It's a problem familiar to many a procurement organization, large or small: disorganized procure-to-pay processes. But when it comes to buying for a Fortune 1,000 company, the major differentiator always comes down to one thing: scale.
When Scott Campbell, vice president of supply chain at W.R. Grace, says there were inefficiencies in the company's procurement strategy, he is talking about serious money potentially tied up in those problems. The Columbia, Md.-based chemicals producer has about $1.7bn in spend that it splits into direct, indirect and logistics categories and distributes over 70 plants in 40 different countries. Three years ago, Campbell and his team set a goal of shifting global operations from a distributed to a centralized model; however, they soon realized that with so many sourcing teams around the globe buying so many different commodities, they had an inherently inefficient procure-to-pay process that was bogging everything down.
"We were very distributed with many sites, so standardizing procure-to-pay would clean out the whole process and give more cash back into the business," says Campbell. "We had a lot of non-value added activity and inefficiencies in the plants that increased workloads." From there, Campbell planned on completely centralizing all global procurement processes, but first things first.
Last year, the W.R. Grace supply chain team started from the basics and worked its way up.
Source: Purchasing