Profiles in Supply Chain Enablement: Diversified company taps spend analysis tools and services, then moves into strategic sourcing.
Company: Fortune 150 Diversified Conglomerate (Northeastern U.S.)
Company Size: Large
Company Sector: Business Services
Area(s) of Enablement: Sourcing, Procurement, Decision Support
Enabler: Silver Oak Solutions (Boston, MA)
Case Study:
Silver Oak provided the first-ever corporate-wide spending analysis for this global customer across 20-plus domestic and five European business units. In total, Silver Oak successfully analyzed $48 billion spend across approximately a million vendor accounts, 270 expenditure categories and 22 million vendor transactions. Additionally, Silver Oak delivered the PRISM Enterprise solution, a leave-behind software application, to enable the customer to perform the corporate-wide analysis on an ongoing basis. The online reports provide multidimensional, user-defined and detailed views of the spending from the corporate level through five business levels to the cost center. These reports provide much-needed data for activities such as negotiations, strategic sourcing, and corporate vendor diversity program spend monitoring. Silver Oak said its solution empowered the customer with a visibility into its corporate-wide spending. The customer has continued to expand the use of the application and the utilization of the business intelligence and reports which it produces, including on-demand reports for real-time spend visibility.
Moving into Strategic Sourcing
Most recently, Silver Oak completed strategic sourcing for three complex, difficult categories for a major business group at the company, identifying 21 percent in annual savings. Using Silver Oak's sourcing process (involving eRFX and auction technology), Silver Oak said it achieved significant impact and payback. All three categories involved identifying demand management opportunities and increasing cost transparency. The category complexities were not only due to the impact of 200-plus locations but also the other critical corporate mandates that were followed diligently throughout the process. As a result, Silver Oak said it developed critical understanding of the operations to facilitate seamless implementation of the sourcing solution. Working with a decentralized corporation comprised of numerous companies provided challenges with multiple data sources and purchasing groups. Despite these factors, Silver Oak said it successfully delivered on project goals.
Note:
Silver Oak Solutions is now part of CGI, an information technology and business process services provider.
For more stories of successful supply chain implementations, read the "2005 Supply & Demand Chain Executive 100" article in the June/July 2005 issue of the magazine. Also watch the Today's Headlines section of SDCExec.com every Tuesday and Thursday for more in depth best practices drawn from this year's Supply & Demand Chain Executive 100.
