Norway



When global leader in airport ground services and cargo handling needed to implement a new solution to provide a reliable and scalable end to end Source-to-Pay system, a stringent audition process began. – powered by a 68,000-strong workforce and active at more than 315 stations in 50 countries across five continents – called on KPMG and PwC to help with the selection headache to deliver a unified suite to meet its global needs and support Sales & Operations Planning (S&OP).

We chose Ivalua because it provides us with a comprehensive suite where we are able to manage all of our needs from supplier selection process and contract management to sourcing and analytics,” reveals Swissport’s CPO Orth. “For us it’s a tool that won’t just enhance our performance but help us look into areas of the business we haven’t been able to examine fully before.”

Orth explains that all invoices and purchase orders now go through the system, a vital requirement when considering the company’s choice of tool. “We had to link the Source-to-Pay tool with our existing SAP landscape,” he recalls. “In SAP we keep all the financial and organisational data – all the activity around Source-to-Contract (S2C), Procure-to-Pay (P2P) and all the different volume models we manage in Ivalua (S2C – eSourcing, performance management and contract management. P2P – purchase requisition, purchase order, goods receipt and invoicing). The payment process happens in SAP so we need separate interfaces. To make it more complex, our fleet organisation decided to use another tool called Maximo for stock management and spare parts at the airports. This can also be integrated into Ivalua because Maximo has a procurement function allowing staff at the workshops to avoid switching systems.”

Orth explains Source-to-Contract is also used to prepare for new industry standards from 2019 when all leasing and rental contracts have to be in a system. “We’ve decided to use Ivalua modules to collect these contracts alongside another tool, a leasing engine, to generate all the data requested by the technical authority. In our countries of operation, we will not connect Ivalua with old systems, they will all switch to SAP ready for the introduction of Ivalua”

Swissport – which served a record 250mn passengers while handling 4.7mn tonnes of cargo in 2017 – is now fully implementing Ivalua in its top 10 countries of operation following a successful pilot in Brazil, with 40 more countries to follow next . “Each one will roll out with one big bang, not module by module,” confirms Orth. “Based on the Brazil pilot we need six months from pushing the button to get the system in place and functioning smoothly. Departments working with the tool have been properly trained with high quality materials. It’s helping us to ensure that there will be no problems getting goods or services into our airports on time.”

Orth explains the biggest challenge faced in driving such a tool across an enterprise comes in laying the groundwork for change, to ensure all processes are up and running with clear roles and responsibilities. “It’s not just that the tool itself will help you, it can help the organisation focus on its development to a more mature position,” he adds. “Not having enough people or the right set up is a constant issue. Driving adoption and making sure those out in the field are following processes is key. We need to educate employees that it’s no longer just about making a call to place an order. Every station has to define who is entitled to put a purchase requisition into the system. To that end, we have implemented ‘no PO no pay’ for paper invoices that bypass the system for procurement.”

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Orth highlights huge benefits to having the Ivalua system in place and a range of key enablers driving the potential for savings in the Source-to-Pay process and enhancing competitive advantage.  “Automation across the entire P2P process reduces inefficiencies. In the past we had 20 people in the department processing invoices by hand; now we can avoid this repetition – I’m not talking about laying off staff but using in the optimum way,” he says. “Standardisation gives us one tool to use around the globe as we roll out with Ivalua. Transparency is enhanced with a faster end to end process from purchase requisition to payment. Everything is traceable in our system – no chance to bypass.”

Orth notes that compliance is enhanced because approval steps are required within the process before a purchase order is issued to both procurement and the budget manager, while Spend Management now has a much-improved view across categories, even those with a small spend. “Previously we had a system that only offered a historic view via invoices. Now we can see all the borderlines in every purchase order helping us to increase managed spend from 30% to 90% plus,” he adds. “Allied to this, Duty Segregation allows for the provision of duties to specific roles – requestor, purchaser strategic procurement and approver. Responsibility is enhanced, for people and functions, across the whole process allowing for ease of auditing with an approvals process that must be followed in order for the system to react.”

What trends is Orth seeing in the logistics industry around procurement services and S&OP? “The main development we’re seeing is for the automation of many manual processes in operational procurement such as hammering purchase orders into the system.” Orth maintains these jobs will no longer be required in the future so he can focus staff more on the strategic aspects of procurement instead of such onerous operational tasks. “We’re seeing a huge step forwards here for Swissport with the transparency and traceability of all actions from the purchase requisition to the payment process in one system. It’s a timely boost for our company as we prepare to go public with our IPO.”

Spanning a diverse career, Orth has experienced different tools and systems in other companies, whether in pharma or with the likes of Siemens and ABB. “SAP systems are always quite complex and can see users struggle to achieve best performance, whereas Ivalua is easy to manage,” he confirms. “All procurement departments at Swissport who have experienced the different features are quite excited about its potential. We’re actually getting requests from the smaller countries that we implement this tool ahead of schedule.”



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