2005 Supply & Demand Chain 100 Case Study  Global 1000 Industrial Manufacturing Company / Global eProcure

Profiles in Supply Chain Enablement: A major manufacturer reduces costs and cuts sourcing cycle times.

Profiles in Supply Chain Enablement: A major manufacturer reduces costs and cuts sourcing cycle times.

Company: Global 1000 Industrial Manufacturing Company (U.S.)
Company Size: Large
Company Sector: Manufacturing
Area(s) of Enablement: Sourcing, Procurement, Decision Support
Enabler: Global eProcure (Clark, NJ)

SDCE 100 2005Case Study:This global manufacturer was seeking to reduce its spend on direct and indirect commodities and services by 15 percent, improve its sourcing process efficiencies, and get a better handle on its spend centrally with enhanced reporting capabilities.

For this consulting engagement, Global eProcure worked with the manufacturer's global purchasing team to identify and realize savings across several commodities. After completing a successful pilot during which Global eProcure addressed nearly $50 million of annual spend and achieved 20 percent savings, the client signed a long term agreement to continue to use Global eProcure's consulting services.

The services include opportunity assessment, industry and supply market analysis and benchmarking, strategy and RFP development, supplier pre-qualification, negotiations, total cost analysis and vendor selection, and ongoing contract and savings implementation and reporting.

Global eProcure provides its eSourcing Tools, such as Automated Spend Analysis, eRFP, Reverse Auctions, to deliver significant savings to the client. The client works hand-in-hand with Global eProcure to supplement its internal purchasing organization.

In addition to direct and indirect cost reductions of 20 percent, additional benefits have included a reduction in negotiations time by 50 percent, a doubling of the number of categories that could be sourced using internal resources, a reduction in the fragmented vendor base on certain key commodities by 30 percent, and a reduced number of single-source categories.

Additional work is now being done to expand into other categories that have not been previously sourced. The company is looking to use additional technologies for categories that were previously undertaken, and savings implementation is ongoing by Global eProcure.

"We have been working with Global eProcure for a year now and have been very satisfied with the quality of services and depth and breadth of its e-procurement technology," said the vice president of purchasing at this company.

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.