SNCF Case Study – Procurement and Finance Needed to Speak the Same Language

We recently announced the publication of our new case study, “Procurement in SNCF demonstrates its value to the organisation,"  featuring the French domiciled but increasingly international transport firm SNCF. The case study can be downloaded here now, free on registration.

In it, we look at how the procurement team in SNCF responded when they wanted to be able to explain and communicate more clearly to their finance colleagues the impact that procurement was having on the business in terms of cost management. Their new processes for tracking and measuring spend and costs, which involved software from Sievo, has gone a long way towards building the credibility of the procurement function within the organisation. In the first of a couple of extracts from the case study, we look at what drove SNCF towards its new approach.

Procurement in SNCF demonstrates its value to the organisation

SNCF was suffering from a problem familiar to many procurement functions. The team had already made improvements and developed good dialogue between itself and Finance, and was able to produce savings figures; but too often either Finance did not recognise the figures, or they could not relate them to real money generated or increased bottom-line profit.

Figures were general, whereas what was required was more specific and solid financial data. But the BI tools with which to extract it were not in place. So Finance encouraged Procurement to find a solution that could provide the data it needed.

Philippe Chauvin, Associate Director Procurement Performance & Control at SNCF explained: “Our goal was to create a clear line of communication between Finance and Procurement. It is my job to ensure that all purchasing figures, analysis and performance are translated into Finance terminology to drive better collaboration and decision making. To do this we needed to be able to produce data that Finance could use knowing they could trust its accuracy and reliability..., but our existing technology was too basic to achieve this; it required too much time and effort.”

Although Sievo’s wasn’t the only available solution, there was a real fit, a congruence, between Sievo and our organisation. What we saw was a sophisticated communication tool that fitted the working methods and practices we’d established at SNCF. But before choosing Sievo, we went through a process of assessing other available software.”

The relationship with Sievo began after an executive from the SNCF procurement team attended a conference where a large French utility company presented a testimonial about its use of Sievo’s spend management solution. SNCF liked what it heard and began discussions with Sievo in 2012.

“Our criteria fell under two major headings: that the software supplier be a specialist in the field (there were plenty of these), and that the proposed solution be aligned with Finance methods and tailored to communicate on spend with the Finance community using recognisable terminology. It was on this second criterion that Sievo stood out above the rest. Rather than choosing a more general BI firm, we preferred to work with a company like Sievo that had specific expertise and experience in the areas of monitoring procurement savings, and communicating that data to the finance function.”

 And you can download the whole Case Study here now, free on registration.

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