☛ Want the latest procurement and supply chain news delivered straight to your inbox? Sign up for the Supply Management Daily
15 April 2014 | Will Green
The head of indirect procurement at CWS-boco has told SM spend visibility will be key to transforming purchasing at the company.
Marcin Chramega, head of international procurement indirect, said cloud-based visibility would show how much “freestyle” spend takes place without purchase orders in the firm’s business units across 18 countries.
Chramega said his centralised team handled around 40 per cent of the firm’s €200 million (£166 million) annual indirect spend, with the rest being carried out by budget holders in business units.
“We have this rule no PO, no payment. It has not been successful yet, but even for a purchase without an order, there must be an invoice and this is the bit I’m going to use,” said Chramega. “Each single invoice which is booked in each single entity in each single country around the globe will end up on the cloud. It will be categorised and accumulated to each category and sub-category.”
Chramega, who joined CWS-boco in January 2013 with a remit to introduce e-procurement, said he would use the resulting data to highlight to senior management where action needs to be taken.
“I will immediately be able to use this exercise and this tool to demonstrate to my top management where are the gaps in our processes,” he said. “This is how much spend is covered by purchase order, and this is how much freestyle ordering.”
He said this would show how the lack of purchase orders meant “you are not proactively managing the spend because people first spend the money and then you get the invoice to approve after the service has been delivered, so if you disagree with it bad luck, because it’s too late”.
“I will show all these misses and gaps with the assessment of the data. This will help me to drive the business and procurement to the next steps. For example, introducing the process of purchase orders, and contract management in the later stages, because we don’t understand today how many contracts we have where and what is the reliability of the company. Every budget holder may understand it and have it in his head or on his computer, but on the top management level there is no common view.”
CWS-boco, which provides workwear and washroom hygiene products and services, is based in Germany with a €1 billion (£830 million) annual turnover. It has recently adopted spend management and sourcing software from Ariba.