September 2022 | procurementmag.com SMBC: TheProcurement:Data-DrivenSMBCStrategy STRATEGY: inBenchmarkingprocurement 101 TELEPERFORMANCE: The complexities of inclusion & supply MANAGEMENT:SUPPLIER Adopting a dynamic approach to managementsupplierLeadingMTNGroup’s procurement transformation, Dirk Karl, CPO & Member of the Board, discusses benefits, smart data-driven decision making, and ESG NUTRABOLT: Supply chain is the engine of business NET ZERO: journeyProcurement’stoachievingnet-zeroinitiatives TRANSFORMING PROCUREMENT WITH A DIGITAL DNA APPROACH
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With a comprehensive content programme featuring senior industry leaders and expert analysts, this is an opportunity to put yourself and your brand in front of key industry decision makers.
JOIN THE COMMUNITY The Procurement Team DANIELAPRODUCTIONGEORGIAEDITOR-IN-CHIEFWILSONEDITORIALDIRECTORSCOTTBIRCHDIRECTORSGEORGIAALLENKIANIČKOVÁPRODUCTIONMANAGERSPHILLINEVICENTEJANEARNETAMARIAGONZALEZ CREATIVE TEAM OSCAR VIDEOSOPHIE-ANNHATHAWAYPINNELLHECTORPENROSESAMHUBBARDMIMIGUNNJUSTINSMITHREBEKAHBIRLESONJORDANWOODCALLUMHOODPRODUCTIONMANAGERKIERANWAITE DIGITAL VIDEO PRODUCERS MARTA THOMASERNESTEUGENIODENEVEEASTERFORDMARKETINGMANAGERKAYLEIGHSHOOTERPROJECTDIRECTORSMIKESADRCRAIGKILLINGBACK MEDIA SALES DIRECTORS JASON CHIEFMANAGINGJAMESWESTGATEWHITEDIRECTORLEWISVAUGHANOPERATIONSOFFICERSTACYNORMANCEOGLENWHITE
“Companies often neglect to view the supply chain as a whole and instead think only about their directismatureimpact.environmentalownAmoreapproachtorecognisetheandindirectimpactthattheiractionshaveontheirsuppliers”
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When it comes to the future of procurement, two trends are here to stay - the adoption of technology and the drive for more sustainable practices
“Procurement today has the opportunity to deliver significant value within an organisation, providing it can successfully navigate modern complexities and challenges.”
PROCUREMENTevent.&
GEORGIA WILSON georgia.wilson@bizclikmedia.com
In this month’s issue of Procurement Magazine we deep dive into the benefits of benchmarkingi n an era of disruption; why supplier management demands a dynamic approach; how procurement can avoid digital transformation burnout amid continuous disruption; and why the time is nowt o improve ESG maturity in procurement if net-zero initiatives are to be met.
This October, Supply Chain Digital and Procurement Magazine return to London for an all-new event - PROCUREMENT & SUPPLY CHAIN LIVE LONDON 2022.
SUPPLY CHAIN LIVE LONDON 2022 will give those attending the chance to showcase their values, products and services to partners and customers.
PROCUREMENT MAGAZINE IS PUBLISHED BY © 2022 | ALL RIGHTS RESERVED FOREWORD procurementmag.com 5
Procurement Magazine returns to London!
Held at the QEII Centre between the 12th and 13th of October 2022, BMG’s all-new hybrid event incorporates two zonesSupplyChain LIVE and Procurement LIVE - to create a single EXPO style
The push for technology and ESG continues to grow
MTN Transforming procurement with a digital DNA approach 24 Our UpfrontRegularSection: 10 Big Picture 12 The Brief 14 Trailblazer:AndreaAlbright 18 Five Mins With: Chad Galvez Strategy: Benchmarking in procurement 101 36 SMBC: Data-Driven Procurement: The SMBC Strategy 42 CONTENTS
Supplier Management Adopting a dynamic approach to supplier management 64 Teleperformance The complexities of inclusion & supply 72 Nutrabolt: Supply chain is the engine at the heart of Nutrabolt 98 Sustainability: Procurement’s journey to achieving net-zero initiatives 114 Technology: Is your company experiencing digital transformation burnout? 90
EDUCATE • MOTIVATE • ELEVATE SHOW YOUR business CARES ABOUTAccreditationequality
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The future of medical supply deliveries United Kingdom
©BOOTS 10 September 2022
BIG PICTURE
Leading health and beauty provider Boots has become the first community pharmacy in the UK to transport prescription-only medicines by uncrewed aerial vehicles (UAVs) – drones. Working with medical drones startup company Apian, the two are testing the benefits of electric, vertical take-off and landing (eVTOL) aircrafts. The largest drone being tested weighs 85kg, with a wingspan of 5m and can carry up to 20kg of payload. “Faster and more reliable than ground transportation, they bring with them additional environmental benefits and offer a more sustainable solution for delivery,” said Max Coppin, Chief Operating Officer at Apian.
procurementmag.com 11
READ
Frank Wadsworth Managing Director and Chief Procurement Officer for the Americas Division, Sumitomo Mitsui Banking Corporation (SMBC)
O’Toole
“WE ARE BUILDING THE LARGEST AND MOST VALUABLE BUSINESS PLATFORM, WITH A CLEAR FOCUS ON BRINGING AFRICA AND ITS ENTERPRISES
Group Executive and MTNCPO,
PLANNING
“GIVEN TRANSFORMATIONALTHE NATURE OF THIS IMPLEMENTATION AND THE CENTRALISATION OF PROCUREMENT FOR THE REGION, OUR PRIMARY FOCUS WILL BE ON IMPLEMENTATION AND CHANGE ACTIVITIES ACROSS THE REGION”
BrendanSALES”
READ
Of
“THE AND SUPPLY FUNCTION REALLY IS THE ENGINE TO THE BUSINESS
MORE
The procurement world is changing. Discover five digital transformation trends for CPOs striving to be more agile in the face of uncertainty.
EFFICIO: 5 IMPACTS OF RUSSIA-UKRAINE ON GLOBAL SUPPLY CHAIN
VP of NutraboltProcurement,
THE BRIEF
12 September 2022
MORE READ MORE
Procurement functions of the future BY THE NUMBERS
IVALUA: STEP-CHANGE IN PROCUREMENT ESG PERFORMANCE
MANAGEMENT
PROCUREMENT
companies plan to make changes to their operating model in the next three years Of companies see digitalisation as key to achieving their company and procurement objectives 99% 65%
ZYCUS: FIVE DIGITAL TRANSFORMATION TRENDS IN PROCUREMENT
Rapid change in boardroom priorities sees a rise in ESG initiative investment in procurement. Ivalua’s CMO, Alex Saric, reflects on this trend.
From inflation to material shortages, Ashray Lavsi, Senior Manager, Efficio, identifies five ways the RussiaUkraine crisis is impacting the global supply chain.
DirkFORWARD”Karl
• Optimised time and money
The value of an open commerce network is vital for organisations to be successful in their business functions. By establishing an effective and comprehensive network for suppliers, the procurement function can benefit from:
Retailer faces investigation from Quartz, which states that more than 50% of H&M products with high sustainability scores are no more sustainable in their sourcing than comparable competitor garments.
WINNERSLOSERS
The time is now to redefine P2P
• Greater purchasing speed
A new era
“So, the answer is clear. The network you use makes a huge difference in your operations and shouldn’t be overlooked when it comes to your procure-to-pay processes,” concluded Basware
GENERAL MOTORS (GM) General Motors (GM) signs two new long-term agreements with Livent and LG Chem for the supply of battery-grade lithium hydroxide and cathode active material (CAM).
EUROPEAN UNION (EU) Establishing the European Defence 2022-2024.€500mnregion’sUnion(EDIRPA),commonReinforcementIndustrythroughProcurementActtheEuropean(EU)strengthensthedefencewithabudgetbetween
Leading British grocery retailer Tesco has reached an agreement with US food giant Kraft Heinz following a 30% rise in supply charge for its products. Tesco initially refused to continue to stock Kraft Heinz products rather than pass on price rises to consumers.
• Increased supplier collaboration
• Greater accounts payable speed
H&M
A common term in the world of procurement for many years, it appears that the P2P function is ripe for another transformation.“Althoughchange can be a little intimidating, it’s almost always necessary. Especially when it comes to redefining (or rather renaming) procure to pay,” says Basware.
(P2P)procure-to-payof–PN2PCouldprocure-to-pay
• Supplier management of information electronically
TESCO & KRAFT HENIZ
SEP22 procurementmag.com 13
The leading software company calls upon a change to redefine P2P, instead calling it PN2P – Procure, network, to pay.
(P2P) be getting a new name? According to cloud-based P2P software company Basware, a shift is happening in the P2P space.
Completing the International Women's Forum Fellows Program, Albright has been recognised
14 September 2022
TRAILBLAZER
Walmart veteran, Andrea Albright has been a part of the American multinational retail corporation since taking on the role of Assistant Buyer in 2005.
ANDREA ALBRIGHT, EVP OF SOURCINGGLOBALAT
Andrea andDynamic,Albright:inclusiveinnovative
Dynamic, inclusive and innovative With 10 years of leadership experience managing and inspiring large teams, Albright credits her success over the years to creating strategies with a customerfirst mindset and building highly competent, cognitive, adverse teams to effectively execute such strategies.
Serving as Executive Vice President (EVP) of Global Sourcing, she has developed a career at Walmart built on innovation, transformation, and inclusion. Among her peers, Albright has a reputation of being a dynamic, solutions-orientated leader.
as a rising woman in business, one of Fortune’s Most Powerful Women in Next Gen, and sits at number four in Procurement Magazine’s Top 100 Women in Procurement.
A
innovativeAlbright:inclusive Top 100 Women in Procurement: #4 Years in the industry: 17+ Joined Walmart: 2005 procurementmag.com 15
Being a strong advocate for diverse and inclusive workforces, Albright has often spoke out on ways industries can open doors for women.
The innovation women bring to retail is absolutely crucial [...] Thank you to our women business owners who were boldly courageous enough to follow their passions”
Diversity and inclusion
“
Among her teams, Albright has been an inspiration, fostering working environments built on trust and psychological safety. It is this approach that she believes encourages radical candour, accelerates the speed of both collaboration and innovation, reduces waste, and increases the targeted use of resources.
“At Walmart, we know we are at our best when we champion diversity and inclusion across our business. Women make up the majority of our associates and the majority of our shoppers, so it makes sense for us to use our strength to support women at all levels of the business,” said Albright.
Over the years, Albright has managed multi-billion-dollar P&Ls and teams of up to 1,200 people. She has also supported 200,000+ associates in a wide range of categories and models, including brick and mortar, eCommerce, and direct-to-store deliver (DSD).
TRAILBLAZER 16 September 2022
“During my career at Walmart, I’ve unlocked team and organisational capabilities to deliver consistent results in sales and profit growth, cost reductions, merchandising innovations, and talent development. Results have led to roles of increasing scope and responsibilities, as well as a reputation as a dynamic, inclusive leader,” says Albright.
communities we serve,” said Albright.
In her role, Albright supports the inclusion of women in positions of leadership; provides associates with the opportunities to complete training and advance their careers; and empowers women suppliers to effectively work with Walmart to grow their business.
procurementmag.com 17
Via Walmart’s supplier inclusion programme, the retailer has spent nearly US$30bn with women-owned businesses. “We’re proud of that number, but we know there is more work to be done as we strive to have our suppliers better reflect the
Albright currently holds a Bachelor’s degree in Science, Apparel, Textile and Apparel Marketing from Kansas State University, and a Master’s in Business Administration and Education from the University of Arkansas.
She continues to serve as the President Of The Board Of Directors at the Girl Scouts; as a Board Member for Cancer Challenge; and as an Alumni Board Member for both Kansas State University and the University of Arkansas.
CHAD GALVEZ FIVE MINUTES WITH... MEET ATMANAGEMENTDIRECTORTHEOFSTRATEGICGLOBALPROVIDERFORTUNE500ORGANISATION–PRUDENTIALFINANCIAL 18 September 2022
My passion and specialism is in supporting the IT and Technology operations within an organisation. I have managed IT procurement and vendor management teams for a variety of financial services companies, including Navy Federal Credit Union, and USAA.
Being in the procurement function allows someone like myself, for example, who has always been keen on technology, to acquire more
My current role at Prudential Financial is Director of Strategic Global Provider Management. In this role, I am responsible for managing large strategic IT vendor relationships that provide a multitude of services to the global operations of the organisation.
Q . WHAT IS YOUR FAVOURITE THING ABOUT THE INDUSTRY YOU WORK IN?
Q. PLEASE COULD YOU START BY INTRODUCING YOURSELF AND YOUR ROLE AT PRUDENTIAL
» In 2009, I joined the United States Air Force as a Contracting Officer (Procurement) and immediately knew it was something I was proficient at, enjoyed, and would be the start of a long, successful career in the industry.
“THERE’S NO BIGGER SATISFACTION THAN HAVING SUCH AN IMPACTFUL ROLE IN DELIVERING THE BEST VALUE TO YOUR INTERNAL BUSINESS PARTNERS” procurementmag.com 19
»FINANCIAL?
» I enjoy the benefits of being in the procurement and vendor management industry because of all the various types of products, services and business operations that one can support.
Q . HOW DID YOU FIND YOURSELF TO BE IN THE PROCUREMENT INDUSTRY?
I’m Chad Galvez and my 13-year career has been in the procurement and vendor management industry.
Many other industries, however – who may not be as heavily regulated – are starting to realise the importance of mitigating risk. It’s imperative that an organisation
FIVE MINUTES WITH...
As such, a procurement professional will be a crucial part of the first line of defence and can contribute to the overall mitigation of third-party risk, negotiating proper terms in the contract and ensuring a proper governance structure has been established. This helps the organisation to manage and monitor its third-party relationships to ensure continual compliance and performance.
Q . WHAT DO YOU THINK WILL BE THE BIGGEST TREND IN 2023 FOR
Q . WHAT DO YOU THINK HAS BEEN THE BIGGEST OBSTACLE FOR
»PROCUREMENT?
The biggest obstacle for the procurement industry has been risk mitigation. Both regulators and industries have put more of an emphasis on reducing risk with their third party vendors and suppliers. Having worked primarily in the financial services space, there has been a big focus on this since 2013, but it continues to remain the biggest obstacle today.
knowledge about a specific discipline, while at the same time providing support to that operational group. There’s no bigger satisfaction than having such an impactful role in delivering the best value to your internal business partners.
“THE BIGGEST OBSTACLE FOR THE PROCUREMENT INDUSTRY HAS BEEN RISK MITIGATION”
More and more organisations are procuring new digital platforms, software, and other various technologies at a rate much higher than ever before, due to the pandemic. I believe in 2023 we will see a boom in organisations procuring technology that is focused on providing virtual experiences for its customers. With virtual reality environments generating greater traction with the general public, we will see fewer face-to-face business interactions.
establishes multiple lines of defence from a risk management standpoint.
»DOWHATPROFESSIONALSPROCUREMENTIN2022ANDCANTHEINDUSTRYTOOVERCOMEIT?
20 September 2022
Prudential Financial
Founded in 1975, Prudential Financial was established on the belief that financial security should be within everyone’s reach. For more than 140 years, the organisation has helped customers reach their potential and tackle the challenges of life – now and in the
procurementmag.comfuture. 21
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TOP 100 LEADERS COMING SOON Join the Community Never miss an Issue! Discover the latest news and insights about Global Procurement LEADERS2022 S•LEADER 2202•SREDAEL2202 DAEL•ERS 2022 • Creating Digital Communities
Y'ello 24 September 2022 AD WRITTENFEATUREBY: GEORGIA WILSON PRODUCED BY: WHITEGLEN
Y'ello procurementmag.com 25 MTN
Dirk andGroupKarl,ExecutiveCPOatMTN. 26 September 2022 MTN
riven by its strong belief that everyone deserves the benefit of a connected modern life – particularly on the African continent – MTN Group is committed to bridging the digital divide, bringing connectivity and financial inclusion to its operating markets.
Procurement transformation: leading the charge
Being a successful and perceptive procurement leader with an international career spanning 25 years, Karl has been CPO at MTN since 2017. As part of his role, Karl leads the group’s procurement transformation strategy. “Our strategy is built on three key pillars,” he explains. “The first is ESG, which is not only key to our procurement transformation, but central to our core strategy as a business. Next, we have the ‘digital DNA’ to push data driven decision making, advanced analytics and agility into procurement, and finally, we are focused on driving supply chain resilience.”
D
procurementmag.com 27
“We are building the largest and most valuable business platform, with a clear focus on bringing Africa and its enterprises forward,” says Dirk Karl, Group Executive and CPO at MTN.
Leading MTN Group’s procurement transformation, Dirk Karl , Group Executive and CPO, discusses benefits, smart data-driven decision making, and ESG
As an early adopter of (ROI).onwithalready“Thissuchtheisoperations,integralsourcingchainintegratingtransformation,procurementitssupplyandstrategicintoonepartofitsMTNalreadyreapingbenefitsofastrategy.approachhasprovidedusavitalreturninvestmentAsanearlieradopter, we were able to navigate the perfect storm of semiconductor shortages alongside the friction caused throughout the supply chain over the last couple of years,” explains Karl. A core part of the isfunction,function.thesourcingagile,introducinginvolvedtransformationgroupMTNnew,anditerativemodelsinprocurement“Acrosstheeveryonescrummaster certified; we have cross functional teams operating in agile squads and pods in order to drive agility. Everything that we have
DIRK KARL EXECUTIVE
GROUP
“We have developed our own tools that support our sourcing function to decisiondata-drivenadoptmaking”
AND CPO, MTN 28 September 2022 MTN
TITLE: GROUP EXECUTIVE AND CPO
Karl has taken MTN’s sourcing and supply chain to the forefront of the industry through an ambitious digitalisation and transformation programme. Focusing on the development and exploitation of advanced technologies such as artificial intelligence and machine learning, a well established centre of excellence comprising data scientists and sourcing
Adopting this approach drastically changed MTN’s operating model. “This also transforms our throughput times in terms of how long it takes us to meet supply chain demands and complete sourcing transactions. This is why ‘digital DNA’ is a critical part of our transformation.”Itwasimportant for MTN to onboard and restructure the people within its organisation due to the new skill set required. “It was a real transformational undertaking, bringing data science expertise into the organisation as well as catering for such change, and developing the systems and tools to transform sourcing and supply chain,” adds Karl.
Since joining MTN in 2017, Karl has been instrumental in delivering significant impacts on MTN Group’s sourcing and supply chain management business. Building on his experiences, he has transformed the organization through multiple levers, which have increased the EBITDA results of the sourcing business by more than 30%.
INDUSTRY: TELECOMMUNICATIONS
DIRK KARL
LOCATION: DUBAI, UAE
learned from IT software development, we are translating into the procurement organisation,” says Karl.
Dirk Karl is the Group Executive and CPO of Global Sourcing and Supply Chain at MTN Group and has overall responsibility for Sourcing and Supply Chain across the MTN Group.
MTN
One thing for certain in modern procurement and supply chains is uncertainty and disruption. “We have had no choice but to become smarter,” says Karl, “Uncertainty is a part of daily life. We still have to make decisions in the face of uncertainty, we can’t take it away, but we can better harness huge volumes of information to make data-driven decisions, which has become an integral part of our procurement and sourcing operation.” MTN is using data analytics and automation to enhance its throughput time, cut down on manual, time consuming activities and drive greater efficiency. Karl explains: “We have developed our own in-house tools that support our sourcing function to adopt data-driven decisionmaking platforms and supply chain risk management frameworks using advanced technologies such as machine learning and artificial intelligence. Our expert sourcing teams are guided by price curves within each category, and our scenario analysis tool is used to analyse millions of possible
procurementmag.com 31
Making smart procurement decisions in the face of uncertainty
“With the introduction and completion of managementtotransformation,ouritwillbeimportantfocusonchangewithinthegroup”
DIRK KARL GROUPANDEXECUTIVECPO,MTN
DIRK KARL GROUP EXECUTIVE AND CPO, MTN
“As an earlier adopter, we were able to navigate the perfect storm of semiconductor shortages alongside the friction caused throughout the supply chain over the last couple of years”
32 September 2022 MTN
“This not only includes our external suppliers, but our innovation partners, startup partners, local SMEs, and crossborder suppliers,” explains Karl.
had agility in mind. “We have organised ourselves in the transformation journey to be agile, moving away from the typical category structure that is mimicked in the procurement function. Instead, our procurement operations are very much aligned with the MTN Group Ambition 2025 business strategy. We are catering for the same change across the company in order to be future fit.”
Incorporating ESG into procurement transformation
sourcing award scenarios and select the optimum scenario for negotiation. We even have our own artificial intelligenceenabled virtual assistant, GeSSiCa, who scans our entire procurement ecosystem searching for bundling opportunities.
MTN Group has an extensive range of partners across its ecosystem.
Along its transformation journey, MTN has
“We also work with academic institutions to support data science and machine-learning capabilities for procurement to enhance this kind of expertise across Africa. As part of our ecosystem, we often work collaboratively, forming joint alliances with others both to further the procurement and supply chain functions and to sell our services.”
“We have further developed our artificial intelligence and machine learning capabilities to assist in eAuctions, providing data-driven vendor evaluations that allow our category managers to optimise the potential tender outcome.”
MTN AND ITS PARTNERS
With ESG core to its business strategy, MTN is not only supporting ESG initiatives in the form of its net-zero roadmap for 2040 and its innovations to reduce emissions across Scope 1 to Scope 3, but the group is also introducing elements of a circular economy into its operations.
“With this approach, we are much more
procurementmag.com 33
IN
MTN transforms procurement with digital DNA approach
our operating markets to navigate the complexities of procurement and supply in developing countries when it comes to hyperinflation, currency fluctuations, crossborder trade, and sanctions,” says Karl.
When it comes to future trends in procurement, Karl emphasises the importance of seeing procurement as an integral part of the business as opposed to an appendix. “Procurement is not only a vital function for cost savings, it has strategic value to unlock opportunities for businesses,” says Karl.
34 September 2022 MTN
FUTURE
To achieve such value, a key trend going forward will be the effective use of data to navigate the complexities of the procurement and sourcing function. “Data will help organisations to tackle inflation and further disruptions to the supply chain. It will be particularly beneficial in
“It’s no longer enough to talk about procurement data visualisation, we have long passed data warehousing, data lakes and data visualisation, it is time to realise the value that can be created to implement behavioural models and predict outcomes. It’s more about empowering operations with predictive insights and forecasting to drive the future of procurement excellence.” TRENDS PROCUREMENT
In addition to its internal ambitions for the next 12 to 18 months, MTN will also be
One way that MTN achieves this is through its localisation policy. ”Through technology innovation and onboarding of local suppliers, we can help societies to prosper and suppliers develop. We do this with sustainability governance oversight by our social and ethics committee to ensure that we are meeting our pledges and supplier code of conduct.”
procurementmag.com 35
What does the future hold for MTN Group?
Over the next 12 to 18 months, MTN Group will continue to drive its procurement transformation, focusing on agility and its new operating model. “The next 18 months are going to be a very bumpy journey,” says“WithKarl.the introduction and completion of our transformation, it will be important to focus on change management within the group to ensure that our human workforce doesn’t fall back onto old methods. The next 18 months will be very much about adapting. We will be looking at the metrics of adapting, the usage of tools, adapting machine learning and adapting data.”
“Finally, we want to focus on our people, investing in their skills and training over the next 12 to 18 months. We are providing agile coaching, agile training, and scrum certifications, along with upskilling our teams in areas such as intelligent automation to be future ready, which we hope to translate into valuable business outcomes,” concludes Karl.
Expanding on MTN’s sustainability strategy, Karl explains the group’s shared value of developing a responsible environment through social and governance practices that are supported by procurement and supply chains. “Only healthy societies can prosper; we have an obligation to support societies to stay healthy or become healthy.”
DIRK KARL GROUPANDEXECUTIVECPO,MTN
“With the university, we will be continuing to work on advanced digital procurement solutions and supply chain tools. We want to advance our control tower and nerve centre here at MTN, which combines sourcing transactions, inventories, and supply chain disruptions. We also want to ensure that our markets are getting the supplies they need on time, with early alert systems in place to further improve our intervention and prevention if disruptions occur,” explains Karl.
“We are building the largest and most valuable business platform, with a clear focus on bringing Africa and its enterprises forward”
focused on the end-to-end sustainability of our business,” says Karl. “We are also focused on reusing and extending the lifetime of our assets and supplies with refurbishment and repairs, instead of producing and buying new. This sub-pillar of our ESG strategy coincides with our drive for agility.”
working on its collaboration with startups and universities – specifically, with the University of Johannesburg.
IN101PROCUREMENT WRITTEN BY: WILSONGEORGIA 36 September 2022
BENCHMARKING
PROCUREMENTBENCHMARKING
I
n an era functionsprocurementisbenchmarkingdisruption,ofavitaltoolforto
With this approach, organisations can generate high quality analysis, leading to better, data-driven decisions. “Adopting a more robust process such as this can help organisations to create a baseline of where they are now in order to understand where they need to be, and the gaps that need to be filled. Communicating the findings can also drive collaborative efforts both internally and external to identify and adopt best practices,” says Flores.
procurementmag.com 37 PROCUREMENT STRATEGY
PROCUREMENT TODAY HAS THE OPPORTUNITY TO DELIVER SIGNIFICANT VALUE WITHIN AN ORGANISATION, PROVIDING IT CAN SUCCESSFULLY NAVIGATE MODERN COMPLEXITIES AND CHALLENGES
understand where their operations sit when compared to a given preference point, these insights can help an organisation to identify potential gaps that need addressing within their operations and how best to do so in order to stay relevant and maintain their competitive edge.
Fundamental to strategic benchmarking is data. However, “in order to generate strong comparisons, organisations need to have the right kind of data. This should then be coupled with picking the right indicators, having an understanding of what it is they want to benchmark, and ensure fair comparibility in order to make affective use of the data,” explains Mélani Flores, Practice Leader, Procurement & P2P Advisory EMEA, at The Hacket Group
The end-to-endThevolatilitysupplyconnectedchainturnsintoopportunity.e2openconnectedsupplychainplatformprovidesthevisibilityandcollaborationyouneedtotackle unpredictability. Build trust and confidence with your channel, supply, logistics, and global trade partners. Take control of supply constraints through direct procurement and meet customer commitments in the face of disruptions and scarcity. The connected supply chain. Moving as one™. www.e2open.com E2open and the e2open logo are registered trademarks of e2open, LLC, or its affiliates.
DIFFERENT TYPES OF BENCHMARKING IN PROCUREMENT
Not only is collecting comparable data challenging, but it is also a challenge to ensue that the data collected is high quality and comparable. Across industries, definitions, data points, scope and strategies
Typical
Mélani Flores, Practice Leader, Procurement & P2P Advisory EMEA, at The Hacket Group explains benchmarking can be an internal process comparing the practices of the procurement functions across an organisation operating regions, or it can be an external process comparing the procurement practices of an organisation to others in the market. benchmarking topics include: Sustainability Processes practices Performance
• Best
When it comes to benchmarking, organisations can gain a wealth of information and visibility depending on what they are looking to compare.
PROCUREMENT STRATEGY
She adds: “Benchmarking can help organisations to understand the art of what is possible within the procurement function as well as inspire.”
The challenges of benchmarking
An exciting element of the benchmarking process for Flores is the technological capabilities. “Benchmarking requires a lot of time and effort from an organisation, technology is crucial in helping those in procurement reduce the time and effort invested in such activities, as well as help to increase the accuracy of what is being measured.”Withadvanced technological capabilities, organisations can benefit from real-time data, accessible for all relevant parties via a single system to make current and more accurate comparisons. But Flores warns: “While technology can provide quicker and broader access to many indicators, it remains crucial to have the right talent in place to interpret the data and make that right decisions on which indicators need to be focused on. Technology should be seen as a supportive tool in this area.”
• Strategy •
Enhancing benchmarking with technology
•
When it comes to benchmarking one of the key challenges for any organisation is collecting comparable data. “Depending on the complexity of an organisation, its systems and governance, the collection of data can be relatively easy, or complex. This is where the technology enhancements from before come into play,” says Flores.
•
Source: indeed.com
40 September 2022 PROCUREMENT STRATEGY
on the finding. “Benchmakring is valuable, it provides a greater level of insight into the operations of an organisation, but the challenge is how to act on the findings, incorporating the insights into the continuous improvement activities of the procurement function,” explains Flores.
BENEFITS OF BENCHMARKING 1. Increased effectiveness and efficiency 2. Ability to set clear business goals 3. New opportunities for discovery 4. Increase sales performance 5. Motivate employees 6. Improved understanding of the operating market 7. Improve product quality
can vary considerably, it is important for organisations to ensure that those they are byovercomechallengeapproach.understandingareagainstbenchmarkinginthemarketalignedwiththeirandAnotherimportanttohighlightedFloresisacting
She concludes: “Those that are leading in the procurement space are organisations that run benchmarking activities on a regular basis, instead of treating benchmarking as an isolated, one time exercise. While a one of benchmarking report will provide an organisation with some value, the greater value is in the continuous development and improvements made through regular benchmarking activities.”
procurementmag.com 41
StrategyTheProcurement:Data-DrivenSMBC 42 September 2022 PRODUCED BY: SADRMIKE WRITTEN BY: ÖZSEVIMİLKHAN
procurementmag.com 43
Prior to joining SMBC, he led global supply chain operations for Bloomberg, while also establishing a third-party risk management programme for the firm, transforming a fragmented, reactive approach into a cohesive one. This role at Bloomberg was preceded by a position leading strategic vendor management for J.P. Morgan’s Investment Banking Division (IBD), as well as Procurement Professional Services for the bank globally, with several billion dollars of spend under management.
44 September 2022 SMBC GROUP
All things procurement with Frank Wadsworth Managing Director and Chief Procurement Officer, Americas Division at Sumitomo Mitsui Banking Corporation
As Chief Procurement Officer for SMBC, Wadsworth is leading the development and implementation of a multi-year target operating model for the organisation to provide a centralised, strategic, and valuedriven procurement function that will foster the timely delivery of quality goods and services to the business.
Wadsworth’s experience includes responsibility for driving multi-milliondollar savings, improving process efficiencies, and reducing risk by identifying and establishing outsourcing, offshoring, and shared services opportunities.
“After finalising our target operating model towards the end of 2020, we hit the ground running in 2021, growing the procurement team, successfully implementing the Coupa platform, and standing up procurement operations for four of nine of our group companies,” says Wadsworth. “We are roughly one-year old as a procurement organisation following our first implementation, and I’m proud to say we’ve accomplished a significant amount in a short period of time.
“We’ve onboarded more than 1,000 suppliers with 75% of fromparadigm–electronicallyinvoicessupplierprocessedasignificantshiftoneyear
F
rank Wadsworth is a Managing Director and Chief Procurement Officer for the Americas Division at Sumitomo Mitsui Banking Corporation (SMBC). Frank has spent his career in financial services, having worked at some of the biggest names in banking: Morgan Stanley, Merrill Lynch, Bank of America, JPMorgan Chase, Bloomberg, and now at SMBC. Beginning his career in technology, Wadsworth gradually transitioned to assume a variety of vendor management leadership roles.
Our procurement practitioners provide a range of advisory and managed services, along with enabling Contact us for more information Achieve your company’s procurement vision with customised solutions
Alpar Kamber is Business Unit Leader of WNS Denali, the global business process management company he founded in 2008 and that is now under the umbrella of WNS Global Services. WNS Denali is a leading procurement solutions company providing procurement, strategic sourcing and supply chain services to 90+ global 1000 companies and offering consulting, source to contract execution, procurement operations, market intelligence, capability enablement, and digital solutions and services to procurement
This is the first phase of enabling digital and transactional procurement at SMBC. The next step is effectiveness: “Strategic thinking around category management, decision-making about which suppliers to work with, taking into account pricing and innovation trends, matching best-of-breed suppliers with the company’s requirements and deriving value from its thirdparty resources – these are among the essential considerations WNS Denali is helping SMBC with on its digital journey.”
Bankingprofessionals.andfinancial
WNS Denali Links with SMBC to Digitalise its Procurement Ecosystem
At the top of most of his clients’ concerns right now are cost and talent. Both of these challenges threaten the viability of the supply chain in ways WNS Denali’s services and technology can mitigate significantly.
Learn more
services are a key sector for WNS Denali, where the conversation usually starts with a discussion around the client’s level of maturity in their procurement journey, the current state of the organisation, and where they want to take it over the outlook period. This is how the relationship with SumitomoMitsui Banking Corporation (SMBC) started. “SMBC is a great example of the value we can bring. They are in the midst of a digital transformation, and implementing a platform
Outcome-driven companies like SMBC partner with WNS Denali to operationalise their procurement function: Business Unit Leader Alpar Kamber explains
that will enable and bring more efficiency to procurement. “So we’re working with SMBC to enable digitalisation of their contracts and help them onboard suppliers with maximum efficiency. Also, we set up a help desk: there’s a lot of transactional work too. Though you want to automate as much as possible, you still need to put human checks in place to make sure that you can deal with exceptions!”
The importance of data to the procurement process
Data Driven Procurement: The SMBC Strategy
“Data is exceptionally important to everything we do,” says Wadsworth. “As Peter Drucker, a leading management consultant and renowned author, once said, ‘you can’t manage what you can’t measure,’”
FRANK SMBCCHIEFMANAGINGWADSWORTHDIRECTORANDPROCUREMENTOFFICER,AMERICASDIVISION
“When I first joined SMBC in 2020, it was important to understand the existing supplier base and historical spend. A simple spend report by business and high-level spend categories was a manual and time-
“Separately, we’ve established a supplier spend analytics data lake with PowerBI dashboards that allows us to quickly and easily assess spend across multiple regions, businesses, and spend categories.”
intensive exercise, pulling data from six ERPs (Enterprise Resource Planning systems), ten general ledgers, filtering, rationalising the data, and, finally, producing a simple PPT spendAccesschart.”togood,
accurate data in a timely way is critical to making informed business and purchasing decisions. Wadsworth says: “Given our long implementation runway with Coupa combined with the need to have quick and easy access to spend data across the regions, I partnered with Visionet
48 September 2022 SMBC GROUP
“Data is everythingimportantexceptionallytowedo”
ago, when all invoices were processed manually. We’ve loaded more than 2,500 contracts into Coupa, with a steady number of new contracts authored and approved through Coupa and executed through DocuSign every day.”
INDUSTRY: FINANCE
BIOEXECUTIVE
FRANK WADSWORTH
SMBC GROUP
TITLE: MANAGING DIRECTOR AND CHIEF PROCUREMENT OFFICER OF THE AMERICAS DIVISION
Officer for SMBC Americas Division, Wadsworth is currently leading the development and implementation of a multi-year target operating model to provide a centralised, strategic, and value-driven procurement function that enables the timely delivery of quality goods/services to SMBC businesses.
specialising in strategic vendor and risk management. Wadsworth is known for transforming business/ procurement operations and thirdparty supplier engagements to reduce risk, create value, and take out cost.
LOCATION:
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David Rowland, Star’s Chief Technology Officer, says, ‘We admire forward-thinking companies like SMBC that value their employees and want to make sure they are secure about how their personal dealings could affect their professional careers. Through the STAR Platform–which monitors for employee conflicts of interest–our clients can ensure that issues are flagged and reconciled in a timely manner.’
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Rowland says ‘the STAR Platform enables enterprise organizations like SMBC to stay ahead of regulatory changes, minimize their risk and protect their assets.’
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these concerns by providing a single, centralized place for monitoring employee conflicts with a compliance software solution. The STAR Platform lowers the cost for reconciliation and database administration, and frees up compliance officers to do the higher-level follow-up and investigative work they’re best suited for.
Monitoring for employee conflicts has become more critical than ever in the complex regulatory environment in which we live and work. Whether dealing with employees at one location, or a staff across multiple time zones, Star has cost-effective solutions for each situation. And because Star partners with so many organizations worldwide, clients benefit from the kind of collaborative software development that delivers unparalleled features and functionality in the compliance technology
Meeting Client Needs–Now And Into The Future
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• Region or country
In the intervening years, the Sumitomo Bank and the Mitsui Bank opened different offices and branches, including in Brazil and Los Angeles. The two banks merged in April 2001, forming what is now SMBC. The firm has a long-standing tradition of serving clients and businesses around the world with more than 86,000 employees across the globe in 140 offices in nearly 40 countries.
to build a supplier spend analytics data lake.” In addition to tracking supplier spend information, it was equally important for SMBC to assess KPIs for its procurement operations function to better understand transactional throughput and processing times, with a view to identifying any bottlenecks in its process.
“Since deploying Coupa, 75% of our invoices are now processed electronically with a mean days-to-pay of three days from the time an invoice is approved,” he says. “Applying a data-driven and analytical approach is foundational to making informed decisions and appropriately aligning our procurement strategy and operations.”
DID YOU KNOW...
52 September 2022 SMBC GROUP
• Line of business/group company
• Category of third-party goods and services
SMBC was founded more than 400 years ago when the Sumitomo and Mitsui family businesses came together, bringing together their diverse products and services and expanding their business. The Mitsui Bank was established in 1876, followed by the establishment of the Sumitomo Bank in 1895. Two decades later, the first branch was opened in the U.S. in San Francisco and in 1918, the New York Agency was established.
Procurement at SMBC has created a supplier spend analytics data lake armed with PowerBI reporting capabilities, allowing both the procurement function and stakeholders across the bank to have quick, easy access to supplier spend reports for SMBC businesses and regions. Authorised users can report on supplier spend, applying dynamic reporting filters to view supplier spend data by:
How the supplier-spend analytics data lake helps identify supplier-spend trends and reveals savings opportunities
SMBC went through an extensive RFP process to assess several leading sourceto-pay technology solutions. “We ultimately selected Coupa as our technology of choice, and I’m pleased to say that, looking back
procurementmag.com 53
over the past year – and six implementations later – we made the right choice,” says Wadsworth. “Coupa is a Software-as-a-Service (SaaS) solution that is highly configurable and interoperable across various modules or source-to-pay functions. Aside from its robust functionality, Coupa provides an intuitive, user-friendly interface that is easy to navigate. Coupa also regularly enhances the product to stay ahead of customer needs and market developments”.
Establishing a centralised procurement function allows SMBC to shift from a tactical transactional purchasing approach
SMBC’s procurement function and key stakeholders can identify:
• Concentration/fragmentation of suppliers across businesses and/or spend categories
• Savings opportunities
Through analysis of historical spend data
• Negotiations leveraged through aggregate purchasing power (region, business, etc.)
SMBC’s centralised, strategic and value-driven procurement function
What technology is SMBC utilising to optimise its procurement operations?
Visionet empowers businesses to drive innovation through modern technologies. We enable digital transformation through digital solutions like PartnerLinQ and HauteLogic that cater to all supply chain needs while our Live Commerce service leverages video streaming to create immersive eCommerce experiences.
We Innovate,Listen,AndDeliverEngineeringAgilityLikeNoOther
encompassing F&B and logistics to healthcare and fashion. Key to its recent success has been its supply chain vertical cloud application, PartnerLinQ, which is a integratedhybridplatform for supply chain connectivity with all analytics, tracking and visibility built in. It’s designed to handle very rapid on-boarding. “That’s why we have grown 100% in the last two years, it’s such a versatile tool, and selling itself,” he said. “We can place PartnerLinQ in the middle of company’s ERP and e-commerce systems, and connect with other vendors, in a matter of weeks.”Arshad Masood is proud to have built a company which is employeeowned and futuregeared.“ Our number one purpose is to serve our employees –and you can’t do that unless you serve your customers, so both are equally important.”
Visionet Systems’ CEO Arshad Masood highlights the growth of its PartnerLinQ platform which is empowering industries to achieve supply chain resiliency Most CEOs who saw 100% growth during COVID would be eager to proclaim their recent successes and focus on the changing digital dynamics. But it’s telling that Arshad Masood, founder and CEO of Visionet Systems, initially takes me back to 1995 and ‘Y2K’ era to explain how, from the outset, he was focused on differentiating the company by focusing on multitask automation. It’s fair to say his vision has paid off. From a $1mn investment, Visionet Systems has grown into a $250mn annual turnover business, operating with 8,000 brilliant minds worldwide, with a diverse range of products, solutions, and services.“You have to focus on the value to the customer, and go and solve their problems in an innovative way –and that’s where the longevity of the business comes,” he said. The company’s 25+ years of experience provided solid foundations at a time of great uncertainty amid the COVID chaos. Today, under a catchy alliterative slogan –‘Digital Defined, Digital Delivered’ –Visionet’s customers are as broad as they’re long,
Visionet Systems –Enabling Businesses to Navigate the Future of Supply Chain
We’ve loaded more than 2,500 contracts into Coupa, with a steady number of new contracts authored and approved through Coupa and executed through DocuSign every day
SMBC GROUP
We’ve onboarded more than 1,000 suppliers with 75% of supplier invoices submitted and processed electronically – a significant paradigm shift from a year ago, when all invoices were processed manually
1,000+
2,500+
“In building out the centralised procurement organisation, I first focused on establishing a team to support day-to-day procurement operations, contract management, and invoice processing, aligning closely with our implementation of Coupa,” says Wadsworth. “More recently, I’ve established our strategic sourcing function staffed with senior-level category leads across our largest spend categories, such as professional services, IT, corporate services, real estate, HR services, travel, and marketing.”
“As Peter Drucker, a leading management consultant and renowned author once said, ‘you can’t manage what you can’t measure’”
FRANK WADSWORTH MANAGING DIRECTOR AND CHIEF PROCUREMENT OFFICER, SMBC AMERICAS DIVISION
across the region to a strategic value-driven procurement model, leveraging digital transformation while providing improved governance and oversight, and hiring professional procurement experts to guide and influence business purchasing decisions.
SMBC’s category leads have several key priorities on the horizon this year, according to Wadsworth: “First and foremost is to assess the supplier footprint and historical spend for their respective categories, establishing savings targets together with an action plan to realise those savings.”
procurementmag.com 57 SMBC GROUP
According to SMBC’s Christine Ackerson, Head of Sustainability, Americas Division: “We are committed to fostering a society in which today’s generation can enjoy economic prosperity and wellbeing to pass on to future generations.
FRANK
“A second priority is to establish a strategic sourcing engagement model and policy with the business to ensure that procurement is in front of buying decisions. It’s important to establish a supplier portfolio-based buying approach to ensure we are selecting the appropriate suppliers based on business requirements, supplier market segmentation and capabilities, and to ensure we are leveraging aggregate purchasing power when making our buying decisions.”
procurementmag.com 59 SMBC GROUP
• Procure renewable energy (goal of100% renewable energy for its operations by 2024)
Ackerson explains: “SMBC’s ten-year sustainability roadmap – called GREEN X GLOBE 2030 – is focused on the environment, community, and next generation, including initiatives to address climate change by committing to becoming net-zero in its global operations by 2030, and net-zero in its loan and investment portfolio by 2050, all while supporting our customers in the transition to a decarbonised society.” The firm’s ESG priorities for procurement are:
SMBC’s approach to sustainability
“Given the transformational nature of this implementation and the centralisation of procurement for the region, our primary focus will be on implementation planning and change management activities across the region”
“The third priority is to establish quarterly business reviews (i) internally with key stakeholders and business representatives, and (ii) with our strategic and critical suppliers, to ensure visibility into their pipeline of prospective deals as well as provide performance feedback.”
The firm’s procurement team is working closely with the SMBC Americas Sustainability Committee and ESG team to incorporate ESG goals into the procurement policy and to execute against each of the ESG goals for procurement.
SMBCCHIEFMANAGINGWADSWORTHDIRECTORANDPROCUREMENTOFFICER,AMERICASDIVISION
• Achieve net-zero greenhouse gas (GHG) emissions in its operations by 2030 (including company travel, but excluding suppliers currently)
• Promote supplier spend diversity
• Develop green procurement guidelines (including greener office supplies, green leasing for office space)
• Coupa Risk Assess to support SMBC’sthird-party risk management
• Centralised contract repository, contract templates and full contract lifecycle capabilities
• Alignment with Bank and regulatory requirements.
new ground this year with the implementation of eSourcing and Coupa Risk Assess,” says Wadsworth.
The future of SMBC’s procurement: the next 12-18 months
By the end of this year, SMBC plans to have Coupa fully implemented in the U.S. and procurement fully operational for the region. The implementation of Coupa is significant, in that it includes the full suite of core functionality:
• Contract lifecycle management (CLMS)
Separately, SMBC’s procurement is contracted with Util, a London-based fintech company. Util has extensive data-mining capabilities used to identify individual company performance against the United Nations’ Sustainable Development Goals, which are helpful in assessing SMBC’s suppliers against its ESG corporate goals and identifying exposure to reputational, legal, or financial risk.
• Invoice processing (P2P)
• eSourcing
60 September 2022 SMBC GROUP
“We’reprogrammealsobreaking
• Auditable, traceable source-to-pay workflow with visibility into “who has the ball”
• Supplier onboarding (SIM)
“Given the transformational nature of this implementation and the centralisation of procurement for the region, our primary focus will be on implementation planning and change management activities across the region.”
• Electronic supplier invoicing with improved governance to ensure invoices are tied to approved purchase orders and underlying contracted commercials
• Increased visibility into supplier spend and contract management
• Checks and balances through predefined workflows, approval chains, and designated tolerances to mitigate rogue spend
According to Wadsworth, “While we are still on our Procurement transformation journey, we have delivered significant value to the Bank to-date” :
Value Delivered
In addition to the design and development of the data lake, Visionet developed PowerBI reports that are not only easy to use and exceptionally versatile, but also graphically sophisticated. “Visionet’s client partner, Rajasshri Phadnaik, played a key role in managing our overall relationship and went beyond the call of duty to drive programme success,” says Wadsworth. “We
procurementmag.com 61 SMBC GROUP
The Visionet delivery team hit the ground running, engaging with SMBC’s business partners across multiple group companies and regions to identify, map, ingest, and rationalise data from six ERP/AP (Accounts Payable) systems with ten general ledgers into a single repository.
SMBC’s partnership with Visionet Arshad Masood is the Managing Director and CEO of Visionet Systems Inc., a leading digital technology solutions company that helps their global clients increase agility, reduce costs, and enable business and technology outcomes. Visionet played a critical role in designing and developing SMBC’s supplier spend analytics data lake and PowerBI dashboards.
“While it may seem like a relatively straightforward exercise, it was exceptionally difficult,” says Wadsworth. “Working with fragmented systems, data models and inconsistent data values presented numerous challenges, all of which the Visionet team addressed head on.”
WNS Denali
“SMBC’s 10-year sustainability roadmap – called GREEN X GLOBE 2030 – is focused on the environment, community, and next generation, including initiatives to address climate change by committing to becoming net-zero in its global operations by 2030, and net-zero in its loan and investment portfolio by 2050, all while supporting our customers in the transition to a decarbonised society”
In 2019, SMBC engaged Sand Hill East, a strategic venture and fintech advisory firm, to assess the Bank’s technology organisation and their readiness to support the transformation journey and leverage
onboarding/setup activities. WNS Denali is an excellent partner willing to quickly spin up teams to meet project deadlines, taking an agile and nimble approach and providing support as needed.
CHRISTINE ACKERSON EXECUTIVE DIRECTOR, HEAD OF SUSTAINABILITY, SMBC AMERICAS DIVISION
OTHER PARTNERS THAT HELP SMBC TO ACHIEVE ITS GOALS
Dell EMC
Dell Technologies products play a crucial role as the strategic data processing platform to run SMBC's core infrastructure. Additionally, SMBC utilises Dell as part of the end-user compute experience. Both are critical use cases for which SMBC relies on Dell’s global footprint to deliver and ensure no disruption to its day-to-day business. Consistent and transparent communication between the executive account team, internal stakeholders and Procurement plays a key role to ensure commitments are kept or contingency plans are made to address (potential) global supply chain issues.
Star Compliance
“In today’s world, there is so much digital information to track, manage, and attempt to put to proper use. As a financial institution, we must be ever vigilant about maintaining proper controls and compliance in a dynamic regulatory environment.”, said Wadsworth.So,when
62 September 2022 SMBC GROUP
When SMBC kicked off its procurement transformation in 2021, they leveraged WNS Denali’s procurement subject matter expertise to assist in SMBCs Coupa sourceto-pay activities. WNS Denali was a key partner for contract meta-data extraction in support of the Coupa Contract Lifecycle Management implementation. Additionally, when SMBC Procurement hit a critical point of onboarding suppliers into Coupa, WNS Denali provided support with supplier
are currently exploring other opportunities with Visionet to leverage their cloud services capabilities.”
SMBC went to market in search of such a product, Star Compliance encouraged the business to leverage proofof-concept methodology to ensure that requirements were met or exceeded prior to full investment.
Sand Hill East
procurementmag.com 63
the capital markets fintech and innovation ecosystem. As part of this ongoing engagement, Procurement was introduced to a fintech company called Util by Roseann Palmieri, the President of Sand Hill East, to help track ESG performance metrics for key SMBCSandsuppliers.HillEastworks with new and growthstage technology companies to advise and
develop new technology ventures from ideation to go-to-market strategies, to scale their businesses and accelerate growth. SMBC benefits tremendously in that it gains insight and early access to new and disruptive technologies.
ADOPTING APPROACHAMANAGEMENT
Simply put, Hogg explains that it will be agility that will help organisations to navigate such a complex market: “It is important to never accept the status quo, while understanding when to double down on trusted supply chain partners and really trying to be customers of choice.”
64 September 2022 SUPPLIER MANAGEMENT
Operating in an unstable market has the procurement function centring their focus on developing a balanced strategy with operational execution to ensure they are getting their products and services at the right price, on time, and at high quality, while also juggling external policies and pressures, such as sustainability and diversity in the supply chain.
From Brexit and the Suez Canal blockage, through to COVID-19 and the war in Ukraine, Hogg explains that these disruptions have created challenges for procurement on a scale that has never been experienced before.
WRITTEN BY: GEORGIA WILSON
Operating in an unstable and complex market, supplier management demands a dynamic approach, putting suppliers at the centre of the procurement strategy
Despite being no stranger to disruption and complex challenges, procurement and supply chains have faced unprecedented pressures in the last three to four years. Richard Hogg, General Manager (EMEA region) at Scoutbee describes the industry as “a neverending deluge of pressures regarding how organisations ensure supply chain continuity and get the right products and services on time, while mitigating risk.”
procurementmag.com 65
APPROACH TO MANAGEMENTSUPPLIER
Simplifying the way everyone buys, pays & saves. Invoice Automation | Online Buying | Purchase to Pay | Advanced Analytics Advanced#TheFutureIsNowSpend Analytics. It’s that Empoweringsimple.businesses to achieve the extraordinary. To achieve the extraordinary go to www.compleatsoftware.com Make savings whilst also reducing your carbon Integratefootprint.intothe world’s most popular retail marketplaces... See what you’re spending in each procurement spend category Review spend over time for future savings Build a constant reflection of your spend Save money on items you already buy Track spend in multiple locations
My name is Richard Hogg. I’m the General Manager (EMEA region) for Scoutbee. I’m responsible for all the go-to-market activities, supporting Scoutbee and its customers across the EMEA region. So, everything from initial customer engagement, through to sales presentations, demonstrations, account management, but really importantly, ongoing customer success. In short, understanding where there’s a demand or need within an organisation for the kinds of products and services Scoutbee provides and making sure we deliver against that.
Richard Hogg
Despite the responsibility for managing third-party suppliers, and driving transformation and improvement always being a part of the procurement function,
COMPANY: SCOUTBEE
Supplier management demands a dynamic approach
INDUSTRY: PROCUREMENT
RICHARD HOGG GENERAL MANAGER (EMEA REGION), SCOUTBEE
procurementmag.com 67 SUPPLIER MANAGEMENT
TITLE: GENERAL MANAGER (EMEA REGION)
LOCATION: WÜRZBURG, GERMANY
He adds: “It’s a common trait that we’re seeing these days. Organisations are striving to guarantee the continuity and the depth of their relationship with existing suppliers, whilst also being flexible, easily adaptable and ready to change rapidly, so I think it's a bit of a combination. Doubling down on existing relationships but also being very agile on pivoting and establishing new ones.”
it has taken the disruption of the last few years to truly see a shift in view. Procurement as a function has talked for decades about being at the top table and having executive board level representation and so on and now is the time that organisations are appreciating what procurement and the supply chain does,” says Hogg.
SCOUTBEE 68 September 2022
RICHARD HOGG GENERAL MANAGER (EMEA REGION),
Today, procurement is now being viewed as a strateigc enabler by many, but for those that don’t Hogg warns: “If procurement isn’t now being given the appropriate levels of representation at a senior board level, then something’s really wrong. Procurement is the function that should be driving, managing, transforming and improving the relationships with thirdparty suppliers.”
Echoing Hogg’s thoughts on the importance of organisations putting suppliers at the centre of their strategy, Weise explained that the takehome message of ‘Profit from the Source is : “If you want to have peace as a CEO, then you need to over-invest in procurement and supply chain.”
He added: "We define procurement a lot broader than being just about cost savings. We talk about sustainability, innovation, speed, quality, and having the risk. And that only works by putting suppliers at the core of the business. That's our recipe: Profit from the Source.”
Daniel Weise at Procurement & Supply Chain Live 2022
BCG ‘Profit from the Source’
Speaking at Procurement & Supply Chain LIVE: The Risk & Resilience Conference, Daniel Weise, Managing Director and Partner at Boston Consulting Group (BCG), spoke of his latest book written in collaboration with Alenka Triplat, Managing Director and Partner; Dr. Wolfgang Schnellbächer, Managing Director and Partner; and Christian Schuh, Managing Director and Senior Partner at BCG.
procurementmag.com 69 SUPPLIER MANAGEMENT
Another key trend Hogg is seeing in the market is the concept of a 360-degree view of information: “A lot of procurement and supply chain organisations have always held information regarding suppliers but
For those trailblazers leading the way when it comes to strategic supplier management, Hogg highlights a key trend: “Organisations are truly doubling down on their existing supply chain and supplier relationships.”
Harnessing data provides a foundation for leaders to validate their advice and decisions. It also allows for greater traction and collaboration to drive much more strategic transformation programmes.
70 September 2022 SUPPLIER MANAGEMENT
what we’re seeing coming to the fore, and particularly where Scoutbee positions itself, is a true 360-degree view of not just the information that an individual organisation itself holds on a given supplier, but enriching that with external content and information.” He adds: “You can't make decisions without data. No matter how experienced an individual or an organisation is, if they’re making strategic decisions without data then it’s unlikely they’re able to assess all of the various pros and cons of making such a decision without evidencebased decision making.”
This trend is being driven by the need for supplier sourcing agility in response to product innovations, new market entires, geographical presence, and risk mitigation. Whilst perhaps not a new revelation in how to approach supplier management, the last few years have put a laser focus on how critical such activities are.
procurementmag.com 71
“When an organisation is spending a lot of money with suppliers and is potentially a strategic customer for them, then typically, these are suppliers who will listen and want to align with the strategic direction of that organisation. As such it’s not just in the hands of how much revenue or income is being distributed to third-party suppliers but what that means when it comes to the balance of power, and the positioning of lots of potentially softer - but hugely important - strategic benefits that can be driven out from the relationship,” concludes Hogg.
Putting suppliers at the centre of procurement strategy
He expands on the critical importance of spending money with the right suppliers, but also understanding the ways in which relationships with suppliers can be leveraged to support the organisations strategies and initiatives.
Critical to any organisation regardless of its operating sector, is the need to manage suppliers and spend. “The amount you spend with third-party suppliers can account for up to 80% of the revenue of an organisation,” says Hogg.
72 September 2022 PRODUCED BY: MIKE SADR WRITTEN BY: GEORGIA WILSON INCLUSIONCOMPLEXITIESTHEOF&SUPPLY
procurementmag.com 73 TELEPERFORMANCE
Global
“Ourservices.mottoat
inclusion
Teleperformance – which I love – is that ‘each interaction matters’,” says Diana Monterrubio, Procurement Global Strategic Director at truetransformingcomparedhastheirmostscale“TeleperformanceTeleperformance.hasgrownintoaglobalorganisationthatconnectsthebiggest,respectedbrandsontheplanetwithcustomers.Today,thecompanydoubleditsnumberofemployeestowhenIjoinedin2011,itsoperationswhileremainingtoitscoremission.”
Diana Monterrubio, Procurement Strategic and in and the of supply shortages
technology
challenges
F
74 September 2022 TELEPERFORMANCE
Teleperformance,Director,ondiversity
ounded in 1978, Teleperformance is a global organisationomnichannelheadquartered in France. Serving 170 markets in 88 countries, Teleperformance provides a variety of services, including customer acquisition management, customer care, technical support and social media
Diana
ProcurementMonterrubio,GlobalStrategicDirector,Teleperformance
76 September 2022 TELEPERFORMANCE
Increasing diversity and inclusion in the technology industry
Across many industries, women continue to be a disadvantaged minority, and Monterrubio emphasises the truth of this in the technology industry. “It’s very common and very visible. Quite often in meetings, it will be 10 men and me. I have been in situations where others assume that the males in my team are
DIANA PROCUREMENTMONTERRUBIOGLOBAL
DIRECTOR,
“I hope that I will be able to help others figure out their place in the world. To do my part for women to not feel like minorities or that they don’t belong” STRATEGIC TELEPERFORMANCE
Diana Monterrubio’s career is deep rooted in Teleperformance. 11 years ago, Monterrubio joined the telecommunication company as an agent in the lead up to her graduation. Since then, she has worked her way up through the organisation from Recruitment Specialist, to Procurement Co-ordinator, and Procurement Category Manager, before taking on the role she holds today - Procurement Global Strategic Director.
my boss when, in fact, it’s the other way round,” explains Monterrubio.
DIANA MONTERRUBIO
TITLE: PROCUREMENT GLOBAL STRATEGIC DIRECTOR
To combat this, Monterrubio is dedicated to educating herself and representing her gender within the technology industry. “I hope that I will be able to help others figure out their place in the world. I try to do my part to ensure one day, women no longer feel like minorities or that they don’t belong.”
INDUSTRY: PROCUREMENT
LOCATION: GUADALAJARA, MEXICO
Monterrubio is dedicated to applying her talents and knowledge on a personal and professional level. To apply the tools she has gained along her student and professional years, in order to keep on striving promotedevelopmentheroutexcellence,forlookingforherownandteammate’stosuccess.
BIOEXECUTIVE
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STRATEGIC
Monterrubio believes that the key to increasing diversity and inclusion in the technology industry is listening. “I think it’s important that we all – not just males –continue to listen and continue to keep on learning. It is important to give everyone the spotlight and a chance to sit at the table. Doing so can change everything for the better, fresh thoughts can only improve the way we operate,” says Monterrubio.
DIANA PROCUREMENTMONTERRUBIOGLOBAL DIRECTOR,
TELEPERFORMANCE procurementmag.com 79 TELEPERFORMANCE
“Thechallengehardestfor women entering into the technology function is finding a way to achieve equality”
“The hardest challenge for women entering into the technology function is finding a way to achieve equality, acknowledging our differences and embracing what brings us together,” she adds. “For example, I have found that negotiation is an art; if men like to do business golfing and a woman doesn’t golf, is she automatically out of the negotiations because of that? Some people may say yes, some may say no, or some may say she needs to adjust.”
80 September 2022 TELEPERFORMANCE
“Something that I love about Teleperformance is its awareness of the issues women face not just in
procurement, but across all industries. Teleperformance is committed to a fair workplace that respects its people and strives for equality. We have a global initiative called TP Women where we address challenges faced by women in the workplace, so I’m very grateful for that. It makes me feel that the company backs me in what I do.”
One piece of advice Monterrubio has been given and would like to pass on: “Do not be afraid to speak up, to express yourself, highlight the challenging work that women are doing in the industry, silence is not a tool that we need.
Teleperformance: The complexities of inclusion & supply procurementmag.com 81
82 September 2022 TELEPERFORMANCE
leadership”ofproportionincreaserolesinwomenpercentagetheofandmenleadershiptohelpthewomenin DIANA PROCUREMENTMONTERRUBIOGLOBAL STRATEGIC DIRECTOR, TELEPERFORMANCE procurementmag.com 83
How can other organisations drive greater inclusion?
“Statistics
“These strategies should be supported and gain participation at all levels of the business. It is also important to track promotions – statistics will never lie, they can tell us the percentage of women and men in leadership roles to help increase the proportion of women in leadership,” says“WeMonterrubio.alsoneedmore female mentors, this is something that I think is still lacking in the industry, we still don’t have that many senior female role models.” will never lie, they can tell us
There are many strategies for driving greater inclusion, but what does it take for such strategies to be effective?
The evolution of global purchasing
For a long time, global purchasing has been evolving. When Monterrubio began working in procurement at Teleperformance she only worked for the sites in Mexico. Back then, the company’s operations were decentralised, operating separately within their borders. Today, Teleperformance operates on a global and centralised governance demanding the need for global executives and directors to take care of negotiations.
“For the last two years, we have been developing a forecasting and negotiations plan: to supply our clients with the technology needed, even with the current shortage. This has certainly been the biggest challenge of my career for the last two years, which is why we have great partners that we work with to help navigate these storms.”
84 September 2022 TELEPERFORMANCE
Navigating the complexities of component shortages
For those in the technology industry, component shortages have been a significant challenge. “I can honestly say this has been a hard challenge, something that has kept me up at night. The supply of components is a chain that needs to be restored and one that we need to make work,” explains Monterrubio.
“With our partners, we have been able to plan for the future, as well as develop new ideas and strategies for the coming years”
DIANA MONTERRUBIO PROCUREMENT GLOBAL STRATEGIC DIRECTOR, TELEPERFORMANCE procurementmag.com 85
86 September 2022 TELEPERFORMANCE
Monterrubio adds: “We have many partnerships with both hardware and software companies. The pandemic required a huge jump in technology and remote
Why ‘partners’ and not ‘vendors’ Insisting on calling collaborators ‘partners’ instead of ‘vendors’, Monterrubio highlights that this is something she learned during her time at Teleperformance. “This mindset has helped me so much in my career. While a vendor is someone that will be with you in business as they look to develop their own operations, a partner is an organisation that you trust and that will grow with you, they want to understand your needs and the value they can bring.”
“For example, I negotiate with all our global technology partners, which I then pass on to our regional and local teams to continue the negotiations internally in their own countries,” says Monterrubio.
procurementmag.com 87
“Negotiating 10 laptops is not the same as negotiating a 100,000, this understanding has helped us to organise our operations to negotiate better pricing and standards, as well as volume so that we spend what is needed on hardware and software rather than overspending,” she adds.
PROCUREMENTMONTERRUBIOGLOBALSTRATEGICDIRECTOR,TELEPERFORMANCE 88 September 2022 TELEPERFORMANCE
“Growth waits for no one, so we need to start planning and we need to get better at forecasting” DIANA
She adds: “As a result, communication and creating standards became our strategy. We still have a long way to go, but we have great leadership guiding us.”
Developing a centralised procurement team Reflecting on Teleperforamance’s development of a centralised procurement team, Monterrubio explains that the key
“But we found ourselves developing this centralised procurement team that required communication in the middle of a pandemic. No one could travel, everyone was at home, so our strategy became centred around the laptop requirements, the headsets, the cameras, the software, and the security of communicating remotely.
Over the next 12 to 18 months, Monterrubio expects to see significant continued growth. “Growth waits for no one, so we need to start planning and we need to get better at forecasting and planning. We also need to keep innovating, creating and developing our strategies for negotiations, procurement, and our partnerships.”
andLanguages265+servedCountries170worldwideemployeesNumber420K+wasYear1978companyfoundedofdialects procurementmag.com 89
working, and our partners have helped us to meet that need, to keep up with the industry and to meet customer demands.
to success is communication. “We didn’t know any of our peers in procurement globally when the new governance took place. We soon realised that, to migrate into a central team successfully, we needed to communicate,” explains Monterrubio.
“With our partners, we have been able to plan for the future, as well as develop new ideas and strategies for the coming years –our partners are definitely important to us and our success in achieving our goals.”
90 September 2022
procurementmag.com 91 TECHNOLOGY
of professionals report that their digital transformation progress has been slowed or stalled at some point.
Katie McEwen, Community Advocate at TealBook, explains how the procurement function can avoid digital transformation burnout amid continuous disruption
As such, many organisations are experiencing a form of ‘digital transformation burnout’. McEwan explains why the procurement function is experiencing such exhaustion: “Imagine after years of work, millions of dollars spent creating requirements, countless hours gaining stakeholder support, and a barrage of never -ending meetings, you get an email from your CPO: ‘Due to the following XYZ unforeseen events, this digital transformation project has been suspended – indefinitely’.
92 September 2022 TECHNOLOGY
Muddy
– this is how Katie McEwen, Community Advocate at TealBook, describes the current procurement landscape.
“This may seem like fiction, but it’s happening over and over again in large organisations – especially since the beginning of the pandemic. It’s a nightmare for procurement teams.”
Tealbook as the Data Foundation of the e-Procurement Ecosystem
While the business case for digital transformation is clear, despite best efforts in the last five years to drive such projects, unforeseen events are stunting growth and potential. According to McKinsey, 70%
and decentralised, with multiple systems and processes
“Today’s modern procurement organisations look more like large metropolitan cities: the infrastructure of the city needs work,” says McEwen. “When 2020 hit, organisations didn’t have the bandwidth to discover and strategise. After playing catch-up for nearly three years, a new wave of shortages and inflation has procurement professionals cutting their losses and running for the hills.”
“
IT’S A CYCLE OF GOING FROM ONE FIRE TO THE NEXT WITHOUT BEING ABLE TO SEE WHAT’S AHEAD OF YOU…ALL YOU SEE IS THE NEXT FIRE. OVER AND OVER AGAIN”
Each time a project stalls, leaders are tasked with recreating the momentum that they once had, building in new requirementments for the changing environment. It is this continuous disruption that chips away at a team’s motivation, resulting in a fear of working 80+ hours a week on a project that may never see the light of day.
I’m Katie McEwen, the Community Advocate here at TealBook.
INDUSTRY: PROCUREMENT
Since entering the industry five years ago, I’ve had the privilege of learning about the complex world of procurement. As I learned more about what those in procurement deal with on a daily basis, I have developed a deep empathy and respect for professionals in the function, and I am setting out on a mission to help.
Starting out, I didn’t know anything about procurement, but I was responsible for understanding what procurement leaders deal with, so I asked questions on LinkedIn. A lot of questions. Then something beautiful happened: I made friends and built a community.
TITLE: COMMUNITY ADVOCATE
For those in procurement experiencing ‘digital transformation burnout’, such a mindset is causing significant delays or a reluctance to implement new elements.
Katie McEwen
TEALBOOKCOMMUNITYMCEWENADVOCATE, procurementmag.com 93
LOCATION: TORONTO, CANADA
KATIE
COMPANY: TEALBOOK
“Consulting services and RFP requirement building is taking time away from forecasting, planning, and strategy. Manual workflows and approvals require a tremendous amount of time, and when the additional time is spent on projects that don’t gain traction, teams aren’t able to be thoughtful and preemptive with their strategy and execution,” explains McEwan.
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“It’s a cycle of going from one fire to the next without being able to see what’s ahead of you…all you see is the next fire,” she adds. “Over and over again.”
Once key priorities have been established, McEwan explains that a data-first approach is the best place to start: “Data is the
How to avoid digital transformation burnout
As such, data should be at the forefront of any digital transformation; without strong supplier data, an organisation may not even be able to identify the gaps that need to be addressed with digital solutions.
When it comes to digital transformation, it is important to not overload your organisation with multiple implementations at once. While there are lots of tools, software and solutions available to address an organisation’s need, it’s important to define key priority areas to address, focusing on one digital solution at a time.
blueprint for the digital transformation design. It prevents burnout by maintaining project momentum because the data reveals the areas of friction, silos, and pain points. It’s not based on a consultant's opinion, politics, or bells and whistles.”
procurementmag.com 95 TECHNOLOGY
Too often seen as an afterthought, McEwan adds: “You can’t argue with data. The data shows you, your team, and internal stakeholders the areas of focus and demonstrates a clear ROI to ensure a successful best-in-class digital model.”
- Katie McEwen, Community Advocate at TealBook
DATA IS
Once implemented, a retrospective should be performed to gain insight into the success of the project.
What is driving the need for digital transformation in procurement?
“ THE
Category managers today spend more time checking for human errors on spreadsheets than strategising and negotiating. More manual work means more time spent on low value activities –automation will help procurement make better decisions based on data.
DIGITAL TRANSFORMATION KATIE TEALBOOKCOMMUNITYMCEWENADVOCATE, 96 September 2022
A closing point for McEwan includes the importance of starting a digital transformation journey with ‘light lift’ projects. “It can be easy to get wrapped up in the capabilities of new procurement technology, but don’t dive in too quickly before you can get a handle on how the solution works. Begin with small projects that are keenly focused on business initiatives,” she concludes.
Following the gathering of data on key transformation areas, it is then important to establish a realistic and detailed launch plan. “The last thing you’ll want to do is rush the project only to have important checklist items fall through the cracks or see the project stall entirely,” explains McEwan.
Most of us understand the need for technology, but I think we can also respect and understand the human component. Organisations can’t plan and strategise when they are constantly putting out fires, and manually checking for exceptions and outliers. Their time needs to be focused on what machines can’t do.
THE BLUEPRINT FOR THE TRANSFORMATION DESIGN” procurementmag.com 97 TECHNOLOGY
GIBSONJESS
SUPPLY CHAIN IS THE AT THE HEART OF 98 September 2022
SADRMIKE WRITTEN
PRODUCED BY: BY:
THE ENGINE NUTRABOLT
As Nutrabolt’s VP of Procurement, Brendan O’Toole highlights the importance of sourcing and supply, reinvention, and staying agile in a volatile climate
In the 20 years since its inception, Nutrabolt has not only firmly established itself as a major player in the active nutrition market, but the entrepreneurial and agile business has also continued to expand globally with a varied range of products, “focusing on the functional beverage segment for the last five years, which has been a huge success for our growing business”.
N
utrabolt is a fast-growing, global active health and wellness company founded back in 2002 and headquartered in Austin, Texas, a city home to an eclectic range of live music and vintage clothes shops. Described as a grassroots organisation that has worked its way onto the global playing field, Nutrabolt shares a few things in common with its birthplace –namely, an endless abundance of energy and being endearingly “scrappy throughout”.
“It's very entrepreneurial here at Nutrabolt and moving quickly, like a startup,” states Brendan O’Toole, Vice President of Procurement at Nutrabolt. “But it's a 20-year-old company, so it also has some of those guardrails of establishment.”
The branding and distribution company has a portfolio that’s distributed across 150 countries, with a particular focus on the pre- and post-workout hydration and muscle strength market – and this is one of the factors that sets Nutrabolt apart from its contemporaries. It has, however,
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“I LOVE WHAT I DO, WHO I DO IT FOR AND WHO I DO IT WITH”
Supply is the engine at the heart of Nutrabolt
BRENDAN O’TOOLE VP OFNUTRABOLTPROCUREMENT,
experienced much of the same volatility and disruption that other global companiesdistributionhavehad to withstand over the past fewO’Toole,years. firmly ensconced in the thick of it, describes the current environment as “very volatile and very tumultuous”, particularly for a co-manufacturing company where “collaboration is key”. And there are no signs that this is going to let up any time soon, with geopolitical events and the economy causing significant stress on global supply chains for the foreseeable future.
“That's really where myself and my team come into play because we're a 100% co-manufacturing company; we don't do any of our own manufacturing here. So,
Brendan O’Toole is an entrepreneurial supply chain executive with over 20 years of experience in a variety of industries including consumer packaged goods (CPG), health and wellness, real estate and land development, sports nutrition, in both startups and Fortune 200Incompanies.hiscurrentrole with Nutrabolt, Brendan is responsible for E2E sourcing of all globally sourced materials, packaging components, and external manufacturing services for both business segments of active nutrition and functional beverages. Previously at The Honest
From O’Toole’s perspective, the procurement and supply chain function of a business – particularly at Nutrabolt – is the engine that keeps the system running effectively and feeds into every aspect of the business, from legal and sales to finance.
LOCATION: AUSTIN, TEXAS, US
Nutrabolt began as a small, grassroots business out of central Texas. Tapping into a growing market related to exercise and wellness, Nutrabolt CEO Doss Cunningham started the company himself with an aim to help build – as the company website
TITLE: VP OF PROCUREMENT
BRENDAN O’TOOLE
INDUSTRY: HEALTH AND WELLNESS
really, it's our external partners that we have to stay extremely close to. It’s a lot of overcommunication, just waiting through the different challenges.”
NUTRABOLT
From humble beginnings to global juggernaut
JW Nutritional is an industry leader in cutting edge manufacturing for a variety of dosage forms. From bulk and bottled powders, stick packs, sachets, capsules, tablets, and gummies, to liquids ranging from 1 ounce to 1 gallon, including single-serving V-Shapes sachets, products are uniquely tailored to inspire customer loyalty and drive brand success.
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By leveraging decades of experience, our robust supply chain, and flexible lead times, JW Nutritional is able to deliver the highest quality dietary and nutritional supplements on the market.
mantra states – ‘strong bodies, clear minds, and a culture of respect and belonging’ within the active health sector. Cunningham has built the company into “a global juggernaut”, effectively “pulling himself up by the bootstraps” to fund it at the beginning.
“THETHEISFUNCTIONANDPROCUREMENTSUPPLYREALLYTHEENGINETOBUSINESSSALES”
O’Toole explains further: “We have different iterations of that: C4 Sport, C4 Original, C4 Ultimate. It's really meant to be accessible throughout for different customer goals and life cycles through their performance journey. C4 Sport is meant to
“At the heart of it, we're a branding and distribution company,” says O’Toole. “Our primary focus is, and continues to be, ensuring that we’re the global leaders on
procurementmag.com 105
the pre-workout side, which is our branded product line called C4.”
Nutrabolt has three core brands that its products fit under, each marketed to different groups and specialising in related pre- or post-workout supports: C4 Energy, Cellucor, and XTEND. The best element of these brands, aside from their differentiated price points to appeal to consumers of different financial capabilities, is the time and dedication that goes into developing each of the formulas, which are targeted at different aspects of the body but with the same overall desired outcome.
BRENDAN O’TOOLE VP OF NUTRABOLTPROCUREMENT,
NUTRABOLT
106 September 2022 NUTRABOLT
BRENDAN O’TOOLE VP OF PROCUREMENT,NUTRABOLT
“I love what I do, who I do it for and who I do it with,” O’Toole enthuses. “Knowing the importance of what we do day-to-day, it’s very motivating. What I do really is act as a liaison back and forth, both internally and externally, to our partners and through our business. So I get to wear many hats. It's never a boring day, and I love that – it fits my personality.”
NUTRABOLT
be a more introductory product line that you can find almost anywhere – the Targets, the Walmarts, CVS. C4 Original is a step up there with a slightly different ingredient makeup, while C4 Ultimate contains more caffeine and more clinically studied ingredients for certain outcomes.”
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O’Toole’s role as Vice President of Procurement is an expansive one, which means a huge amount of responsibility sits on his shoulders day-to-day – though it is this, perhaps, that keeps him interested in the role.
“IT FEELS NEW EVERY DAY HERE. NUTRABOLT IS IN HYPER-GROWTH MODE. WE STRIVE TO BE INNOVATIVE AND ON THE LEADING EDGE OF WHAT WE DO IN OUR INDUSTRY HERE”
The art of procurement and strategic supply management
NUTRABOLT’S KEY PARTNERSHIPS
108 September 2022 NUTRABOLT
KNOW...YOUDID
The fallout of the pandemic combined with ongoing geopolitical, cost of living and climate concerns has led to Nutrabolt pivoting to include a new roster of partners, who are more suited to the immediate future of sourcing and supply. JW Nutritional is an example of one of these newer partners. Hailing from Texas, just like Nutrabolt, JW is a young company with what O’Toole describes as “untapped potential” that has itself pivoted “to innovate in out-of-the-box ways”.
As a 100% co-manufacturing company, Nutrabolt is close to its partners, which means that collaboration is Whilekey. it remains dedicated to historically loyal partner companies – such as Phoenix Formulations, Armada Nutrition, Prinova UK, all of whom have been partners of Nutrabolt through thick and thin – with positive collaboration and teamwork set to continue in the future, new issues necessitate a strategic partnership rethink.
As a testament of the company’s purpose-led, value-focused team culture, Nutrabolt has been included on Great Place to Work and Fortune magazine’s list of Best Workplaces in Texas 2022. This achievement is all the more notable due to the fact that it’s based on employee feedback via the world’s largest ongoing annual workforce study.
Nutrabolt Culture: Teammates Gather for EOY EventsNUTRABOLT
“Everything is a challenge, right? I used to have to explain that my undergrad degree was supply chain management at Michigan State University, and no-one knew what
A gregarious character, O’Toole is well-suited to a role in procurement, which is all about forging relationships and problem-solving with partners as a cohesive team. “I'm responsible for all global sourcing efforts with regards to raw materials, packaging, and co-manufacturing relationships throughout our global network,” he asserts, somehow managing to fit his varied role into neat soundbites.
Despite this enthusiasm for his job and the varied elements that come together to make it up, O’Toole is the first to agree that it has been a difficult few years for everyone within the procurement and supply chain function.
procurementmag.com 109
‘WE HAVE THE BEST PEOPLE IN THE BUSINESS’
NUTRABOLT CULTURE:
“To give an example, there are certain raw materials in our products; our product ingredient makeup is highly clinically studied and there are ingredients that come from all over the world. If you have 30 of those ingredients in a product and one has a major constraint, you can't make that product."
benefit of the business and customers. But another core element has been willingness to adapt and reinvent.
As a co-manufacturing company, the key to surviving and thriving in the face of such difficulty has been ensuring constant communication and collaboration with sourcing and supply partners; luckily, O’Toole is determined to continue building and strengthening partner relationships for the
that was; now, over the past two-to-three years, everyone knows what that is,” O’Toole says with a wry smile. “There’s really been a start, stop, start, stop rhythm to commerce. During COVID-19, everything completely shut down, and then, coming out of it, everything just shot back the other way. Now, we have macroeconomic and geopolitical challenges that continue to make business even harder.”
110 September 2022
A cost-effective solution was identified to resolve this ingredient issue, though it required careful planning to ensure the formulation was not just similarly effective, but safe for consumption, too. Time had to be taken to ensure that the ingredients used
This is particularly important because, as O’Toole passionately believes, “a team that embodies understanding is the crux of a good partner”.
procurementmag.com 111
“OVER THE NEXT 12-18 MONTHS, THE AIM IS TO CONTINUE TO SCALE AND GROW OUR BUSINESS WITH BOTHPARTNERSHIPSSTRATEGIC–ONTHENUTRITIONANDFUNCTIONALBEVERAGESIDE”
He continues: "It's really been an oscillation of keeping eyes on all the different ingredients, packaging components, the labour side, domestically and abroad, with COVID callouts, stimulus checks and getting people to go back to work. It was a continuous circular issue wheel, if you will, day-by-day.
NUTRABOLT
BRENDAN O’TOOLE VP OF PROCUREMENT,NUTRABOLT
We have to really look at all the lead times at an aggregate level, the constraints throughout – if we have 15, 20 ingredients in one, but one is single-sourced from Italy and it has a lead time of 20 weeks, we have to account for that. That all plays into our speed-to-market and is part of our procurement process.”
Other ways that the company has stayed afloat have been liaising with potential vendors, seeking cost-effective solutions in the locality and being open to change. Together, these solutions have helped Nutrabolt’s procurement and supply chain function to demonstrate “resilience through insurmountable changes”, retaining some aspects of the team in place while growing others after the pandemic
“My group and I oversee all of that. Through the pandemic and even now, when we're designing products up front, we really have to take a step back and look at the ingredient makeup and the packaging. Here's where we want to produce it, closest to the customer.
worked well together and had no adverse effects, as well as to account for different sourcing locations.
Another key to surviving such a difficult few years has been the act of strategically investing in new tools and systems for routine admin tasks. “We've launched new tools, demand planning software or ERP systems, business intelligence and reporting to really try to automate routine administrative tasks, allowing for us to focus more on our partners and the relationship with those partners, which is what matters most.”
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O’Toole continues: “We had to start redesigning our supplier sourcing strategies to create opportunities for localised suppliers, allowing for flex manufacturing capacity through simplified contractual addendums.”
Investing in automated technology and systems, and shifting suppliers
BRENDAN O’TOOLE VP OFNUTRABOLTPROCUREMENT,
Looking to the future of Nutrabolt
• To “drive internal operational efficiency with a focus on continuous improvement and“Ifsimplicity”youdon't have the basic foundation in place or are trying to be too orchestrative, it’s just a recipe for failure,” he explains, setting down the company’s outlook. Though his sector is experiencing a tumultuous time, O’Toole is excited for the future at Nutrabolt.
In an age of unprecedented global strife, many sales, branding and distribution companies have found themselves unexpectedly impacted. As such, sourcing strategies are being reconsidered by many, if not all, global businesses – and Nutrabolt is no“We'reexception.looking and choosing to nearshore where possible. Indigenously, a lot of our ingredients that go into our products come from global sources, including China. With their repeated lockdowns, COVID surges, the port struggles and other geopolitical factors, we've had to look at other countries and, more imminently and myopically, why not in the States?”
“Over the next 12-18 months, the aim is to continue to scale and grow our business with strategic partnerships – on both the nutrition and functional beverage side. The domestic part of our business has always been the key to our sustainability and growth, but we're really seeing opportunities globally, as well, in different markets. We’re continuing to robustly fortify and create strong relationships here in the US, but these are also starting to occur in other markets, so this is a huge focus of our business going forward,” O’Toole concludes.
Focus is something that O’Toole believes all businesses will crumble without. As such, he cites Nutrabolt’s operational pillars as the core focus for the business, now and into the future:
“WE'VE LAUNCHED NEW TOOLS, DEMAND PLANNING SOFTWARE OR ERP SYSTEMS, BUSINESS INTELLIGENCE AND REPORTING TO REALLY TRY TO AUTOMATE ROUTINE ADMINISTRATIVE TASKS”
• To ensure continued global business growth “through a high-quality and built-forscale network of co-manufacturing partners”
• To provide an omnichannel supply chain service that is “transparent to our customer, repeatable and cost optimised”
procurementmag.com 113
“What we don't want to do is get hung up on contract details or get ‘deal fatigue’ and make it too hard to do business with some of these partners. We want everyone involved to be protected, but are trying to have some simplified addendums so we can continue to move quickly with these partners to garner the manufacturing and supply capacity that we need.”
WRITTEN BY: GEORGIA WILSON
114 September 2022
Taulia’s Bob Glotfelty and HICX’s Costas Xyloyiannis explain the need to improve ESG maturity in procurement if net-zero initiatives are to be met
net-zerojourneyProcurement’stoachievinginitiatives
In recent years, it has become very clear for many that 90% of an organisation’s impact surrounding ESG isn’t related to its direct activities, but instead comes from their supply chain.
procurementmag.com 115 SUSTAINABILITY - NET ZERO
“Those that are having a true impact, acknowledge the role that the supply chain plays in climate change, and the need to look beyond your own four walls. This is where procurement comes into play. It is where organisations have the ability to drive preferred behaviour within their supply chains,” explains Glotfelty.
n today’s global market, 95% of Fortune 500 companies publish detailed information surrounding their environmental, social, and governance (ESG) efforts. This follows on from increased governmental and regulatory pressure, which demands more transparency and accountability from individual businesses if they want to thrive. It’s something of which many CEOs and high-up officials are acutely aware.
“Most big companies today are committed to ESG activities,” says Bob Glotfelty, Chief Growth Officer at Taulia.
Because Insight Beats Hindsight Ensuring the agility and resilience of your business and supply chain starts with identifying the risks. Download our report to start your resilience planning today. Inform your supply chain reporttime-measuredplanningresiliencewithourseries Download ASCRI Report
COMPANY: TAULIA
My name is Bob Glotfelty, and I am the Chief Growth Officer at Taulia.
Adding to Glotfelty’s comments, Costas
Based in San Francisco, I oversee our marketing teams, our supplier outreach teams, partnerships, and new geographic expansion activities – in particular, our China operations.
I have been with Taulia since 2014, joining the company as the Director of Marketing Operations.
TITLE: CHIEF GROWTH OFFICER
2. Is the entire company brought into ESG? Such initiatives often require a strong top-down approach in order to be successful.
INDUSTRY: FINANCIAL TECHNOLOGY
“Most companies are still in the very early stages of their ESG maturity,” says Glotfelty, who attributes this to a couple of key challenges:
LOCATION: SAN FRANCISCO, UNITED STATES
Xyloyiannis, CEO of HICX, says: “Companies often neglect to view the supply chain as a whole and instead think only about their own environmental impact. A more mature approach is to recognise the direct and indirect impact that their actions have on their suppliers’ ability to reduce emissions.
Bob Glotfelty
Industries ripe with opportunity, yet are still in the early stages Ripe with opportunities to partner with suppliers to drive environmental change together, it is time for the procurement industry to grow its maturity when it comes to sustainability and achieving its net zero ambitions.
1. Making decisions. Within an organisation, such activities can take time, so a consensus needs to be achieved in order to move an initiative forward. It can be very challenging for organisations to make big and complex decisions.
Since then, I have held three other roles at the company prior to the job that I do today. These include: Head of Supplier Success; Vice President of Customer Success; and Vice President of Growth.
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Costas Xyloyiannis TITLE: CHIEF EXECUTIVE OFFICER COMPANY: HICX INDUSTRY: SOFTWARE LOCATION: LONDON,
My name is Costas Xyloyiannis, and I am the CEO and co-founder of HICX, the Supplier Experience Management platform.
HICX is a fast-growing company, so it’s my responsibility to drive the vision and strategy, to ensure everything we do is scalable, and to build a great leadership team. ENGLAND
118 September 2022 SUSTAINABILITY - NET ZERO
My goal is to transform the way major companies think about supplier experience and data.
Such solutions were typically used to reduce or remove the need for paper processes, which, in turn, has a positive impact on the environment. Since then, Glotfelty says that industries have expanded the capabilities of technology so that “there are now many other ways that digitalisation can help”.
COSTAS XYLOYIANNIS CHIEF EXECUTIVE OFFICERHICX
Agreeing with Glotfelty, Xyloyiannis says: “It is important to recognise that no company is an island and that, particularly for large organisations, any ESG policy must include the entire supplier ecosystem. To achieve ESG commitments, organisations need extensive information about suppliers on
Digitalisation – a commonly heard phrase in today’s business world. For more than 20 years, industry leaders have discussed the benefits of digitalisation.
One such way is the use of digital solutions to efficiently gather supplier data – of key importance as data becomes
Is digitalisation the answer to ESG maturity challenges?
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“Companies often neglect to view the supply chain as a whole, instead thinking only about their own environmental impact”
the cornerstone of business acumen and transparency. “Digital solutions can help to better understand how your suppliers are performing based on key metrics such as their emissions. With these kinds of insights, organisations can select their preferred suppliers,” Glotfelty continues.
“But the reality is that many systems used to manage supplier information are not fit for purpose, lacking the ability to support the data hierarchy needed to manage all aspects of supplier data. The key to gathering useful data is preparing the foundation upon which to build the best possible supplier lists, creating a single source of truth in supplier data. To drive net-zero campaigns that are truly meaningful and maintainable, this is crucial.”
Whilst dependent on the maturity level of an organisation when it comes to leveraging some of the more advanced and innovative tools, Glotfelty details some of the key technology starting points for those not as advanced.
“Those that are having a true impact acknowledge the role that the supply chain plays in climate change and are aware of the need to look beyond your own four walls”
Fundamental technologies for organisations to adopt
BOB TAULIACHIEFGLOTFELTYGROWTHOFFICER
“For procurement professionals looking to drive sustainability and net zero within their supply chains, some of the basic foundations to build are an effective way to measure your efforts. I recommend
which to base decisions. This data should be accurate, current and devoid of duplicates.
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looking into sustainability providers such as EcoVadis, who are able to remove the burden of measurement and evaluation for the function,” says Glotfelty.
“Payment solutions are also useful tools to drive sustainability efforts,” he adds. “Digitalisation in this area can help organisations to incentivise their suppliers with early payments to improve their sustainableXyloyiannisefforts.”concludes:
“When it comes to driving sustainability efforts, embracing
“This way, a single source of truth in supplier data can be accessed and maintained – across every single solution within the stack. This is the route to enabling supplier experience management and making informed ESG decisions.”
best-of-breed technology to address specific challenges is immensely valuable. But this only works when the various systems used are integrated. Therefore, a platform that integrates supplier data with other functions across all solutions is fundamental.
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