anticipatory power: “To understand, according to what they did already, what they will need in the future.” But there are issues with becoming too reliant on the facts and figures directly in front of you. “If the information or data exists, it’s because something’s already been done, and procurement is always looking ahead at what should be done next, because otherwise there is no real impact,” Nuhamovici says. "Planning ahead is definitely one of the most important things that I spend a lot of time on, whether that’s 144

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HALO BENEFITS FOR SUPPLIERS Monetary gain isn’t the only benefit of working with a market-leader, says Nuhamovici. Suppliers stand to learn and improve their business in the long-term by working in true partnership with Microsoft. “One of the biggest benefits suppliers gain by working with us is learning from the Microsoft culture,” says Nuhamovici. “It can help businesses to modify the way that they think about a certain product or service, and then they can provide a better and improved service, not only to us, but in the wider market. “We really believe that we're adding an additional layer. We’re not changing every business fundamentally, of course, but if we add just one additional layer in the way that things are being done, we can help improve the way that certain businesses operate. When you do business with Microsoft, you can learn from us. We always come with a very innovative way of solving a certain need, and when we achieve that, it can be very important for the market - not just for ourselves.”

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understanding opportunities, looking for new directions, hearing from other peers within the organisation or externally, I’m looking around, and ahead, all the time. “One thing that I think that is underestimated, and not a lot of people are looking at, is trends,” he adds. “They tell you a lot about what is, what was, and what the thoughts of people are at each step. It's like personalising the data, because otherwise data is just data. Looking at a trend, you can now understand what happened with a certain supplier, a certain market, a certain category, or a certain country. I'm really a believer that trends can bring you important insights about the business.

“ When you begin to connect the dots between departments, that’s when you can think about how to leverage procurement to bring the company to a better position” EYAL NUHAMOVICI

SR. PROCUREMENT ENGAGEMENT MANAGER, MICROSOFT ISRAEL

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“You should always strive to secure global contracts, and then complement or supplement those with local services” EYAL NUHAMOVICI

SR. PROCUREMENT ENGAGEMENT MANAGER, MICROSOFT ISRAEL

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“To give you an example, when it comes to engaging with a stakeholder, if you come informed by a trend, you understand their previous actions, in that way, understand what might be interesting for them in the future. If they have $100 and our procurement position can help save them $20, for example, that’s extra money that can be spent on additional services or saved. Those sorts of insights lead to more commercial value than simply handing back some money.” This, Nuhamovici says, will be the biggest challenge for procurement in the years ahead, not just for Microsoft, but in the sector at large. “Innovation comes in technology, by leveraging systems, but it also has to come from new ideas,” Nuhamovici says. “That comes from partnerships and pooling those ideas to pull the market ahead,” he says. “Once you sign an innovative contract with a supplier, it becomes the common practice for the supplier because they learned how to do it. Now they can copy or adjust this idea with future contracts in the market. This is a good example of how you eventually lead and develop procurement to be better positioned and create a larger impact not only on the company you work with, but on other markets as well. “It's a challenge, and that’s a good thing, because when you're being challenged, that is how you improve your ideas. If everything goes smoothly, you never improve, and that to me is quite a beautiful thing.”

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BI GROUP RISES TO MEDICAL CHALLENGES IN CENTRAL ASIA WRITTEN BY: DOMINIC ELLIS PRODUCED BY: GLEN WHITE

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BI Group has seen a boom in health business during the pandemic and Chief Procurement Officer Darkhan Shildebayev anticipates rising demand

Darkhan Shildebayev, CPO, BI Group

he last 18 months have been universally challenging for the construction industry but companies of the size and pedigree of BI Group have weathered it better than most. The COVID-19 crisis actually presented the group – which has 5,000 employees and is ranked as one of the leading globally – with unexpected opportunities, as it was tasked with building 15 hospitals in two months, spanning a total area of 115,000sqm. Meeting the urgent health needs has been an overriding priority for its 160strong procurement team, to the extent that it established a dedicated medical procurement division and even opened its own lab for PCR studies at Nur-Sultan (formerly Astana – the name change was made by Presidential decree in March 2019). This was on top of procuring items for the group’s 180 projects, covering everything from materials and machinery for housing developments to major stadium projects; last year saw the launch of a 7,000-seat athletic complex in the Kazakhstan capital. “There was huge demand for medical equipment last year. We did well, as we never broke any agreement terms or schedules,” said Chief Procurement Officer Darkhan Shildebayev. “We believe procurementmag.com

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that medical building will be at the heart of construction for the next couple of years for us.” As part of a charitable campaign to help fight the pandemic, BI Group also donated 1,065 oxygen concentrators to hospitals throughout Kazakhstan. The BI-Zhuldyzai Foundation, despite the quarantine measures and economic difficulties, has continued its charitable activities and helped 1,253 children with difficult medical diagnoses. In total, 52,603 rehabilitation services were provided in 2020. Housing drives group growth This year BI Group is budgeting for growth of 15% in development business, and a 154

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slight growth in contracting and projects – and altogether group growth of around 5%, which is respectable given the precarious economic situation. Housing projects are its main business driver and affordable housing accounts for 10-15% of its portfolio. The main objective is to make sure it doesn’t face challenges with shortage of materials – a universal predicament facing the industry. “The pandemic has had a huge impact on our business. We had our suppliers shut down their production lines, and had to deal with border closures – we had materials stuck but it’s much better nowadays.

BI GROUP

DARKHAN SHILDEBAYEV

“WE BELIEVE THAT MEDICAL WILL BE AT THE HEART OF CONSTRUCTION FOR THE NEXT COUPLE OF YEARS FOR US”

TITLE: CPO INDUSTRY: CONSTRUCTION LOCATION: CENTRAL ASIA Darkhan Shildebayev, 34 years old born in Zhezkazgan, Kazakhstan. He has been with BI Group for a little under six years, and held various positions within the company including, head of competitive intelligence and representative offices in Moscow and Riyadh in Saudi Arabia. Previously worked at financial institutions and mining companies including Jusan Bank (formerly Tsesna Bank) and Kazakhmys. Holds master’s degree in International Business Management from Carinthia University of Applied Sciences, Austria.

DARKHAN SHILDEBAYEV

“We don’t have much production in Kazakhstan, it’s mostly imported from Russia and neighbouring countries – and they’re trying to develop their economies through construction,” he said. “The fastest way to warm up the economy is construction and there will be huge demand for resources and procurement.” One permanent change will see BI Group set more long-term contracts with its suppliers, and prioritise them, he said. “We’re going to change how we work with our suppliers, making it easier for them to see what they’ll be working on, so they’ll know the projects in advance – so they can allocate their resources much easier than it used to be.”

EXECUTIVE BIO

CPO, BI GROUP

BI GROUP

BI Group rises to medical challenge in central Asia

He foresees sharp growth in construction, anticipating 9% industry growth, which will create challenges with materials, machinery and manpower. Building on supplier relationships BI Group was fortunate as it had embraced digital before the pandemic, so making the switch was painless compared with many companies. Through its supplier relationship platform, BI Partners, suppliers can directly interact through the app. Without going into specific terms, he says that “the more you buy, the bigger your discount.” Last year also marked a real estate services turning point, as apartment units could be bought via the BIG App. Now the plan is to combine all the platforms together, creating one ‘eco-system’ for the whole company. He hopes it will 156

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be finalised within a year. In 2020, service specialists processed 147,608 client requests. “The idea is to connect what we buy, with those who buy it from us,” he said. “We have sufficient amount of information, in construction and sales, but now the idea is to create a picture to understand what this data says to us.” Out of 10,000 partners, BI Group has 200 main partners, which will be important for the next five years. Suppliers at the top of the list include Danfoss (hydraulic solutions), Kazenergokabel (electrical equipment

BI GROUP

1995

Year Founded

$1.4bn (2015) Revenue

5,000

Number of Employees

supplies), GQ Engineering (low current solutions and electrical equipment supplies), MIT (medical innovation technology and medical supplies), Troya, Fenix, Megasmart (all furniture supplies) and Kazintertech (educational equipment supplies). In another clear example of its attention to detail, BI Group has a special IT department responsible for cybersecurity, which carries out ‘penetration testing’ on an ongoing basis.

RECORD SALES IN 2020 In 2020, more than 10,039 thousand families received the keys to their apartments. The first residential complex Tamerlan Residence was built in Shymkent and the company entered the Uzbekistan market with the construction of the first residential complex from BI Group in Tashkent (NRG Oybek).

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DRIVING COST SAVINGS THROUGH DIVERSE, INNOVATIVE PROCUREMENT WRITTEN BY: LAURA V. GARCIA PRODUCED BY: GLEN WHITE procurementmag.com

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By leveraging technology, Spring Branch ISD is making their way to innovative and diverse strategic procurement and picking up the cost savings

ichard Gay, Director of Procurement Services at Spring Branch ISD, is a passionate leader who derives great pride in doing good through good procurement. Whether it’s capturing cost savings that make their way back into the schools to further support learning, inclusive procurement practices that ensure fair and equitable access to opportunity or leveraging digitisation to lighten the work of school officials so they can spend more of their time focused on their students, Gay leaves no stone unturned. His quest is to ensure his department and his team is, as his father urged, the best that it can be. “I grew up in the space program. My dad worked in the Mercury, Gemini, Apollo and space shuttle projects. Those were very challenging times. We were doing things as a country and as a citizenry that had never, ever been done before. My dad left all of his children with the legacy of not being afraid to try something new. Get out there and take risks when you need to be a leader and an innovator. “ Mission: Be the Best Procurement Team We Can Be “The charge that I give to my staff is that we are going to be the best procurement platform in the K-12 world. Whatever it takes to do that, we need to make sure that we're doing that every day when we come procurementmag.com

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“ My dad left all of his children with the legacy of not be afraid to try something new. Get out there and take risks when you need to be a leader and an innovator” RICHARD GAY

DIRECTOR OF PROCUREMENT SERVICES, SPRING BRANCH ISD

into work. What I can do to make them successful is to make sure that they have the professional development, guidance and mentorship that they need to be able to achieve that goal.” “Being innovative and being a mentor, and being able to share those experiences with younger, less-experienced procurement professionals and enlightening them to the possibilities of things like e-procurement bidding and digitisation of the contractual process is one reason I came to Spring Branch.” “We became ISO certified in Baltimore County, and I follow much the same model as ISO, which says what you're going to do, do what you say and then prove it. I think that it enables you to be the best that you can be. And that's why we apply for nationally recognised certifications and peer reviews. The achievement of Excellence in 162

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Procurement from the National Procurement Institute, the Quality Public Procurement Department from the National Institute of Governmental Purchasing (NIGP).” “Here in Texas, we have the Texas Association of School Business Officials. They have the Award of Merit for purchasing operations. Applying your procedure and policies to these outside organisations and having your peers review them, and awarding you a plaque or certification for doing things right gives you something tangible that you can show your employees and say, ‘good job, you’re doing it right.’” “We also go to the schools and walk around where they can see the children learning in the classrooms or playing basketball, and that helps them to gain a more solid understanding and appreciation for what their role and their mission are here in the public school.”

SPRING BRANCH ISD

RICHARD GAY TITLE: DIRECTOR OF PROCUREMENT SERVICES COMPANY: SPRING BRANCH ISD INDUSTRY: EDUCATION MANAGEMENT

EXECUTIVE BIO

Fair, Inclusive, and Transparent (FIT) Procurement Throughout his procurement career, Gay has strived to offer a fair and equitable bidding environment designed to encourage and provide equal opportunity to minority and small business participation in all contracts. Over the past 10 years, BCPS has issued State and County funded contracts valued at $1.94bn with a Minority Business Enterprise (MBE), Women Business Enterprise (WBE), Disadvantaged Business or Small Business Enterprise (DBE/SBE). In 2010 and again in 2014, Gay also had the honour of receiving the award for “The Most Inclusive School Administrator of the Year for Minority Business” from the Maryland Washington Minority Contractors Association, something in which he holds great pride.

Richard Gay has been a school business official for the last 25 years and Director of Procurement Services for the Spring Branch Independent School District since March 2018. Gay has a Bachelor of Arts degree in Public Administration from Stephen F. Austin State University as well as a Master’s Degree in Public Administration from Troy University and an MBA from the University of Houston. He also stands as a graduate of the US Army Command and General Staff College. Upon graduation from Stephen F. Austin, Gay received his commission as a Second Lieutenant in the United States Army Field Artillery and served 28 years as a commissioned officer in the United States Army and United States Army Reserve.

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Unlike the private sector, in public procurement, relationships are created through the bid and contract process. It’s within this process that Gay needs to ensure fair access to all vendors. “If I need to buy textbooks, I have to issue a public bid. I have to advertise, and I have to take all commerce. I have to make sure that what I consider with the procurement environment is Fair, Inclusive, and Transparent (FIT). “I still think there's a lot of room to be innovative in areas like e-procurement and digitisation of the procurement process. I have been a leader and an innovator in bringing e-procurement platforms to the K-12 environments that I work in. And that has created huge efficiencies and the ability to save large amounts of resources. We are able then to redistribute and reuse those resources throughout the organisation. “We took an organisation that was mostly paper-driven and turned it into a digitalfirst organisation, which has in the last three years created a savings of about $4 million. So that’s really brought a whole new way of thinking to the district. Measuring things

“ I have been a leader and an innovator in bringing e-procurement platforms to the K-12 environments that I work in. And that has created huge efficiencies and the ability to save large amounts of resources” RICHARD GAY DIRECTOR OF PROCUREMENT SERVICES, SPRING BRANCH ISD

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Spring Branch, From Transactional to Strategic Procurement

like savings we’ve captured through the purchasing process that frees up resources that can then be used in the classroom, that's very important to me. And that's what's guided me through my career in public education.” “We have limited budgets that are based on tax rates and tax dollars that are in revenues that are collected. So, you need to pride yourself on being able to get the biggest bang for your buck. I've been very fortunate in that a lot of the initiatives I've brought to play have saved more than $75mn for the public schools for which I've worked for. And those dollars go back into the classroom to educate children.” The COVID Challenge: Building Agility with Amazon Realising the efficiencies gained from technology, Gay is leveraging the powers of the Amazonian giant to shift from transactional to strategic procurement. procurementmag.com

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“When I started with Spring Branch, I noticed that some of the processes that we had in place were extraordinarily bureaucratic, paper-driven and timeconsuming. And I realised if we could automate and streamline our processes, we could then reorient and refocus our staff on what I consider to be the strategic process of procurement, rather than the administrative, which is essentially issuing purchase orders, receiving and paying invoices. Gay’s goal of transitioning to strategic procurement practices led him to become an early adopter of e-procurement. “We have an electronic ordering system. We use Dynamic Punchout Catalogues to create a shopping environment, if you will, for our end users. One of the key ones we use is the Amazon Business platform. We're able to leverage the Amazon platform and order just about anything that we could possibly need on a campus digitally and have it delivered within 24 to 72 hours.” “It's been estimated that if you use a digital procurement process versus the oldfashioned paper process that you save about $73 per transaction. When you have that kind of soft savings in your process, that returns a lot of time and effort back to the principal and to the teachers. Those are hours that can be spent on things like working on curriculum, putting effort into the education side things instead of administrative tasks.” “We've only been on the Amazon platform for about two years, and we've generated more than a half-million dollars in savings. And of course, we got hit with COVID and having a platform like that available to us was absolutely the best decision we could have made as far as being able to get the supplies we needed to move to a digital education program, which requires an entirely different supply chain than in school learning.” 166

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“You have to have the tools that students and teachers need for remote learning, which requires a whole different supply chain. And then, after labour day, we came back to the campuses. We now have about 81% of our students back in the classroom. Again, that takes additional preparation of supplies such as gloves, cleaning and sanitation supplies, plexiglass shields for desks, different types of masks for students of different ages, sanitising products that aren't harsh on the kids' skin yet still effective against germs, different types of filters for cleaner air supply, etc. It’s a long list of supplies with complex requirements, and it’s been quite a challenge for us, one that Amazon helped us to meet.”

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DocuSign CLM, Mitigating Risk and Increasing Efficiencies As the world began to procure the supplies needed to combat COVID-19, spiking demand far beyond the norm and planned for, supply chains became fraught with issues. Mitigating risk and securing supplies delivered on time and as needed was critical to avoiding stockouts. Gay’s trusted vendors, and well-tuned inventory and order management, kept him safe. “We’re very lucky. I have not had a real delay in any of those supplies because we've used contractors and contracts that we already had in place that had very robust supply chains. We left the classroom back in March of 2020, and

we didn't come back until September of 2020. That gave us time to get all of those supplies into place and make sure that each teacher in a class term had plenty of all the necessary supplies without risking deadstock, and so our strategy was to ensure a steady supply versus an oversupply.” Digital Contract Lifecycle Management (CLM) ensured proper management of those vital contracts. “In July of 2019, procurementmag.com

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“What used to take maybe a couple of months of negotiation meetings and mail, we now do digitally, and in 24 to 48 hours, we’ve got a contract” RICHARD GAY DIRECTOR OF PROCUREMENT SERVICES, SPRING BRANCH ISD

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Spring Branch ISD implemented the use of DocuSign CLM for contract lifecycle management. We've been able to restructure all of our contract templates and negotiate some very complicated contracts using that product. Having one of our most important processes on a digital platform during COVID was a lifesaver. I must say, that was a very good decision on our part to make that all work for us.” “I can now send my contracts back and forth between vendors electronically, and we’re able to track changes. We can then negotiate over the changes. And with the push of a button, all the changes are then incorporated into a brand-new document. We get signatures electronically. What used to take maybe a couple of months of negotiation meetings and mail, we now do digitally, and in 24 to 48 hours, we’ve got a contract.”

Gay also mitigates further risk against fraudulent requests for payment using PaymentWorks. “It takes several days for one of my staff members to track down just one request from a vendor. We get anywhere from 20 to 40 requests a day, and a lot of them are fraudulent, which is why we have a partnership with PaymentWorks. They verify bank accounts and tax ID numbers. They will verify and ensure that our payment actually goes to the right account and the right vendor. I'm sleeping better at night knowing we’re not going to send a check accidentally out to the wrong bank or the wrong vendor because I have a good solid verification process in place.”

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