How to tame your Data Dragon:

Running Information -driven multinational procurement organisation

Darko ŠEPIĆ

2015-12-10

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Erste Group

EGP Services

EGP – World Class Procurement

SourcingInternational/Local

Purchasing Local/Tactical

Order Management

BPOBusiness Process

Outsourcing

Avoid and reduce costs based on TCO

Purchasing based on categories on international or local level

CR/CARisk Mitigation

Category MgmtSRMContract Mgmt

Spend based fee

Ensure on time and in place availability of 3rd party services and goods efficient

Operational management of POs. Spend from a locally defined lower limit (i.e. 5K) up to a limit of 30K

PO Coverage (Compliance)Internal execution of orders ≤ 5 daysPO/Boilerplate contracts

Ordering PlatformsTemplatesHotline

Spend based fee

Ensure convenient execution

Call-offs from existing contracts (unlimited) and purchases under the lower limit of Service B

Straightforward execution

Done by business line

Purchasing Project

Contract Creation

Category MgmtVendor Mgmt

Contract Mgmt

Requisition &

Ordering

Documentation&

CR/CA Calculation

Receipting&

Evaluating

InvoiceProcessing

Purchasing Project

Contract Creation

Category MgmtVendor Mgmt

Contract Mgmt

Requisition &

Ordering

Documentation&

CR/CA Calculation

Receipting&

Evaluating

InvoiceProcessing

Purchasing Project

Contract Creation

Category MgmtVendor Mgmt

Contract Mgmt

Requisition &

Ordering

Documentation&

CR/CA Calculation

Receipting&

Evaluating

InvoiceProcessing

Provide cost-efficient services

Operations of support processes for the local banks

Separate feeper service

• Travel Depart.• Print Shop• Warehouse

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Category Management

Contract Management

SRM

RFx

EGP Focus

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People Operations

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Analysis Paralysis?

How to run information driven multinational procurement organisation?

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� No other Central functions existing in the Group,

only local entities & „coordination” roles

� Seven different languages

� Seven different bank histories & business cultures

� No common IT system nor IT environment

� No data existing for major part of procurement area

� Low awareness within current procurement

organisation about need to change & develop

Year 2007: Challenges

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What gets measured gets done:Creation of Data for Goal setting & Right Performance

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- Management dedication

- Establish Organisational unit for Business IntelligenceA

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What gets measured gets done:Creation of Data for Goal setting & Right Performance

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- Understand data, relations between various data & how it will be used

- Build tools for data input, data analysis and reportingB

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What gets measured gets done:Creation of Data for Goal setting & Right Performance

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- Gather data from all possible sources (if not existing, create a source)

- Create output, analyse and enrich it (reports, dashboards, visualisations)C

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What gets measured gets done:Creation of Data for Goal setting & Right Performance

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Supplier dataSupplier data External indexesExternal indexes

Workflow dataWorkflow dataPersonal dataPersonal dataOrganisational data

Organisational data

Maverick spend

Maverick spend

Order management

Order management

ProjectsProjectsBudgetsBudgets

ContractsContractsSurveysSurveysSpendSpend

SavingsSavings

Managing spend & risk Support Operations

ROI / CoA metricsCustomer Satisfaction

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What gets measured gets done:Creation of Data for Goal setting & Right Performance

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� Align Company & Personal goals

� Set clear, quantitative targets which are linked to data source

� Create data source where missing or do not set target if you can not measure it objectively

� Inspect what you expect, linked to the BI system for continuous measurement

� Build knowledge y/y basis and develop the system

� Visualise & explain goals to the team

Housekeeping:Keeping the information source trustworthy

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Housekeeping:Keeping the information source trustworthy

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Mechanisms

� Clear responsibility & ownership in the system for

each & every document / data source

� Regular management & staff meetings -

housekeeping on agenda

� Immediate system-based alerts to staff &

management

� Weekly push report - scorecards

� Data report Reviews on Quarterly business reviews

with customers & suppliers

� Personal KPIs directly linked to continuous data

quality

E-mail alerts

Weekly scorecards

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Be careful what you wish for:The culture change in procurement organisation

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Be careful what you wish for:The culture change in procurement organisation

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D

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� Ongoing Change management process

� Take care of soft facts, networks, team roles

� Facts and Data will have limited success on cultural change

� Fear of change is based in ignorance – educate & inform continuously

� Visualise goals

� Never give up

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The Future

� Expansion of Cross-section measurements (Derivatives/Indexes)

� Integration of External market data sources (GPCA)

� Integration of Supplier Risk management & Compliance sections

� Deployment of Balanced scorecard portal to every employee

� Step-up toward Predictive & Discovery Analytics

� Complete the puzzle

� Expansion of Cross-section measurements (Derivatives/Indexes)

� Integration of External market data sources (GPCA)

� Integration of Supplier Risk management & Compliance sections

� Deployment of Balanced scorecard portal to every employee

� Step-up toward Predictive & Discovery Analytics

� Complete the puzzle

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THANK YOU!

Erste Group ProcurementProcurement Services GmbH

Am Belvedere 11100 Wien

Austria

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