An exciting portion of the Ariba Spend Management Day (http://www.ariba.com/events/smd/?campid=45) in Atlanta was hearing from a panel of sourcing professionals on how they are accelerating savings within their Ariba programs. BB&T, Cox Enterprises, and The Home Depot are all at different stages in their spend management lifecycles, and had anectotes to share with the audience about their successes.
- Mike Mannheimer, VP & CPO of Cox Enterprises (http://www.coxenterprises.com/corp/home.htm) shared the initiatives the organization has set out to achieve, including forming sourcing groups of subject matter experts. Cox has had great success in strategic sourcing, and this approach is aimed to line up the right resources to conquer the more strategic and challenging categories. Once the low hanging fruit has been sourced, ensuring that internal staff has the knowledge and capability to think outside the box will lead to greater results and savings. The company has captured multi-million dollar savings results annually since 1998, by utilizing the right sourcing strategy and Ariba RFX type for the right category, and marketing the success of strategic sourcing results internally. At Cox, 30% of the $7.9B in spend is controlled by the top 15 suppliers, leading to an increased focus on those strategic categories including cable TV programming, telecom equipment, paper/print, IT hardware & software, etc. Mannheimer also spoke about the importance of treating suppliers as collaborative partners, which he believes leads to stronger relationships and better results for his organization.
- A partner of Ariba since 2002, The Home Depot (http://www.homedepot.com/) utilizes the Sourcing, Supplier Management, Buyer and T&E platforms. Ben Finger, Sr. Manager of Finance, described the spend management journey and the impact it has had on the organization. The company focused on building out the sourcing organization to have a dedicated team of specialists to execute on the strategic sourcing process that had been designed. The "low hanging fruit" topic came up during Finger's presentation also, as The Home Depot had great success with reverse auctions in many of these high spend, low risk categories. Over the past three years, the focus has been on expanding the spend under management, by utilizing the Ariba Sourcing and Contracts modules, and shifting from a "cost out" to a "total cost" focus. Most recently, the organization has been focusing on implementation of the Supplier Management Program, as well as utilizing Ariba Sourcing not only for an RFX vehicle, but also as a knowledge repository for internal documents and other resources. Finally, Finger educated the audience on focusing on the internal customer's needs. For the Sourcing group within The Home Depot, this is the retail stores, and taking their needs into consideration when sourcing almost all categories was imperative to drive compliance.
- BB&T (Branch Banking and Trust, http://www.bbt.com/) Principal Sourcing Consultant Kenneth Hernandez spoke about the first 6 months into the organization's rollout of Ariba, including the Sourcing and Procure-to-Pay platforms. The organization has had success with reverse auctions, including successful savings on a BB&T corporate event. During a 90 day savings initiative, tremendous results were achieved in the categories of carpet, signage, and office supplies. Hernandez also presented BB&T's strategy around the categorization of spend, which leads to a prioritized pipeline of activities. He believes it's critical to evangelize the process and the organization's goals internally, to increase program adoption and support. Finally, Hernandez spoke of the benefits of utilizing Ariba Sourcing technology to mimic your organization's current process, whether offline or in another system. When these processes and the tool functionality are leveraged, positive results will happen!