Expanding the influence and impact of Procurement – a case study featuring Ron Schnur at Utz

As many procurement professionals have discovered, transforming your processes to meet today’s challenges in an effective manner is not as simple as writing a new mission statement. The success of the Procurement team at Utz Brands, Inc., a snack food company, came from how they intentionally targeted key strategic initiatives under Senior Vice President and Head of Procurement Ron Schnur’s leadership.

After operating as a privately-owned entity for 99 years, Utz went public in August 2020. That placed new commitments on the company — in addition to all of the other challenges everyone was facing at the time — such as a focus on growth, innovation and operational excellence. In January 2023, Ron joined Utz to lead procurement through this transformational period. In his assessment, “Utz previously excelled in the operational aspects of procurement, such as transacting business, supporting manufacturing operations and maintaining raw material inventory — the day-to-day firefighting of procurement. This focus and track record however, was in some ways at the expense of fully optimizing and maximizing procurement’s total strategic value to the enterprise as a whole.” So there was a lot of opportunity to do more and make a bigger impact.

Identifying the need for foundational technology and processes

Before joining Utz as its SVP Procurement, Ron had been consulting with the Supply Chain department working on a number of different projects. One of his deliverables was to provide an overall procurement organization assessment focused on current capabilities and future state gap analysis in people, process and technology. His final recommendation laid out a transformational roadmap for procurement. The leadership team was on board from the beginning — but he still had to execute his recommendations in an orderly and intentional manner to deliver the results.

“The first thought I had was foundations,” Ron explains. “There had not been much investment in procurement systems, so we had to build a foundational infrastructure and capabilities.” However, although Utz Brands enjoys a long and successful history, Ron understood that he had to be prudent and efficient with the dollars available to invest in technology because he did not have the budget that larger competitors have to spend. This meant that implementing one of the full end-to-end spend management suites was not feasible from a cost and change management perspective. “Instead,” he noted, “we had to choose our solutions in a more targeted and perhaps even piecemeal fashion.”

The procurement team was fully aligned with implementing changes and investing in new tools and processes. The team had enjoyed a track record of success in supporting growth, and also appreciated that we needed to deliver even better results to continue growing and expanding.

The team first searched for a spend analytics solution. Until then, the company had used its ERP system for most of its opportunity assessment research. That system could tell you, for example, that the company had spent $XX million with a supplier on a particular ingredient or package. But to make its potato chips, Utz buys many different materials from many different suppliers, and Procurement needed greater data granularity. The most significant impact of implementing a spend analytics solution was providing the visibility and details behind the dollars spent on various Indirect spend categories. Utz’s Procurement team had never focused on influencing budget owners in the corporate services area to strategically source their categories.

When the team indicated the need for a spend analytics tool, however, the discussion became about whether the company could save money by building the tool in house. This could take a long time, though, when the daily technology issues of a large company would almost certainly interrupt them. “So, I made the argument that instead of fighting for internal resources of time and personnel, we could invest in an industry leading tool that will take less time to implement and not cost us too much money anyway.”

Procurement got its spend analytics tool and was soon delivering insights that both opened the eyes of the company’s leadership and gave Procurement more leeway to implement its next piece of procurement tech: an e-bidding platform to drive more competitive sourcing, enhance the RFP process and drive competitive tension among suppliers.

The procurement leadership team fully supported and embraced the implementation of these new tools and their individual leadership and commitment created a lot of positive momentum and stakeholder engagement. The team launched many new sourcing opportunities and engaged with stakeholders in different ways resulting in other positive impacts for the company.

For the third piece of tech, a contract management system, the Legal Department was a strong ally. While Procurement wanted templates to streamline the contracting process for suppliers and other procurement-centric use cases, Legal needed support for the contracts that would support Utz’s growth, efficiency, integration and acquisition strategy. “Obviously, a business case that organically arises from both Procurement and Legal meets a more receptive audience,” Ron comments. “I knew what I needed, and Legal knew what it needed from a CLM solution for its end. The Legal Department was a key champion as well. Once you have these points in place, the next steps follow more smoothly. It has been a home run. It has completely changed our end-to-end enterprise contracting process.”

Managing the change around new tools

Implementing new tech is only one part of the transformation process, however — and in many ways, it is the more inconsequential part. While tools create a functional foundation for Procurement, some of the department’s processes needed to change as well.

Part of the team’s strategy was to reorganize how Procurement engaged with all budget owners and influenced “how we buy, what we buy” across many other spend categories. “The historical approach focused on reacting to operational elements, like a plant being short of potatoes, instead of demand driven supply management processes. In addition, the broader supply chain organization was working to implement other new tools and processes. The company made a commitment to implement Integrated Business Planning so that the enterprise had a more robust and centralized planning capability instead of each production plant managing its own planning, forecasting and production scheduling.

We are really focused on an integrated cross-functional approach for operating our company. So, part of our procurement digital transformation involved making sure that our processes and technology are connected with and part of the broader business transformation. We are working with the team to implement a more robust materials requirements planning process in Procurement so that it positions us in a predictive position instead of a reactive one. This helped us become smarter and better and more efficient around what we’re ordering, how we’re ordering, how much we’re ordering, how much inventory we’re holding, etc.”

Similarly, the technologies Procurement invested in had to integrate with the practices of the people who actually used it. For the most part, this did not prove a problem. While Procurement needed data from Finance for the spend analytics tool and budget owners were curious about the e-bidding platform, neither were directly impacted by Procurement’s use of these tools. These tools helped Procurement to be more effective when engaging with stakeholders in strategic sourcing and competitive bidding activities.

The only Procurement related tech implementation that required significant change management was the contract management software because of its impact on the Legal department and business processes: the altering of templates touches everyone who writes a contract. “But again,” Ron points out, “we had a great partnership and support from our Legal Department who vocally called for a system that would work for our team as well as Legal — in some ways Procurement was simply along for the ride, benefiting from the reality of a growing company. If you have cross-functional impetus to change a system and process, people will embrace the change and learn how to navigate the change.”

Having learned how to use each of these tools individually, Ron’s team turned to integrating them into a unified strategic sourcing category management process. “The change is more of a mental process than learning to press certain buttons,” he says. While they once used spreadsheets to make ordering decisions based on historical data, they are now learning to treat historical data as one piece of information that informs how they manage their business on a rolling 12 week supply forecast.

The Procurement team has positively embraced many new ways of working and their “enterprise mindset” is one of the team’s most inspiring traits. They do whatever it takes and pursue whatever action needed that is in the best interest of the enterprise. Ron shared that “the team has been doing good work for many years and they have continued to raise their game.”

Be intentional about change

When asked about what he had learned from pursuing his transformation strategy at Utz, Ron had this to say: “I think what I would reinforce with everybody is to be intentional. Do your assessment, find your gaps and build a roadmap for how you will address those gaps. Especially, be intentional about prioritizing and sequencing the work, understanding the cadence of the work.” A lot of this is recognizing what resources you have, how changes make demands on those resources and what you gain from successfully investing in specific initiatives and projects. You need to understand what the enterprise needs from the Procurement transformation, how fast they need it and then build your roadmap in such a manner to meet those needs.

A second piece of advice he offered came from Howard Friedman, the CEO of Utz. Howard basically told me, “While you have a list of things you want to work on, some people will want to add things to that list. That’s good. But, stick to your plan. You have a well thought out plan, and while you may have to alter it or modify it from time to time because of business needs or external forces, just add these other requests to the list and stick to your plan.”

These two points dovetail in an example Ron offered. Procurement was trying to identify and execute more strategic sourcing projects to drive more savings faster, but someone asked us to complete a supplier payables audit because Utz had overhauled its accounts payable process over the past 24 months. While the Company could conduct the supplier accounts payable audit in-house, it would have required investing valuable time and personnel at the very moment Procurement was pursuing higher savings initiatives to deliver greater impact sooner. So, instead of burdening the team with another thing to do and consequently lessening its focus on each, Procurement put the supplier audit request on the list to complete the following year. Procurement later worked with Finance to evaluate the supply market, create and issue an RFP and select a leading company in this area to conduct the audit.

“My point,” Ron concludes, “is that you have to be flexible and able to adjust when the business environment requires it. But if you have carried out a really good assessment and gap analysis and have a plan to drive value, have the confidence to stick to that plan — even as other requests make themselves known. Then, without being too self-congratulatory, your team does need to market its results and contributions as well as inform people about the progress you’ve made. This bit of department self -marketing generates continued enthusiasm, engagement and continued support for the work that the team is doing.”