How to Know if E-Procurement Is Right for You -... -
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Published on: 6/15/2003
Last Visited: 1/9/2004
At ImagePoint, which designs, manufactures and puts up outdoor signs for retailers such as McDonald's, Pizza Hut and Taco Bell, e-procurement already embraces both direct and indirect material spend but not yet services, says Vice President of Information Services Steve Hammond.Aluminum, steel, fasteners, wood, plastic sheets-everything that goes into constructing ImagePoint's signs has been sourced through software from SupplyWorks since early 2002.Indirect materials-everything else, in fact-utilized the Web-based buying tools supplied by specialist indirect material suppliers, such as Granger, Insight and Staples.The incentive for moving direct materials onto SupplyWorks, explains Hammond, was better productivity in the buying department that allowed buyers to do what they ought to do-buy better, not shuffle paper.
Instead of printing purchase orders then faxing or mailing them to suppliers and then finally chasing the suppliers for order confirmations, ImagePoint's procurement requirements are fed directly from its elderly enterprise system into the SupplyWorks system.
"The time that our purchasing agents used to spend chasing paper is freed up so that they can now spend more time working and negotiating with existing vendors, and qualifying new ones," says Hammond."Their jobs used to be transaction-based.Now they are performing a higher value role."
Already, that higher value role is delivering a bottom-line benefit.The company is on track to achieve a 10 percent reduction in its annual purchase spend of $32 million.It is, points out Hammond, "a very sizeable return on our investment."In addition, the plan is to grow the business by 6 percent to 8 percent this year, but without hiring any more purchasing agents.