Bristlecone has been involved in supply chain management since the inception of this industry and there are many things that we have observed in over a decade of being active in this field. No matter how big or small an organization is, inadequate visibility into where the business is spending its money is always a cause for great concern. Organizations are challenged with issues like contract compliance issues, or large sourcing cycle’s times, etc. Here we are discussing some of the best practices for procurement optimization.
Spend optimization – The key to better supply chain management
A handful of major organizations, from different industries and geographical locations, each facing a unique problem, were taken up as case studies, their problems analyzed extensively, and quick solutions were offered. Here is the report on what Bristlecone did for these organizations.
A Fortune 500 company involved in paper manufacturing, and facing problems with Spend Management
This North America based organization had little insight into its spending patterns, and lacked a formal program to track compliance and savings. With special focus on cost leveraging and high business alignment, best fit solutions were deployed within 20 weeks, the company was able to achieve 100% visibility of global spend, and within 22 months, a total of 11% savings on procurement was ensured.
A Telecom company that needed to cut down its sourcing cycle time
The organization was in dire need for a centralized solution that automated sourcing, thus reducing the sourcing time, which was inordinately high. The execution costs associated with the sourcing were also very high. Bristlecone used a consistent methodology to improve the global sourcing of the company and deployed strategic sourcing solutions and services. Within a period of 14 weeks, the solutions yielded a 60% reduction in sourcing time, along with a reduction of 20% in the procurement costs.
A Consumer Product Manufacturing company facing contract compliance issues
This $19 billion worth organization lacked visibility into its global contracts and its suppliers were not complying with the contracts. Through managed contract compliance reporting and benefit tracking solutions, all of which was deployed within 10 weeks, Bristlecone helped achieve 100% contract compliance. Bristlecone also brought down process cost by 15% and cut down the contract cycle time by half.
An automobile manufacturer in India needed a more agile supply chain
A complex direct material ordering process, and high procurement lead time were a concern for this Indian manufacturer. Bristlecone helped centralize the order placing system, ensured faster deployment, and integrated built in compliance process to provide the company with a reduction of a whopping 80% in their Req2PO time. Contract compliance also went up to 100% and an overall process cost reduction of 40% was achieved.
A major global petroleum company wanted to ensure better supplier relations
The geographical diversity along with the presence of multiple vendors for the same products that too in the absence of central visibility posed a major challenge for the organization. Supplier segmentation was the first step, and Bristlecone also integrated compliance tracking alongside the performance and scorecard implementation system to fully automate the supplier relationship management process. A 13% improvement was also seen in the supplier compliance, and the total deployment time for this process was just 20 weeks.