Case Studies

Sourcing

AOL Inc.

Success Story: Procurement ROI

Improved Adoption By Using Project Management

The Challenge:

Double Adoption Within 6 Months

In 2009, AOL separated from Time Warner leaving AOL’s Procurement team with no visibility into the company’s spend, no workflow, manual processes and approvals, and long cycle times. After AOL partnered with Iasta, a Determine Company, in 2010, the company noticed a drastic improvement in the previously challenging areas, but recognized AOL’s Procurement team had not been accepted across the organization. As a result, AOL’s Procurement team was challenged to doubling their previous adoption within six months by becoming a strategic business partner to seven new business units.

The Solution:

Track Organizational Savings, Performance, and Cycle-Time

The primary goal was to make sure new business units knew about AOL’s Procurement team and how Procurement could support the business unit’s needs. AOL’s Procurement team developed marketing messaging describing the function of the team, why the business owners should work with them, and the return and value other business units had received. By leveraging Iasta Executive Analytics Suite, Iasta SmartSource, and Iasta SmartAnalytics, the team was able to track organizational savings, performance by business unit, ROI, and project cycle time. The sourcing solution turned into a true project management effort that gave AOL visibility into every project they evaluated and performance metrics the team could use to evangelize their successes.

By December 2012, Procurement ended up paying for ourselves 70 times!”

— Cherlyn Decker
eSourcing Manager, Procurement & Strategic Sourcing Director

The Results:

Achieved $43M in Savings

By the end of Q1 2012, AOL had reached 100% adoption of seven new business units. AOL’s early success allowed the company to expand into nine new business units by end of year and save $29M on $64M of new investments. In fact, AOL touched $204M in projects through Procurement’s collaborative efforts and saved the company $43M. Year over year, AOL’s project portfolio dramatically increased from $61M they touched in 2011. Procurement’s goal was to pay for themselves ten times. By December 2012, Procurement ended up paying for themselves 70 times! AOL also reduced costs by lowering call volumes to the help desk, adjusting maintenance support tiers, and consolidating wireless phone spend.

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