Wilson aims to get the cost of a PO below €2
Wilson aims to get the cost of a PO below €2

Vodafone and the 'happy PO' metric

11 November 2019

Vodafone Procurement’s digital transformation 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 its digitised system, the company can create performance charts for each PO, and can rate divisions or countries according to PO performance, said Ninian Wilson, group SCM director and CEO. “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.”

Wilson, who was talking at the CIPS Annual Conference 2019, was in week 185 of his job, and had completed the first generation of the transformation. “The cost of each PO is now €2.36,” he said. “By the end of this year it will be down to €1.99.” 

POs are now tracked on a system that was set up using an off-the-shelf tool from Celonis, and the data is displayed on digital screens, which are updated twice a day. The data is displayed in a user-friendly manner on screens, and tracks POs according to efficiency and compliance. It can drill down to the flow of a PO, picking out areas where there are 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 DOA (design organisational approval) compliant, segregational duties 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.

Now, when Wilson goes into performance review meetings or supply chain review meetings, they can refer to live data from the system rather than PowerPoint presentations. “Process reviews would take three weeks to get the data together, then four days to get the PowerPoint presentation right, and by day 25 we were ready for review – and the month was almost finished,” he said. “And then in the meeting, people focused on the data, querying the stats shown on the presentation slide. We wanted to make data speak.”

Ongoing transformation will see the computer analyse processes overnight and in the morning provide recommended actions to category managers, he said, and ultimately go even further. “In the morning the computer will say, ‘I’ve looked at this and made these changes. If you want to say no, click here and I’ll change it back’,” said Wilson.

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