Cora is just one of RBS's digital friends improving engagement with customers - and suppliers
Cora is just one of RBS's digital friends improving engagement with customers - and suppliers

Procurement innovation in action

This year’s CIPS UK Conference showcased procurement innovations including chatbots and glowing trees

Agility, innovation and transformation were the watchwords at the CIPS UK Conference in London in November, with sessions dedicated to improving engagement with suppliers, and embracing sustainable practices and new technology. 

Kevin Murphy, capability lead for transformation at The Royal Bank of Scotland (RBS), talked about breaking boundaries and testing the status quo in procurement using a disruptive strategy. 

He said: “We’re working with an agile methodology, and we’re moving away from the long business case – with PowerPoints and a massive investment – towards more small, incremental wins. It is disrupting our onboarding processes and RBS’s appetite to work with new companies.”

RBS has connected with the Singularity University in San Francisco, which developed glowing trees to replace streetlights, and Made in Space, which created a 3D printer for the International Space Station. It is also using chatbots to “better engage with suppliers and customers”, including Cora, a virtual banking assistant, and Archie and Sophia, which all support customers or internal colleagues.

As part of a panel discussion on creating value through technology, Rob Metcalf, group purchase manager for global planning performance at JCB, explained how the company had significantly reduced costs across the business. Previously, the firm had limited information about where money was spent and with which suppliers. He said: “We created a new indirect purchasing team, and we needed to give them the system and tools to put their arms around £400m spend.

“We didn’t have full visibility on where we spent money, on what and why. It took spend control and analytics with a new informed buying team to understand why everybody was buying the same things from different suppliers at different prices.”

Previously, JCB had been delegating the purchase of indirect materials – which represents a quarter of its direct material spend – to the business department.

Worker voices

Nadia Youds, social impact manager of supply chains at John Lewis & Partners (JLP) echoed the importance of staff engagement as she explained the company’s new approach to auditing suppliers that helps give workers a voice. 

The retailer’s Better Jobs Programme includes an online portal that has given workers in the supply chain an opportunity to contribute to business decision-making and improve workplaces.

The portal allows factory managers to communicate and improve across seven areas: growth, reward, security, job design, respect, health and wellbeing and worker voice. Youds said: “This is an inward-looking tool to help managers think about the ways that they currently incentivise workers and create opportunities across the business.”

Delegates also heard about Vodafone Procurement’s digital transformation, which has created transparency across the purchase order (PO) process, cutting costs and “making the data speak”.

Every year, Vodafone issues around 839,000 POs and with a digitised system it can create performance charts for each PO and rate divisions or countries.

Ninian Wilson, group supply chain director and CEO at Vodafone, said: “We wanted to create a happy PO, not a pissed-off PO – we wanted one that was efficient, fast, and hits all the compliance issues.”

He added: “The cost of each PO is now €2.36. By the end of this year it will be down to €1.99.” 

POs are tracked on a system set up using an off-the-shelf tool from Celonis. Data is displayed on screens, which are updated twice a day, and the system can drill down to the flow of a single PO, picking out potential blockages, so that they can be addressed early. The “happy PO” metric shows “definition, whether it needs or doesn’t need work, if it is compliant, and if it’s backed by a contract within the service level agreement. And it shows what needs to be done to become a 100% happy PO”, explained Wilson.

See the agenda from this year’s event, and register your interest for next year’s conference

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