BAE puts 80% purchasing online target back to 2004

2 October 2002
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03 October 2002 | David Arminas

Aerospace firm BAE Systems has pushed back the target date for making 80 per cent of its purchases electronically.

Colin Webster, group commodity manager, said implementing e-procurement had been more difficult than expected and the target was now the end of 2004, a year later than first planned.

He told SM: "Originally, we wanted 80 per cent by 2003, but it has been more difficult. However, we are still going for the 80 per cent but it is not achievable until the end of 2004."

Difficulties included getting suppliers on board, ensuring BAE staff use the system, co-ordinating product codes for catalogues and getting the IT programs to follow commands.

The programme for maintenance, repair and operations materials and services started 18 months ago and 1,000 BAE staff are now using e-procurement in the 10 business units throughout the UK.

Implementation of the system is about 85 per cent complete and suppliers are still being brought on board, Webster said.

"Part of BAE's strategy has been to roll out a purchasing card system at the same time as the e-procurement system," he added. "Doing them together brings its own challenges."

The new system, which runs through the aerospace trading exchange Exostar, replaces ordering by faxes, telephone, e-mail and website with a totally electronic process. No paper is produced or information from paper transferred on to screen from ordering to payment of supplier.

"To get people off their old systems has been an issue," said Webster. "But each business units has a lead person for e-procurement to drive it through."

Webster noted that although 46 suppliers have joined, some are still sceptical. A major success has been adopting an electronic catalogue with first-tier electronics supplier Premier Farnell.

"Typically we would have had a couple of hundred suppliers. Now, through Premier Farnell, it is about two."

Chas Ewen, group e-commerce business development manager at Premier Farnell, said operating standards between the companies involved made setting up a catalogue difficult.

SMoct2002

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