A self-service platform is transforming procurement processes at HSBC, a conference was told.
Jan Fokke Van Den Bosch, CPO at HSBC, said stakeholder satisfaction at the bank was improved by allowing employees to make purchases without “someone from procurement sitting next to us”.
Speaking at ProcureCon Indirect in Copenhagen, Van Den Bosch said getting the right specifications in place on the platform was crucial, particularly in the area of services.
“In the office it’s pretty hard to specify what you [as a stakeholder] need if you want to buy services,” he said. “Someone needs to help you specify what you need and find providers, help with contracts. That’s where things go wrong.”
Van Den Bosch said stakeholders requiring services such as IT, legal and marketing could connect with the platform and it would find the right supplier and send out an RFP.
“We are about to go into production with this platform. People in the business don’t need to go to procurement,” he said.
He added: “People buying themselves are happy people. They are in control of the whole process, so your net promoter score goes up.
“Suppliers are happy because someone has specified something they can deliver.”
Van Den Bosch said the platform took care of requisitions, purchase orders and invoicing, which meant “procurement will need to be more strategic”.
“Procurement will need to find the suppliers of the future to put on the platform,” he said, including organising contracts and making sure suppliers are risk assessed.
He said the technology meant “we can see people’s behaviour” and “influence behaviour by introducing suppliers they haven’t thought about”.
Van Den Bosch said another benefit of the platform was that suppliers who performed better would be able to justify a higher price compared to those who were mediocre, lessening the need for price negotiations.
“There will be a natural balance in pricing. Suppliers who offer the most value pop up first,” he said.
“I don’t believe in price negotiations. I never get what I want; the supplier doesn’t get what they want. You are starting a relationship in a very strange manner.”
Van Den Bosch said he was confident that by the end of next year 85-90% of statements of work at HSBC would be going through the platform.
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