Geraldine Lim, Author at 51��News Center

Procurement Becomes a Strategic Business Function at SuKarne

Geraldine Lim — Thu, 01 Jul 2021 13:15:52 +0000

Discovering opportunities for a business to improve processes and operations does not have to be an exhausting adventure. Sometimes challenges can be seen in broad daylight. That was the case for SuKarne, a , thanks to innovation and technology adoption.

World Class and Northern Roots

With corporate headquarters in Culiacán, Sinaloa, in northern Mexico, SuKarne is one of the four organizations established by . What emerged 52 years ago as a family initiative is now the third-largest beef fattener in the world and the fifth-largest beef supplier in North America.

The company’s success has been sustained by an infrastructure consisting of five comprehensive livestock units, four in Mexican territory and one in Nicaragua; seven processing plants, with an installed capacity of 2 million head of cattle per year; 10 distribution centers across Mexico, the U.S., and Central America and 400 distribution routes; more than 220 livestock purchase and conditioning centers; and more than 300 owned stores. In addition, since its facilities have the necessary international sanitary and industrial certifications, SuKarne is a big exporter — its products are available in six countries on four continents. In fact, it is estimated that SuKarne is responsible for 70% of the meat exports of the Mexican economy.

SuKarne today has 13,000 direct workers, collaborates with more than 100,000 agricultural and livestock suppliers, and serves more than 80,000 customers, such as supermarket chains, although most are micro-businesses like small butchers and restaurants.

The numbers speak for themselves: the Mexican economy has a true powerhouse in the global market for animal protein.

First Steps: Goodbye to Paper-Based Billing

Before adopting 51��Ariba solutions, SuKarne’s Procurement department would not have surprised anyone from an innovation perspective. In fact, as in many organizations, it was a highly traditional corporate area serving a registry of more than 5,000 suppliers, 2,000 of them active, not including suppliers of livestock and raw materials for livestock feed, which are served by another area of the corporation.

In these circumstances, recalls SuKarne Chief Procurement Officer Gonzalo Padilla, the work was bureaucratic, prone to human errors, and without real business value. “Between 60 and 70% of the team’s time was spent on managing invoices: reviewing them, ensuring that none had been misplaced, and taking them in-person to a colleague’s desk in the Accounts Payable area. All this, despite the fact that electronic invoicing had been implemented in Mexico for a while,” Padilla shares.

Common mistakes, derived from human execution, were not unusual in this environment: lost or misplaced invoices, which delayed payments and ignited the anger of suppliers; processes interrupted by the modification of a process or corporate policy, and even by the vacations of a person involved in the process; and long sessions at Accounts Payable desks to review and reconcile issues, which tended to cause friction between departments.

“The Procurement area concentrated on management tasks that did not add business value; we dedicated ourselves to seeking payments and not seeking negotiations,” says Padilla.

Aware of its challenges and taking advantage of a reorganization that brought Padilla’s team into the Finance department, the Procurement team set out on an innovation journey with the implementation of the solutions, part of SAP’s Intelligent Spend Management concept.

Initially, thanks to , the billing processes were digitalized and automated, reducing the administrative and transactional burdens of the team while also reducing human errors and non-essential interactions with the Accounts Receivable area. In this way, the Procurement department was able to focus more on generating value for the business, including conducting strategic negotiations for the company.

SuKarne’s suppliers were resistant to the new model at first. “They did not see the benefits, perhaps because we were in the initial process of discovering and understanding them, and therefore the process of supplier adoption was slower,” recalls Padilla. “Once the advantages were evident, a communication campaign was implemented that was very important since it showed the benefits: invoices from suppliers would not be parked on a desk and the payments would come out on time.”

Extending the Power of Innovation

Billing was not the only area of improvement. SuKarne also began a digital transformation project encompassing the entire organization, which implied defining and rethinking processes, creating operation manuals, documenting transactions in the various areas, and establishing continuous improvement policies, among other tasks that are essential in these types of innovative initiatives.

Within this framework, Padilla’s team, taking advantage of the end-to-end source-to-pay solutions – 51��Ariba Strategic Sourcing and – expanded its digital procurement capabilities. After an internal analysis of the different tasks and goals of the Procurement area, multiple opportunities were detected to boost productivity to new levels:

Self-purchase catalogs

Taking advantage of the functions of , self-purchase catalogs were created for items in which Padilla’s department uses prenegotiated contracts. At SuKarne, this tool is already being used for purchases of stationery, general services, materials, and some aspects of marketing. Catalogs are very easy to use, implement, and manage so the company has full visibility and control of transactions. Quality remains high since the catalogs include images of the product, price, characteristics, etc. In addition, the company was able to adapt this resource to its branding, so the catalogs today are known as the “Compras SK” portals.

Contract generation process

Before the implementation of 51��Ariba Contracts, when a contract was generated, Legal had to go through an internally developed tool, which provided very basic functionality and did not offer any certainty in terms of time. Now, with 51��Ariba Contracts, from the moment a supplier registers in the SuKarne system, the provider can find all the legal and commercial information they need on the platform. In addition to speeding up activity, this allows for timely monitoring of contracts and easy reviews.

Audits

Being part of the agri-food industry, SuKarne is constantly audited by authorities, industrial organizations, institutions, and even clients. An important part of these reviews focuses on suppliers — how they are evaluated, what criteria are used to qualify them, what policies and action plans do they have, etc. SuKarne found a solution in the portfolio with and . In the past, when an audit was submitted, the company had to put in place a plan to address that specific item. Today, the evaluation of suppliers is carried out all the time, through very friendly, digital tools. When an audit is submitted, SuKarne now has real-time information accessible immediately.

In order to achieve these advances, a decisive factor, according to Padilla, was the support of the 51��team. “Through seminars and constant support, the team not only explained the capabilities of the solutions to us, but also guided us in the task of adapting existing processes to the platform, how to get more out of the innovation we were adopting,” he says.

Challenge Overcome: The Year of the Pandemic

From Culiacán, SuKarne’s Procurement department continues to explore – and discover – the benefits of investing in innovation. With the guided sourcing and guided buying capabilities within the 51��Ariba solution suite, the company hopes to improve other procurement and sourcing processes and increase the efficiency of Procurement interactions with other corporate divisions.

These future projects will be led by a totally transformed department – a Procurement team with the capacity to provide value to the business in a new and strategic way. The solutions implemented help ensure SuKarne has complete visibility and robust analytical functions via .

“The platform allows us to see how the organization’s spending moves; which categories grow the most; which supplier, especially if it is a strategic one, are we ceasing to serve,” comments Padilla. The data obtained is specified in reports, which are sent to SuKarne’s central corporate information system supporting decision-making in the organization.

In 2020, the year in which the global economy was severely affected by the pandemic, SuKarne managed to protect its supply chain, which, in turn, safeguarded its business operations.

“Through the platform, we detected that there were suppliers and categories that were falling. Thanks to the information, we discovered that they were companies facing financial difficulties due to the health crisis, which is why our purchase orders were declining,” Padilla points out. “With regard to strategic suppliers, this allowed us to detect risks to the operation and, in some cases, to think of ways to support them.” And in that sense, another benefit cannot be ignored: technology adoption in an unfavorable economic environment can help to guarantee punctual payments.

With the support of its Procurement area, 2020 was difficult, but not catastrophic, and SuKarne succeeded in this new context. Beyond operational continuity, the power of technology had a positive impact on suppliers, who could have been most affected by the pandemic.

2021 Predictions for Intelligent Spend Management Amid Ongoing Disruption

Geraldine Lim — Mon, 28 Dec 2020 14:15:58 +0000

As the world continues to feel the effects of the pandemic, businesses are more focused on managing disruption than ever before. Customers, while understanding in most cases, have a tighter hold on their purse strings and still maintain high expectations.

We asked 51��executives for their perspectives on what to watch for in 2021. Here’s what they had to say.

“In the new year, organizations will prove to be decisive in their approach to managing spend as they take steps toward business recovery. Only a holistic, cloud-based approach with the data underlying every spend decision — from direct and indirect goods procurement to contingent labor, services providers and MRO spend, all the way to travel and expense management — offers the necessary insights to counter disruption and extend competitive advantage. These insights help companies achieve their financial goals, as well as their operational, environmental and social objectives. Never before have connected commerce and intelligent spend management been as pivotal to business success as they are going to be in 2021.”

– , president, Intelligent Spend and Business Network, SAP

“As we look toward a new year and anxiously await the broad distribution of vaccines against COVID-19, leaders in the procurement, supply chain and logistics industries will take center stage as nations mobilize to turn back the pandemic. How adaptable is our infrastructure, how agile is our technology and how ambitious is our purpose in the race to safely manufacture these life-sustaining breakthroughs and distribute them equitably? The eyes of the world’s 7.8 billion people will turn to leaders in procurement and operations management to help navigate what may be the most complex if eagerly anticipated logistical challenge of all time. The opportunity and responsibility are immense.”

��– , chief product officer, Intelligent Spend Management, SAP

“This year has been defined by supply chain disruption. The impact of COVID-19 has accelerated trends that will not only lead to the diversification and localization of supply chains, but also increase the need for digitalization and end-to-end visibility. Now more than ever, procurement is uniquely positioned to be transformative and highly impactful for businesses as we enter a new era of data-driven intelligence. A shift away from the traditional, linear supply chain to a broader supply network, coupled with dynamic partnerships driving innovation, will be key to gaining a 360-degree view of supply, improving cash flow, developing new products and pursuing sustainability initiatives. Breaking away from reactivity and focusing on proactivity will be essential in tackling new business challenges in a post-COVID-19 world. Network strategies, and making use of data-driven insights, will be important in avoiding repercussions from future shocks and shifts, replacing linearity with interconnectivity.”

– , executive vice president, Network and Ecosystem, 51��Procurement Solutions

“As the year draws to a close, the full measure of the pandemic’s devastating effects is just coming into view. Beyond its incalculable human toll, COVID-19 has wreaked havoc on nearly every business, in every industry, in every region. As we welcome a new year, I believe that procurement — and particularly procurement technology — has a paramount role to play in restoring confidence to organizations as they seek to regain their competitive edge, revive their operational resiliency and replenish their hopes for the future. That level of confidence requires a seamless, integrated approach to digital business processes that extends visibility, reduces complexity and fosters collaboration. That’s how procurement ‘makes it happen,’ and it’s why we’re placing a strong focus on executing against our 51��Procurement vision in the year ahead.”

��– , chief product officer, 51��Procurement Solutions

“The evolution of procurement over the next five to 10 years will be driven by macroeconomic factors: the exponential growth of the digital economy, declining productivity and the stagnation of globalization. Living with the coronavirus pandemic, and planning for a future with increasing uncertainty, many organizations are watching global supply chains and taking stock of their own risks in the market. Supply chains need to be structured differently moving forward to remain resilient and adaptable; and spend management organizations are going to play a pivotal and central role in leading that change. We can expect to see suppliers as the driving force for innovation in most organizations, helping realize the promise of artificial intelligence and begin to reverse the productivity slump. As such, companies will need to take a very different lens regarding management of their supplier base than in the past. I anticipate the rise of spend management professionals as trusted advisors, providing solutions and preparing for unforeseen events; delivering greater value by moving the conversation from cost-saving to strategy.”

– , senior vice president, Product Strategy, SAP Procurement Solutions

“Humans are innately resilient. As companies large and small strive to survive the pandemic period and its devastating economic effects, we see human and machine intelligence coming together to play a significant role in decision making. Not only is this helping companies survive and fuel recovery efforts, but it is also inspiring new business models and transformation initiatives that are setting the course for long term growth. Companies are banding together as they look to share resources, responsibly dispose of inventory and spares, shift culturally to be more inclusive in work from home policies and naturally place greater emphasis on employee health and safety. Businesses will continue to incorporate more network-driven and digital strategies to engage with existing trading partners and find new ones. Meanwhile, procurement operations are front and center leading efforts to accelerate digital transformation and drive greater supply chain resilience. To operate in today’s business environment, companies must focus on digitalization to increase productivity, leverage data and intelligence to drive visibility in supply chains, shift sourcing strategies and create responsible trading partnerships for long term sustained business resilience and growth.”

– , global vice president, Product Strategy, 51��Procurement Solutions

“In the new year, I expect contingent workers and services providers to continue to play a leading role in helping organizations rebound from disruption, regain their competitive edge and respond to the shifting needs of customers. The creativity and flexibility for which external labor is renowned may not be new. But, for some organizations, gaining visibility into this often-unseen segment of the workforce may be. In 2021, I believe the transparency and insights made possible by cloud-based external workforce management solutions will help to determine which organizations return from the pandemic stronger than before – and more responsive and resilient to unforeseen change.”

– , general manager, 51��Fieldglass

“If 2020 was a year of disruption – and was it ever – then let 2021 be a year of rebuilding. In the year ahead, I foresee cloud-based solutions, particularly with regard to external workforce management, playing a vital role in lending businesses the flexibility they need to take steps toward recovery. Just as they always have, contingent labor and services providers deliver the depth of skills and expertise necessary to propel businesses forward. With the right sets of digital tools, organizations can achieve maximum visibility and value from these essential workers, ramping up and down efficiently as the new year unfolds.”

– , chief technology officer, 51��Fieldglass

“Building unconditional customer trust and thriving for customer success will continue to be a focus for businesses in 2021. COVID-19 has taught businesses to adapt quickly to changes and cater to customers’ needs with unwavering attention, making them their true partners. In the new year, I expect Customer Success teams to play a prominent role in understanding the customer’s health, identifying what the customers need to be more successful in a challenging environment and as trusted advisors provide intelligence to make smart decisions to mitigate risks thus providing seamless customer experiences. Connecting and engaging with customers will continue to be different via remote and , however, personalized communication and services will play a critical role.”

– , senior vice president, Customer Engagement and Adoption, 51��Procurement Solutions

“COVID-19 undoubtedly shined a light on the importance of Procurement. As businesses experienced major shifts and disruption on a global scale, procurement leaders rose to the challenge and emerged as heroes in their organizations by securing critical supply and ensuring business continuity. Even more importantly, by laying the foundation for functional excellence in this way, they were freed up to connect to their organizations’ strategy and purpose despite challenges that at times seemed unsurmountable. However, as we come out of the crisis-mode that defined most of 2020, changes must be made to truly overcome supply chain disruption and ensure long-term resiliency. A critical lesson learned is the importance of establishing and maintaining strong supplier relationships. By proactively listening to suppliers and better understanding their experience and challenges, procurement leaders can take the necessary action to improve their businesses through their ability to secure critical supply, deliver with a greater degree of resiliency and accelerate savings by uncovering and addressing barriers. As we head into 2021, it is time to recognize the power these relationships have in providing insight for leaders to better understand their KPIs and move the needle for their businesses in a positive direction.”

– , senior vice president and general manager, Intelligent Spend and Business Network, SAP

The 51��Ariba Live Virtual Experience Continues in May

Geraldine Lim — Tue, 05 May 2020 11:15:18 +0000

The continues starting today, with more than a dozen new sessions being released throughout the month.

Customers, industry experts, and leaders from 51��Ariba and 51��Fieldglass will explore timely topics that will help companies tackle the specific challenges they are facing right now and forge a path to greater business resiliency.

Business has never needed procurement more. When supply chains are disrupted, demand is unpredictable, and cost control and cashflow are critical, every company needs procurement and supply chain leaders to be strategic drivers.

51��is bringing together a community of procurement, supply chain, finance, human resources (HR), and IT leaders to share insights and lessons learned to help organizations respond, recover, and reinvent.

Three fireside chats with live Q&A sessions will focus on business agility and stability.

Ryan Flynn, principal at Deloitte Consulting, LLP, and Chris Haydon, president of 51��Procurement Solutions, will discuss why spend management leaders need to become masters of complexity to add more strategic value to their organizations, as well as how leaders are distinguishing themselves.
Keith Baranowski, global vice president and general manager of 51��Ariba Solutions for Direct Spend, will talk with a representative from leading medical devices provider Stryker Corporation about collaborating with suppliers to unleash hidden value in the supply chain.
Vasanth Balasubramanian, global head of Account Services for 51��Fieldglass, and Molly Spatara, global vice president of Brand Experience for 51��Ariba and 51��Fieldglass, will discuss how agile organizations are using the external workforce to meet evolving business needs and maintain business continuity, along with the insights they are gaining along the way.

Ten on-demand sessions will cover supply chain resiliency, gaining visibility and actively managing a distributed external workforce, continuing to drive business value, and more.

Sean Thompson, executive vice president of Network and Ecosystem for 51��Procurement Solutions, will lead a discussion about building durable supply chains with Sheri Hinish, SupplyChainQueen and co-founder of Supply Chain Revolution; Sondra Scott, chief operating officer of Verisk Financial; and Padmini Ranganathan, vice president of 51��Ariba Risk and Sustainability Solutions.
Representatives from AGCO, Nationwide Mutual Insurance Company, and W.R. Grace & Co. will share best practices from their successful supply chain management programs, covering topics including supply chain collaboration, driving measurable savings outcomes and building out risk management capabilities.,
51��Fieldglass experts will discuss how customers are managing their external workforce programs to drive business value, and how they achieve even greater success using the Digital Partner Network for 51��Fieldglass solutions.

Geraldine Lim, Author at 51����News Center