Going Once, Going Twice ... Savings

Cable & Wireless expects to save up to $37 million

London  November 29, 2001  Positive outlooks are rare in the economy these days, but Cable & Wireless, the global telecommunications group, announced that it expects to achieve savings of up to $37 million per year through the implementation of its eProcurement program.

The Cable & Wireless eProcurement program, comprising the eProcurement system and Procurement Professional eTools, such as eAuctions, provides procurement professionals with online information and tools for category management. The company said its eAuction tool has already led to substantial savings, estimated at approximately $4 million, from three recent auctions over a four month period.

Martin Ward, senior vice president of Global Procurement, Cable & Wireless, explained his company's hopeful forecast: "The business rationale for eProcurement was to focus on cost saving and empowering the business. This has become even more important in the current climate. eProcurement is providing a vehicle to deliver more focused governance over the procurement process, thereby leading to an improvement in our gross margin. eAuctions are the first element of the program to go live and we are delighted, both with the savings we have realized already and with the high levels of satisfaction our suppliers have expressed with the system," he said.

One of the first areas of Cable & Wireless to see benefits from the eAuction tool was energy expenditure. The eAuction process was one of the factors that enabled Cable & Wireless to achieve a 22 percent reduction in this year's energy expenditure, producing a saving of $2 million.

Dale Wiles, the key account manager at London Electricity who won the bid, said: "The e-auction process allows greater transparency when quoting and gives an instant view on the competitiveness of our quote."

The combined Cable & Wireless and Accenture team rolled out eProcurement capability to the United Kingdom in September 2001, and it is currently rolling out the program in the United States with 100 supplier catalogs available for online purchase, thus providing 10,000 goods or services to Cable & Wireless electronically.

The next phase of the project is to roll out to additional new users in Japan in December and rest of Europe by the middle of next year. Once fully deployed, the system will be able to facilitate B2B commerce with over 500 suppliers.