GETTING TO GLOBAL SPEND VISIBILITY                               October 2012                   Brian Jones               ...
About NestleGlobal MissionTo be the recognized leader in Nutrition, Health and Wellness andthe industry reference for fina...
Unmatched        product       and brand        portfolio   10,000 different products   Over 1 billion products sold eve...
Nestlé Business Services - North America Part of Nestlé’s global shared services organization supporting the  North Ameri...
About Me Personal Experience   – 32 years with the Nestlé family       • Ralston Purina, Nestlé Purina PetCare, Nestlé Bu...
Summary: Nestlé Spend Reporting                                                       Nestle Spend Reporting              ...
Key ChallengesIndirect Material                               Non SAP BusinessMaterials are classified by the PO creator a...
Current Solution: Zycus iAnalyze Nestlé needed a tool to bridge the spend reporting needs After a rigorous search proces...
Benefits of iAnalyze Supports Business Units   – SAP   – Non SAP Applies consistent classification across direct and  in...
Indirect Materials:“Regional classification” is key!   Not a mapping between Nestlé global classification and Nestlé    r...
Supports Performance Metrics Sample KPI #1 - Percent spend under management Spend in certain categories is designated as...
Supports Performance Metrics Sample KPI #2 - Preferred supplier spend (reduced “maverick  spend” ) Designating supplier ...
Supports Performance Metrics Sample KPI #3 - Spend under contract Example: Top 5 indirect suppliers, spend and percent o...
Supports Performance Objectives                                                                              Ensure Inform...
Supports Procurement Strategies Sample Strategy - supplier rationalization   – Helps identify where a large number of sup...
Summary                             Doing the upfront                                 work with     Understanding the     ...
Questions
Getting to Global Spend Visibility_Nestle
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  • Our product and brand portfolio is characterised by strong market positions, or even leadership. We have the largest range of foods and beverages of any food company.We say that we have a product for every moment of the day, from your morning cereal or yogurt, drinking water or coffee throughout the day to your evening meal of Buitoni pasta or Maggi noodles.And from birth, with our infant formula, to specific products for older people, as we will see later with Nestlé NutritionGlobal or local, our brands are always relevant to the local consumer and fulfill their food and beverage needs, as well as their nutritional needs, through every moment of their day and across whole lifetimes.They are part of everyday life, leading to great consumer loyalty.Our products reach all consumers, from Nespresso coffee, to those on the lowest incomes through our Popularly Positioned Products, which we will look at later.We have more than 2,000 brandsMany brands have category leadershipMany brands have been around for several decades, some for over 100 years.
  • Getting to Global Spend Visibility_Nestle

    1. 1. GETTING TO GLOBAL SPEND VISIBILITY October 2012 Brian Jones Nestlé Business Services Procurement Excellence
    2. 2. About NestleGlobal MissionTo be the recognized leader in Nutrition, Health and Wellness andthe industry reference for financial performance Key Stats  CHF 83.6 billion in sales in 2011  330,000 employees in over 150 countries  461 factories in 83 countries
    3. 3. Unmatched product and brand portfolio 10,000 different products Over 1 billion products sold every day A product for every moment of every day, from morning to night and from birth to old age
    4. 4. Nestlé Business Services - North America Part of Nestlé’s global shared services organization supporting the North American businesses North America Nestle Business Units Nestle Nestle Nestle Nestle Nestle Nestle Waters Health Purina Nestle USA Canada Nutrition Profession North Science PetCare America
    5. 5. About Me Personal Experience – 32 years with the Nestlé family • Ralston Purina, Nestlé Purina PetCare, Nestlé Business Services – Last 8 years in Nestlé Business Services (NBS) – Held roles in product R&D, IT, and Procurement – Current role is Technology Manager within NBS Procurement Excellence team • NBS Procurement Excellence is a tools and processes team supporting direct and indirect strategic buyers
    6. 6. Summary: Nestlé Spend Reporting Nestle Spend Reporting Tools Used Business Areas SAP Non SAP SAP ERP Business SAP Business Units Business Systems Warehouse Units Direct Indirect Material MaterialMaterials are classified according to the global classification whenthey are created in master data, thus eliminating the possibility tomisclassify spend
    7. 7. Key ChallengesIndirect Material Non SAP BusinessMaterials are classified by the PO creator atthe time the PO is generated using the Nestlé No direct or indirect material spend in currentglobal classification. Nestlé system“Human Factor” has a significant impact onaccuracy Non PO spend is Detailed P-Card Marketing Procurement Org. Reporting unavailable spend is unavailable Market Procurement organizations needGlobal Procurement Org. Reporting spend reported using a classification they can understandGlobal Procurement organization wants spendreported according to the Nestlé global The global taxonomy is not intuitive to buyerstaxonomy and does not represent spend the way buyers manage their categories
    8. 8. Current Solution: Zycus iAnalyze Nestlé needed a tool to bridge the spend reporting needs After a rigorous search process, ultimately chose Zycus iAnalyze
    9. 9. Benefits of iAnalyze Supports Business Units – SAP – Non SAP Applies consistent classification across direct and indirect materials – Indirect materials • Provides consistent classification using a “regional” classification • Allows for the capture of non PO spend • Enables detailed P-Card spend reporting
    10. 10. Indirect Materials:“Regional classification” is key! Not a mapping between Nestlé global classification and Nestlé regional Market classification It’s an independent classification built on: – Nestlé custom developed classification rules – Nestlé preferred supplier list for indirect categories • This provides the supplier “line of business” classification when Nestlé specific rules cannot be applied Spend tool engine classification • When neither rules or suppliers apply to the spend Spend tool reclassification capability is vital – Regardless of the Nestlé regional classification generated, it can be improved over time via input from buyers
    11. 11. Supports Performance Metrics Sample KPI #1 - Percent spend under management Spend in certain categories is designated as non- addressable, which allows increased focus on KPIs for percent of addressable spend under management Marking non-addressable spend allows Procurement to better focus on spend under management
    12. 12. Supports Performance Metrics Sample KPI #2 - Preferred supplier spend (reduced “maverick spend” ) Designating supplier categories gives this visibility The supplier categories can be defined by the Procurement organization
    13. 13. Supports Performance Metrics Sample KPI #3 - Spend under contract Example: Top 5 indirect suppliers, spend and percent of total spend
    14. 14. Supports Performance Objectives Ensure Information is Backed by the Required Lack of Private Certifications Suppliers’ •Nestlé populates Information supplier diversity Verification of •Lack of private information in Supplier Information suppliers’ information iAnalyze, using can also create gaps in information that Nestlé •Many spend analysis can ensure is backed Increase Spend tools have a native supplier diversity information by the required •Increase Spend with capability to support certifications diverse suppliers diverse suppliers, but verification of the supplier information was a Nestlé concern
    15. 15. Supports Procurement Strategies Sample Strategy - supplier rationalization – Helps identify where a large number of suppliers exists within a single category There may be a savings opportunity with over 1,200 suppliers for Gaskets and Seals
    16. 16. Summary Doing the upfront work with Understanding the rules, preferred Buyers will accept classification that vendor lists, etc. will and use the tool makes sense to the help your spend because it shows Procurement analysis tool the spend data in buyers is key to the present the spend a form they are adoption of spend data in the familiar with, and analysis tools classification that can use makes sense to the buyers Final Thought: Tools need to truly work for people in order to drive the adoption and use needed to support your Procurement organization’s goals
    17. 17. Questions

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