The Continued Story: Transforming The Supply Organization And Payables To A Center-Led Decentralized Model
4 Years and 73,000 man-hours later, with $112 million in benefits on the balance sheet..and $170 million in cost reduction

Pete Connelly CPO Leggett & Platt

Center-led Procurement (CLP) extends the reach of purchasing to lead and improve procurement processes regardless of whether they are executed centrally or locally. At Leggett, 250 independent business units were turned into a centrally led, de-centrally executed model – every commodity and every staff member were affected worldwide. Due to popular demand, we are bringing Peter back to continue his candid saga. He demonstrates the result he has achieved in five repeatable, simple metrics to achieve massive savings.

• Implementing and enforcing policy and processes in a CLP environment on suppliers and business units with the help of cross-functional teams -  tracking where the savings went
  
• Structuring your automated procurement systems to support a center-led decentralized environment
  
• Maintaining data quality and educating the entire organization on why up-to-date quality data is essential
  
• Measuring the success of CLP in terms of supplier performance as well as at a business unit level

Building Trust To Reach Optimal Value From Your Key Supplier Relations

A big objective of supplier consolidation efforts is to end up with fewer, more strategic supply partners. Companies embark on advanced supplier relationships for the long term to integrate technology, forward vision and cost, quality and service management to jointly realize continued improvements.

• Integrating procurement and supply chain technology to improve visibility on both ends
  
• Sharing market developments (locally and globally) on a continuous basis to make supply adjustments proactively
  
• Sharing internal expertise (e.g. have your engineers dig deep into how your suppliers functions and vice versa) to build trust and to identify areas for improvement
  
• Addressing the marriage between lean and SRM: integrating strategic suppliers into your own factories to eliminate waste
  
• Involving your key suppliers in creating your collaborative forward vision
  

Keynote: The Ups And Downs Of PPG's Broader Automation Journey

James L. Polak Director, General Purchasing PPG Industries, Inc. 2008 Pro of the Year – Supply & Demand Chain Executive Magazine

Jim is a procurement leader and innovator who has driven the adoption of ‘broader procurement automation’ throughout PPG since the early days of enabled spend analysis, around ‘00/’01. Back then, segments of PPG believed the project was a waste of capital and no savings would be realized. Jim acquired the support of BU leaders, created cross-functional teams, set an arbitrary target and time limit and unexpectedly achieved large savings. Since then, the procurement organization is positively perceived throughout PPG and has become an integrated, best-in-class operation. Today, PPG has 24 locations with over 1,400 users conducting business in their PPG eBuy procure-to-pay requisition-to-invoice buying platform, with over 25 catalogs and over 3500 enabled suppliers. Jim shares the ups and downs of his procurement automation journey.

Integrating Market Intelligence Into Your Strategic Sourcing Process To Unlock Value

Vel Dhinagaravel CEO & President Beroe Inc.

5 Keys To Measuring Your Supplier Relationships Holistically Through Dual Accountability Scorecards

Brian Slobodow Chief Operations Officer Neways, Inc.

Smart folks use scorecards to measure the holistic effectiveness of a supplier-manufacturer relationship, not just a one-way show and tell on price/quality/delivery. Brian started working on developing a two-way scorecard about 4 years ago whilst at J&J. At the time they did an end of quarter assessment with a number of suppliers but were growing more dependant on key suppliers through outsourcing. The existing measurement become too limited and they started developing a dual scorecard in cooperation with their key suppliers. Upon implementation, they experienced a lot of organizational pushback from the company – the new scorecard required a major mindset change and metrics sharing on both ends of the relationship but resulted in increased performance and supplier contentment. The two-way scorecard is now routine in both direct and indirect contracting. Brian outlines 10 keys to successful implementation of dual accountability and the metrics behind it.

Getting Procurement And Key Suppliers Involved In New Product Design Early On To Drive Costs Out Of The Supply Chain

James N. Wisner C.P.M., CPIM, P.E., PMP, Global Procure-to-Pay Hardware Process IBM

“…If you’re depending solely on your R&D team to innovate, you’re putting your company at risk. Why? In many firms, R&D productivity is flattening while innovation budgets are climbing faster than revenues. A Solution? Gather promising ideas outside your company” – Harvard Business Review.  In this session we discuss how to bring procurement and your key suppliers into the product design process to expand the engineer’s view to the supply chain impact of their new product decisions.

• Examining real-life examples of getting procurement and supplier involvement earlier in product design and manufacturing planning stages to assess:
  • Technology transition and market inflection points
  • Supply chain flow (and end-to-end cost/visibility)
  • Inventory and life-cycle cost reduction opportunities
  • Product design alternatives
    

Workshop: Acquiring Supplier Value Engineering Expertise To Reduce Costs Of Existing Products

	Joseph Richardson Manager, Global Commodity Management Global Subsea Sourcing FMC Technologies
	James N. Wisner C.P.M., CPIM, P.E., PMP, Global Procure-to-Pay Hardware Process IBM
	Ric Zaenglein Director of Marketing for Manufacturing Endeca Technologies

In economic times like these, it is critical for companies to drive cost out of existing products. However, companies tend to be leaner with less design expertise in-house to dedicate to mature products and are leaving millions on the table. Here is a solution: Rather than going out and hiring staff, companies increasingly look to suppliers for value engineering design services to drive the costs out of products. This can be achieved through product re-design, alternate production and distribution processes or different packaging.

• Building the trust and a secure data exchange platform to allow for joint product value engineering
• Joint value engineering in practice; results achieved to date
• Creating a structure to share the savings and drive continuous improvement

The workshop starts with two brief presentations by Joseph Richardson from FMC on Value Engineering and Ric Zaenglein from Endeca on Lifecycle Information Visibility.

We then divide into rotating roundtables with a group closing by the moderators.

Re-Designing Your Existing Supply Chain Processes Through Modeling To Yield Significant Savings

Chris L. Osen VP, Supply Management MeadWestVaco

We are heading for record fuel costs with oil prices expected to rise to $150-200 per barrel in the near future. Logistics has reached 10% of our GDP. We can no longer disregard how products move around the globe.  Network Modeling provides a tool for comparing the optimal supply chain to reduce costs.  Learn how MWV migrated from 200 warehouses to less than 20 to save millions in transportation and inventory reduction. By understanding your entire supply chain, you can reduce transportation costs, eliminate inventory, and optimize your manufacturing footprint. By modeling your network, you can also support Low Cost Country Sourcing initiatives as well as evaluate in-source versus outsource decisions.    

• Learn what it takes to start the modeling process
  
• Focusing on the Total Cost of Ownership, we tackle all the factors needed to make an informed decision
  
• Identify the key stakeholders and data requirements
  
• Recognize that network modeling is a journey, not an event
  

Ensuring Contract Execution Compliance To Realize Full Anticipated Contract Savings

Robert Kane Director Strategic Sourcing and Supply Management Weyerhaeuser Company

You have undoubtedly had a brush with consortium buying and/or cross-company leveraged buying; so many failed in the past, but it seems like such a great buying tool especially for parts and indirect. We explore successful examples on how to achieve the synergy savings and apply lessons learned from failed ventures.

• Examining why leveraged/consortium buying does and does not work for certain categories
  
• Taking your lessons learned to form a new buying group considering the:
  
  • Importance of buying partner selection
    
  • Budget and resource allocation required for success
    
  • Agreement of buying methods and quality standards
    
  • Time it takes to get to know each other and to set IP standards
    
  • Obtaining supplier recognition of the consortium and handling the loss of negotiation control
    

Interactive Workshop: Training Your Buying Organization In Counter Inflation Through Tools And Processes

	Brian Slobodow COO Neways International
	Susan Cheng Executive Director, Strategic Sourcing & Procurement Warner Bros Entertainment

Your buyers greatly improved their strategic sourcing strategies and are actively using the tools available to them such as RFP’s and analytics to identify the best supply base. But if your suppliers raise their pricing due to inflation your buyers are put on the spot. A simple ‘no’ won’t cut it. In this session we discuss the groundwork of trainings companies have developed to provide their buyer teams with ammunition to counter price inflations. We run through exercises to demonstrate 1-on-1 counter inflation techniques to build this capability.