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Strategies for Managing All Spend in a Networked Economy

Many companies focus on management of indirect, direct, or temp labor spend, but few have mastered the art of managing all their spend from one platform. In this session, learn how business leaders are enabling collaboration across internal departments and with their suppliers to develop tightly integrated sourcing, procurement, and payment strategies for all of their spend.

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Strategies for Managing All Spend in a Networked Economy

  1. 1. #AribaLIVE @ariba Strategies for Managing All Spend in a Networked Economy Ashley B. Miller, Group Vice President, Sourcing Business Information Office, SunTrust Bank @ashleybmiller124 April 8, 2015 © 2015 Ariba – an SAP company. All rights reserved.
  2. 2. #AribaLIVE @ariba SunTrust Bank at a Glance © 2015 Ariba – an SAP company. All rights reserved.2 SunTrust Banks, Inc., with total assets of $190.3 billion, is one of the nation's leading financial services holding companies. Through its flagship subsidiary, SunTrust Bank, the company provides deposit, credit, trust and investment services to a broad range of retail, business and institutional clients. Other subsidiaries provide mortgage banking, asset management, securities brokerage, and capital market services. Atlanta-based SunTrust enjoys leading positions in some of the most attractive markets in the United States and also serves clients in selected markets nationally. We are committed to Lighting the Way to Financial Well-Being for our clients. It is our purpose as an organization, and we do it by putting our clients’ interests first. We strive to understand our clients’ individual circumstances and provide personalized advice and services that meet their unique banking, borrowing, and investing needs. SunTrust’s more than 1,500 retail branches and 2,240 ATMs are located primarily in Florida, Georgia, Maryland, North Carolina, South Carolina, Tennessee, Virginia, West Virginia and the District of Columbia. In addition, SunTrust provides clients with a full selection of technology-based banking channels including online, state-of-the-art customer services centers, and through the latest mobile devices. SunTrust’s Internet address is @ashleybmiller124
  3. 3. #AribaLIVE @ariba Spend Profile for a Financial Services Organization © 2015 Ariba – an SAP company. All rights reserved.3 @ashleybmiller124
  4. 4. #AribaLIVE @ariba Current State Before a Spend Management Strategy • Lack of Robust Spend Visibility  Limited Product/Line Item Visibility  Imperfect Visibility into What Was Being Purchased and at What Price • No Formal Means for Spend/Contract Compliance  Contracts were Negotiated, but Limited Ability to Match Invoices to Contract Terms  No Automation to Match Compliance • No Centralized Contract Repository  Contracts were all over the bank which made it difficult to determine which suppliers we had contracts with • No Place to Store Sourcing Project Documents and Deliverables © 2015 Ariba – an SAP company. All rights reserved.4 @ashleybmiller124
  5. 5. #AribaLIVE @ariba Goals of a Successful Spend Management Program • Contract Compliance  Ensures financial stewardship & expense management of Supplier Spend  Invoices are matched to negotiated Contract Rates with preferred suppliers • Spend Visibility  Implement processes and reporting that ensures detailed information on our Spend (What was bought, How much was paid, How many received, Who consumed, Supplier utilized) © 2015 Ariba – an SAP company. All rights reserved.5 The Path to Success • Identify & Solution Commodities • Enable Suppliers Electronically • Transact Electronically • Implement Continuous Improvements
  6. 6. #AribaLIVE @ariba Ensuring Value Realization © 2015 Ariba – an SAP company. All rights reserved.6 Value Lever Reporting Metric Price Reduction Sourcing Project Savings % Rebate Dollars Spend Compliance % of POs on Catalog or Contract % of Invoices Reconciled to PO or Contract % of Addressable Spend with Preferred Suppliers Process Improvement % of POs on Catalog % of Electronic Invoices Invoice Cycle Time Cash Management Invoice Time to Approval Average Days Payable Outstanding Supplier Management & Leverage # of Suppliers That Make up 80% of Addressable Spend Build a Scorecard and Measure Results @ashleybmiller124
  7. 7. #AribaLIVE @ariba Best Practices & Key Learnings • Have Senior Leadership involved and supportive of a spend management strategy • Have a small team of people who understand the tools and business processes • Create a No PO or C, No Pay policy to let suppliers know you will not pay them without a PO# or C# in advance • Create a Category Onboarding plan • Cease accepting paper invoices for suppliers where you have an Ariba relationship • Understand what commodities work best with each Procurement solution (Catalog, Non- Catalog, Contract Compliance, Services Procurement) • Important to create a strong connection/line of communication between sourcing, procurement, AP • Realize P2P strategies for services likely requires a phased approach with a solution that matures in cycles of process improvement • Realize…THE VIEW IS WORTH THE CLIMB! © 2015 Ariba – an SAP company. All rights reserved.7 @ashleybmiller124
  8. 8. #AribaLIVE @ariba Next Steps for SunTrust Bank • Contract Compliance and Spend Visibility Using a Spend Management Tool  Continue to strive to achieve more spend under management  We are currently at 93.4% spend under management but we want more • Continuous Improvement, Continuous Improvement, Continuous Improvement • Never Be Satisfied  Work on continuing to tweak Ariba to make it work better for us so that we can be more efficient and effective © 2015 Ariba – an SAP company. All rights reserved.8 @ashleybmiller124
  9. 9. #AribaLIVE @ariba APPENDIX © 2015 Ariba – an SAP company. All rights reserved.9 @ashleybmiller124
  10. 10. #AribaLIVE @ariba Ariba Solutions Deployed at SunTrust © 2015 Ariba – an SAP company. All rights reserved.10 Supplier Performance Management Risk Questionnaires Sourcing Project Management: Reporting, Project Cycle time, Project Artifact storage, etc Standardization in Process & Templates: Sourcing Library Performance of RFI, RFP, & Auctions Document Archival Savings Tracking Contract Management Contract Administration: Storage, Archival, & Retrieval Establishes linkage between Master & Sub-Agreements (approx. 23,000 agreements) Contract Compliance: Invoice to Contract Match Reporting: Expiring Contracts, Contracts by Supplier, LOB, etc Approvals for contracts electronically routed (PCAR) Procurement Catalog & Non-Catalog Purchase Orders: Punch-out, supplier hosted, custom workflow, etc. Services Procurement in use for Consulting, Print, Recruiting, Training (collaboration feature not currently in use) Accounts Payable Invoice Processing: Invoices matched to PO and/or Contract Invoice Workflow: Exception handling, approvals, receipt verification Payment Terms: Prompt Payment Discounts Ariba Network eBilling: 95% volume of invoices are eBilled & about 50% of spend is eBilled Electronic issuance of POs, Contracts, etc Electronic Supplier Connectivity: EDI, cxml, csv uploads Catalog Maintenance: Supplier managed
  11. 11. #AribaLIVE @ariba SunMart/Ariba Overview © 2015 Ariba – an SAP company. All rights reserved.11 SUNTRUST SUPPLIER LOB Identifies Need Supplier Order Fulfillment and Invoicing “Ariba Procure-to-Pay” Outbound POs / Contracts Inbound eInvoices Invoices are electronically “matched” to applicable PO/Contract and validated for price, quantity, etc. Requisition PO Contract Request Contract Invoice matching and approval routing (where applicable) Accounts Payable Oracle Supplier Master Approved Invoices Daily Export Benefits: • Controls: Houses Supplier Information that Supports Financial Controls related to transactions with the Supply Base • Management: Provides Management Information that is Fundamental to Managing the Supply Base • Supplier Visibility: Electronic Linkage to Suppliers through the Ariba Network ensures efficient and effective transactional relationship among buyers and sellers Supplier Data Daily Import