Buying made easy - a webinar series from OpusCapita
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OpusCapita webinar on taking control of procurement processes. This is the first webinar in the series of three.
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Buying made easy - a webinar series from OpusCapita
- 1. Buying made easy – A webinar series from OpusCapita 5 Steps for Taking Control of Your Procurement Processes
- 2. Internal Agenda • Introductions • 5 Steps – Performing an internal audit – Prioritization of your spend categories – e-Purchasing solutions and guided buying – A ‘no-PO, no-Pay’ policy – Engaging with your suppliers to provide you with e-catalogs and e- invoicing • Closing remarks 17.10.2016 Presentation name2
- 3. Internal Rowan Lemley (host) Our panel of experts 17.10.2016 Presentation name3 Kati Myllyniemi Managing Consultant Martin Casserdahl Head of Consulting & Training
- 4. Internal4 OpusCapita by the numbers Company: • Founded 1984 • Over 2100 employees • Revenue €257 million (2015) Buyer-Supplier Ecosystem: • 8 000 customers in over 100 countries • ~100 000 suppliers • 600 million transactions annually, 200 million processed purely electronically • 40 million different products bought and sold
- 5. Internal Helping organizations sell, buy and pay more effectively
- 6. 5 Steps for Taking Control of Your Procurement Processes
- 7. Internal Step 1: Performing an internal audit 17.10.2016 Presentation name7
- 8. Internal The audit • To ensure your procurement supports your business • To manage by data not by gut feeling Why do this? • Spend Categories • Spend Analyses based on invoice data How to start? • Make management decisions based on facts and figures What is the value? 17.10.2016 Presentation name8
- 9. Internal Step 2: Prioritization of your spend categories 17.10.2016 Presentation name9
- 10. Internal Prioritization of Spend categories • Focus • Get effect • Change management Why prioritize? • Spend • Transactions • Relevance How to start? • Compliance savings • Relevant for end user • Easy to do it right What’s the value? 17.10.2016 Presentation name10 Avoid: Empty System and non-suitable call-off methods
- 11. Internal Step 3: Guiding buying with eProcurement solutions 17.10.2016 Presentation name11
- 12. Internal Guiding buying behavior • Realize the value of negotiated contracts Why do this? • Make it easy to use • Automate what can be automated How to start? • On-contract spend • Streamlining processes What is the value? 17.10.201612
- 13. Internal Step 4: No-PO, No-Pay 17.10.2016 Presentation name13 NO PO NO PAY
- 14. Internal No PO no Pay Policy • Supplier collaboration • Support Change Why a policy? • Select categories • Ensure Buying channels • Supplier relation How to start? • Change happening • Supplier collaboration • Easy to do it right What’s the value? 17.10.2016 Presentation name14 Avoid: Putting all the effort on the Supplier
- 15. Internal Step 5: Improve Supplier Engagement 17.10.2016 Presentation name15
- 16. Internal The value behind better supplier engagement •Continuous improvement of the Procurement process •Find and realize the hidden savings from your processes Why do this? •Define expectations for both parties •Articulate what you need from them (content) How to start? •To engage your users to the contract suppliers •Realize savings in future while showing commitment to your operational procurement What is the value? •Not to lose savings that you have Sourced & Contracted What to avoid? 17.10.2016 Presentation name16
- 17. Closing Remarks
- 18. Internal Closing Remarks 17.10.2016 Presentation name18 Kati Myllyniemi Managing Consultant Martin Casserdahl Head of Consulting & Training
- 19. Thank You See you at the next ‘Buying made easy’ – webinar on eProcurement Topic: 5 ways data analytics adds value to Procurement (November 10) Rowan Lemley
Editor's Notes
- Why do this? - One of the main reasons why doing the Spend Analysis and supplier audit to your spend is to have the full picture of your spend: - From who are we buying, - Why are we buying - How the purchasing is done? To understanding your indirect spend suppliers and what are they providing your company is the start How to Start? If you have a KPI or reporting solution that reports the spend nicely according to your categories it’s easy to start the deep dive to the spend categories and the suppliers within those. When we have started with our customers the Spend Analyses for the Indirect spend it’s common that we just need to start from the invoice data and start to make the bunch of data to understandable format. First: define or sharpen your Purchase Spend Categories Do they match with your todays business or are they based on situation a decade ago? When having the Spend Categories defined do audit to the financial reports together with your Financial department collages: check which GL accounts are used to post the invoices for these categories. Then your picture starts to crystallize when your purchase spend volume, with supplier information starts to have a form. Take a target to identify 80% of the Spend volume so that you really know who are your main suppliers in certain categories. In many Spend Analysis projects we have found surprises: your suppliers deliver to many categories, non-contract suppliers delivering to well contracted categoriec, category that you thought you had in control – shows that there is still some maverick buying going on. What is the value? This gives you the knowledge and the figures, what’s going on in your organization You know: From who are you buying What are you buying Now you can also start to track the change that you are driving
- Why do this? Why is prioritization of the categories important? Not only the ones with highest spend or most no of transactions. You need to find the relevant ones How to start? – How do you find them? Critical content for end users - Cover the relevant categories for the majority of the end users. The most transaction intense categories, to improve efficiency in the SSC. In order to enable automation and get the effect The largest spend categories – to ensure compliance saving What is the value? Compliance savings – focus on the large Spend categories What to avoid? Enable the content with the wrong call-off method And to “open up and empty Shop”
- GUIDED BUYING Why do this? NOW you have done your spend analyses and found out what is happening there and you know what is the critical content for the users; what are they looking for. NOW is a time to bring in solutions that support your Procurement policy and your end-users needs. With guided buying we mean the way how you make it EASY for your users to COMPLY with the contracted suppliers How to start? - You need to make it easy for your users to follow your Procurement policy (typically people just want to follow the process if they just know how to do that. Guided buying could be selection of items which are either suggested just the only one available. With justification users could buy something that differs from suggested, Guided buying is a method to support your users to find the right purchasing instructions for special things Guided buying is a method to make the contract suppliers available with smart forms or free text ordering Guided buying is also everything that is guiding although it’s invisible for the end users: their searches bring results that you, in procurement want. What is the value? You are streamlining the purchasing process and therefore getting also more spend on-contract
- Why do this? In order to be successful with the Change Management you need the Suppliers help A “No PO No Pay” policy is a very efficient to elevate the Change Management and make sure an eProcurement solution is really used How to start? Implement the Policy in specific categories to start with. Where the Buying channels are well defined and the Supplier collaboration is working well. What is the value? A Policy helps to drive Change in a very effective way and What to avoid? A Policy not backed up by Management. The Suppliers are not to blame, this is a decision buy the Buying Organization and needs to be communicated that way. Make sure there is an incentive for the Suppliers as well. Make Sure the buying channels are Crystal clear to the Buying organization before implementing. If that is not clear, implementing the Policy will be a nightmare. And the whole initiative risks to “Crash and Burn” Remember – You do not get a Second chance…
- Why do this? - As mentioned before in the No-PO No pay policy, this continues on the same path. There are certainly benefits on your side as buyer (or as payee of the invoice) but also on the Supplier’s side How to Start? If you have started the the No-PO No pay policy from the most strategic or highest volume suppliers continue to next level. Three example steps: Source, negotiate and implement a purchase to pay process together with your suppliers also to the lower volume categories Look not only the highest spend but also suppliers with highest volume of invoices . If they do match with po and invoice with high & rates then focus on suppliers with High volume of invoices AND poor matching rate On more way is to define the Purchasing process better with suppliers that previously has not had no Purchase Orders delivered. What could be the method of ordering? Could their offering be created as eCatalog or could be utilize Service procurement processes. What is the value? The values lies in the lost benefits when your organization is buying from the non-contracted suppliers just because they do not know what is the correct supplier or the correct way to purchase. This is also the way to show your commitment to the suppliers and gain benefits in your next sourcing or negotiation round and keep or gain more value for money. PLUS your own purchasing process has improved the process not only in procurement but also on the Financial department bringin benefits to your whole organization What to Avoid? Don’t lose your negotiated savings just because people in your organization do not know how to comply the company purchasing policy Negotiate savings and then create easy to follow purchasing process to people in your organization that also improves efficiency on your suppliers side. Do not STOP. Continue find and define the next steps, KPI’s for that and continue.