FMC Technologies: Closing the SPM and Spend Analysis Books Fast!

FMC Technologies’ spend analysis and SPM process is mature and fast enough that procurement leadership has promised business users that they will have access to updated reports within five days of their monthly closes (the frequency of refreshes is monthly). Yet FMC Technologies is exceeding its internal service level agreements in this area. At the moment, the process has become so streamlined that users get their data three days ahead of schedule – on “Day 2” after close!

As a backdrop, their previous approach could only deliver the reports by “Day 10” each month, a change representing an enormous process improvement. This rapid access and the far-superior reports and dashboards have combined to drive adoption – something that leadership monitors regularly, to see how end users have taken to the solution. To the executive in charge, the only measure of solution success is adoption. This emphatically states: “People use it!”

Greater usage and adoption means that frontline operations, purchasing, materials and engineering team members are leveraging supplier performance and related data to drive better outcomes for projects and end-customers – in ways they could not have envisioned before that can truly impact the business.

The same is true with the suppliers. FMC Technologies buys licenses for key suppliers so they can see their data and SPM statistics. This helps cut down on unproductive discussions that result from different understandings of what data is at the heart of the issue. One of the features and dashboards that the procurement team uses with suppliers is a performance indicator with a summary of actions that have been taken.

However, it is not yet a substitute for other systems. In a future release, the team would like to be able to stream relevant content to key suppliers for internal dissemination. This is a supplier-led request that indicates clearly the solution is well received on both sides of the table.

This post is based on research, analysis and commentary contained in the following Spend Matters Perspective and case study: Where Spend Analysis Meets the Supply Chain: Putting Big Data in a Procurement Context (a free download in the Spend Matters Research Library) Authored by Spend Matters Principal Analyst, Thomas Kase, the paper explores FMC Technologies’ experience applying a spend analysis framework to supplier performance management.

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