Collaborative Sourcing: Achieving the Next Wave of Sourcing Savings

Collaborative Sourcing: Achieving the Next Wave of Sourcing Savings Sundar Kamakshisundaram - Ariba Andrew Bartolini - Ardent Partners Rohan Ranadive - BB&T Carl Hernas - Coach Mr. Govind Jaju - Ranbaxy Laboratories Ltd © 2011 Ariba, Inc. All rights reserved.

Andrew Bartolini Bio ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved.

CFO Priorities ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],IN THE PAST ,[object Object],[object Object],[object Object],[object Object],TODAY © 2011 Ariba, Inc. All rights reserved.

CFO Priorities ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],IN THE PAST ,[object Object],[object Object],[object Object],[object Object],TODAY © 2011 Ariba, Inc. All rights reserved. Increasing Alignment between the CFO and the CPO

Business Trends that Will Continue in 2011 ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved.

What These Trends Demand of Procurement: ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved.

[object Object],[object Object],[object Object],ANALYSIS

CASE STUDY Visibility Analysis Process Collaboration © 2011 Ariba, Inc. All rights reserved. ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

BB&T: Beginnings of Spend Management Transformation ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved.

BB&T Spend Management Program Vision © 2011 Ariba, Inc. All rights reserved. A Clear Purpose and Organizational Commitment The Right Talent Organized for Success A New Approach, Technology, and Process Discipline ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Program Execution Details ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved.

Spend Management Transformation The BB&T Journey © 2011 Ariba, Inc. All rights reserved. Platform Implementation Shared Service Implementation Execution 2009 2010 And Ongoing 2011 ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Communication and Change Management

Process, Technology and Spend Categories ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved. ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Coach 7-Step Spend Management Process Check Point #1 Check Point #2 Check Point #3 Check Point #4 Check Point #5 Check Point #6 Check Point #7/Ongoing Develop Sourcing Pipeline and Conduct Wave Opportunity Assessment Source and Negotiate Award Contract and Plan Implement-ation Implement Supplier and Category Management Processes Measure Performance And Continuously Improve Analyze and Identify Opportunity Develop Sourcing Strategy Sourcing Pipeline Management Strategic Sourcing Category and Supplier Implementation and Management © 2011 Ariba, Inc. All rights reserved.

Considering the Variety of Categories and the Opportunity, a Wave Plan Seemed the Most Prudent FY10 FY11 FY13 FY14 FY12 Savings Wave 1 Wave 2 Wave 1 (QW) Wave 2 (12/09-5/10) Wave 3 (6/10-11/10) Wave 4 (12/10-5/11) Wave 5 (6/11-11/11) Wave 6 (12/11-5/12) Wave 3 Wave 4 Wave 5 Wave 6 Wave 7 Wave 8 We are here Wave 7 (6/12-11/12) Wave 8 (12/12-5/13) Savings Realization © 2011 Ariba, Inc. All rights reserved.

Sample of Wave 4 Projects © 2011 Ariba, Inc. All rights reserved. Category Description of Addressable Spend Annual Savings (%, $million) Capital vs. Expense Status Visual Merchandising ,[object Object],21.7% Combined Completed Commercial Print ,[object Object],14.3% Expense In Progress Packaging ,[object Object],6.5% Expense In Progress Fixtures ,[object Object],10.0% Capital In Progress Backroom Shelving ,[object Object],10.0% Capital In Progress Security and Fire ,[object Object],9.2% Combined In Progress General Contracting ,[object Object],7.1% Capital In Progress Utilities ,[object Object],8.9% Expense In Progress Inbound Transportation ,[object Object],1.7% Expense In Progress IS Hardware ,[object Object],7.3% Capital In Progress IS Consulting ,[object Object],6.5% Combined In Progress Media Buying ,[object Object],3.5% Expense In Progress HQ Maintenance ,[object Object],2.4% Combined In Progress Meetings and Events ,[object Object],1.6% Expense In Progress Small Package DM ,[object Object],1.9% Expense In Progress Total 6.3%

Example #1 (Wave 2) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved. Baseline Spend and Category Insights Activities Completed Remaining Activities Results/Savings

Example #2 (Wave 3) ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved. Baseline Spend & Category Insights Activities Completed Remaining Activities Results/Savings

Snapshot from our Quarterly Review with Executive Leadership © 2011 Ariba, Inc. All rights reserved. ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Key to Success + = Lowest Total Cost of Ownership © 2011 Ariba, Inc. All rights reserved. CPO ,[object Object],[object Object],[object Object],[object Object],[object Object],Business ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Ranbaxy Laboratories Ltd. Is the Largest Indian Pharma Company with Global Reach and Competencies across Value Chain ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved. ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

Ranbaxy’s Spend Management Transformation Journey ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved.

Results Summary ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved.

We Innovated and Leveraged This Initiative to Address Significant Portion of Core Spend and Difficult Categories ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Red – Large Spend Low Savings ; Black – Small spend High Savings © 2011 Ariba, Inc. All rights reserved.

Best Practices… ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],© 2011 Ariba, Inc. All rights reserved.

Collaborative Sourcing: Achieving the Next Wave of Sourcing Savings © 2011 Ariba, Inc. All rights reserved. Sundar Kamakshisundaram - Ariba Andrew Bartolini - Ardent Partners Rohan Ranadive - BB&T Carl Hernas - Coach Govind Jaju - Ranbaxy Laboratories Ltd

Collaborative Sourcing: Achieving the Next Wave of Sourcing Savings

Collaborative Sourcing: Achieving the Next Wave of Sourcing Savings

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Collaborative Sourcing: Achieving the Next Wave of Sourcing Savings

Editor's Notes