Pleasanton, CA May 30, 2002 Consumer electronics manufacturer LG Electronics has tapped e-procurement platform provider Commerce One's suite of solutions to build a supplier relationship management (SRM) system and to cut $190 million from its nearly $5 billion annual spend.
GTWEB Korea, a B2B e-commerce provider, will build and maintain the SRM system for LG.
During a sixty-day pilot, LG Electronics evaluated several e-procurement and e-sourcing solutions before selecting Commerce One 5.0 to power its supplier management system. The manufacturer is looking to the SRM system to help the company build a more competitive and efficient supply chain framework to manage its extensive supplier base.
LG is also set to use Commerce One's strategic sourcing solution in a bid to reduce the overall costs of buying goods and services and to help reduce the cycle time for sourcing items and services.
"LG Electronics initiated this project to achieve better return-on-investment from the $4.9 billion purchasing activities we engage in every year," said LG Electronics vice president and CIO Youngmin You. "We expect purchasing costs to be reduced by about $190 million as the process of sourcing local and international suppliers becomes more efficient using the multi-language support of Commerce One 5.0. We also hope to increase internal efficiencies through the new system."
"LG Electronics is a prime example of a major Korean company using global auction and sourcing technology to deliver fast economic benefits and competitive advantage," said Kyuho Ahn, president of GTWEB Korea.
Mark Hoffman, chairman and CEO of Commerce One, said: "Strategic sourcing streamlines the source-to-pay process, providing visibility and control across the entire purchasing process, which can deliver significant cost savings. We look forward to working closely with GTWEB Korea to enhance LG Electronics collaboration with its existing and new suppliers."