What value does Supplier Information Management unlock? (End-to-End SIM Strategy)
In this part of our series of webinars on ‘End-to-End 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 capitalized on the benefits that Supplier Information Management provides. As a result, they have subsequently been able to undertake further new initiatives, which would not have been possible without it.
In the webinar, we cover:
- The advantages and benefits Supplier Information Management unlocks
- What the core use cases are
- Further value SIM brings to the wider organization
Major benefits Supplier Information Management (SIM) brings
Adam begins the discussion by explaining that EDF is a complex organization comprising five different businesses within the UK and that all of them have 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 the benefits of having a centralized system which is able to manage suppliers across the five units, especially as they all have different needs.
Similarly, Jerry explains, “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.” As there wasn’t one system used to manage it before, it was all done through email. This process, he adds, was very manual and required suppliers to submit and manage their information multiple times.
On the other hand, since deploying SIM, Adam and Jerry have seen many advantages, 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
“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,” Adam adds.
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, we can ensure that information is collected, verified and preserved. Since then, we have seen a dramatic reduction in the issues that we’ve had.” As well as reducing fraud, he concludes, “Once you can get your supplier information consolidated, as we have done with HICX, the doors just open on other opportunities.”
Supplier information management has enabled both organizations to carry out tailored activities at scale, in a consistent and repeatable manner across multiple business units, as well as providing the ability to manage high quality data within efficient processes.
This avoids substantial issues that bad supplier data causes. Jerry explains, “This was an area that we struggled 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 – and that information would be entered in an inconsistent way. Without integration, some of it was entered incorrectly.” This led to not knowing the spend, for example, 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 in 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 suppliers. EDF could not operate and work in that environment. I have seen some of the larger source-to-pay systems and 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 in a manner that is always accessible to all relevant business units and departments.
Likewise, Adam mentions that, due external factors, such as changing laws or conventions controlling environment and risks, EDF is not short of requirements to have to work towards. “HICX gives us a place to add these further requirements on to, due to having a really good core structure.” He goes on to explain that EDF want to achieve net zero which is only possible with the help of their suppliers, highlighting the importance of SIM as part of this drive.
Ensuring success for SIM
For ensuring success, Jerry explains, “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 that it is important to put yourself into the supplier’s position and ask yourself 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 that, although it is dependent on the complexity of the organization and its structure, working with suppliers and making use of the portal are essential, as well as keeping suppliers 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.” In other words, prioritizing supplier experience in order for them to return the favor when the time comes.