What value does Supplier Information Management unlock? (End-to-End SIM Strategy)
In this part of our series of webinars on ‘End-to-End Supplier Information Management (SIM) Strategy’, Duncan Clark, Head of Product Marketing at HICX, is joined by Costas Xyloyiannis, CEO at HICX; Adam Hubbard, Supply Chain Governance and Performance Manager at EDF; and Jerry Grable, Director of eBusiness at BAE Systems, Inc. to discuss the value that SIM has brought to their organizations.
Both EDF and BAE have adopted Supplier Information Management initiatives in order to capitalize on their benefits. Since then, they have experienced multiple advantages, such as being able to drive Supplier Information Management initiatives further which would not be possible without it.
In the webinar, we cover:
- The advantages and benefits Supplier Information Management unlocks
- What the core use cases are
- The value SIM brings to the wider organization
Major benefits Supplier Information Management (SIM) brings
Adam starts off the discussion by explaining that EDF is a complex organization composed of five different businesses within the UK, all of them having their own focus with separate supply chains. He adds, “HICX, which is our supplier onboarding and supplier management system, is one of only two systems that we use in supply chain that is properly embedded across all five of those different businesses.” Adam explains it is very beneficial to have such centralized system which is able to manage suppliers across all five businesses, especially as they all have different needs.
Similar to Adam, Jerry states, “Our journey with HICX started seven to eight years ago when we saw a need to actually start doing supplier management. Supplier management is one of the few processes that encompasses all of our business units.” He further elaborates that as there wasn’t one system used to manage it, it was all done through email. This process was very manual and required suppliers to submit and manage their information multiple times.
When prompted on the benefits and advantages they have noticed since deploying a SIM strategy, both Adam and Jerry mentioned similar points, including:
- Having a properly engaged supply chain
- Being able to scale teams and manage them from top-down
- Having the tools to mass-communicate to all suppliers in a very efficient manner
Adam highlights, “Fundamentally, if a supplier doesn’t go through the HICX process, they don’t get set up into our ERP system, which means we don’t raise a purchase order which means we are not paying invoices.”
Core use cases
A core use case for BAE was being able to digitalize supplier onboarding and management processes. Jerry states, “With HICX, having all the requirements and workflows pre-defined, as we send them on this supplier onboarding process that information is collected, it’s verified, and it’s preserved. Since then, we have seen a dramatic reduction in the issues that we’ve had.” Jerry elaborates many of those issues included cases of fraud and data changes which have previously been a threat to 12,000 yearly suppliers. He concludes, “Once you can get your supplier information consolidated, as we have done with HICX, the doors just open on other opportunities.”
Costas adds that he is pleased that HICX has “Been able to do tailored activities at scale, in a consistent and repeatable manner” for both organizations which have multiple business units, as well as having the ability to manage high quality data in efficient processes.
On the other hand, both Jerry and Adam can recall instances in which bad supplier data has caused substantial issues previously. Jerry adds, “This was an area that we struggled a bit with prior to HICX. Being in a business of a several ERP systems, in the past as we would collect information and enter that into our various systems, that information would be entered in an inconsistent way. Without integration, some of it was entered incorrectly.” These issues have led to not knowing the spend for each supplier which was critical piece of information for negotiation purposes. A single-entry point which feeds the data further into relevant businesses has been an effective solution.
Adam adds “In some companies I worked before, supplier onboarding is simply paying an invoice. As a supply chain team you have very little control over suppliers, your tail spend goes through the roof and it is very difficult to manage your supply base or manage a cohesive strategy with the suppliers. EDF could not operate and work in that environment. I have seen some of the larger source-to-pay systems, what they can offer as far as SIM is concerned and frankly, I think they would struggle to do what we do in HICX.”
Future Supplier Information Management initiatives (SIM)
For BAE, a major initiative is to centralize NDA agreements with suppliers as well as using it as a portal to collect all information which is always accessible to all relevant business units and departments.
Likewise, Adam mentioned due to various external factors such as changing laws and control, environments and risks EDF is not short of requirements to work around while “HICX gives us a place to add these further requirements on to, due to having a really good core structure.” He explains that EDF want to achieve net zero which is only possible with the help of their suppliers, thus highlighting the importance of SIM even further.
Ensuring success for SIM
For ensuring success, Jerry highlights, “We are a complex business, we knew a number of stakeholders had to be brought into this. For us, it was making sure that we had the support and agreement from top-down. I think that is what made our deployment successful.” He further points out it is important to put yourselves into the supplier’s position and ask yourselves if what is required of suppliers makes sense and is useful for both sides.
Adam builds on this by commenting on how to measure the success of SIM projects. He claims it is dependent on the complexity of the organization and its structure, however, working with suppliers and making use of the portal is essential as well as keeping them engaged to continuously update their data for the benefit of both parties.
Costas ends the discussion by summarizing his thoughts regarding trends in SIM. He believes that it is important to “look at suppliers as a partner rather than a resource, collaborating and setting them up for success”, that is, prioritizing supplier experience in order for them to return the favour when the time comes.