Accelerated Savings can be realized through effective category management strategies and supplier collaboration especially once the simple and low hanging sourcing categories are exhausted. Without a clear strategy on structuring an effective category management program that includes the combination of people, process and tools sustaining savings year over year becomes a daunting task. Successful sourcing programs leverage an optimal mix of Category intelligence, Strategic Sourcing technology and Supplier Collaboration strategies to execute shorter sourcing cycles, maintain bottom-line savings, and extend their sourcing efforts globally. Attend this session to learn from leading edge companies from various industries how they measure, implement and realize accelerated savings through effective supplier collaboration, strategic sourcing and sound category management practices.

1. Realize Accelerated Savings through
Effective Category Management and
Supplier Collaboration Strategies
© 2013 Ariba, Inc. All rights reserved.
May 2013

2. #AribaLIVE
Agenda
• Introduction
• Panel Discussion
• Key Takeaways
• Q & A
© 2013 Ariba, Inc. All rights reserved.2

3. #AribaLIVE
Top Challenges for CPOs
© 2013 Ariba, Inc. All rights reserved.
Source: 2012 CPO Agenda, Aberdeen Group
61% of you will have
increased cost
savings targets
44% of these targets will
be greater than
5%
Creating procurement
process efficiencies is
the top priority for CFOs
and CPO’s

4. #AribaLIVE
The Panel Team
Speakers: Dustin Neild, Covidien Eric Noyes– UHG
Gurdeep Singh– Cairn India Ltd.
© 2013 Ariba, Inc. All rights reserved.4
Moderator : Sundar Kamakshisundaram,
Sr. Director – Solutions Marketing, Ariba, Inc

5. #AribaLIVE
Agenda
• Introduction
• Panel Discussion
• Key Takeaways
• Q & A
© 2013 Ariba, Inc. All rights reserved.5

6. Dustin Neild
Global Program Manager –
eSourcing

7. Integrity, Honesty, Safety and Quality
We will conduct business with
integrity
and honesty in compliance with all
laws
and Company policy.
We are committed to produce
products
that are safe and of the
highest quality for our customers.
7 | Confidential & Proprietary

8. 8 |
is …
Covidien is a $12 billion global healthcare products leader
dedicated to innovation and long-term growth. Covidien
creates innovative medical solutions for better patient
outcomes and delivers value through clinical leadership
and excellence.
Medical Supplies
$1.74B
2012 Net Sales by Business Segment - 11.85 Billion
Medical Devices
$8.11B
Pharmaceuticals
$2.0B

9. Our Mission and Vision
Create and deliver innovative healthcare solutions, developed
in ethical collaboration with medical professionals, which enhance
the quality of life for patients and improve outcomes for our
customers and our shareholders.
Deliver unmatched value to our customers by providing solutions
that improve patient outcomes and healthcare delivery through
clinically relevant and economically valuable innovation.
Our Vision
Our Mission
11 |

10. 51 Manufacturing Facilities in 18 Countries
14 |
Countries with Multiple Facilities
United States 23 France 2
Canada 2 Germany 2
Mexico 3 Ireland 4
United Kingdom 2

11. Covidien’s Ariba Footprint:
19 |
FY12
•Ariba Sourcing Professional
•$1B Sourced
Contract
Mfg
10%
Direct
47%
Indirect
43%
FY13 goals
• Capture more Spend/Projects
• Better link sourcing
productivity to performance
goals
• Measure productivity
consistently & globally
• Improve Auditability – link
savings to projects
• Categorize Savings better &
support more advanced
analytics
• Improve global visibility to
real-time savings
performance (Dashboards)

12. Typical Savings Reporting Use Case:
20 |
 User Completed a Strategic Sourcing Project and selected a supplier.
The project is scheduled to begin saving $1.2M annually when it begins on
Jan 1st. The $1.2M is allocated across 2 GBUs and several Locations.
Management wants to know:
• What’s the “effective” savings – i.e. savings that occur in the present
FY. Note: COV uses an OCT-SEP FY.
• What’s the status of this savings?
• Is the project on track?
• On time to deliver when planned?
• Delivering +/- from the estimate?
• Is the Team/group/organization on track to FY goals?
• Which projects are lagging/require chasing?
• Which strategies are most productive?
• Which categories are most/least productive?
Challenge: How to measure “savings” from non-competitive Sourcing Projects

13. Insert: Project Pipeline and Savings Tracking
21 |
 Uniform way for all teams to measure Savings/Productivity
 Links savings reporting to actual projects
 Creates auditable Approval Process
 Plots & Forecasts multiple savings measures, over time
Legend: OOTB, Repurposed, Custom
OOTB Savings Measures
• Estimated
• Negotiated
• Actual
Covidien Savings Measures
• Estimated Savings
• Negotiated
• Implemented
• Latest Estimate
• Latest_Estimate (for reporting)

14. New fields:
22 |
Covidien Savings Form Fields
Legend: OOTB, Repurposed, Custom
• Commodity
• GBU (Department)
• Contract Awarded
• Savings Type*
• Location
• Supplier(s)
• Source of Baseline*
• Sourcing Lever (execution strategy)
• Material Category
• Sourcing Lever Region

15. 23 |
Example:

16. 24 |
Measure Definition Use
Estimated Savings Initial estimate
(sometimes
goal/plan/budget)
• Set up initial
plan years.
• Long term,
measure how
well me meet or
beat our initial
estimates
Negotiated All Negotiated savings
(including any rebates
or potential thresholds)
To see if we
ultimately realize all
negotiated savings
(or measure “leak”)
Implemented Actual savings
realized/implemented
Measure overall
performance
Latest Estimate aka: LE – most recent
estimate
High Confidence
forecasting based
on latest data

17. Some Standard Reports:
• Pipeline Report: All Active/planned projects
(and what savings, if any, are
projected/reported on them)
• FY+ Report: All projects contributing to this
and future FYs (all statuses)
• Current FY Allocation detail: Just this year,
cumulative.
25 |

18. Typical Dashboard (Director w/ Multiple Teams):
26 |

19. Global Savings FY Allocation Report
27 |

20. Contract
Mfg
16%
Direct
45%
Indirect
39%
Contract
Mfg
10%
Direct
47%
Indirect
43%
Then & Now:
28 |
FY12
•Ariba Sourcing Professional
•$1B Sourced
FY13 (ytd)
•Sourcing Pro + Project
Pipeline and Savings Tracker
•$1.7 Sourced in FY13*

21. What’s Behind the Increase?
• More Project types are being captured
• FY12 Projects (previously uncaptured) have
now been captured to show FY13 impact
• Users who want to prove their job
performance, ensure they have
savings forms!
• Managers want their dashboards to be
accurate and complete.
29 |

22. Improved Savings Analysis:
30 |

23. Improved Savings Analysis:
31 |

24. Next Generation:
• Use negative savings amounts to create
headwinds
• Directors & above will enter headwinds & tailwinds
• Tailored Savings form templates for
different groups
• Streamlining approval process
• Measure & Investigate “leak”
• Monthly Savings reports / linking savings reports
to performance metrics
• Report on outstanding approval tasks
32 |

25. Lessons learned:
• Start Early – don’t wait for a new FY
• Plan for “Carryover” from prior years
• Audit the transfer from prior sources
• Get all the “measures” right the first time (updating
many savings forms is a lot of work)
• Use the system approvals process as much as possible
• Do have oversight from Sourcing Excellence or an
independent party
• Plan for data loads – leave enough time at quarter-end
• Use Reports or saved searches for users with
many forms
33 |

26. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.34
Enterprise Sourcing & Procurement
UHG Procurement & Sourcing Transformation
May 8, 2013
Eric Noyes
Senior Director, Enterprise Sourcing & Procurement

27. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.35
UnitedHealth Group is the most diversified health care company in the United States and
a leader worldwide in helping people live healthier lives and helping to make the health
system work better for everyone.
• Serving more than 80 million individuals worldwide with health benefits and services.
• Operations in all 50 states in the United States and 20 other countries worldwide.
• Headquartered in Minnetonka, MN
• 2012 revenues of $110.6 billion
• Fortune 500 ranking: No. 22
• Named a member of Dow Industrial Average in 2012
• Named World’s Most Admired Company in the Insurance and Managed Care sector,
2010, 2011, 2012, by Fortune.
• 133,000 employees
• Founded in 1974
UHG at a Glance

28. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.36
• United Healthcare, our Health Benefits platform, serves key markets and geographic
regions with a broad range of health benefit products and services for both
consumers and benefit sponsors. We serve people in employer-sponsored health
plans, those enrolled in Medicare and Medicaid, as well as those who purchase their
own health plans.
– Employer & Individual
– Community & State
– Medicare & Retirement
– Military & Veterans
• Optum, our Health Services platform, focuses on helping improve the health care
system itself, including population health management, care delivery and improving
the clinical and operating elements of the system.
– OptumHealth
– OptumInsight
– OptumRx
Our Businesses

29. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.37
Establishing ES&P
 Governance and Controls were established:
• Binding Authority Policy – Updated to Require ES&P Approval
• New Supplier Setup – Requires ES&P Involvement and Approval
• Mandate Ariba request to engage with ES&P
• Created dedicated Vendor Oversight Team
 ES&P Operations team created within ES&P
• Define and Enforce Policies and Procedures
• Develop Processes for Procurement Activities
• Support and Develop ES&P Tools
ES&P
Operations
(18)
Commodities
(183)
M&A
(5)

30. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.38
Establishing Enterprise Sourcing & Procurement
Outstanding Customer Service
Maximize Value
Mitigate Risk
Common, Practical Solutions
simple:
create a simple
experience for
our customer
that automates
both value and
control
functions
strategic:
be a strategic
partner in the
sourcing and
buying process
both on value
creation and
risk mitigation
secure:
manage the
risk introduced
to our business
and brand
through
commerce with
suppliers
In 2010, UnitedHealth Group centralized procurement functions across all
business units with a vision and four main business goals:

31. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.39
ES&P by the Numbers
~ 12,000 Requisitions per month
~ Over 200 employees
(Domestic and off-shore)
~ $4.5 Billion in Indirect Managed Spend
~ 15% of new suppliers require risk assessments
~ Run-rate savings targets achieved for
2010, 2011 and 2012
Buyers
Assistance
RFx
New
Supplier
30 – 40 new supplier setups delivered per month

32. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.40
ES&P Timeline
2013:
− Deliver 2013 Run-Rate Savings Target
− Complete Wave 3 Ariba implementation (Contracts Pro)
− Complete Wave 2 Supplier Data Hub Implementation (Data Mart /
Reporting Warehouse)
− Develop and optimize Strategic Sourcing organization
− Complete build-out of offshore team
2012:
− Complete Wave 2 Ariba implementations (Sourcing Pro)
− Complete Archer eGRC implementation
− Complete Wave 1 Supplier Data Hub implementation
− Continue to build-out offshore team
Align Build Optimize
Q1 Q2
20 10
Q3 Q4 Q1 Q2
20 11
Q3 Q4 Q1 Q2
20 12
Q3 Q4 Q1 Q2
20 13
Q3 Q4
2011:
− Developed and drove Procurement Business Goals
− Delivered 2011 Run-Rate Savings Target
− Purchased Ariba Procurement technology suite and
deployed Wave 1 implementation (P2P & SIM)
− Built-out offshore staff
2010:
− Centralized Procurement in Enterprise Operations
− Developed and deployed new organizational structure
− Built and staffed organization
− Built detailed Future State Roadmap
− Delivered 2012 Run-Rate Savings Target
− Completed Procurement Tools assessment
Maximize Value
Outstanding Customer
Service
Mitigate Risk
Practical, Innovative
Solutions

33. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.41
ES&P Technology Updates
Risk ToolContracts SIMP2PSourcing
Work
Intake
Sourcing – Established centralized Sourcing team to facilitate UHG Sourcing Events
Increased amount of competitive bidding
Drives material run-rate savings and
Improves UHG’s ability to leverage scale
Documentation and formality to award process, eliminates subjectivity
A R I B A
Key Metrics
• Spend amount ($) competitively bid
• Amount bid by diverse suppliers
• Cost savings ($)

34. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.42
 Dedicated Team: Sourcing Process Expertise
 Setting sourcing strategy
 Business requirements definition
 Process definition
 Roles & responsibilities for all parties
 “No-hand-off” model – continuous participation & ownership of commodity
manager and business
 Continuous connection to our businesses on sourcing events
 Benchmarking
 Ariba Sourcing Tool
 Owner & SME for the Ariba Sourcing Tool
 Event (RFP, RFI, RFx Auction) expertise
 Event Management
 Liaison to the suppliers for tool & process interface
 First line of system trouble-shooting & triage
 Management of library of templates, attachments, content etc.
Sourcing “Center of Excellence Model” Approach
What is our Sourcing Team’s Focus today?

35. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.43
Three Year Strategy
2012 2013 2014
Strategic
Focus
• Understanding the
Ariba Tool
• Developing Process
Matter Expertise
• Mastering the
Ariba Tool
• Forecasting &
Planning of Work
• Going Beyond
RFx: Auctions,
Dutch Auctions
etc.
Key
Deliverables
• Increased Proficiency
• Savings
• Basic metrics
• Even more savings
• Integration with
Ariba Contracts
• Improved Reporting
& Metrics
• Customizable
solutions for our
customers
Investment
Requests
• Training
• Define
Commodity/Sourcing
Roles &
Responsibilities
• Build the Team:
FTE’s to meet
demand (5 more
FTE’s)
• Dedicated Sourcing
Event Room

36. Any use, copying or distribution without written permission from UnitedHealth Group is prohibited.44
Summary
Summary/Key Benefits
– Continue to experience evolution in our
business processes
– Visibility into our processes and metrics have
increased
– Increased automation and standardization
– Drive additional hard dollar savings
– Improved controls and policy compliance
► We operate in a highly regulated industry
► Driving program compliance is critical to our success

37. © 2013 Cairn India Limited
May 2013
Cairn’s Procure to Pay (P2P) Transformation
Category Management and Supplier Collaboration
Gurdeep Singh - Deputy General Manager, Procurement and Supply Chain

38. 46
Agenda
 Cairn: An overview
 Our assessment of our procurement capabilities
 Journey towards becoming a High Performance Procurement
organization
 Next steps

39. 47
Agenda
 Cairn: An overview
 Our assessment of our procurement capabilities
 Journey towards becoming a High Performance Procurement
organization
 Next steps

40. 48
Overview
“Fastest growing energy
company in the world,
2012” - Platts Top 250
“Runners up award to
Raageshwari Oil Mine by
National Safety Awards (Mines)
by GoI”
“16 awards in 26th Mines
Safety week 2012 under
aegis of DGMS, Ajmer”
SRI LANKA
PR-OSN-2004/1
KG-DWN-98/2
KG-ONN-2003/1
KG-OSN-2009/3
INDIA
SOUTH AFRICA
MB-DWN-2009/1
CB/OS-2
RJ-ON-90/1
BLOCK 1
RAVVA
SL-2007-01-001
• Amongst top 20 global independent
E&P company; Market Cap
>US$12bn
• Q3 FY 2012-13 average daily gross
operated production of over 200,000
boepd; Currently operating ~25% of
India’s domestic oil production
• Proven and Probable resource base
over 1bn boe

41. 49
Procurement effectiveness is critical to Cairn
Procurement
is a key
foundation to
Cairn’s
Success
We deal with over 2200
suppliers, which leads
to over 6400 purchase
orders and 50,000
invoices
Logistics
50 Cairn FTE’s are
devoted to finding,
negotiating &
contracting with
suppliers
Resources
400 different people
are required to interact
in the procurement
cycle
Organization Impact
At any one time $1Bn
spend is committed with
suppliers to deliver goods
& services essential to
the business
Spend Impact

42. 50
Agenda
 Cairn: An overview
 Our assessment of our procurement capabilities
 Journey towards becoming a High Performance Procurement
organization
 Next steps

43. 51
Cairn – Procurement Maturity Matrix in Apr’12
Major Moderate
Performance Gaps
Organizational
Alignment / Model
Sourcing
& Category Management
Operating Process
Management
Supplier Relationship
Management
Knowledge/ Information Management
Performance
Management
Human Resources Management
Supply
Management
Strategy
Process gaps, non-compliance and long lead time were key issues
Inadequate transparency and information sharing across functions
Substantial (and increasing) contracting load – Significant potential for delay
Low
Source: A.T. Kearney’s House of Procurement

44. 52
Significant challenges through the Purchase
Requisition (PR) to Pay process cycle
Requirements
Finalized
Place Purchase
Order (PO) /
Contract in SAP
Goods / Service
received by User
GRN/SES Created by User
Invoice
Received from
Supplier
Invoice MatchingSuppliers Paid
•No system based end-to-end Sourcing solution available
•One way to purchase every item - SAP PR (Purchase
Requisition)
•Multiple Tenders for the same/similar material/services
•Lack of structured and standard way of communication with
vendor
•Lack of visibility of Invoice status to Vendor
PO/Callout in SAP

45. 53
Our challenges were reflected in the metrics
Procurement TAT very high
~ 50 days (<$50K)
~ 150 days (>$100K)
Lack of visibility of savings and
potential vendor database
Challenges in adding new vendors
to the sourcing database
% Payments within 30 days of
invoice receipt at 75%
First pass yield of Invoices at 40%
Limited Spend review & category
management
~80% material codes used once

46. 54
Procurement… the dinosaur

47. 55
Agenda
 Cairn: An overview
 Our assessment of our procurement capabilities
 Journey towards becoming a High Performance Procurement
organization
 Next steps

48. 56
Initiatives towards areas of improvement
Procurement Dimension Key initiatives
Sourcing &
Category
Management
Requisition to
Pay process
Procurement
Technology
1 Improving spend visibility
2
3
Multiple buying channels4
Electronic supplier collaboration5
E-sourcing and visibility at each
stage
Easy data availability for analytics

49. 57
1. Improving spend visibility
 80,000+ materials re-codified [UNSPSC - preferred classification structure
& eOTD - preferred codification dictionary]

50. 58
MIS – PACE
(e-Passport)
SAP ECC
SupplierInteractionwithindividualbuyers/
users
ManualPurchaseRequisition
Existing IT Landscape
MDM

51. 59
MDM
MIS
SAP ECC
SupplierCollaboration
Req. -To –
Pay (RTP)
SRM Module
(On Premise)
Contract Management (CM)
(On Cloud)
eSourcing (On Cloud)UserPortal*
Catalogs
A combination of SAP SRM and Ariba chosen to
drive the change
(On Cloud)
(On Premise)

52. 60
2. E-Sourcing and Visibility at each Stage
Key benefits
 Online submission providing
more time for bid submission
(saves on courier delivery time)
 No need for physical
signatures, print-outs, courier
 Re-submission / clarifications
response is easier
 More opportunities for suppliers;
enabling better supplier
participation
 Fast Track implementation within 2 months
 Spend adoption at 90%+
 500+ projects completed with $1.8 Bn spend in pipeline
 2700+ Vendors on boarded

53. 61
3. Easy data availability for analytics
 e-Sourcing tool helps capture the
details on categories, vendors and
spends
 Web reports can be accessed
anytime, from anywhere
 Standardized reports configured in SAP
 Implementing SAP BI/BO for accessing
relevant information in future

54. 62
4. Multiple buying channels
Multiple
Buying
Channels
PRF- Low
value
purchase
s
Credit
Card
Catalog
User Led
Procurem
ent
Purchase
Requisitio
n
Initially, primary channel of procurement was a PR-PO process [requisition to order]
Simplified
Process
Simplified
Process

55. 63
5. Electronic Supplier Collaboration
ARIBA
Contracts
1
B2B Integration
2
Vendor Portal
3
Standard Contract templates & Faster Buying Channel
 Standard Terms; Transparent and faster negotiation
 Reduce To utilize the suppliers’ feedback to have more market-aligned terms &
conditions to shortening the sourcing cycle
Establish business integration with other vendors
 Seamless integration of backend ERP systems with key
strategic suppliers by using Quadrem
 Data transfer (PO, SES, invoices) – expected to ease invoice
processing & enable on-time payment
On time information to all Suppliers everytime
 Enabled vendor portal using SAP SRM for all vendors
 Suppliers get information on PO, GRN/SES, Invoice status, Invoice deductions
 Ease invoice processing & enable on-time payment

56. 64
Cairn – Current Procurement Maturity Matrix
Major Moderate
Performance Gaps
Organizational
Alignment / Model
Sourcing
& Category
Management
Operating Process
Management
Supplier Relationship
Management
Knowledge/ Information Management
Performance
Management
Human Resources Management
Supply
Management
Strategy
Process gaps, non-compliance and long lead time were key issues
Inadequate transparency and information sharing across functions
Substantial (and increasing) contracting load – Significant potential for delay
Low

57. 65
Agenda
 Cairn: An overview
 Our assessment of our procurement capabilities
 Journey towards becoming a High Performance Procurement
organization
 Next steps

58. 66
Next Steps
 Codification of materials for Projects and codification of Services
 Continued focus on ensuring 100% sourcing through Ariba
 Bring on-board more strategic suppliers through integration with Quadrem
 Greater usage of e-auctions for relevant categories in due course
 Leverage the building blocks to ensure more focused category
management and strategic sourcing

59. 67
Thanks
Gurdeep Singh
DGM - PSCM
Cairn India Ltd
Ninth Floor | Tower-B | Paras Twin Tower | Golf Course Road | Sector-54 |Gurgaon122002
Email: gurdeep.singh@cairnindia.com
M: +91 8527594802; D: +91 124 459 4353

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61. Questions?
Contact info:
Sundar Kamakshisundaram: sundar@ariba.com
© 2013 Ariba, Inc. All rights reserved.
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