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Procurement in Practice — The top 10 lookouts of digital transformation at Britvic (Part 2)

03/08/2022 By

Continuing on from Part 1 yesterday, Simon Mays, Transformation Director at Britvic Soft Drinks Limited, shares the rest of his top 10 learnings from having completed a full end-to-end procurement digital transformation program.

He, his team and partners have fully digitized sourcing through to paying suppliers, and are beginning to see results, such as 85% spend under category strategy, 88% spend under contract, 17% reduction in suppliers, 20% reduction in invoices and a reduction in average invoice processing days from 14 to 2.

Looking at the entire process from beginning to end, his “top 10 lookouts of transformation” in brief are:

  • Engage with stakeholders early on
  • Be sure of your starting point so you can measure progress
  • Take an honest look at your team’s existing talent and organizational structure
  • Define and gain early buy-in for a Target Operating Model (TOM)
  • Have a digital agenda but be aware it won’t fix everything
  • Start change management early
  • Be clear on three-way roles and responsibilities — client, SI partner and software partner
  • Align procurement strategy with business strategic goals
  • Get supplier data clean and in order early and dedicate resource to onboarding
  • Develop a KPI dashboard with leading and lagging indicators

Top 10 learnings from a procurement transformation

The Target Operating Model (TOM)

“With a Target Operating Model you have to think early on about what happens at the end of the program. While you can complete a great project, you need to consider who is going to pick it all up after the project team is disbanded. There will be onboarding suppliers, user issues and training to deal with, and over time we wanted to shift the balance to have the team working on more strategic activities. For example, we found that some of the Directs team were spending well into double figures of their time supporting repetitive tasks, like updating scheduling agreements, inputting pricing updates, and so on. We collaborated with other areas of the business, like IT and Master Data Management, to have repetitive data-driven tasks performed by a central support team rather than the Category Managers and tactical support for sourcing activities embedded into the new shared services function.

“It’s not an easy task. Don’t underestimate the importance of putting in place a center of excellence. This team will support the ongoing development of upstream processes, such as spend governance and category planning processes, contract management, training of new users, and take responsibility for PMO and data analytics activities — think of it as a best practice function.

“So, the model is classic: a shared service, a centre of excellence and strategic procurement.”

The technology selection

“The digital agenda is on everyone’s lips right now. Ours runs over several years as we recognized early on that we needed to align with the CIO’s digital agenda and we now have a roadmap within procurement. We worked closely and positively with the IT team. We began with an AI-based strategy-creation tool, and we were able to align and process-link this with our chosen source-to-pay tool. You also need to be clear about other supporting tech needs, like risk management, sustainability and ethical sourcing, so you can align with IT. Unlike others, we didn’t support a ‘best of breed’ approach for supporting technology but were flexible enough to recogniz the need for specialist software where relevant. A ‘one-size-fits-all’ software wasn’t evident to us.

To help your search for the right procurement technology, or to stay on top of what is available, take a look at Spend Matters TechMatch℠ tool 

“While our tech selection followed an extensive tender process, it led to streamlined processes, workflows and greater compliance, with cloud-based reporting and analytics to ensure a closed-loop digital process. One thing to note is that when designing the new processes and subsequently configuring the S2P system, the project leadership team were careful to keep software customization to a minimum, and any deviations were managed through a strict control process.

“But it’s important to remember that putting in a new piece of software doesn’t fix everything. Don’t assume that the people working in the business understand the current processes and what the knock-on effect of the tech will be further down the chain. If you don’t take heed of that, suppliers could get paid late or invoices could be blocked. You need to map people’s different understandings of how they think the process works with how the process is going to work, so you create an understanding of the gap. You then have to change behaviors and understanding before you can be confident of realizing success with technology. Identifying ‘Personas’ in the business early on really helped us.”

Change management

“The primary lesson we learned was the need for a well-defined change management strategy that is led internally, and to implement it as close to the start date as possible. Everything we did from communications to training to post-project management followed a structured change management framework that considers the change and the impact.

“We used volunteer representatives from different parts of the business (the Personas) to interview key players about how it works for them now and how the change will affect them. It helps develop a change plan that can feed into the design of the tool. One big thing we learnt was that while external support on the framework and methodology was valuable, you also need it closely supported internally by someone who understands the function and is able to communicate change in the language of the business. In fact, as many volunteers as possible from inside and outside of procurement is good, since they eventually will become super users and ambassadors of the S2P tool.”

Three-way roles and responsibilities

“This speaks for itself — with technology implementation comes the software provider, the systems integrator that does the design and configurations, and the customer. Make sure you have roles and responsibility defined because, especially on such a broad project, these lines can get blurred and you need to keep tight control.”

Spend Matters’ Procurement Services Market Directory can help dertermine which services providers specialize where. 

Procurement strategy and strategic business goals

Like many large corporations, the Britvic business strategy has three top-line objectives: people, planet and performance, with sustainability, innovation and productivity sewn in.

“Fortuitously,” says Mays, “the organization’s new strategy for 2025 came in quite early on during our program, so we were able to start aligning our procurement and supply chain strategy with the new objectives, and that also aligned with our new CPO coming on board. This alignment is hugely important because, as I explained earlier, being able to communicate in-line with the language of the business is a must for stakeholder engagement and project success.”

Matt Swindall, Chief Procurement Officer at Britvic said: “We are transforming Procurement through our people, better process and technology to deliver value across a broad range of metrics and building credibility as we lead in contributing to Britvic’s goals and objectives. By investing in our team we help them grow, become more effective and build engagement and recognition.”Set featured image

The importance of good supplier data

“When you start to onboard suppliers, from the ERP to S2P system, clearly you need good quality, clean data. We found this challenging with multiple instances of duplicate accounts (which could be caused by currency types or dormant account entities) and out-of-date supplier contact details that needed to be fixed prior to onboarding. This resulted in multiple checks and validations and prolongs onboarding time, so don’t under-estimate the importance of getting your data clean as early on as possible.

“We began by undertaking this ourselves, but soon realized we needed a dedicated resource. However, we made the mistake that thinking the resource could be from a pure admin background, with little or no knowledge of procurement — we soon realized we needed someone different. When you have around 1700 suppliers to onboard, you really someone who can penetrate the service desk and get to the right person. But it’s worth the effort upfront to seamlessly get all your suppliers included in the new system that will get used for all sourcing contracts and invoicing.”

The KPI dashboard

“It sounds obvious, but it’s good to remember that when you develop a KPI dashboard, make sure it covers the whole end-to-end project and isn’t just an end-state indicator. We’ve split ours into leading and lagging indicators, which we find more helpful than just indicating how much spend is under category.”

Closing remarks

“We are starting to see some real benefits and had great feedback,” says Mays. “In just 18 months the full S2P process has been automated, and the project has led to a procurement strategy fully aligned with the 2025 business plan, underpinned by a multi-year project pipeline, a robust governance process and better standardization. Finance loves the analytics, treasury and legal love the governance.

“Technology has helped drive that governance, and that has helped the business to see procurement as more than just the team that goes after the lowest price.

“But what we’ve taken away from this journey, is that transformation never stops. User adoption is ongoing, and retraining, like for sourcing events, is always required. We’ve learnt that you need to stay in control but be aware that you cannot do this alone. Full transformation is a full-time job, and you need everyone to be involved.”

Many thanks to Simon Mays and to Britvic for sharing their expertise, insights and learnings.

Look out for more practitioner-related commentary on a diverse set of issues as we feature a CPO each month on Spend Matters.   

CPO - Chief Procurement Officer