Aggregate Industries Procurement Technology Case Study – a Highlight from Coupa Inspire

Gerard Cantwell , the Director of Procurement at Aggregate Industries (AI) was one of the keynote presenters at the recent Coupa Inspire event in Paris. Aggregate Industries quarries, manufactures and supplies a wide range of heavy building materials to the construction industry, and is now part of the huge LafargeHolcim building materials group, which has over 100,000 employees worldwide and revenues of 32 billion Swiss Francs. Cantwell’s session at Inspire took the form of a discussion with Simon Kelly of KPMG, one of Coupa’s key delivery partners.

Cantwell’s central aim in introducing Coupa software was to “get our contracts out to the coalface” – that is, make sure the internal users knew what deals procurement had put in place and then actually used those suppliers and contracts. There was previously too much maverick spend– but “in procurement, we sometimes made it difficult for people to be compliant”, he said. Mobility was another major driver, as the firm has a lot of staff out and about, and he also wanted “more professionalism in running tenders, quickly and easily”.

So far, AI has implemented the Coupa P2P platform from requisition through to goods received, plus tender management; invoicing is next on the list, then travel and expenses management. In terms of the results to date, savings have been achieved – “it is hard to measure, as always, but for instance we ran an auction for electrical goods last week and saved 15% in half an hour!”

The process improvement savings are substantial too; an “80% process improvement in terms of converting requisitions to POs, right first time invoices improved by 15% and a 50% reduction in maverick spend”, Cantwell says.

In terms of how the project was handled and managed, there were some challenges, he admitted, including the usual change management barriers. “We’re a traditional company, people were nervous about any change. But if people can buy from the Web in their private lives, they can use Coupa very easily”.

Perhaps the most useful part of the session for the practitioners in the audience came with Cantwell’s tips for a successful implementation.

  • Get top level support for the business case – it is a journey to the “go live” point and you will need the support at some point.
  • Find out how your suppliers feel about the products you are considering – that was a major consideration in his system selection. (That is an excellent point and we don’t always see it considered).
  • Remember you and your team have their day jobs to think about even as you implement new systems – you need capability and capacity to handle the implementation. That is why he brought in KPMG – “timing and quality would have slipped without them”. But it can be done quickly – just 12 weeks for AI.
  • Have real capability available for users from the start – AI had 300 catalogues loaded in the platform from day one.

The final interesting point was that Cantwell has set up a “procurement hub” – a small team of four people to manage the system, handle exceptions, advise users and so on. That has worked well, he believes.

So, a good case study for Coupa and useful for those considering systems investment – and it will be interesting to see how the next stages (invoicing, T&E etc.) go for Cantwell and Aggregate Industries. Perhaps one for Inspire 2016 ...

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