Leading retail grocer maximizes strategic sourcing efforts through Supplier Analytics and SIM
Large grocery retailer in the US. Organization has diversified through acquisitions, adding jewelry and general merchandise to its mix, supermarkets which account for more than 90% of sales.
eSourcing is a baseline for managing suppliers
For over a decade, the organization had established an e-sourcing center of excellence, encouraging a more formalized approach to bidding business through the use of a reverse auction platform. Over this time, the organization was able to update the platform and expand upon its basic bidding foundation to create a platform designed around strategic sourcing activities. Sourcing professionals became quite adept at learning how to incorporate the e-sourcing platform strategically into their work routines.
However, as an organization, one of the most difficult tasks they faced was having some form of automated visibility of supplier information and data. This meant creating a systems approach that helped manage contracts, social compliance (diversity, & sustainability), insurance information and food certifications.
Managing the basis of supplier information risk
Within the organization, systems often generated information that provided a means to help optimize sourcing efforts critical to increasing effective relationships between the organization and its overall supply base. But over time, the grocery chain’s customer demands and business organization changed, and regulations evolved with it.
The real challenge was having ready access to data and information, critical for being able to efficiently react and/or interpret other alternatives to streamline through various scenarios for managing supplier. From an IT perspective, the company needed to consolidate multiple supplier information management processes across the organization given the challenge in managing compliance and lack in visibility of supplier risk across all business units.
Working with Determine
The organization had been using Determine’s toolset for 1.5 years and had accomplished an eSourcing tool transition for a Center of Excellence (CoE), eSourcing and Optimization training for Buyers outside of CoE and implemented three new eSourcing processes.
Now the focus now was on developing a business process associated with policy governance related to the acquisition of all supplier information, documentation,
and general compliance requirements.
Implementing Supplier Information Management (SIM)
In partnering with Determine, the main goal of the company was to find a way to provide SIM access to end users across multiple business units despite varying IT infrastructure. Bottom-line, being able to quickly react to situations that arose and the ability to effectively reprioritize the supply base was essential.
Prior to deploying the SIM solution, supplier information was assembled through manual and decentralized efforts by sourcing and procurement personnel. So one goal of the project would be to enable building a systematic, yet automatic approach for requiring all suppliers to pre-register through Determine’s supplier portal. This design would drive compliance in key areas, such as food safety, law, accounting, diversity, sustainability, and social compliance.
The vision of this approach was to work with a greater number of suppliers to gain a deeper understanding into their supply chains and encouraged them to communicate and share potential opportunities. Adding this type of visibility would enable the organization to establish stronger and more meaningful strategies, and in a longer term for generating mutual benefits and improvements for their customers.
Newfound Control and Visibility in thousands of suppliers
To further internal visibility and address the supplier information challenge at hand, Determine collaborated with key organizational stakeholder groups to distill supplier onboarding requirements. Key among them was compliance in Food Safety, Accounting, EIN, Tax ID, User Audits, Insurance, Diversity, Sustainability, Law, and Sourcing.
As part of the SIM deployment effort, Determine helped develop over a dozen custom dashboards for linking information never before brought together in one place within organization including geo-locational understanding of risk based on non-compliance with GFSI, Non-GFSI and Animal Certifications. This provided 75+ users (each tagged to a key Business Unit) the ability to assess the risk and compliance metrics of over 50,000 vendors.
The organization also developed unique approaches for understanding the velocity of supplier on-boarding efforts and the areas where high-risks were avoided through compliance overview planning and detailed dashboard design that included integration from third party data providers like Lexis Nexis. Moreover, the level of effort in managing the companies’ global supply base and avoiding supplier risks during onboarding required Determine to provide on-going support and expertise in dealing with supply base efforts.
Using Determine’s technology the organization today developed an enterprisewide process for onboarding organization vendors. And with Determine’s help, the organization has established a best-in-class operational model to execute a best-in-class supplier onboarding vision of over 75% supplier submission rate.