Big Picture e-Business

[From iSource Business, June/July 2002] Debra Bell may be credited with spearheading the e-procurement and e-supply chain initiatives at AT&T, but she knows it's not a standalone job. And neither is supply management. In order to enable the supply chain at a $65 billion telecommunications behemoth, this chief procurement officer has taken a holistic approach to the task.

When the AT&T e-procurement initiative began several years ago, aggregating purchasing and spend activity from across all business units was the first order of business for Bell. But, lucky for AT&T, Bell realized the bigger picture: Supply management must be an integrated part of managing expense, as well as meeting customer quality, price and delivery requirements. In other words, automating procurement across the enterprise was only part of the mission; re-engineering internal business processes in order to accommodate new technology, new ways of procuring and new ways of aggregating data, is imperative.

iSource recently caught up with Debra Bell to ask her about the impact of supply management on business processes and how it affects the organization as a whole. 

iSource: How has AT&T been utilizing supply management technology?

Bell: AT&T has been very much in the forefront in terms of moving in the direction of strategic sourcing, leveraging our procurement, managing our supplier relationships and our supply base, as well as working across the entire business to make sure we have the right arrangements in place to feed the business needs, but also to give us the benefit of scale in the marketplace.

iSource: How have you gone about trying to merge all the business units together in terms of their procurement?

Bell: We have very strong relationships across the business units. The way I organize the procurement group is by industry expertise. In each area of procurement, for example advertising or network capital, we have groups that specialize in those procurement areas, so they add value by understanding the industry, the suppliers, the trends and the technology of that area. In addition, they work across the business, which means they understand what one group may be doing over in our network services group as well as what someone might be doing in our ATT Labs group whether they are working with the same suppliers or procuring similar goods. We're able to leverage those relationships and leverage that spending activity across the business by being the single point of contact and having supplier relationship responsibility.

We also have a lot of very strong support across our business and up through our CEO in making sure that we do leverage our procurement in intelligent ways. So it's not a battle for my organization to be able to work cooperatively across the business. It's really just a mode of operation for us, and we have a lot of support across all of the executives in the units.

iSource: When do you think the benefits of e-procurement and supply management technology were realized on an executive level?

Bell: Well, since Mike Armstrong's been chairman he's been a very strong advocate. But we've had a fairly mature procurement organization at AT&T for probably 10 years. It has just continued to increase in focus over the past five years. But certainly the electronic tools have enabled us to really facilitate that in a more systematic, comprehensive way than before we had those tools. For instance, we had a fairly sophisticated legacy system that did a tremendous amount of the financial systems work. We migrated to an ERP [enterprise resource planning] solution probably about four years ago, and that certainly has allowed us to leverage more things like project accounting and procurement functionality of the ERP system. But now the newer e-enabled tools and systems have taken the supply chain a dimension beyond what the ERPs were able to.