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Highlights of Darryl Judd, Chief Operating Officer of Logistics Executive Group giving a talk on why People Matter at a conference hosted by ACN (Air Cargo Netherlands) in Amsterdam.
Horizon 2013 Driving Global Adoption to Procurement Technology - A Cargill Ap...Zycus
"In 2010 Cargill, a $130B international producer and marketer of food, agricultural, financial and industrial products and services, initiated a project to reorganize the fragmented procurement function into a centralized Global Strategic Sourcing Function. One key missing element of a successful transformation was a spend visibility solution which could collect, categorize and disseminate spend data across the companies 70 plus business units, 30 plus ERP systems, 60 plus countries and more than a dozen languages. Cargill turned to Zycus’s spend analysis tool as their solution of choice.
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James Ratcliff, European Director of Procurement at Kimberly Clark - Balancing global & regional procurement
1. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Leading the world in
essentials for a better life.
Leading the world in
essentials for a better life.
Leading the world in
essentials for a better life.
Leading the world in
essentials for a better life.
Balancing Global and
Regional Procurement
James Ratcliff
2. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Leading the world in
essentials for a better life.
What we will talk about today
• About Kimberly-Clark (K-C)
• How has K-C’s organisational model changed over the last 5
years?
• Linking the structure and strategy of the business with the
procurement approach.
• How to approach different categories of spend.
• How to unleash the power of procurement professionals –
wherever they are and whoever they report to.
3. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Leading the world in
essentials for a better life.
• About Kimberly-Clark (K-C)
• How has K-C’s organisational model changed over the last 5
years?
• Linking the structure and strategy of the business with the
procurement approach.
• How to approach different categories of spend.
• How to unleash the power of procurement professionals –
wherever they are and whoever they report to.
4. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Leading the World in Essentials
for a Better Life
58,000 employees worldwide
$21.1 Billion in Net Sales in 2012
Well-known global brands HUGGIES®
KLEENEX®
SCOTT®
KOTEX®
PULL-UPS®
DEPEND®
#1 or #2 position in more
than 80 countries
1.3 billion consumers
use our products daily
5. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Our Businesses
Personal Care
Health Care
Consumer Tissue
K-C Professional
6. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Leading the world in
essentials for a better life.
• About Kimberly-Clark (K-C)
• How has K-C’s organisational model
changed over the last 5 years?
• Linking the structure and strategy of the business with the
procurement approach.
• How to approach different categories of spend.
• How to unleash the power of procurement professionals –
wherever they are and whoever they report to.
7. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Leading the world in
essentials for a better life.
Global Procurement Organization
At a Glance
8. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
LEVERAGE
ONE
PROCUREMENT
Procurement Responds and
Transforms to Business Needs
REGIONAL
EXECUTION
Limited co-
ordination
• Global team staffed
by volunteers
• Regional opt in/out
Build capabilities
Achieve quick wins
and savings targets
Category Strategies
Implemented
Stretch target
exceeds 150%
OPTIMIZE
EXTENDED
ENTERPRISE
Business strategy
integration
5-year-goal
increased by
250%
Pre-2010
2010
2011
Through 2015
Reach for
World Class
Performance
Bring sophistication
and maturity to
processes
Deliver world-class
% value savings
on total spend
management
2013
Align with
business sectors
Value target
expands in
scope and size
2012
BUILD
GLOBAL
MODEL
REDEFINE
VALUE
9. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
What does the world of Global Procurement look like at K-C?
10. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Global Strategic Sourcing
Center of Excellence
Global Infrastructure Team
People-Process-Technology
Regional / Business
Procurement Leaders
Global Procurement Council
K-C’s Global Procurement Organization
GLOBAL
OPERATING
MODEL
11. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Example: Buying elastic used to be a
stretch…..
12. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Leading the world in
essentials for a better life.
• About Kimberly-Clark (K-C)
• How has K-C’s organisational model changed over the last 5
years?
• Linking the structure and strategy
of the business with the
procurement approach.
• How to approach different categories of spend.
• How to unleash the power of procurement professionals –
wherever they are and whoever they report to.
13. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Balancing Global and Regional Procurement
is all about the Right Alignment
Align your
procurement structure
to the business need
and business structure
14. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Strong Global and Strong Regional
Teams are Essential to Value Creation
• Regional procurement leaders
are the face of procurement
to their businesses
• Global procurement team
provides leverage for
global categories,
strategic support for regional categories
and infrastructure for talent management,
systems and processes
15. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
So what does this mean to a business
leader?
Business leaders do not want to know about our organisation.
Single point of contact for all procurement needs.
Business leaders do not want to know about our organisation.
Single point of contact for all procurement needs.
16. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Leading the world in
essentials for a better life.
• About Kimberly-Clark (K-C)
• How has K-C’s organisational model changed over the last
5 years?
• Linking the structure and strategy of the business with the
procurement approach.
• How to approach different
categories of spend.
• How to unleash the power of procurement professionals –
wherever they are and whoever they report to.
17. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
One way of viewing category
globalisation….
0
1
2
3
4
5
Spend indicator
Likelihood of K-C
demand growth
Risk
Opportunity for
savings
Opportunity for
global consolidation
Ability to change
material
Speed of technical
change
Potential
competitive value
0
1
2
3
4
5
Spend indicator
Likelihood of K-C
demand growth
Risk
Opportunity for
savings
Opportunity for
global consolidation
Ability to change
material
Speed of technical
change
Potential
competitive value
18. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Category Groups Help Determine Accountability
Category group
Who sets the
category
strategy?
Who strikes
the deal?
Who
manages the
contract/
deal and
relationship?
What is the
supply base?
At what level
is the
contract?
Global
Global
“Global strategy and
globally managed”
Global Global Global
Global Global
Regional Regional
Local Local
Global
Regional
“Global strategy and
regionally managed”
Global Regional Regional
Regional Regional
Local Local
Regional
Regional
“Regional strategy
and regionally
managed”
Regional Regional Regional
Regional Regional
Local Local
Regional
Local
“Regional strategy led
and locally managed”
Regional Local Local Local Local
Each box shows who takes the lead – though as with all good teams
there will be flexibility according to the need and the circumstances
Model developed with E&Y
19. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Example category – packaging
Category group
Who sets the
category
strategy?
Who strikes
the deal?
Who
manages the
contract/
deal and
relationship?
What is the
supply base?
At what level
is the
contract?
Global
Regional
“Global strategy and
regionally managed”
Global Regional Regional
Regional Regional
Local Local
Model developed with E&Y
20. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Leading the world in
essentials for a better life.
• About Kimberly-Clark (K-C)
• How has K-C’s organisational model changed over the last
5 years?
• Linking the structure and strategy of the business with the
procurement approach.
• How to approach different categories of spend.
• How to unleash the power of
procurement professionals –
wherever they are and whoever
they report to.
21. Leading the world in essentials for a better life.Leading the world in essentials for a better life.
Building Talent is Essential
for Continued Success and Growth
Global, internal and
external search to
identify the best talent to
staff the procurement
organization
Formal training academy to
deliver ongoing best practice
training around the globe
Succession planning &
talent management to
retain and grow our
best people
22. Key Take-aways...
Balance Your Global and Regional Procurement Teams
for Exceptional Value Creation!
• It all starts with the business strategy and structure
• Don’t make the business leaders a victim of your
structure
• Select the right approach for each category, one size
does not fit all
• Ultimately depends on recruiting and developing
outstanding people
23. Leading the world in essentials for a better life.
Leading the world in
essentials for a better life.