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FOREWORD
W
elcome to the June edition listeners, and we’re great at multitasking of Supply Chain Digital! – these are skills that are highly valued.” This month’s issue brings us to Elsewhere, we interviewed Sandeep Toronto, where we attended Arora, VP Global Sourcing and ProcureCon Canada and rubbed Strategy at SPX Transformer shoulders with business leaders to Solutions, about the process of create some exclusive implementing a Sourcing features and video content. Excellence Framework as For our cover feature, we part of its digitisation spoke to Sheri Spinks, a journey. prominent member of You also won’t want to Sheri Spinks, the Global Council for miss features with World GCAWP the Advancement of Vision, SEG Automotive, Women in Procurement, Turkcell, Applus, about how diversity has UnitingCare Queensland and become increasingly important in the Deloitte in what is another fully-loaded procurement space. edition! This month’s Top 10 looks at “I would encourage more women to the leading SCM Software Companies get into this space, to educate in the market today. themselves and to be vocal about the Would you like to be featured in value they can add to organisations,” the next issue of Supply Chain Digital? says Spinks. “Women really do have a Get in touch at different perspective on things like sean.galea-pace@bizclikmedia.com negotiation and relationship building. Generally, we are more empathetic and Enjoy the issue! tuned in with others, we’re good Sean Galea-Pace
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CONTENTS
12
Exploring the changing role of procurement‌
24 Diversity is key to the evolving procurement function
34 Bringing ProcureCon Canada to life
54 Creating shared value, the right way
TOP 10
SCM software providers
70 42
Events & Associations
CONTENTS
74 SPX
112 SEG Automotive
94 World Vision
140 Applus
126 Turkcell
168 Deloitte
154 UnitingCare Queensland
P R O C U R E M E N T T R A N S F O R M AT I O N
Exploring the changing role of procurement… As the procurement function becomes increasingly prominent, we spoke to ProcureCon Canada attendees from IBM, Black & McDonald, JamesWay and CSA Group about what this means for the future of supply chains
12
WRITTEN BY
JUNE 2019
OLIVIA MINNOCK
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P R O C U R E M E N T T R A N S F O R M AT I O N
T
his April, Supply Chain Digital attended ProcureCon Canada to get the inside scoop on the latest advancements and challenges facing
the world of procurement. The event’s sheer size and scope was testament to how the procurement function has grown and developed in just a few short years. “If we reflect back two decades, we were seeing more of the back office support function: process-
14
ing and providing some support in terms of order issuance and invoice resolution management,” says Crithica Parthasarathy, IBM Procurement Services Practice Lead. “Today, we’re on the frontline with the C-suite team and it’s increasingly influencing the bottom line.” Ankur Thakur, Director of Strategic Procurement at JamesWay Incubator Company Inc, echoes this sentiment. “Within my organisation, we now have a seat at the table – supply chain isn’t just under the operations umbrella,” he explains. “I believe supply chain and procurement is like the foundation of a building: if the foundation is wobbly, the building can collapse. The supply chain and procurement department manages a high proportion of the raw material costs and negotiates with key stakeholders.” JUNE 2019
15
“Supply chain and procurement is like the foundation of a building: if the foundation is wobbly, the building can collapse” — Ankur Thakur, Director of Strategic Procurement at JamesWay Incubator Company Inc
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P R O C U R E M E N T T R A N S F O R M AT I O N
“Accepting diversity allows different perspectives within a business” — Wael Safwat, Procurement Director at Black & McDonald and Chairman of CIPS Canada
16
Despite this progress, bringing
As businesses take steps to really
procurement to the C-suite remains a
invest in procurement, how can the
work in progress worldwide. “Different
case for this be pushed? “You need to
organisations are going through
understand what the objectives of the
different maturity journeys,” explains
organisations are and what the goals at
Wael Safwat, Procurement Director
the top level are,” says Parthasarathy.
at Black & McDonald and Chairman
“You need to be able to sit with each
of CIPS Canada. “For some, it’s about
C-suite member and understand
cost savings and getting the lowest
what challenges they are facing – what
cost, but for a lot of medium and
is the roadmap? How can you remove
larger organisations it’s more about
pain points for others in the organisa-
focusing on value creation and
tion? That’s really a unique ability
business enablement.”
because procurement is able to see
JUNE 2019
things from both sides of the lens –
cally and work with those numbers.
from inside the organisation and what’s
My approach is taking data and then
happening in the marketplace. It’s
elevating the poor of procurement.
important to think about how you can
When you’re sitting at a table with the
drive and foster change.”
CIO, CFO and operational leaders and
Manny Satija, Strategic Sourcing
you understand their business at the
Director at CSA Group, says that cold,
same or higher level than them, you
hard facts are key when making the
suddenly become significant – I would
case for procurement. “I’m a big
encourage everyone to spend time
believer in numbers, so when I think
listening and learning the business.”
about organisations I always like to
The next big thing to impact procure-
look at how spend ties in with the
ment will be new technology, says
procurement function. If you start
Safwat. “AI, IoT, Big Data and robotics…
talking numbers, you get a lot of
the digital transformation era is coming,
attention when you can relate strategi-
and we as procurement professionals
CLICK TO WATCH : JAMESWAY‘S ANKUR THAKUR ON TODAY’S PROCUREMENT PROFESSIONALS
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17
P R O C U R E M E N T T R A N S F O R M AT I O N
“Today, we’re at the frontline with the C suite team, really influencing the bottom line” — Crithica Parthasarathy, IBM Procurement Services Practice Lead
18 need to be on top of this trend to
edge of the sector but also to develop
enable our organisations,” he explains,
softer skills to achieve success. “To me,
adding that this will mean a more
relationship building is the core,” says
connected approach. “Working
Satija. “There’s the traditional idea of
independently isn’t the way forward in
having a strong IQ, but you also have to
my view. Collaboration and the ability
have a very strong EQ to be successful.
to engage with other organisations
It’s all about connecting.”
within procurement as well as other
“To be a successful procurement
industries will enable both parties to
practitioner first of all requires the right
elevate and explore different things.”
soft skills, in terms of stakeholder
With evolution of the procurement
engagement, ability to positively
professionals vital to ensure the ability
manage conflict, enabling and
to cope with the ever-changing
influencing teams,” adds Safwat.
procurement sector, it’s become
“This goes hand in hand with technical
important to not only harness knowl-
skillsets. CIPS, for example, offers a
JUNE 2019
CLICK TO WATCH : NETWORKING ACROSS THE SUPPLY CHAIN AT PROCURECON CANADA
number of learning opportunities
market. In terms of the main procure-
through qualifications even online
ment skills, I always believe you can be
courses and online content that helps
book smart but you also have to be
professionals to stay up to date with
street smart. The key thing is not to shy
what’s going on in industries across
away from negotiations. Knock on
the globe.”
every door. Don’t worry what people
A big challenge, but Thakur is
will think; just try. When I see the pool
confident in the supply chain profes-
of people coming in, there’s no dearth
sionals of tomorrow. “You’ll be sur-
of good people,” he adds. “You just
prised how many talented people are
have to find the right people who know
involved in supply chain,” he says.
the principles of procurement.”
“People are coming from different fields
One key element of talent manage-
and diverse industries and they
ment echoed across the event has
understand how procurement works
been diversity, and Thakur cites
and how to negotiate across a global
Canada as a diverse country: “You see w w w.suppl yc ha i ndi gi ta l. com
19
P R O C U R E M E N T T R A N S F O R M AT I O N
people with experience from across the globe which can be an advantage.” Safwat sums up the advantage to conducting operations in Canada. “The great thing about the Canadian market is inclusion and diversity,” adds Safwat. “You tend to work across a massive variety of cultures and you need to be sensitive about approaching these cultures, but it’s a really great opportunity to build new relationships and leverage those in driving successful business results. “Accepting diversity allows different 20
perspectives within a business. People will be able to share different experiences from different places. It also opens up a collaborative culture within the organisation in terms of being willing to accept others and collaboratively work toward common goals. This is an opportunity for organisations to tap into new areas that they have never thought about.” The final aspect which rang true for each professional was the success of ProcureCon Canada not just as an event, but as a reflection of the region’s culture and commitment to supply chain excellence. “Part of the reason I come is to network with my peers,” JUNE 2019
says Parthasarathy. “It’s about sharing best practices, learning what other organisations are doing, and creating camaraderie amongst us in the profession. Share stories,” she advises her fellow attendees. “Share pain points. Understand from others what theirs are and what capabilities they can offer to help with the challenges you face.” “For me, ProcureCon is a great opportunity to connect,” adds Safwat. “ProcureCon has been really successful in Canada, we’ve seen a tremendous number of registrations particularly this year – it’s a reflection of how businesses tend to understand the value of procurement and the importance of the function.” However, the size and attendance of this year’s event has not just happened by chance. “It’s a well-managed event,” adds Thakur. “People have a learning appetite and the presentations cover a variety of topics. I will be back next year!”
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DIVERSITY
24
Diversity is key to the evolving procurement function Sheri Spinks, a prominent member of the Global Council for the Advancement of Women in Procurement, explains how the procurement function has changed and why diversity is more important than ever WRITTEN BY
JUNE 2019
OLIVIA MINNOCK
25
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DIVERSITY
T
he Global Council for the Advancement of Women in Procurement was founded as a forum to promote the involvement of
women involved in the procurement, sourcing and supply chain professions. “We are a global group of over 2,500 members and counting, with a focus on both attracting and retaining women in procurement and supply chain.
We also provide a forum for discussion and mentorship and offer the skills and tools women need to empower themselves and advance their careers,” says Executive Secretary & Director Sheri Spinks. Spinks caught up with Supply Chain Digital at
26
ProcureCon Canada, which she has attended for three years. She argues that’s it’s a great platform for making long term connections. “I think it’s important now more than ever to give a voice to women in procurement. We need to talk about the enhancements and value we deliver as well as the soft skills we possess that contributes to our success in this area,” she comments.
A CHANGING FUNCTION “Historically, procurement used to be seen as administrative, process driven, reactive and policy focused – now, we are finally being seen as strategic business partners,” says Spinks. As the function has changed and evolved, so have the requirements of those JUNE 2019
27
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DIVERSITY
28
“ Historically, procurement used to be seen as administrative, process driven, reactive and policy focused – now, we are finally being seen as strategic business partners” — Sheri Spinks, Executive Secretary & Director of Global Council for the Advancement of Women in Procurement
working in the space. “It’s important now more than ever that procurement professionals have a broad business acumen, both from an understanding and skill perspective,” she comments. Now, it’s not just qualifications and knowledge, but soft skills such as negotiation and innovation that are key to winning in the procurement sphere. “Innovation leads to cost savings if you can find a better way of doing something,” says Spinks. “An effective procurement or supply chain professional is going to be constantly looking at engaging new suppliers. They’re going to be bringing innovative solutions to the table.” The key for today’s procurement professionals, says Spinks, is open communication and true partnership with suppliers – “talking about the goals that each organisation has and working together to come up with solutions”. Now, she argues, supply chains can be seen as true generators of revenue by engaging new partners that bring business opportunities. “It’s not just cost,” she emphasises, having just delivered a talk at ProcureCon about total value ownership. “The onus is on procurement
JUNE 2019
CLICK TO WATCH : ‘GLOBAL COUNCIL FOR THE ADVANCEMENT OF WOMEN IN PROCUREMENT’ 29
professionals within the organisation
DIVERSE SKILLSETS
to make that shift,” she explains.
When it comes to the procurement
“It’s about value, and when you look
function of today, engaging the right
at value you have to consider innova-
professionals means a commitment to
tion, quality and diversity. It’s really
diversity, and Spinks has various
understanding the needs of your
commitments to promoting the role of
business, the individual needs of your
women in procurement. “The reality is
stakeholders, and making sure you’re
that there is still a gender gap,” she
meeting that need. If you consistently
says. “I would encourage more women
meet or exceed those needs, and
to get into this space, to educate
deliver value based on their terms and
themselves and to be vocal about the
definitions, the business is going to
value they can add to organisations.
want to keep engaging procurement
Women really do have a different
and supply chain.”
perspective on things like negotiation w w w.suppl yc ha i ndi gi ta l. com
DIVERSITY
and relationship building. Generally, we are more empathetic and tuned in with others, we’re good listeners, and we’re great at multitasking – these are skills that are highly valued when looking at a supply chain or procurement role.” The Global Council, says Spinks, provides mentorship which is vital to women wishing to make their mark in the procurement space. “They can see other women that have been successful in climbing the corporate ladder, taking on more senior roles. We’re also 30
going to provide a forum and database to allow members to utilise best practices from other women – and men, in the spirit of diversity and inclusion!”
“ I think it’s important now more than ever to give a voice to women in procurement” — Sheri Spinks, Executive Secretary & Director of Global Council for the Advancement of Women in Procurement JUNE 2019
Sheri Spinks discusses her experience at this year’s event. “I was really interested in the session on AI in procurement, because that’s something I need to sharpen up on myself. It’s not something I’ve had a lot of experience with on the corporate side. For those who want to make the most out of coming to ProcureCon events, I would say take advantage of the networking opportunities. Use the app because that’s a quick way of understanding who’s here and what they do. It’s about getting out of that comfort zone. You’re not going to get any value out of a conference like this if you just come and sit down, go to sessions, then hide in a corner and do some work. You’ve got to get out there and network, meet as many people as you possibly can and enjoy it. I’ve made some great connections here and always keep coming back.”
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31
DIVERSITY
“ Women really do have a different perspective on things like negotiation and relationship building” — Sheri Spinks, Executive Secretary & Director of Global Council for the Advancement of Women in Procurement 32
CLICK TO WATCH : ‘SHERI SPINKS ON GENDER DIVERSITY IN PROCUREMENT’
JUNE 2019
33
she laughs. “It’s not just a women’s
and beyond, we are starting to see
group. We’re open and both welcome
more employee resource groups and
and encourage anyone who is passion-
I think those are really effective within
ate about advancing women in supply
organisations so women have a place
chain and procurement to join us.”
to go, a platform, and an opportunity
A key issue, Spinks feels, is that
to network or gain a mentor.”
women are not perceived as ‘powerful’ enough to take on leading procurement roles involving high level negotiations. “It’s really up to women to own their space, be confident in their skills and not let their gender get in the way of them being able to really excel in what they do,” she concludes. “Within procurement w w w.suppl yc ha i ndi gi ta l. com
CONTRACT MANAGEMENT
34
Bringing Proc Canada to life We caught up with Alex Chard and Frank Musero from Worldwide Business Research (WBR), a business events firm which organizes ProcureCon Canada, to find out what goes into an event of this scale WRITTEN BY
JUNE 2019
OLIVIA MINNOCK
cureCon fe
35
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CONTRACT MANAGEMENT
What is the aim of ProcureCon
they can air their grievances, and share
Canada?
different ideas, best practices and
Frank Musero: We’re aiming to bring
lessons learned.”
together leading practitioners and
36
senior level procurement professionals
What was the key focus in organizing
from Canada’s largest companies for
this event?
two days of learning, networking and
Alex Chard: First things first, make
strategy sharing.
it Canadian-driven and Canadian-led.
Alex Chard: It’s a one-stop shop for
The idea is to really engage the
procurement professionals across the
Canadian market and the people doing
Canadian market. The idea is not only
the work on the ground. All of the major
to bring peers together to address the
companies that are based here in
challenges they face day in, day out,
Canada, whether Canadian companies
but also to provide them a forum where
or multinationals that work here, as
“ It’s a one-stop shop for procurement professionals across the Canadian market” — Alex Chard, Senior Program Director, WBR
JUNE 2019
CLICK TO WATCH : WBR’S ALEX CHARD ON MAKING PROCURECON HAPPEN 37 long as we’re bringing those players in,
the right players here in Canada.
we can really find success.
Oftentimes, individuals can be a little siloed within their industries or
What challenges were involved?
markets, or even their geographies.
Frank Musero: The biggest challenge
So really trying to engage them and
is trying to figure out the topics that
bring them in was probably the biggest
are more important to the practitioners,
challenge – but that wasn’t a big hurdle
because when we build an event, we
to jump over. There’s quite a bit of
build it eight months before the event
recognition for ProcureCon here in
starts, so we need to plan to make sure
Canada which really helped.
that the topics will be relevant eight months in the future and not just when
Why was it important to get the right
we’re doing our research.
speakers on board?
Alex Chard: For me, the biggest
Frank Musero: This is the one time of
challenge was probably identifying
year that all of these practitioners can w w w.suppl yc ha i ndi gi ta l. com
CONTRACT MANAGEMENT
“ Being a wallflower at these events does not serve you at all. Learn from your peers and make some friends” — Alex Chard, Senior Program Director, WBR 38
be in the same room together and learn
comes to succession planning and
from leading minds. It is good to have
ensuring you have continuity. Often,
a variety of industries here because
with new employees taking on roles
these people don’t interact with each
and the old guard starting to retire, you
other on a daily basis – some are
lose a lot of that knowledge base that
competitors, some are in industries
perhaps hasn’t been digitized, for
that may not interact day to day. Having
example, or isn’t in a format that is
that variety of companies allows them
readily available to new employees.
to share and exchange ideas.
Another key topic is change management: really driving that internally
What have been some hot topics
and ensuring that you have buy-in at
at this year’s event?
all levels of the organization in order to
Alex Chard: One is talent: that seems
ensure that you’re making headway.
to be a big issue, especially when it JUNE 2019
One of the biggest challenges that
and bounds as more people know about us. Alex Chard: One of the big things we’ve noticed is not only the breadth of the audience, but breadth in terms of industries represented: we’re seeing more heavy industry, mining, oil and gas as well as a broader geographic spread across Canada. Does this reflect the increasing importance of procurement? Frank Musero: One of our speakers said that procurement has changed more in the past five years than the last 100, and it’s totally true. Some of the we have seen has been about supplier
sessions we hold today weren’t even
diversity. We had two conversations
a concept five years ago when we
about that at this event: companies are
started this event. Procurement has
trying to build out supplier diversity
moved from a tactical purchasing
programs where previously they may
operation to really being a strategic
not have considered that as an
part of the organization.
important aspect in their supply chain. Why attend ProcureCon Canada? How has the event grown since
Frank Musero: Across the 10 events
it started?
in our portfolio, ProcureCon is one of
Frank Musero: This is the sixth year
the only events that is peer-led. You’re
we’ve done ProcureCon Canada and
hearing from other practitioners that
we have doubled the attendance from
have shared the same problems you
when we started – it has grown leaps
have, and they’re on stage talking w w w.suppl yc ha i ndi gi ta l. com
39
CONTRACT MANAGEMENT
“ ProcureCon is one of the only events that is peer-led. You’re hearing from other practitioners that have shared the same problems you have” — Frank Musero, Finance Events, WBR
40
about those problems and how they’ve
It’s about building a community at the
solved them. You can then come back
end of the day.
with a nugget of good advice which you
Frank Musero: Our mobile app has
can implement back in the office.
the most up-to-date agenda and lists all speakers and attendees who you
How can attendees make the most
can message. The best way to take
of ProcureCon?
advantage of that is onsite: build your
Alex Chard: Engage. Be engaged.
custom agenda, look at who is here…
Participate. If you are sharing ideas and
take advantage of everything in that
asking panelists questions, you’ll walk
app because that will help you
away with a ton more information that
customize your experience and make
you would otherwise. Being a wallflow-
the most of the event.
er at these events does not serve you at all. Learn from your peers and make some friends. You can call them up when you go home and really try to understand how they can help you out. JUNE 2019
ProcureCon Canada is definitely going to be bigger next year.
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S U S TA I N A B I L I T Y
42
Creating shared value, the right way Suranga Herath, CEO of the English Tea Shop, discusses the importance of sustainability, transparency and creating shared value at every level of the supply chain WRITTEN BY
JUNE 2019
HARRY MENE AR
43
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S U S TA I N A B I L I T Y
I
t’s rare to see a successful company, operating a tried and tested business model, turn around and completely reinvent itself.
The old adage “If it ain’t broke, don’t fix it,” comes to mind; why subject your business to radical upheaval and the risks therein? Because it’s the right thing to do. “We wanted to find a model that empowered people,” recalls Suranga Herath, CEO of English Tea Shop.
“We were a production house before English Tea Shop was born, a very ordinary tea business that packed all sorts of brands. It was that kind of a company because we thought business was simply about capability 44
and maximising resources.” In 2008, Herath’s company was packing 70 different brands of tea for exportation to the US, UK and Europe. In 2010, the company made the move from Sri Lanka to the UK. “That was the moment of truth for us,” says Herath. “Coming from Sri Lanka, a nation famed for its tea and spices, we had this huge passion for people, naturally, because it’s a very labour-intensive industry. We realised that the traditional tea industry didn’t empower the people at the bottom of the pyramid. That needed to change.” The right course of action was, for Herath, obvious and imperative, regardless of its challenges. “The shift was very risky. It was a huge transformation from being an ordinary, conventional JUNE 2019
45
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S U S TA I N A B I L I T Y
“ We enhance transparency and fairness along our value chain by creating shared value” — Suranga Herath, CEO, English Tea Shop
business, to leaving the auction system, leaving the large plantation companies that supplied us and moving to a very small number of small-scale suppliers of tea and ingredients, with the goal of becoming 100% organic, which we accomplished within two years,” says Herath. Nine years later, English Tea Shop has grown 65% annually over the past seven years, and last year reported revenues in excess of US$28mn across more than 50 markets. We spoke to Herath about his quest to empower people at every point in the supply chain, guarantee transparency and fairness,
46
JUNE 2019
47
and transform the lives of thousands
help our business to grow sustainably,”
of small-scale farmers across Sri
says Herath in an interview with the
Lanka, India, New Zealand, South
Soil Association. He continues: “Which
Africa and beyond.
is why we work closely with the farmers
“We enhance transparency and
who grow our organic tea, they provide
fairness along our value chain by creating
constant inspiration as we see the
shared value,” explains Herath. English
challenges they face on a daily basis.
Tea Shop’s model stems from the work
Their hard work and dedication make
of Harvard Business School Professor,
us strive for success because as we
Michael Porter. “This is the principle on
succeed, they succeed.” Porter himself
which we run our business. In essence,
notes that “Shared value is not social
this means that by being an ethically-
responsibility, philanthropy, or sustain-
minded business, we not only help
ability, but a new way for companies to
improve the world around us but also
achieve economic success.” w w w.suppl yc ha i ndi gi ta l. com
S U S TA I N A B I L I T Y
“ The market is demanding prominence, authenticity and transparency from the supply chain” — Suranga Herath, CEO, English Tea Shop
48
English Tea Shop’s next step in
Herath sees the increased transpar-
creating shared value across its supply
ency in his supply chain as an opportu-
chain involves a partnership with the
nity to simultaneously operate in a more
Soil Association, a certification non-
ethical way and create value for the
profit based in Bristol. “They’re leading
company. He notes that the rest of the
from the front and we’re helping fund
market is taking note. “The rise of the
their efforts to build a platform,” says
CPO role, as well as the dramatically
Herath. “English Tea Shop is one of the
increased focus on supply chain
pioneer brands that is going to be
management and the entire procure to
tested on the model. All our supplies,
pay process, has been elevated.
the entire value chain will be a guinea
And it’s in response to market demand,
pig for a process that, hopefully,
because the market is demanding
creates transactional transparency
prominence, authenticity, transparency.
from farm to cup.”
That’s what’s elevated the procurement
JUNE 2019
function as a whole,” Herath posits. “Of course, for our business, it was just natural. We are, I think, a perfect example of how the procurement process has evolved.” Thinking back to the auction method that English Tea Shop used to use, Herath reflects “Nine years down the line, what we now have is a very complex supply chain management system, a big team led by master blenders and procurement specialists, adopting new technology. I think the requirement was clearly for a process, leadership and people that create winwin solutions. It’s no longer just about going to the sources and buying tea.
E XE CU T I VE PRO FI LE
Suranga Herath A global expert on the tea industry, Suranga Herath is CEO of English Tea Shop, one of the world’s leading organic tea businesses which brings high quality, ethically-sourced tea to customers all over the world. His business has grown 65% annually over the past seven years whilst continuing to instill sustainable practices that enrich the brand’s community. By doing so, Herath’s visionary leadership has led the way in sustainable practices, inspiring other forward-thinking ethical food and drink companies to follow.
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49
S U S TA I N A B I L I T Y
This is about finding better yields for both parties, achieving better quality, better efficiency, saving in every possible way for both sides, and knowing very well that we’re entering into long-term relationships.” From the very beginning, English Tea Shop has cultivated its small network of growers by investing in technology and sharing knowledge, working to convince other growers to take up organic farming practices. “We had to inspire other people to buy into organic small farming to expand our supply 50
base,” says Herath. “From the simplest things, like giving suppliers a long-term contract, to building big storage facilities to hold stocks because we didn’t have the luxury of working off an auction that gave us weekly demand.” The process worked, and English Tea Shop’s positive
schools.” Herath maintains that this sort
impact on its growers’ lives has contin-
of investment at the base of the pyramid
ued to spread. “In 2018, we launched
is essential to the creation of shared
a sustainability impact report. The
value. “If you don’t do these things, then
results showed that we had impacted
our kind of model cannot be a success,
over 1,352 farmer families, in terms of
because how do you expect small
investing in them, paying for their organic
farmers to be planning or taking risks
and Fairtrade certifications, paying for
without that support? It so unfair,” he
their new technologies, supplying them
says. “We had to take the risk, we had
with irrigation solutions, and building
to take the burden, and we had to build
and helping them develop regional
those growers’ capabilities to ensure
JUNE 2019
“ We are, I think, a perfect example of how the procurement process has evolved” — Suranga Herath, CEO, English Tea Shop
51
they could be sustainable and the
non-GMO.” Herath concludes: “We
brand is sustainable.”
want to be the leading independent tea
Looking to the future, Herath and
brand, and be known for our own
English Tea Shop aren’t content to rest
unique creating shared value model.
on their laurels. “We’re on a mission to
We’ve just entered China, we got into
improve upon our energy use and reduce
Chile last year and we’re working on
waste. For 2020, we’ve set ourselves
Brazil now. We want to keep expanding,
the goal of being completely free from
but we want to do it the right way.”
single-use plastic. This year we’ve already completely revamped our core ranges; they’re now plastic free and w w w.suppl yc ha i ndi gi ta l. com
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T O P 10
54
JUNE 2019
TOP 10
Supply chain management software providers Streamlining the f low of a product or service from its initial raw materials to when it hits the retail shelves was once seen as a Herculean task but now supply chain management (SCM) software is simplifying the process. We take a look at the top 10 SCM software providers in the market
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55
T O P 10
56
10
Coupa Software
San Mateo, California, USA
Founded in 2006, this relative newcomer to the SCM landscape has made significant gains under the leadership of CEO Rob Bernshteyn. Coupa’s revenue from SCM endeavours generated more than $114mn in 2016, and the company anticipates revenues to exceed $253mn by the end of the 2019 fiscal year. Among the brand’s software wins is its Business Spend Management Platform which offers software options spanning procurement, invoicing, sourcing and analytics among others. Coupa enjoys more than 400 customers across 40 countries and employs more than 1,300 people.
JUNE 2019
57
09
HighJump
Minneapolis, Minnesota, USA
Ranked among Forbes’ Most Promising American Companies in 2015, HighJump has raised more than $140mn in revenue while employing a modest team of under 1,000 people. Headquartered in Minneapolis, Minnesota, it reportedly emerged from a concept in 1983 to an outfit that has offices throughout North America, Europe, and even Shanghai. Servicing upwards of 4,200 clients, HighJump earned recognition on the Inbound Logistics’ Top 100 Logistics IT Providers in 2017 and was honoured as one of the 2017 Food Logistics’ Champions: Rock Stars of the Supply Chain.
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T O P 10
58
08
Basware
Espoo, Finland
Finland, Basware puts a high emphasis on automated solutions and has earned honours that include Innovative Procurement Technology of the Year at the Innovate Awards, and recognition on the Global Finance’s list of Best Web-Based Supply Chain Financing Solutions. Founded in 1985, the outfit generated revenue of more than $166mn in 2017 while reducing operating costs. Under the interim leadership of CEO Klaus Andersen, Basware employs more than 1,800 people across more than 50 countries. To its credit, Basware has worked with household name clients that include Toshiba and McDonald’s among others.
JUNE 2019
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T O P 10
60
07
Descartes Systems Group Ontario, Canada
Headquartered in Ontario, Canada, this global software company employs more than 1,360 people with a focus on logistics and supply chain management. Founded in 1981 and led by CEO Edward J. Ryan, Descartes Systems has aggressively made key acquisitions each year since 2006. The company established an early reputation for logistics technology and the forethought to offer customers on-demand software as a service (SaaS). This type of predictive innovation has earned it more than 13,000 customers across 160 countries and revenue exceeding $275mn in its 2019 fiscal year.
JUNE 2019
61
06
JDA Software Group Arizona, USA
Founded in 1985 by James Armstrong and Frederick Pakis, this SCM business has emerged as a global leader, employing more than 4,300 people. The American-based company enjoys 40 offices globally and serves upwards of 4,000 clients with a focus on supply chain management. It ranks on the Forbes list of Top 200 Small Businesses and posts sales above $387mn, coupled with 16% growth. Led by CEO Girish Rishi, its innovative logistics provides “inventory optimisation,” and “omnichannel fulfilment” to sectors that include manufacturing, hospitality, travel, and retail among others.
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T O P 10
62
05
Manhattan Associates Atlanta, Georgia, USA
Manhattan Associates was founded by Deepak Raghavan in 1990 with a focus on designing, engineering and making good on supply chain solutions. Led by CEO Eddie Capel, the organisation exceeded $549mn in 2018 revenue while reinvesting $72mn into R&D. Altogether, the organisation has directed nearly $500mn towards R&D while remaining debt-free for nearly three decades. The SCM software trailblazer works with more than 1,200 customers worldwide, employing more than 3,000 people and has earned notoriety on Forbes’ America’s 100 Most Trustworthy Companies.
JUNE 2019
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63
T O P 10
64
04
Epicor Software Corporation Texas, USA
Founded in 1972 as Triad Systems Corporation, this Texas-based firm was called Activant Solutions Inc. before it was acquired by Apax Partners and merged under the current moniker in 2001. Led by CEO Steve Murphy, Epicor provides SCM services to more than 20,000 customers spanning 150 countries across sectors that include manufacturing, retail and distribution. Employing approximately 4,000 people, Epicor has generated revenue approaching the $1bn mark. The company has deftly pursued acquisitions that include SPECTRUM Human Resources Systems Corp in 2010 and Solarsoft Business Systems in 2012.
JUNE 2019
65
03
Infor Global Solutions New York, USA
With sales topping $3.1bn, this New York City company was previously known as Agilisys. Infor Global Solutions reportedly engages with more than 90,000 organisations globally including direct support for supply chains. Founded in 2002 and led by CEO Charles Phillips, Infor reportedly employs upwards of 17,000 people including 1,200 support professionals. Its has reportedly produced 176 new products, serving more than 71mn customers via the cloud. Its brick and mortar locations have expanded to 168 facilities worldwide and earned recognition on Forbes’ America’s Largest Private Companies 2018.
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T O P 10
02
SAP
Waldorf, Germany
Widely considered to be a leader in supply chain management software, SAP was founded in 1972 and enjoyed total sales exceeding $27.4bn internationally.
66
The corporation has offices in upwards of 180 countries and reportedly has more than 425,000 customers. Under the direction of CEO Bill McDermott, SAP employs more than 88,000 people and was ranked on the Forbes 2019 lists that include America’s Best Employers, Canada’s Best Employers, Block Chain 50, as well as the World’s Best Employer on 2018. Its cutting-edge software includes Product Lifecycle Management, SAP Supplier Relationship Management, and SAP Supply Chain Management applications as well as mobile platforms.
JUNE 2019
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T O P 10
01
Oracle
California, USA
This American software leader was reportedly founded in 1977 in Santa Clara, California, by Larry Ellison, Bob Miner and Ed Oates. The operation is currently head-
68
quartered in Redwood Shores, California, where Ellison holds the position of Executive Chairman & CTO. Safra Catz heads Oracle’s efforts as CEO. Oracle reportedly posted sales in excess of $39.5bn and employs more than 138,000 people. It ranked in the top 200 of the Fortune 500 list in 2018 in terms of revenue and employees reportedly enjoy a median annual salary of approximately $90,000. The rank and file at Oracle include 40,000 engineers and developers, 19,000 consultants with implementation responsibilities and 16,000 support professionals serving 430,000 clients. Oracle provides SCM services such as product life cycle management, order management, and supply chain logistics among others.
JUNE 2019
69
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EVENTS & A S S O C I AT I O N S
The biggest industry events and conferences WRITTEN BY SEAN GALEA-PACE from around the world
70
10–12 JUNE
Supply Chain Summit 2019: Atlanta [ THE WESTIN PEACHTREE PLAZA, ATLANTA ] The Supply Chain Summit 2019 is the meeting place for the forces of innovation, transformation and connectivity that will fundamentally reshape the supply chain industry over the coming years. Over 800 supply chain and procurement representatives will meet to discuss digital transformation strategies and look at the supply chain of the future. Supply Chain Summit: Atlanta will look to enable companies from all over the world to discover a truly global perspective on the current supply chain landscape.
JUNE 2019
24 JUNE
50 WORDS 17–19 JUNE
Gartner Supply Chain Executive Conference 00–00 MONTH [ BARCELONA, SPAIN ] Event Name Here 2019
CIPS Middle East Supply Management 50 WORDS Awards 2019 [ DUBAI ] Respected as a benchmark for excellence, a CIPS Middle East Supply Management Award is the most pres-
[ALOCATION ] aimed at helping supply conference
tigious recognition an organisation or
Learnand chain the procurement latest and best professionals practices for
individual in the procurement and
improved the “redefine supply concept chainofand what logistics a supply
supply chain profession can receive.
performance chain should do in Japan. to driveIn value”, just one theday,
Winners and attendees will take to the
acquire the Gartner Supply latest Chain knowledge Executive and the
stage and receive recognition for their 00–00 MONTH
most effective Conference 2019 techniques looks at the to grow futureyour of
vision, hard work and collaborative Event Name Here 2019
supply More digital. chain,than manufacturing, 900 professionals logistics
[leadership LOCATION ]in procurement and supply
and distribution from all over the capabilities world will bein in attend-
Ucias nis eturitAward qui toresto blamusam management. categories
Japan. This ance, as thesummit conference will draw looksupon to cover the
quas et Best ent enit, siminctatur? include Contribution to Corporate
experience Strategy andofTransformation, leading companies Demand to
Aque consequ Best isimenita num etur,toinus Responsibility, Contribution
explore how Reimagining Forecasting, a cross-functional Supplier supply Risk,
consecaesResponsibility, is dolupta consequi ut veriCorporate Best Supplier
chain teamTalent Innovation, can enhance and Leadership companyand
ons equundaManagement ecatiatem dene Relationship as well as
results in Japan. Customer Fulfillment Along and top Service experts, as well
repratetur, qui del imin CIPS Procurement andcomnist Supply ionem-
high-profile as other keyspeakers areas of discussion. and top practiHear
poritis nobis dolorpo repello rrorepu Professional of the Year, CIPS Young
tioners from some will of beGartner’s invited toleading share their resear-
dantia que duciet eritasProfessional consequo Procurement and ut Supply
views as chers on the managing firm welcomes supply chain, the supply pro-
voluptatiur, escimax imperferor sum of the Year and the overall winning
curement chain professional and logistics to a new in Japan. era: converg-
conse moof eaquation pedipsam and quiam. category CIPS Procurement
www.eventurl.com ing the physical and digital supply chain.
www.eventurl.com Supply Team of the Year.
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EVENTS & A S S O C I AT I O N S
09–11 JULY
ProcureCon Asia [ SINGAPORE ] 72
Asia’s premier gathering for global and regional CPOs and Asian heads
11–12 JULY
Ovation: The World’s Most Exclusive and Renowned CPO Think Tank [ CHANTILLY, FRANCE ]
of procurement. Procurecon Asia
Created to look “far beyond the tradi-
2019 brings over 200 attendees and
tions of procurement”, Ovation looks to
more than 100 CPO’s and Heads of
the future of supply chain and the key
Procurement to access and explore
trends that will directly impact the
interactive case studies, broad discus-
group-level CPO. Over the course of
sion on industry challenges and
two days, 50 exclusively invited CPOs
trends and network with some of the
from around the world will attend work-
biggest names in the procurement
shops designed to drive divergent
space. Procurecon asks profession-
thinking, challenge and enlighten fellow
als in both direct and indirect
thought leaders and learn how to
procurement to ‘maximise learning
better harness the complexity of global
and optimise your organisation’s
supply networks and ecosystems in the
supply chain strategy.’
digital world.
JUNE 2019
73
3-5 SEPTEMBER
Transport Compleet [ GORINCHEM, NETHERLANDS ] Now in its 15th year, the Transport
24–26 SEPTEMBER
Supply Chain & Logistics Summit and Expo 2019 [ HILTON ANTWERP, BELGIUM ]
Complete Gorinchem is a networking
The EMEA Supply Chain & Logistics
event which brings the entire road
Summit & Expo is one of the most
transport industry together.
established events of its kind in Europe.
Welcoming 12,000 visitors annually,
Now in its 21st year, it is a highlight in
the event will enable both international
the calendar where world-class organ-
and regional providers to showcase
isations meet to maximise efficiency
their latest products and solutions to
and minimise costs through supply
a professional audience.
chain strategies of the future.
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74
USING SOURCING EXCELLENCE FR AMEWORK TO DRIVE OPER ATIONS FORWARD WRITTEN BY
SOPHIE CHAPMAN PRODUCED BY
DENITRA PRICE
JUNE 2019
75
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S P X C O R P O R AT I O N
FOR SPX TRANSFORMER SOLUTIONS, SCM STRATEGY IS ABOUT IMPLEMENTING SOURCING EXCELLENCE FRAMEWORK AND DIGITIZATION TO IMPROVE SPEND VISIBILITY AND OPERATIONAL EFFICIENCY
A 76
s a key aspect of the SPX Corporation’s value creation roadmap, strategic sourcing is expanding from a back-office function
to an integral efficiency improvement operation. “SPX Transformer Solutions’ value creation roadmaps target operational excellence and margin expansions through continuous improvements and excellence initiatives in Engineering, Sourcing and Manufacturing,” notes Sandeep Arora, Vice President of Global Sourcing and Strategy at SPX Transformer Solutions. “In that way, strategic sourcing and supply chain management remains one of the core functions of transformer business and thereby becomes a part of the value creation roadmap for SPX Corporation as a whole.” SPX Transformer Solutions operates medium and large power transformer manufacturing plants in Waukesha, WI and Goldsboro, NC as well as components division manufacturing Transformer Health Products® in Dallas, TX. JUNE 2019
77
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S P X C O R P O R AT I O N
Arora joined SPX Transformer Solutions in 2014 and has more than 25 years of transformer and switchgear industry experience in the Transmission and Distribution energy sector. Arora has held positions as Managing Director at Schneider Electric’s Distribution Transformer business in the India Region, as well as VP of Business Development and Supply Chain at Schneider Electric’s US-based Distribution Transformer division. Arora has also held the position of Plant Manager at CG Power within the Medium 78
Power Transformer business in the
E X ECU T I VE P RO FI LE
Sandeep Arora Sandeep joined SPX in 2014 as VP of Global Sourcing and Strategy. From 2008 Sandeep spent 5 years with Schneider Electric, India as the Managing Director of Transformers (India region) and in 2012 moved to Schneider Electric, USA as the VP of Supply Chain & Business Development. Prior to 2008, Sandeep worked with CG Power in India and the USA for over 15 years in various roles within manufacturing, supply chain, project management, business development, M&A and Information Technology. During his 25+ years of business and operational excellence expertise he has set up and strategically grown global organization in Asia, Europe and the US region with Supply chain optimization and business development. Sandeep earned his Bachelor of Electrical Engineering and an MBA in Marketing from Nagpur University, India.
JUNE 2019
“THE SCM STRATEGY IS DRIVING OUR SUPPLY CHAIN TO BE SMOOTH AND EFFECTIVE” — Sandeep Arora, VP Global Sourcing & Strategy, SPX Transformer Solutions
79
E XE CU T I VE PRO FI LE
Brian Mason Brian joined SPX in 2015 and was appointed as an Executive Officer in 2017. Brian spent 14 years with Emerson Electric, most recently as the President of Emerson Connectivity Solutions. He started his career with General Electric and graduated from its Manufacturing Management Program. He worked in multiple businesses with roles in engineering, operations and product leadership. Brian has obtained expertise in global manufacturing, operational excellence, M&A and business turnarounds through 25+ years of leadership experience across multiple continents and industries. Brian earned his MBA from Northwestern University and his B.S. in Electrical Engineering from Michigan Technological University.
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S P X C O R P O R AT I O N
“ I WORK CLOSELY WITH THE BUSINESS FUNCTIONS TO CREATE A CULTURE OF EXECUTING CUSTOMER SATISFACTION” — Sandeep Arora, VP Global Sourcing & Strategy, SPX Transformer Solutions
US and Deputy General Manager of Operations, Supply Chain and Projects at the same firm, working in the Large Power Transformers unit in India. He is a proven international leader skilled in flexing global operations to meet changes in customer cost and spend requirements. Arora explains “My role is essentially to work closely with the business functions to create a culture of executing customer satisfaction, focused on cost, efficiency improvements, and supplier performance.” Arora adds, “one key step for me as a supply chain and
80
JUNE 2019
CLICK TO WATCH : ‘SPX TRANSFORMER SOLUTIONS OVERVIEW’ 81
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departments and suppliers to identify
STRATEGIC SOURCING: WHAT DOES GOOD LOOK LIKE?
the pain points and improve opera-
The Sourcing Excellence Framework
tional efficiency.” He further states that
(SEF) helps the business drive opera-
by having open conversations with key
tional efficiency and margin stability
suppliers and partners, the company
when price volatility and supply chain
has turned its supply chain into a net-
risk on commodities exist. For example,
work where information is shared in
commodities like steel and aluminum
trust to have a win-win strategy.
– mainly driven by section 232 tariffs –
sourcing leader is to meet with internal
Since 2015, the SPX Transformer Solu-
continue to be unfavorable to trans-
tions team has driven the supply chain
former original equipment manufactur-
methodology using sourcing excellence
ers (OEMs) in the US.
framework which is now well established and followed within the business.
“Since 2018, our proactive approach in implementing the Sourcing Excel-
SOURCING EXCELLENCE FRAMEWORK – “SIMPLIFY THE WAY WE WORK”
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83
S P X C O R P O R AT I O N
C O M PA N Y FACT S
At SPX Transformer Solutions we strive to improve operational efficiencies and margins through • Continuous improvement • Strategic sourcing: Risk mitigation through dual sourcing, vendor consolidation and insourcing to leverage synergies across SPX businesses • Sustainability 84
JUNE 2019
$1.5bn+ Approximate revenue
1912
Year founded
5,000+
Approximate number of employees
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85
S P X C O R P O R AT I O N
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ETOS® THE FIRST OPEN OPERATING SYSTEM FOR TRANSFORMERS
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YOUR BENEFITS AT A GLANCE • 1 system from 1 partner • Manufacturer-independent • Ability to connect third-party suppliers (sensors and data) • Open for Integration in any environment • Modular system of hardware and software • Maximum cyber security • Also available as retrofit solution • Efficient operation & maintenance of each transformer Reinhausen Manufacturing Inc. 2549 North 9th Avenue Humboldt, Tennessee 38343, USA Email: info@reinhausen.com www.reinhausen.com
JUNE 2019
87 lence Framework has helped us miti-
vendor consolidation we get better
gate some supply chain risks mainly
reliability and repeatability. Arora says:
driven by trade actions on steel and
“The sourcing excellence framework,
aluminum. This in large power trans-
as it is based on Total Cost of Owner-
formers has made US Transformer
ship (TCO), also addresses vendor
manufacturers non-competitive due
consolidation and in-sourcing, thereby
to imports coming from other regions,”
leveraging synergies across other
Arora notes.
SPX Corporation businesses. It has
The sourcing framework was put
also helped the procurement function
in place to ensure our supply chain is
to be “Future Proof” through “Balanced
smooth and effective, as it enables us to
Enforcement and Enablement”.
manage our top suppliers using 80/20
In SPX Transformer Solutions, the
rule. The 80/20 rule focuses on 80% of
latest transformation is the digitization
our overall direct spend which is man-
of its procurement operations. “With
aged by 20% of suppliers. By having
supplier spend data analytics, we’re
long-term dual sourcing contracts and
aiming to further improve supplier w w w.suppl yc ha i ndi gi ta l. com
S P X C O R P O R AT I O N
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JUNE 2019
89
performance on Quality, Cost and
former Solutions continuous improve-
Delivery (QCD) through digitization.
ment and performance management
We’re currently using the software
culture in terms of “what does good
interface-Qlik which talks to our
look like in sourcing” Arora collaborates
Enterprise Resource Planning (ERP)
with his peers and team members
system and other softwares for real-
by asking questions which helps the
time analysis of data. Along with
business to remain competitive:,
this, we have integrated a contract
• Do we have a long-term contract with
management tool to manage Master
our top suppliers to control 80% of
Procurement Agreements and drive
our total spend?
business process improvements” says
• Do we have a firm price contract
Arora. The mantra here is to “simplify
using the ‘should cost’ model to avoid
the way we work”.
price increase risks?
To further strengthen the SPX Trans-
• Do we have dual sourcing? w w w.suppl yc ha i ndi gi ta l. com
S P X C O R P O R AT I O N
• Do we have the right payment terms
elements to its approach other than
with our suppliers to support our
sourcing. “When we talk about the
operating working capital?
SCM strategy we start with sourcing,
• Do we have the right Incoterms® with our vendors?
which is made up of two parts:strategic, which includes risk mitigation
• Do we have the right inventory carrying
strategy through dual sourcing using
cost and turns ratio?
should cost model and operational,
The company’s tools address these
which includes transactional day-to-
uncertainties.
day buying,” states Arora.
The other major contributor towards our transformation is the Supply Chain
SUPPLY CHAIN MANAGEMENT STRATEGY
Management (SCM) strategy. The
“Besides sourcing, supplier manage-
SCM strategy has five intrinsic
ment is the other important piece of
90
SUPPLY CHAIN MANAGEMENT STRATEGY
“Master excellence thru repeatability” JUNE 2019
“ C ONTINUOUS IMPROVEMENT SHOULD BE EMBEDED IN THE CULTURE OF ORGANIZATION” — Sandeep Arora, VP Global Sourcing & Strategy, SPX Transformer Solutions
staff by providing carrier paths through functional development. Finally, we look at organization structure and business intelligence to get optimum benefits by aligning SCM strategy to our business strategy. For SPX Transformer Solutions, SCM strategy is more than just a buzz word – it’s a habit that defines the business’ culture and enables continuous improvement. According to Arora to drive sourcing excellence initiatives, “continuous improvement should be embeded in the culture of organization.”
SCM strategy, in which we assess
Ultimately, the business aims to
how we qualify, evaluate and classify
improve operational efficiency, which
our suppliers. We also ensure that we
Arora claims can be achieved within
have dual sourcing in place, so that we
these three functions in an organiza-
are not caught unaware when a single
tion: one is through redesign to cost,
source supplier is no longer viable on
which is led by engineering, the other
QCD” says Arora.
is productivity improvement, which is
Then we must talk about people –
driven by manufacturing and the final
to implement any strategy, we need
one is sourcing efficiencies driven
engagement of our employees. People
through a sourcing excellence frame-
can become a major challenge if not
work. In regards to the financial impact,
involved at the right time as before in-
as Cost Of Goods Sold (COGS) is
troducing new suppliers manufacturing
the largest contributor to transformer
employees need to be ready to accept
operational cost, and therefore the big-
and manage the change effectively.
gest opportunity to improve COGS lies
For achieving this, first and foremost
in the sourcing bucket.
we need to select and upskill the right
To implement a successful SCM w w w.suppl yc ha i ndi gi ta l. com
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S P X C O R P O R AT I O N
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JUNE 2019
strategy with highest value creation, the firm has aligned a sourcing excellence framework to internal manufacturing and engineering capabilities. Arora adds that the company’s supply chain transformation journey in 2015 would not have started without the support of suppliers and partners. “These long-term strategic partnerships encourage SPX Transformer Solutions team and its suppliers, to focus less on immediate fluctuations in the market and more on value creation types of opportunities together outside of the daily buyer and seller arrangement. Companies committed to one another are better positioned to share the impact of price fluctuations together resulting in more stability over the long run.” Arora concludes by echoing SPX Transformer Solutions’ President-Brian Mason’s belief, “As SPX puts its business system strategy using operational excellence in place, it aims to leverage synergies between its portfolio of products to drive company growth in an ‘efficient and organic’ way.”
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World Vision: procuring aid for the world’s most fragile communities WRITTEN BY
HARRY MENEAR PRODUCED BY
DENITRA PRICE
JUNE 2019
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WORLD VISION
Tim Covell, Supply Chain Director of World Vision’s Gift in Kind operation, discusses the ways in which his team pushes itself to continually provide aid more efficiently to deprived communities
I
n 1947, Reverend Bob Pierce gave the last five dollars from his pocket to help care for an orphaned girl from China named White
Jade. Three years later, Pierce founded an organi96
zation dedicated to helping children in dire need of care around the world. Over the next 65 years, World Vision has grown into a powerful and tenacious non-governmental organisation (NGO), striving for the elevation of deprived communities out of poverty. Today, it works in nearly 100 countries and in just five years, together with partners and donors, has impacted the lives of over 200mn vulnerable children by tackling the root causes of poverty. “Our strategic vision is to step into the most fragile countries, in the most fragile contexts, to help people and communities out of poverty,” says Tim Covell, Supply Chain Director at World Vision. “World Vision is focused on the twin pillars of humanitarian community development and disaster relief. There are a host of programs that work together under those two JUNE 2019
97
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WORLD VISION
pillars, including sanitation, bringing
“ We’ve grown from 30,000 pallets to 84,000 pallets over the last three years” 98
— Tim Covell, Supply Chain Director, GIK, World Vision
clean water to communities, health, education, agriculture – helping a community break the cycle of poverty over the course of a 15-year program.” Covell spent the two decades preceding his move to World Vision in the private healthcare technology sector. “I loved the technology, loved the teams – I really had no intention of moving on,” he recalls. “As I was thinking about my life, I realized it was time to use those skills I’d learned over the years serving in a humanitarian organization.” In December 2016, Covell jumped at the opportunity to work for World Vision and has since led the company’s Gift-in-Kind (GIK) operation. “A GIK is where a corporation will donate products instead of cash,” he explains. Every year, Covell and his three major teams work tirelessly to process, allocate and distribute tens of thousands of pallets of donated goods – ranging from bicycles and wheelchairs to clothing and school supplies – to some of the world’s most isolated and fragile communities. “We’ve grown from 30,000 pallets to 84,000 pallets over the last three years,” Covell says.
JUNE 2019
CLICK TO WATCH : ‘WORLD VISION USA – REACH OUT WITH US’ 99 “It would be impossible to handle that
excess inventory, reverse logistics,
degree of growth without continuous
or whatever their business challenge
improvement and change to the way
might be,” says Covell. Dealing with this
that we operate and drive our process-
influx of donations is the role of the first
es.” Covell sat down with us to discuss
of Covell’s three teams: Capacity &
World Vision’s GIK operations, and the
Integration. The team interacts with
ways in which he and his team push
the various local operatives around the
themselves to continually improve and
world in order to establish what each
better serve those in need.
community needs to better progress
Unlike a traditional procurement role,
towards becoming self-sustaining.
the GIK supply chain operates in
“Each year they reach out to countries
response to donated items from large
around the world in order to understand
corporations around the world. “We
what kind of products they can use to
position ourselves as a business
facilitate their ministry. Then we create a
solution to corporations to deal with
global demand plan that predicts how w w w.suppl yc ha i ndi gi ta l. com
WORLD VISION
100
JUNE 2019
$2.76bn+ Approximate revenue
1950
Year founded
40,000
Approximate number of employees
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101
WORLD VISION
102 many containers will ship to each
logistics, Covell notes that the donation
country and which product types they
process makes for more efficient
need to contain,” explains Covell.
“acquisition” power on behalf of World
“In the world of GIK, as opposed to
Vision. “We want to make sure that every
the world of procurement, it’s distinct in
product that we ship and spend freight
that we can’t predict 100% what kind of
dollars on is going to help a community
product we’re going to get,” he
and facilitate ministry in whatever
continues. “We start with a demand
capacity it’s being used for,” he explains.
plan and then, as we receive donations
“GIK is a powerful element of the overall
over the course of the year, this team
ministry, because it’s such a magnifier.”
will do their best to align the products
Covell’s department ensures the value
that were donated with the demand
of donated items is efficiently distributed,
that was placed on them by the various
allowing for even more aid to be
countries.” While the GIK model
provided to those who require it than
creates unique challenges in terms of
through traditional procurement NGO
JUNE 2019
practice. “For every dollar we spend in freight, there’s almost $20 worth of product that we’re shipping and being able to bring into play for ministry utilization,” he maintains. The second team handles logistics, both domestically and internationally. Covell praises this team for its role in overcoming geographic hurdles during the ‘last-mile’ before delivery. “This team has a very challenging role, because the countries where we
“ Missionary Expediters are a fantastic asset to us in being able to crack the code of accessing some of these very challenging countries” — Tim Covell, Supply Chain Director, GIK, World Vision
operate typically have inadequate infrastructure, and trying to get products to communities in need
103
E XE CU T I VE PRO FI LE
Tim Covell, Supply Chain Director Tim has a BS in Operations Research/Systems Analysis from West Point Military Academy, and a MS in Engineering Management from Milwaukee School of Engineering. After some time serving in the Army and then leading operations in transportation services, he spent over 21 years at GE Healthcare in Milwaukee, WI. During that time, he had experience in a variety of roles from Mfg and Materials leadership to New Product Development and Advanced Mfg Engineering. He recently joined World Vision in Seattle, WA to lead the GIK Supply Chain operation and has been serving there for two and a half years.
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WORLD VISION
SERVING THOSE W H O S E RVE H I M
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105
“ GIK is a powerful element of the overall ministry, because it’s such a magnifier” — Tim Covell, Supply Chain Director, GIK, World Vision
means you’re typically required to go far off the beaten path.” In order to aid in the delivery of supplies to the farthest corners of the planet, World Vision has established a decade-long partnership with freight forwarding business Missionary Expediters. “They are a fantastic asset to us in being able to crack the code of accessing some of these very challenging countries,” says Covell. “As an NGO, we’re obviously looking to be very frugal, but a relationship with a trusted partner that knows its way around getting freight into challenging areas is also essential. w w w.suppl yc ha i ndi gi ta l. com
WORLD VISION
Missionary Expediters just ticks all the boxes; we’re very pleased with our partnership with them.” The third team Covell oversees is the GIK division’s distribution center in Pittsburgh, Pennsylvania. “They have a significant space there where we store and then sort products. That’s where the magic happens,” Covell explains. The center uses numerous volunteers to sort, package and dispatch items to World Vision’s entire network. Given that the workforce is largely made up of volunteers, the Pittsburgh center is 106
the perfect demonstration of the need for clear, unified processes in order to produce consistent results. “One of the things that I’m really passionate about is having good documentation, as well as work instructions that really establish a foundation for what we do and how we do it. Every day you have a different group coming in, so we need to have a standard mechanism,” says Covell. “Having a consistent process is really the foundation for continuous improvement. If we’re all working the same way and with the same output, we can build upon that platform to create and implement changes and then improve our working structure; JUNE 2019
107
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WORLD VISION
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JUNE 2019
WO RLD VI SI O N I N 20 17
• Treated 118,000 children for acute malnutrition • Distributed over 10.9mn malaria treated mosquito nets • Responded to 170 emergencies in 56 countries • Trained over 58,000 teachers • Provided more than 1.4mn small loans • Sponsored over 3mn children.
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109
WORLD VISION
110
“ For every dollar we spend in freight, there’s almost $20 of product that we’re shipping and being able to bring into play for ministry utilization” — Tim Covell, Supply Chain Director, GIK, World Vision
so process control documentation creates the foundation for future continuous improvement.” Continuous consistent improvement is reliant on clear communication and coordination, and Covell stresses that technological advancements over the past decade have been essential to that process. “Recently we invested in the Microsoft Dynamics Enterprise Resource Planning system,” he says. “It’s been a powerful tool to be able to synchronize different portions of the team, in the US and internationally.”
JUNE 2019
111
Covell describes this, along with a new
GIK team will continue to leverage every
Transportation Management System,
tool at its disposal in order to continually
as “a real game-changer”. “Being able
improve its ability to deliver vital supplies
to manage large donors, having the
to improve the quality of life of the
transparency and the communication
people who need it most. “Our journey
efficiency between the logistics teams
ahead is continuing to figure out how to
and the various warehouses around
be good stewards of the freight dollars
the country, has been a real asset,”
that are donated to us and support
he reflects.
World Vision’s ministry operations.”
Looking to the future, the GIK operation has cause for celebration. “In June, we’ll be shipping our 5,000th container,” Covell says with pride. The project is far from over though, and the w w w.suppl yc ha i ndi gi ta l. com
112
SEG AUTOMOTIVE: AGILITY AND AUTONOMY IN THE SUPPLY CHAIN
WRITTEN BY
HARRY MENEAR PRODUCED BY
JUSTIN BRAND
JUNE 2019
113
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SEG AUTOMOTIVE
NINA BOMBERG, GLOBAL LEAD BUYER AT SEG AUTOMOTIVE, DISCUSSES COLLABORATION, COMMUNICATION AND THE COMPANY’S INCREASED AGILITY FOLLOWING ITS CARVE-OUT FROM BOSCH
C
onventional wisdom dictates that, when leveraging bargaining power, the bigger the company, the better the deal. In
January 2018, the Starter Motors and Generators division of multinational engineering and electron114
ics company, Bosch, completed its transition to become an independent organisation. Trading under the name SEG Automotive, now owned by Chinese consortium Zhengzhou Coal Mining Machinery Group (ZMJ) and China Renaissance Capital Investment (CRCI), the company is continuing to push the envelope of powertrain solutions for combustion engines and electrification in the automotive sector. “Our new advantages include being more flexible, faster and more able to incorporate supplier innovation,” explains Nina Bomberg, Global Lead Buyer at SEG Automotive. Bomberg was hired by SEG in 2017 before the company’s carve-out was completed, taking the reins of a global procurement network readying itself to step into the future. She sat down to discuss SEG’s sourcing, procurement and supply JUNE 2019
115
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SEG AUTOMOTIVE
“ YOU CAN BE TOUGH WHEN YOU NEGOTIATE, BUT YOU SHOULD ALWAYS BE FAIR AND TREAT PEOPLE WITH DIGNITY AND RESPECT” — Nina Bomberg, Global Lead Buyer, SEG Automotive
chain strategy going forward, the company’s plans to become a world leading provider of electrification solutions, and why bigger doesn’t always equal better. Bomberg has always enjoyed the unpredictable nature of a career in sourcing. “One day you need to rent an elephant and the next you’re finding a financial auditor,” she laughs. “I’ve always enjoyed the diversity.” Change in the procurement industry isn’t restricted to the day-to-day: over the
116
JUNE 2019
CLICK TO WATCH : ‘SEG AUTOMOTIVE CORPORATE VIDEO’ 117 past decade, Bomberg notes, the role
acknowledges that a large portion
of the supply chain executive and their
of the industry still has a long way to
department has evolved dramatically.
go in terms of supply chain evolution.
“We’ve moved from being a purely
“I joined a company in 2012 that was
cost-driven money saver to becoming
turning over multiple billions of dollars
internal consultants on a mission
every year – yet they didn’t have an
to create value for the organisa-
indirect sourcing department. The
tion,” she says. “Cost saving is
role of procurement is changing, but
definitely still a part of our role,
some companies have a longer way to
but we also focus on supply
go than others,” she says. With SEG,
security, innovation and more.”
Bomberg’s excitement continues, not
The opportunity to join a company
only to be working in a growth sourcing
that was preparing to cross
industry, but also to be part of a team
such a monumental threshold was
that is at the forefront of the supply
an enticing one for Bomberg, who
chain industry’s evolution. w w w.suppl yc ha i ndi gi ta l. com
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Original photo © seg-automotive.com
VISIT OUR SITE FOLLOW US:
“The biggest lesson I’ve learned at
essential to fully leverage employees’
SEG is that what goes around comes
expertise. “As global lead buyers, we are
around,” says Bomberg. “How you treat
responsible for the overall purchasing
the other side of the table is crucial. You
strategy. We’re also the ones coordinat-
can be tough when you negotiate, but
ing the commodity buyers that SEG has
you should always be fair and treat
spread around the world. We have
people with dignity and respect.”
local people doing the purchasing in
Establishing respectful, mutually-ben-
the specific countries, as they are
eficial, long term relationships between
much closer to our internal business
SEG and its suppliers is a vital aspect
partners, as well as local legislation,
of Bomberg’s role in managing the
regulations, taxation, local suppliers
company’s buying strategy. Communica-
etc. If everything was done from the
tion between the company’s high-level
central office, we would not be able to
decision makers and local buyers is
operate with the same amount of
E XE CU T I VE PRO FI LE
Nina Bomberg Nina Bomberg has a background in various Indirect roles in multi-national companies operating in different industries. Today she is the Global Lead Buyer in the Indirect Sourcing division of SEG Automotive. Their capex sourcing team is a team of seven people, spread across all regions. Currently she focuses on right-sizing processes after the company’s carve out from Robert Bosch. Her experience in multi-cultural change management and stakeholder management, as well as a motivator prove to be beneficial for this task. Bomberg is a business graduate and holds an MBA from ESCP Europe.
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SEG AUTOMOTIVE
flexibility and insights,” explains Bomberg. “It’s very important that, when we implement our strategies, we align closely with our specialist departments so they understand why we do or don’t do certain things. In the sourcing space, a lot of things live and die by whether the internal business partners align with a strategy.” SEG Automotive’s strategy of communication and collaboration also applies to their suppliers. “We’ve had extensive discussions with our supply base which 120
allowed us to explain our mission of reducing global CO2 emissions, our new structures and showcase the
“ THE AUTONOMY WE HAVE NOW MEANS WE SET OUR OWN TARGETS – AND ELECTRIFICATION IS A KEY AREA OF GROWTH FOR US” — Nina Bomberg, Global Lead Buyer, SEG Automotive
JUNE 2019
additional benefits that we now bring to the table. In the past, we had many suppliers that were a good fit for the huge organization that is Bosch. Now, we develop suppliers that are perfect for SEG and our new size and speed. Very often that is a supplier we have worked with for many years, and in some cases it’s a new organisation,” she says. One of the new companies working with SEG is CHG Meridian, an IT services and leasing company from Weingarten, Germany. “Since the carve-out, we’ve had a very good relationship with CHG using their IT solutions,” Bomberg says. “Our next project will be to streamline our forklift fleet. CHG will definitely help us to align and organise it better.” Bomberg notes that SEG’s more agile business profile is conducive to both increased levels of communication and adaptability. “Instead of the complex organization of Bosch, we now have a dedicated sourcing team that serves only SEG. With increased focus, process knowledge and more direct communication, intercultural and inter-disciplinary teamwork has become much easier. This includes regular visits of the global lead buyers to the local buyers around w w w.suppl yc ha i ndi gi ta l. com
121
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“ IN THE SOURCING SPACE, A LOT OF THINGS LIVE AND DIE BY WHETHER THE INTERNAL BUSINESS PARTNERS ALIGN WITH A STRATEGY” — Nina Bomberg, Global Lead Buyer, SEG Automotive
my we have now means we set our own targets – and electrification is a key area of growth for us,” emphasises Bomberg. “We have the clear goal of being a technology leader in that field as well.” SEG’s new Chinese owners reflect the increasing maturity of the electric vehicle market in the Asia Pacific region. Bomberg asserts: “China has established itself as the largest car market in the world and is driving the change towards electrification.” European demand for solutions that
the world ,” says Bomberg, adding that
reduce CO2 emissions is rising rapidly
the reduction in organizational complex-
too and SEG is anticipating a continued
ity has allowed SEG’s team to cater
surge in a market where it is already the
its sourcing practices to the unique
key player. “48V mild-hybridization in
challenges of different markets. “Now
particular will be a key technology in
it’s possible to have a supplier that only
Europe, which is set to even outpace EVs
works in Brazil but is exactly right for
in terms of market penetration. Just as
that market, whilst for the other six
with starter motors and generators
countries where we produce, we buy
before, we are a technology leader for
from someone else.”
48V, which transforms any conventional
More focused, adaptable sourcing is
internal combustion engine into an
giving SEG the ability to hone in on its
efficient mild-hybrid with minimal effort.”
long term goals: to further increase its
The company is looking to expand its
contribution to reducing CO2 emissions
portfolio and improve upon existing
from passenger cars and commercial
products at its new R&D centre under
vehicles, while also becoming a leader
construction in Changsha, China, which
in electrification solutions. “The autono-
is collaborating across continents with w w w.suppl yc ha i ndi gi ta l. com
123
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“ ONE DAY YOU NEED TO RENT AN ELEPHANT AND THE NEXT YOU’RE FINDING A FINANCIAL AUDITOR” — Nina Bomberg, Global Lead Buyer, SEG Automotive
vehicles,” says Bomberg. At the same time, the company also expands its product portfolio to answer regional mobility needs. SEG’s Indian division is set to introduce an electric motor designed to power e-rickshaws. The 2kW electric motor, christened the EM 1.2-HR (high range), has been developed to cater to the growing demand for e-rickshaws across many cities in India.
the German R&D centre. “With this new
“With the capabilities and collaboration
facility, we’re able to further expand our
of our Indian and German engineering
research into powertrain solutions for the
teams, we have been able to bring the
future, especially high-voltage compo-
product from conceptualisation to reality
nents in preparation for fully electric
in a record time of one year,” said Anil
JUNE 2019
125 Kumar MR, Managing Director, SEG
confident that the company has lost
Automotive India in an interview with
none of its bargaining power when
Autocar Professional earlier this year.
it comes to its relationships with a com-
Looking to the future, Bomberg
plex supplier network. “We are a smaller
expects to be at the heart of an increas-
company now, no question. However,
ingly diverse procurement network,
we are still a US$2bn multinational
as SEG further expands its product
corporation and a global player in our
portfolio. “The automotive industry is
segment. Despite the fact that it is
facing a transformation – and SEG
not the size of Bosch anymore, SEG
Automotive will actively shape this
Automotive is still a market leader in
transition towards more efficient
its business fields and will continue
combustion engines, 48V hybrids and
to leave its mark.”
electrification,” she says. As an independent company, SEG may be more agile and focused, but Bomberg is w w w.suppl yc ha i ndi gi ta l. com
126
TURKCELL: DRIVING SUPPLY CHAIN MANAGEMENT EFFICACY THROUGH TECHNOLOGY AND COMMUNICATION WRITTEN BY
MARCUS LAWRENCE PRODUCED BY
JUSTIN BRAND
JUNE 2019
127
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TURKCELL
Ali Türk, Executive Vice President of Supply Chain Management at Turkcell, discusses how Turkey’s largest mobile operator is driving efficiency with customers at the forefront
T 128
urkcell, the largest mobile operator in Turkey, has undergone a significant shift in its procurement and supply chain
operations driven by a radical ideological change to the business itself. “Turkcell is a unique company, a digital operator,” says Ali Türk, Executive Vice President of Supply Chain Management at the firm. “We are dealing not only with the mobile part, but also the commerce part: it’s one entity.” With a focus on establishing a high quality internal infrastructure, technology and network infrastructure, and meaningful, functional digital services, Turkcell has undergone a structural change that highlights the importance of procurement to its wider strategy. As part of supply chain management’s realignment as a strategic function, Turkcell established a dedicated procurement committee to drive positive change. Meeting every week alongside the CEO, Murat Erkan, the committee makes key JUNE 2019
129
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TURKCELL
decisions on the company’s biggest purchases. While these make up 3% of
130
follow throughout the organisation. These structural adaptations are
the firm’s purchases at large, their
bolstered by the application of
combined volume equates to 80% of
disruptive technologies, driving
the total made by Turkcell. “All of the
efficiency and transparency at Turkcell.
company’s top executives are fully
However, Türk stresses that digital
involved in these processes, and they
transformation is, to Turkcell, a tool
acknowledge and evaluate all of the
rather than a goal. “Digital transforma-
aspects of procurement investments
tion is a must to survive in our era,” he
and strategy.” Not only that, but a
says. “It enables us to focus on optimis-
unification of operations between
ing costs in a sustainable structure, to
teams has been achieved through the
increase revenues, and to increase the
adoption of agile management method-
level of quality we offer our customers.”
ologies, enabling a consistent thread for
A particular area of interest for Türk is
supply chain management strategy to
robotic process automation (RPA) and
“ Turkcell is a unique company, a digital operator” — Ali Türk, EVP Supply Chain Management, Turkcell
JUNE 2019
CLICK TO WATCH : ‘TURKCELL: RAMAZAN’A ÖZEL SALLA KAZAN PAYLAS!’ 131
the benefits it could have for internal
ICT department to drive the gradual
teams. He adds that the application of
rollout of RPA through specific
this technology will be based on what
digitalisation departments. “For
those teams themselves view as the
example, supply registration, fee
areas that would benefit most from
operation, calculation of monthly
automation, and the freeing up of staff
payments, operation of the tender
from repetitive tasks that it would
process, opening site acquisition and
enable. “We have procurement
scrap sales orders; they’re all opera-
departments, logistics departments,
tional issues and ritual issues,” says
real estate, construction and site
Türk. “Right now, we are developing
acquisition departments, and they are
some use cases and we will forward
each highlighting their requirements,”
those tasks to RPA.”
he says. Once those needs are defined, they each collaborate with Turkcell’s
In addition to its RPA ambitions, Turkcell has deployed artificial w w w.suppl yc ha i ndi gi ta l. com
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TURKCELL
CLICK TO WATCH : ‘TURKCELL: RTÜRKIYE’NIN ARAMA MOTORU YAANI BIR YASINDA’ 134
intelligence (AI) technology to enable
that will streamline communications
price estimations for services and
between internal departments.
network site acquisitions. “Right now,
The chatbot stands to mitigate time spent
we are managing approximately 20,000
chasing answers to various questions
value sites and we have a huge site
across multiple teams, particularly when
acquisition team that oversees the hiring
it isn’t clear who might be best placed
of those sites,” says Türk. With AI,
to provide those answers. “We will
Turkcell is using Big Data and analytics
eliminate these unproductive elements”
to drive intelligent land acquisition,
says Türk, “and we will address our
selecting sites that offer the best value
teams to focus more on strategic
to the company: maximising efficiency
business operations.” He adds that
whilst simultaneously cutting costs. The
digitalised contracts and digital
company is also developing a supply
signatures will significantly streamline its
chain management chatbot
dealings with contractors and landlords.
JUNE 2019
Türk’s team manages around 20,000
approval from the regulators to go
contracts with landlords which, until
digital and, thanks to mobile and
now, has been done through physical
biometric signatures, the completion
copies, meaning turnaround times are
time for contract signatures will be
protracted, cargo and courier costs
decreased from 10 days to between
mount up, and there is significantly
six and 10 hours. No cargo costs,
increased risk of delays caused by lost
no courier costs, no lost documents.
or damaged paperwork. “In Turkey
The processes will be fully optimised.”
there are regulations that limited us to
Across its supply chain, Turkcell’s
using hard copies for contractual
application of disruptive technologies
documents,” says Türk. “We got
is supported by a meaningful, hands-
E XE CU T I VE PRO FI LE
135
Ali Türk Ali Türk joined Turkcell as the Senior Vice President of Supply Chain Management in May 2016 and was appointed as the Executive Vice President of Supply Chain Management in March 2017. After graduating from the Industrial Engineering Department of Istanbul Technical University in 1999, Türk completed the Istanbul Technical University Executive MBA program in 2001. Between 2002 and 2007, Türk held various management positions responsible for logistics planning, warehouse and supply chain management processes at Ülker Group Companies. He worked at Ceva Lojistik between 2007 and 2011 as Warehouse and Value Added Operations group manager. Joining Turkish Airlines in 2011 as Cargo Operations Vice President, Mr. Türk has served as its President since 2012.
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TURKCELL
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CLICK TO WATCH : ‘TURKCELL: TEKNOLOJININ DÜNYAYI DEGISTIREBILECEGINE INANIYORUZ’ 137
on approach to vendor management that ensures their respective offerings meet Turkcell’s needs in the fullest capacity. “We regularly evaluate our suppliers’ operational, commercial and quality perspective capabilities,” says Türk. “Also, for effective vendor management, meeting regularly is crucial. I don’t expect the vendors to only come to us, but we also visit them at their own premises and facilities to help us understand how they operate.” With the added insight provided by
“ You have to change people’s perspectives. Change means that it’s changing to good, not bad” — Ali Türk, EVP Supply Chain Management, Turkcell
Turkcell, Türk notes that the key driver w w w.suppl yc ha i ndi gi ta l. com
TURKCELL
of this approach is encouraging its vendors to evaluate their processes and inspire innovation. Not only that, but operational stability is also supported by this focus on establishing effective lines of communication. “At times we generate new projects which impact our business methods and processes, and every time that happens it’s known by all parties,” Türk adds. Furthermore, supplier-enabled innovation has been defined as a key performance target for each procurement specialist at the firm, ensuring that 138
innovative opportunities are actively sought whilst working with suppliers.
“ For effective vendor management, meeting regularly is crucial” — Ali Türk, EVP Supply Chain Management, Turkcell JUNE 2019
Tying everything together is an unerring commitment to effective change management. “If you want to be successful on this transformation journey, change management is the most crucial part,” enthuses Türk. “You have to change people’s perspectives. Change means changing to good, not bad. The next era should be better than before.” To drive this positive attitude to shifts in operations and the application of new technologies,
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139
Turkcell operates what Türk calls
already been approved by our boss
Supply Chain Management Boot-
to take forward,” says Türk. “We tell our
camps that bring together the talents
staff that, as we’re changing everything,
of different teams across the SCM
they have to adapt quickly, but we
spectrum at the firm. The focus is
emphasise that they are managing
primarily on generating innovative
these innovative projects. They’re
ideas and making employees a part
driving the change, and that’s crucial.”
of the transformation process, with the additional benefit of cross-functional collaboration at these events and establishing strong lines of communication between different teams. “The bootcamps have generated a lot of projects so far, and some of those have w w w.suppl yc ha i ndi gi ta l. com
UILDING A ROCUREMENT EPARTMENT ROM THE ROUND UP WRITTEN BY
HARRY MENEAR PRODUCED BY
JUSTIN BRAND
140
141
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APPLUS+
MONTSE EMPEZ, CHIEF PURCHASING OFFICER AT APPLUS+, TELLS THE STORY OF BUILDING THE COMPANY’S PROCUREMENT DEPARTMENT FROM THE GROUND UP, AND OF THE DIGITAL TRANSFORMATION OF ITS SUPPLY CHAIN
A
decade ago, the role of a procurement department and its Chief Purchasing Officer (if the role existed at all) was often
relegated to a monthly meeting of the accounting 142
department in order to briefly discuss the cheapest possible way to acquire products and services. Today, the business community has “moved on from the idea that procurement is just a cost cutting department. Now, it’s a department that adds value to the company and is capable of driving change inside the organisation,” says Montse Empez, Chief Purchasing Officer at Applus+. Founded in 1996 and headquartered in Madrid, Applus+ is one of the world’s leading testing, inspection and certification companies. It provides solutions for customers in multiple industries to ensure that their assets and products meet health and safety, quality and environmental standards and regulations. Applus+ operates in more than 70 countries and employs 22,800 people.
JUNE 2019
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APPLUS+
“ IT’S THE HOT TOPIC RIGHT NOW. EVERYONE IS TALKING ABOUT PROCUREMENT DIGITAL TRANSFORMATION” — Montse Empez, CPO, Applus+
Joining the company in 2011, Empez was tasked with a unique and engaging challenge: building Applus+’ procurement department from the ground up. “Since I joined the company, I have seen tremendous change in the perception of procurement and the involvement that we now have in strategic decisions. It has not been an easy path; we have had to show we’re adding value to gain that confidence,” Empez recalls. Touching on the long-term digital transformation of Applus+ procurement department, Empez discusses her journey so far,
144
how the growing importance of the procurement department has led to increased challenges, and the ways in which digital transformation is instrumental in overcoming them. The pervasive digital transformation of the business landscape is, Empez asserts, the touchstone by which every procurement department will be judged by history. “It’s the hot topic right now. Everyone is talking about procurement digital transformation,” she notes. “We are trying to integrate all the companies to access data via either API or web services, so that we can gain access to information JUNE 2019
CLICK TO WATCH : ‘APPLUS+ BRANDCLIP VIDEO’ 145 incredibly quickly. That sort of imple-
made was to internalise that function,”
mentation will hopefully allow us to
Empez recounts.
be proactive rather than reactive.”
Outside of Spain, she quickly
Gathering data from the 70 countries
discovered that Applus+ operations in
across which Applus+ operates has
most countries lacked a procurement
been no mean feat for Empez, who
process, and those that did have one
faced initial challenges at home and
weren’t standardised. “We had no
abroad. “When I joined Applus+, the
spend visibility and no global deal or
first thing I found out was that there
agreement in place for our fleet.
were no procurement specialists in
Applus+ has over 5,000 vehicles,
Spain. The company had an external
which represent one of the most
procurement department that was just
important requests for proposal (RFPs)
processing local purchase orders and
in the company, so that was the first
invoices, not doing any procurement as
thing I tackled,” says Empez. After
such. So, one of the first decisions I
reworking Applus+ fleet management, w w w.suppl yc ha i ndi gi ta l. com
APPLUS+
146
“ I’D LIKE APPLUS TO BE AHEAD OF THE MARKET, NO MATTER WHAT KIND OF CHANGES ARISE” — Montse Empez, CPO, Applus+
JUNE 2019
147
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“ WITH THE NEW SYSTEM, I STARTED GETTING INFORMATION THAT MEANT WE COULD MAKE SMARTER DECISIONS AND ENSURE COMPLIANCE” — Montse Empez, CPO, Applus+
ensure compliance.” Now, Applus+ is in the process of migrating its procurement department again, this time to SAP Ariba’s service. “Ariba is a much more robust system than our previous deployment,” Empez explains. “It gives us additional advantages with regards to our procure-to-pay process, and it allows us to implement rules with procurement to be more consistently compliant. We are very satisfied with the Ariba deployment and what we can get out of the system.” Empez maintains that, regardless of the solutions in use, one of the greatest challenges of the digital transformation of procurement is an increased focus
Empez worked on developing procure-
on compliance. “Procurement is
ment policies to demonstrate which
coming under more and more scrutiny,”
software solutions system would best
she says. “There are increased controls
suit the company’s needs. “A year after
and compliance standards on the
I joined the company, I raised the
procurement process now, especially
department’s needs with the board of
relating to things like Corporate Social
directors, and they agreed to launch an
Responsibility (CSR). Procurement is
RFP. I’m proud to say that six years
something that can, if done poorly,
after the first implementation, we now
really hurt a company’s reputation.”
have 13 countries using it. It’s not
Sustainable practice across the
complete, but it’s a great start,” says
procurement department is another
Empez. “With the new system, I started
avenue through which responsibility
getting information that meant we
increases alongside importance.
could make smarter decisions and
“Sustainability in the supply chain w w w.suppl yc ha i ndi gi ta l. com
149
APPLUS+
150
is taken much more seriously than 10 years ago,” says Empez. “We’re doing a lot of things: we want to make sure that we work with suppliers that are
€1,676mn Approximate revenue
sustainable in the way they operate, so we have a pretty strict evaluation and qualification process. The same goes for our products.” Looking to the future, Empez sees emerging technologies like Big Data, prescriptive analytics and the Internet of Things (IoT) as key to overcoming the challenges facing procurement departments. However, she observes, JUNE 2019
1996
Year founded
22,800 Approximate number of employees
APPLUS+ DIVISIONS
•E NERGY & INDUSTRY DIVISION: leading global provider of non-destructive testing, inspection, quality assurance and quality control, project management, vendor surveillance, certification, asset integrity services and technical staffing services. •L ABORATORIES DIVISION: testing, certification and engineering services to improve product competitiveness and promote innovation. The Division operates a network of multidisciplinary laboratories in Europe, Asia and North America •A UTOMOTIVE DIVISION: global leading provider of statutory vehicle inspection services in several markets in which the periodic vehicle inspection is mandatory for the compliance of safety and environmental standards.
•D IADA DIVISION: IDIADA A.T. (80% owned by Applus+ and 20% by the Generalitat of Catalonia) has since 1999 been operating under an exclusive contract at the 331-hectare technology centre near Barcelona (owned by the Generalitat of Catalonia), which includes the most comprehensive independent proving ground, testing laboratories and vehicle development centre for motor vehicles in Europe. The contract runs until 2024 and is renewable until 2049. The Division provides services to the world’s leading vehicle manufacturers for new product development activities in design, engineering, testing and homologation.
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APPLUS+
152
“ ARIBA GIVES US ADDITIONAL ADVANTAGES WITH REGARDS TO OUR PROCURE-TO-PAY PROCESS” — Montse Empez, CPO, Applus+
while the majority of companies are, in some way, adopting artificial intelligence (AI) and predictive analytics, this investment is not being seen enough in the supply chain and procurement departments. “These technologies will play a significant role in procurement. My question is ‘when?’ I don’t think the market is ready yet. Applus+ has implemented AI tools in its systems for checking things like the procure-to-pay process. But the reality is that only maybe 1% of our suppliers are ready for
JUNE 2019
153
an AI integration.” This is something
transformation. Of course, there will
that Applus+ is putting a great deal
always be new things,” she laughs.
of emphasis on going forward. “In all
“I’d like Applus+ to be ahead of the
our new RFPs we’re looking for digital
market, no matter what kind of changes
players,” Empez explains. “Through this
arise. By next year, I hope we have a
intelligence, we can definitely improve
consolidated structure and are ready to
efficiency and cost.”
take on new challenges and projects.”
Empez relishes the ongoing challenge and dynamic nature of her role. “Right now is a fantastic time, because my role and department are changing the organisation. By 2020, I hope we will finish our department’s digital w w w.suppl yc ha i ndi gi ta l. com
154
JUNE 2019
UNITINGCARE ENCOURAGING INNOVATION THROUGH THE SUPPLY CHAIN WRITTEN BY
SEAN GALEA-PACE PRODUCED BY
STUART IRVING
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155
UNITINGCARE QUEENSLAND
Michael Gillin, General Manager Procurement and Services at UnitingCare discusses the supply chain strategies UnitingCare is utilising amidst rapid industry changes
A
s an organisation that puts its people and the community at the forefront of its decisions, UnitingCare understands
the importance of leveraging modern technology and innovation to achieve success in the healthcare industry. 156
Michael Gillin, General Manager Procurement and Services, has overseen how UnitingCare has established and maintained a well-managed strategic function across the business. Having previously worked in management consulting roles at KPMG which took Gillin to Brisbane, Australia, from the UK in 2011, he joined UnitingCare in April 2017. Gillin believes that his previous experience truly laid the groundwork for success in his role with UnitingCare. “A lot of the work I did with KPMG was large-scale global business transformations and most of it was focused around procurement, supply chain and cost reduction,� says Gillin. “In a procurement role, one of the major things that you need to do is engage with suppliers and business stakeholders. With major reform occurring in the aged, health and community JUNE 2019
157
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UNITINGCARE QUEENSLAND
“ I believe a good partner is one that’s aligned to your values and your objectives. It’s a company that’s proactive with you and not just providing a service”
158
— Michael Gillin, General Manager Procurement and Services, Unitingcare Queensland
JUNE 2019
sectors, UnitingCare has had to innovate and make the necessary changes to respond to change. I think my experience in supporting the organisation through that change has afforded me a better understanding of what works and what doesn’t.”
INNOVATION IN THE CARE SECTOR Earlier this year, UnitingCare held a successful Supplier Innovation Tradeshow and Showcase in Queensland, led by Daniela Kerr, Procurement Specialist at UnitingCare. The event exceeded expectations, with over 50
CLICK TO WATCH : ‘CAROLINE’S STORY: I WANT TO MAKE A DIFFERENCE IN PEOPLE’S LIVES’ 159 of UnitingCare’s key suppliers attend-
UnitingCare’s network of hospitals
ing the trade show. “The theme of the
continue to excel in being recognised
show was sustainability and innovation
for their clinical expertise and use of
and there were lots of advanced technol-
cutting-edge medical technology.
ogies from different suppliers show-
Last year, UnitingCare’s Wesley Hospital
casing new, innovative products and
was internationally recognised as
services,” explains Gillin. “The feed-
Australia’s first Centre of Excellence in
back from everyone in attendance has
Robotic Surgery, one of only 10 hospitals
been fantastic and it made all the hard
worldwide at the time and recently
work worthwhile.”
opened a new Emergency Centre at
Having centred its expo around innovation, Gillin affirms how important it is to
Buderim Private on the Sunshine Coast. “In our aged, community and disability
continue to develop its services and
business units we have developed
facilities. “Innovation is absolutely critical
an affordable housing strategy and
to us and was a key focus of our expo.”
implementation plan, designed and w w w.suppl yc ha i ndi gi ta l. com
UNITINGCARE QUEENSLAND
160
JUNE 2019
implemented innovative programs to
to support people to life a full life
support children and families in foster
regardless of their circumstance.
and kinship care,” explains Gillin. “We
“I believe we’re an organisation with
have continued to provide expertise
a heart. I love that we’re an organisa-
to support clients transitioning to the
tion with a social purpose and it gives
National Disability Insurance Scheme
me a sense of pride to know what I’m
(NDIS) including the roll-out of digital
doing is contributing to something
applications to assist clients with their
very meaningful.”
NDIS plan management. From a pro-
With technology transforming the
curement and supply chain aspect,
way companies worldwide conduct
we’re interested in the innovation our
business, Gillin understands the value
suppliers can bring into our organisation.”
of implementing it into UnitingCare’s procurement strategy. “I think it’s really
MAKING A DIFFERENCE
important that we try to get an end-
As a not-for-profit organisation, Gillin
to-end solution from our sourcing
affirms UnitingCare’s operations are
platform to our contract and supplier
underpinned and guided by its mission
management platforms. We’ve currently
E XE CU T I VE PRO FI LE
Michael Gillin Michael Gillin is a General Manager, Procurement and Services at UnitingCare and has over 18 years’ experience in driving operational efficiencies. Before starting at UnitingCare, Michael spent ten years as a Management Consultant for KPMG in Australia and the UK helping businesses transform operations and reduce costs. Michael also spent seven years in as an Engineer in the automotive industry with Jaguar Land Rover and MG Rover.
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161
“ I believe we’re an organisation with a heart” — Michael Gillin, General Manager Procurement and Services, Unitingcare Queensland
163
got about three or four different solutions
success, Gillin reflects on what his
that work across processes and they’re
organisation looks for when deciding
not all integrated,” he says. “Data is
to embark on a new venture. “I believe
a bit of a challenge at the moment and
a good partner is one that’s aligned to
is critical for us to understand demand
your values and your objectives. It’s
so that we can support the business to
a company that’s proactive with you
be more operationally efficient and
and not just providing a service; it’s
competitive because the industries in
coming to you with ideas and chal-
which we operate are continuing to go
lenging the way that you do things to
through large changes so it’s vital that
help you improve.”
we work out where we fit into that.” Having formed mutually beneficial
After establishing important partnerships with Accenture and Bunzl, Gillin
partnerships with a range of compa-
affirms UnitingCare’s collaboration
nies in order to achieve and sustain
with the two companies are very w w w.suppl yc ha i ndi gi ta l. com
UNITINGCARE QUEENSLAND
165
“ Innovation is absolutely critical implemented a procurement hub, which consists of eight Uniting entities across to us and was Australia working collaboratively together a key focus of to deliver procurement benefits,” our expo” explains Gillin. “Accenture are our beneficial. “Led by our Chief Financial
Officer Peter Gunn, we have recently
partner and are responsible for running the hub for us. They’ve been brought on board to bring the organisations together and to run procurement and supply
— Michael Gillin, General Manager Procurement and Services, Unitingcare Queensland
chain initiatives with the goal of reducing costs,” he says. “Bunzl is also a strategic partner to the Uniting Care business; it supports us as one of our major w w w.suppl yc ha i ndi gi ta l. com
UNITINGCARE QUEENSLAND
2000
Year founded
17,000
Approximate number of employees
166
JUNE 2019
distributers that services around 500 sites across all of Queensland and the Northern Territory. It’s important that we partner with a supplier that understands our needs and the importance of getting product to our residents, patients and clients in a timely matter to help support their needs.”
LOOKING FORWARD Looking to the future, Gillin has a clear idea of where he anticipates UnitingCare to be over the coming years. “UnitingCare have devised a 2030 strategy which has given us direction around our key focus areas. We’ve got a clear direction of where we want to be, but to be successful it really comes down to people. It’s great to have strategies and become more digital, but it’s important that we don’t lose sight of the fact that we provide care, support and health services to people in need,” says Gillin. “The key is to keep the people we look after at the forefront of everything we’re doing. We are driven to making sure any investment provides the most benefit to our front-line staff and the people that we serve.”
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168
Deloitte: delivering strategic sourcing transformation empowered by digital analytics WRITTEN BY
OLIVIA MINNOCK
JUNE 2019
PRODUCED BY
ARRON RAMPLING
169
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DELOITTE
With procurement increasingly gaining a seat at the executive table, Deloitte consultant Natascha Schijven says having the right digital analytics and diverse talent in place is key to transforming sourcing operations
M
anagement consultant Natascha Schijven has witnessed the changing procurement landscape for around
two decades. Now a Partner for Supply Chain 170
& Manufacturing Operations at Deloitte, she began her career in manufacturing for a multinational packaging company in the Netherlands. Even though the local manufacturing environment was exciting, Natascha wanted to make use of a background in international business and language studies. “I wanted to make sure I would work on projects that were more complex, spanned geographies and leveraged my languages and international business background so I moved from manufacturing into strategic sourcing,� she recalls. Schijven sourced direct materials in packaging across Europe and indirects for a global specialty chemicals company, but started to feel her work lacked challenge. “At some point I got bored with the repetitive nature of my nine to five job and wanted to find something more challenging JUNE 2019
171
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DELOITTE
“ Next generation sourcing managers need to be trained in advanced analytics and be knowledgeable of the technologies empowering them”
172
— Natascha Schijven, Partner, Supply Chain & Manufacturing Operations, Deloitte
and versatile”, she says. Schijven moved into consultancy, first with A.T. Kearney and then for Deloitte. Having previously worked with consultants herself, she was ideally placed to understand the situation from both sides. “Having been on the receiving end, working with several consulting firms, allowed me to understand where the client is coming from. It’s a very different world as a client: you effectively have your own day job, plus then all of a sudden you need to manage a consultant coming in.” Assisting some of the world’s largest organizations in Fast Moving Consumer Goods, Retail, Pharmaceuticals and Industrial Products to transform the way they source and manage costs, Schijven argues that what makes Deloitte different is the way it works as a true partner for its clients. “We are there hands on from A to Z. We’re in the trenches with you – we’re not here to tell you how to do something and then leave you to go ahead and do it,” she explains. The global consultancy’s methodology, and indeed Schijven’s experience to put herself in the clients’ shoes, has proven to resonate well with clients the world over. “It comes down
JUNE 2019
NATASCHA SCHIJVEN, PARTNER SUPPLY CHAIN & MANUFACTURING OPERATIONS AT DELOITTE. ‘DELOITTE AS A PARTNER’
to being authentic and truthful, speak-
Indeed, Deloitte’s AI practice,
ing from one human to another. That
Deloitte Omnia, is armed with next
helps clients not to just see consultants
generation, disruptive solutions from
as guns for hire, or cyborgs coming
Internet of Things (IoT) to Deep
to take jobs away from them.”
Learning, Machine Learning solutions
Deloitte, Schijven adds, is more than
and many more. “We can offer clients
just consulting. “We have a variety of
ways to take cost out through strategic
critical business lines. We have breadth
sourcing sustainably – to accelerate
and depth. We have a lot of technology
time to value and truly optimize on
empowering us and a bench strength
total cost of ownership for our clients
in advanced, digital analytics that I had
– across departmental silos. After
previously never come across. Deloitte
we’ve transformed an organization,
has a whole practice built around
Procurement is no longer just seen
digital and digital disruption.”
as a cost cutter.” w w w.suppl yc ha i ndi gi ta l. com
173
DELOITTE
NATASCHA SCHIJVEN, PARTNER SUPPLY CHAIN & MANUFACTURING OPERATIONS AT DELOITTE ‘DIVERSITY OF THOUGHT’
174
PROCUREMENT CHANGES
been one of the best ways in which you
As industries become more competi-
can rapidly control costs,” Schijven
tive, the way procurement is viewed is
continues. “We’re seeing a shift from
indeed shifting, with businesses
not having to worry about cost to that
understanding a greater focus on cost
being the principle concern – there is
management is needed in order to
less flying below the radar in high-mar-
succeed: “Focus is very much shifting
gin environments, so you need to get it
in the CFO space toward cost control.
under control. The past decade or so
The world is rapidly becoming more
has seen the shift from procurement
competitive and there’s a lot of
being a back office, cost-cutting
disruption fueling mergers and
function, to a function that truly delivers
acquisitions. If you don’t get ahead
value cross-functionally and increas-
of that, you’re not going to be able
ingly has a seat at the C-level table.”
to monetize. You’ll miss the boat. “Strategic procurement has always JUNE 2019
As the function shifts however, there will inevitably be those organizations
which are further ahead, and the
WHAT IS DIGITAL?
landscape has yet to smooth out and
A key challenge Schijven sees procure-
catch up. “It’s a journey,” says Schijven.
ment professionals face is the shift to
“That’s what makes this space so
digital, with one simple question on
interesting. You’re always pushing the
their minds: “What is digital? What is
envelope because you’re working with
this all about? I’m hearing this buzzword
clients who are starting out in the
flying around, but I don’t have a clue
‘beginner’ phase, as well as clients who
what it is. I’m Googling it and getting
are absolute leaders in the space – you
around 400 definitions.” According to
have to have the exhaustive content
the consultant: “The key challenges are
and disruptive innovation capability to
really around how to capitalize on a
show both of them how to reach the
world where everything is connected
next level, and get the next double-
through different levels of technology,
digit cost reduction or multiple base
as well as understanding advanced
point value enhancement.”
analytics that allow you to harness
E XE CU T I VE PRO FI LE
Natascha Schijven is a senior leader with deep experience in large scale cost and strategic procurement transformation across food & beverage, retail, pharma, chemicals and oil & gas in Europe, North America and Asia. She was recently recognized by SCMA as one of Canada’s 100 Inf luential Women in Supply Chain. Schijven is considered a thought leader in analytics-empowered/digital cost transformation and is an experienced panelist and public speaker. She is passionate about enhancing workplace diversity, mentoring and advancing women leaders. Schijven currently leads the Direct Materials Management offering for Deloitte Canada.
w w w.suppl yc ha i ndi gi ta l. com
175
DELOITTE
176
JUNE 2019
$43.2bn Approximate revenue
1845
Year founded
286,200
Approximate number of employees
w w w.suppl yc ha i ndi gi ta l. com
177
Eliminate empty miles
“ Strategic procurement has always been one of the best ways in which you can rapidly control costs” — Natascha Schijven, Partner, Supply Chain & Manufacturing Operations, Deloitte
long-term sourcing decisions. This is how we help produce insights clients never dreamt were possible before, because all the data that was decentralized across hundreds of laptops, different enterprise systems and thousands of bits of paper is now in one centralized database or stack. That’s what it means to me.” Looking at strategic sourcing more specifically, digital means “having everything from your PDF material and artwork specs, through to your policies, contractual and operational procure-
and effectively deduce the core gist
ment data centralized”. “Putting
required for more accurate and
statistical, optimization and other
accelerated decision making. That’s
digital analytics to work within a
what’s needed to survive in the new
rigorous strategic sourcing process on
Industry 4.0 era.”
all that combined to rapidly produce
For Schijven, then, what does digital
exhaustive insights human intelligence
mean? “To me, it’s all about the
never could – that’s how I would explain
conversion of data into key ‘nuggets’ of
the benefits of analytics empowered
information, so inherently it’s all about
strategic sourcing to a CPO,” says
the analytics, harnessing the ability to
Schijven. In order to effectively
have everything that used to be on
capitalize on digital in strategic
paper digitized, empowering central-
sourcing, a key priority is to have the
ized cross-functional analysis. It means
right talent in place. “There’s a big shift
leveraging Big Data technology and
in capability; the skillset required to
having the latest advanced analytics
extract value is vastly different. Next
get to work on all those petabytes of
generation sourcing managers need
data to inform short-, mid-, and
to be trained in advanced analytics and w w w.suppl yc ha i ndi gi ta l. com
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be knowledgeable of the technologies empowering them. This is key next to other critical enablers such as transformation enabling governance and change management.”
DIVERSITY OF THOUGHT When it comes to getting the right talent, Schijven comments: “I would advise organizations to look broadly, step outside of your comfort zone. What has surprised me is that it’s not always necessarily folks with a business or engineering background 180
who’ve got the right stuff. I’ve been pleasantly surprised by people with completely diverse backgrounds, from microbiologists to historians. Have a healthy mix of diversely thinking people,” she advises. Diversity of personal experience, such as having a mix of genders, will also be useful. “Women and men see things inherently differently – we’re just wired differently. Again, in the end what you should strive for is diversity of thought which is fueled by diversity across multiple dimensions; different genders, racial backgrounds, educational backgrounds, sexual orientations, etc. People who have walked life JUNE 2019
differently have different ways of viewing problems and coming up with solutions. You will not be able to build a high-performing team equipped to excel in the digital age with only engineers or only business folks. We’re all myopic because we’re all ‘molded’ to be who we are today through our gender, culture, upbringing, education and so on. Businesses should ensure a diverse pack if they don’t wish to keep coming up with the same answers.”
A WELL-ROUNDED ECOSYSTEM Another way Deloitte achieves diversity of thought is by leveraging its network of carefully selected partners – and this comes down to Schijven’s key philosophy of being authentic. “We’re never going to be everything to everybody,” she says. “If you try to run a business like that, it’s sub-optimal and it would be excruciatingly costly. Being true to yourself and saying ‘this is something we don’t do, but we have a really good partner that can offer this, and we will help drive it’ is the right way to go about it. No person or company is omniscient; being humble and self-aware enough to recognize this is key to success.” w w w.suppl yc ha i ndi gi ta l. com
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“We have a broad range of consulting capabilities but there are always areas we don’t want to invest in or dive deep into. It’s a symbiotic ecosystem really, for example we have a network of software partners that provide the enabling, empowering technologies below some of our core capabilities. In the end, we want to authentically do what’s best for our clients so it’s critical to know which partners to work with and how best to leverage each other’s skills.”
ENABLING TRANSFORMATION “Some clients, and even some consultants quite frankly, believe cost transformation means a consultant comes in and like a tornado or ‘gun for hire’, goes around taking all the costs out with bare bones left and then leaves,” Schijven comments – but this isn’t the Deloitte way. “The problem with that approach is that it’s not sustainable – cost will creep back in. So, if you truly want to do strategic sourcing transformation, holistic cost transformation – or any transformation for that matter – you need to embrace the fact that it truly is a transformation. It’s not something you do to an organization; it’s something you do collaboratively w w w.suppl yc ha i ndi gi ta l. com
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NATASCHA SCHIJVEN, PARTNER SUPPLY CHAIN & MANUFACTURING OPERATIONS AT DELOITTE ‘PROCUREMENT HAS CHANGED’
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“ I believe procurement will gain more and more of a seat at the executive table – and that’s the way it should be” — Natascha Schijven, Partner, Supply Chain & Manufacturing Operations, Deloitte
JUNE 2019
with an organization. Transformation enabling change management is critical or it will not ‘stick’ and people will revert back to the way they used to do things. You need a carefully orchestrated communication and issue mitigation plan, agreed upon, visible executive sponsorship and clear transformation governance set up to help people through it. Interestingly enough many times it’s merely about treating each other as humans: actively listen with your undivided attention, repeatedly engage and communicate,
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involve and ask advice from those most
executive table – and that’s the way it
affected. People want to be valued,
should be. If you want to take control
acknowledged, heard and recognized.”
of something – not just your own costs
With this commitment to change
but those of your suppliers and the full
management, Deloitte guides its
interconnected value chain, which
clients through transformations that
is what we’re dealing with in a digital
last – and as the importance of
world – you need to empower those
procurement continues to increase,
you put in charge with the appropriate
this will remain key to each one of
level of decision-making authority.”
its clients. “Cost pressure is going to keep increasing,” Schijven says. “As strategic procurement is one of the key direct influencers to that cost, I believe it will gain a more important seat at the w w w.suppl yc ha i ndi gi ta l. com
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