On page 26
Amer Sports
Transforming indirect procurement
On page 44
SAP
Disarming disruption with AI
On page 50
PwC
AI Supply Chain Strategy Game
On page 62
ING
Data Driven Ecosystem
Meet Matthew Rose, Procurement Advisory Partner at KPMG MAGAZINE
On page 16
KPMG
A digital future for procurement – Powered by KPMG
On page 36
Women in Leadership
The digital future of procurement was the topic of discussion for our lead feature with KPMG’s Matthew Rose. Mathew outlines how KPMG can partner with your business to play out this digital game of snakes and ladders.
Sven Novak offers the details on how working in partnership with key partners like LeverX has been instrumental in a successful overhaul and transformation of indirect procurement at Amer Sports.
Women certainly have to navigate a complex path on the journey to leadership roles. This is certainly true in the male ‘suit and tie world’ of procurement and supply chain. Luckily, we caught up with 9 inspirational female leaders who have shattered the glass ceiling who offered their advice to the up and coming crop.
Female leadership is personified in Royal Mail CPO Rebecca Simpson. Rebecca heads up this edition’s leadership section with some insight into the need for the Royal Mail procurement function to play a big role in the ongoing company wide transformation.
SAP’s John McNiff alongside PwC’s Fred Akuffo and Tom Alesbrook offer insight into how AI can modernise your supply chain operations and drive the sustainability charge.
We have a touch of finance from Ivar Lammers at KYC plus a sprinkling of sustainability and procurement tech from Ditch Carbon, Tradeshift, and Certa.
Enjoy The Business Profile Team
I am extremely proud of the practice we have built and the awards we have won as a result of this strong team, including a Highly Commended award for Commercial Impact at this year’s Management Consultancy Association awards.
Matthew Rose KPMGFeature on page 16
A senior procurement and supply chain executive with more than 25 years of experience, Rebecca Simpson, falls into the inspirational leader category having notched an impressive track record of transformation and delivery across multiple sectors and geographies. Having joined the UK’s renowned Royal Mail Group as Chief Procurement Officer in February 2023 she has been tasked with reforming the procurement function into a ‘best in class’ function..
Certainly not a one-size-fits-all situation, Rebecca offers insight into the ambitions and opportunity for procurement that exists within Royal Mail.
Hi Rebecca, you are Royal Mail’s first CPO in some time. What attracted you to the role?
Partly just that! I have always been attracted to greenfield roles where you often have more opportunity to shape and make an impact quickly. I have a fairly unique style, value autonomy, and always work at pace so the ability to define the role and function is important to me. The fact that it was Royal Mail and undergoing such a significant transformation was also a major pull. It is such an iconic
brand with an incredible history, however, has had challenging times and to be part of what will be the largest transformation of a FTSE250 company in recent times is truly energising. The execs were clear that they were looking for a lot from the procurement and supply chain team to be able to set itself for success, and that is just the sort of challenge I have always been attracted to.
Your CV is littered with roles at large and often complex organisations, with a common denominator -
they all in their own way needed to reshape their procurement focus. As already stated, the scope represents both a significant opportunity and challenge. What was the remit from day one, especially given the existing structure you inherited?
I have always been drawn to complex challenges –the more the better, and hopefully have never moved on until the change has been implemented and impact has been felt. If I am honest,
I don’t think the exec board were 100% clear in terms of remit, but they understood the value that could be driven through procurement and were keen for it to be explored. So, it is great that they had that vision and the role received strong backing. As you say, the business had been without a CPO for some time so I found a team with a lot of good individuals with strong professional experience, but they had lost their way somewhat and become siloed to a certain extent without strong
leadership and guidance. They had lost their ‘voice’ and become transactional in nature but with good systems and processes, so there was still plenty to build from. It was a reminder for me of how quickly even previously high-performing functions can lose their way without effective leadership, motivation and strong governance. I have no doubt COVID and remote working probably also had an impact and led to levels of disenchantment within the team.
I have always been drawn to complex challenges –the more the better, and hopefully have never moved on until the change has been implemented and impact has been felt. If I am honest, I don’t think the exec board were 100% clear in terms of remit, but they understood the value that could be driven through procurement and were keen for it to be explored.
You are highly experienced and familiar with these types of scenarios. While most procurement professionals often refer to the first 100 days as being key for them to assess, you had a slightly different approach. Can you tell us more?
As you build experience through a range of scenarios (I have been fortunate to have been involved in significant acquisitions / integrations / operating model transformations and so on), I think it does help you to make quick decisions and trust your instinct as to the direction to take. I actually started with the ambition to observe and listen before setting a strategy, however it was apparent early on the pace of change that was needed and what needed to be done. I quickly made an assessment in week one around the level of maturity across core areas – category management, processes, technology, people, SRM etc. Through understanding the financials and with engagement of stakeholders, I got clear sight of how we could make the most impact. I am pleased to say that a few months in, that assessment has not changed, and the direction set is
delivering tangible results. For me it was important to set a clear vision early on - one that empowered the team so that we could start to make small changes almost instantly.
You’ve inherited a good tech stack and the core of a team that is experienced, together with a relatively new board and CFO who are all energised to transform the business. How much importance is placed on procurement at present? How important to you is it to have a CFO and board that champions procurement’s role in this transformation?
It is paramount for me and the impact that this can have cannot be underestimated. Knowing I have this is a game changer in terms of what the function can deliver and most importantly the speed we can do it. It is certainly much easier if you feel you are swimming with the tide rather than against it. I would say a great deal of focus is placed on procurement as part of the broader transformation as we cut across all transformation initiatives, plus our ability to influence key enablers and of course our supply chain. I have agreed stretch targets across key pillars including
cost, cash and carbon, and these need to be delivered..
What challenges does the previously siloed nature of procurement create in terms of visibility?
It was definitely a key area for me to address as an initial priority. For me procurement is at its best when we are recognised as a true business partner We stand shoulder to shoulder with our operational counterparts ensuring excellent execution whilst also working with the exec and functional heads to shape and deliver strategy. We can only do this through strong stakeholder relationships and credible delivery. The team had become subservient with business making decisions and seeing procurement as an admin function to support this. Lacking objectives that supported broader business strategy and lack of visibility of any tangible results helped to cultivate a function that was not empowered or performing. I am pleased to say we have already come along way – much of my initial focus was on building those stakeholder relationships and explaining the role procurement could
play to help deliver real results and fundamentally improve the business. Some early successes has then built momentum.
Typically, the best way to gain visibility, especially during a procurement transformation, is to deliver some ‘quick wins’. You have only been in the business a short while but what would you point to as the most significant wins so far?
Yes, I agree, for me transformation typically is successful when it is a series of small wins and incremental improvements rather than a
‘big bang’ approach, which can often be costly and either not materialise or not succeed to the extent needed.
It starts with a vision that the team can get behind. We have this now and I try my best to embody this and encourage a culture of success, taking on challenges and not being afraid to be bold. The team recognises we now have leadership and the support of execs with clear objectives that they can get behind which will deliver success for the business, but also help stretch and develop them as professionals. We have board level visibility and I report into our EB weekly. I identified that
given the financial context
RM is operating in, we could best support by delivering on an improved cash position, sustainably reduced cost base and improved carbon performance. And we now have clear deliverables against these and stretch targets to deliver more.
ESG is front and center of the long-term ambitions of the business. Procurement will play a huge role in driving initiatives to ensure targets are not just met but surpassed. Scope 3 emissions are under focus.
What is your approach to embedding the sustainability
angle into your supplier relationships? How important are strategic relationships in the supply chain in driving innovation? And do you feel there is work to be done if Royal Mail is to be in a position where it can truly collaborate and source real value from the supply chain?
Absolutely. Currently, RM is the lowest carbon delivery provider, and we must stay that way, which means smashing our net zero targets and staying ahead of the competition. This is a real differentiator for the business and customers are increasingly seeing
ESG performance as a key selection criteria. We must ensure this is reflected across our value chain. I have recently had our scope 3 plan approved by the board and am building a new team entirely focused on just that. This means effective supplier relationship management with a focus on decarbonisation of our supply chain whilst also driving additional mutual benefit in terms of value, innovation, risk mitigation and so on. As you can imagine, we have high carbon categories including logistics and tech so these are our initial areas of focus – our aim is to cut scope 3
emissions by 25% by 2030 so we have a lot to do.
People, processes, technology. Royal Mail is no different to any other business, with these three areas paramount to success. People, however, are often cited as the key driver in this equation. Royal Mail is without doubt a standout brand but has certainly had its share of challenges. How important to your overall ambition for procurement is it to not only take your existing employees with you and encourage them to grow, but to also recruit and retain the next generation of Rebecca Simpons?
Currently RM (Royal Mail) is the lowest carbon delivery provider, and we must stay that way which means smashing our net zero targets and staying ahead of the competition. This is a real differentiator for the business and customers are increasingly seeing ESG performance as a key selection criteria and we must ensure this is reflected across our value chain.
Your team and the legacy they can create is everything. My priority was to align the structure with the business so that roles and relationships were clear –this is now done. Fortunately, due to exec backing and despite our challenges, I am recruiting for key positions. Some of which are entirely new for the business - for example, those relating to SRM and carbon reduction. I believe people want to be part of something successful and also part of something which is fun, and this is the culture I try and generate to energise existing team members and to attract new recruits. I am also using third-party consultancy support in the short-term to help both deliver quick impact, but to also coach and upskill team members. It is important to me that the team feels invested and that we celebrate successes. I hope over time, we build a team that includes more entry level roles including apprenticeships and graduates to help build a pipeline for the future. Developing individuals and seeing them go on to bigger and better things has been one of the highlights of my career.
Crystal ball time: If we look forward, what would you hope procurement has achieved and where how will the overall journey proceed from this point?
I guess that depends on timescales, but I certainly see a wealth of opportunity. I want to ensure in the next 1824 months that procurement is a recognised business partner, and we are known as experts in our field and called upon to support and lead key third-party activity. Procurement does not need to be circumvented because the value is recognised (market knowledge, risk management etc.). We have delivered sustainable cost reduction across all cost categories in line with our stretch ambition, and we
have adopted innovative commercial models and finance mechanisms that deliver value and improved working capital. Given the business challenges faced, this is fundamental. We have a robust carbon reduction plan across all key carbon categories with effective baseline measurement and plans to hit our 2030 target. The team is energised internally and externally and is known for being best in our class.
If businesses can guide their procurement functions to obey three golden rules while avoiding seven deadly digital sins, then the opportunity before them is huge. Matthew Rose, Procurement Advisory Partner at KPMG plays out this game of supply chain Snakes and Ladders, reiterating that the odd fall is not necessarily a bad thing.
Hi Matthew. To dive right in, what picture would you paint of the current business landscape when it comes to procurement? What are supply chains actually dealing with in the here and now?
It really is just an ever pressing need to do more with less. To achieve more despite almost-uniquely strong headwinds.
Geo-political issues and post-COVID supply constraints have piled the pressure on many procurement functions to enhance risk management procedures. This has come at the same time as a huge acceleration in the importance of ESG and new and growing roles for procurement to manage ESG in the supply chain. The result has been a scramble to automate procurement in
I am extremely proud of the practice we have built and the awards we have won as a result of this strong team, including a Highly Commended award for Commercial Impact at this year’s Management Consultancy Association awards.
order to pivot resources to these new areas demanding attention, and away from their traditional focus which has been on transactional and low value operational procurement processes.
Indeed, this is what we’re seeing at KPMG with many of our clients seeking to make step changes in efficiency that are designed to drive as much as 30% or more in improvements.
Before diving into how they’re achieving such drastic changes and what your proposed roadmaps are, let’s take a step back. What is KPMG’s, and indeed your own, role as a facilitator in this procurement space?
I lead the Procurement Advisory team for KPMG’s Corporate clients in the UK. I have worked in Procurement for more than 20 years starting out in consumer goods in the early ‘00s and then joining the world of consulting. I am passionate about procurement and its potential to play an increasingly important role in delivering business value – from innovation and competitive advantage to risk and sustainability.
At KPMG, I lead a team that helps clients to transform these procurement functions. This means moving to leading practice operating models, deploying best-of-breed digital solutions, unlocking value from supplier spend, and driving sustainability in the supply chain.
It’s a fast-paced customercentric environment focused on driving innovation and delivering tangible outcomes for clients. We are always researching new solutions, scouting for ideas and trying to cut through the hype to identify what will deliver real value to clients.
‘We’ seems the operative word here?
Absolutely – both internally here at KPMG, and externally with clients, there are always interesting conversations to be had. Our team is formed of people from a diverse range of backgrounds, spanning procurement and the supply chain, but also finance, technology and sustainability. It includes experience from a multitude of different sectors including automotive, energy, natural resources, consumer goods, retail, defence,
pharmaceuticals, diversified industrials, telecoms and technology.
I am extremely proud of the practice we have built and the awards we have won as a result of this strong team, including a Highly Commended award for Commercial Impact at this year’s Management Consultancy Association awards. You seem perfectly positioned to tackle some of those aforementioned challenges, and certainly the pace of change that businesses are facing right now, then?
Importantly, the broader digital procurement landscape has risen to the challenge with new technology solutions and promising automation coming to market almost weekly.
Technology has historically focused on automating core transactional processes such as PO generation or approvals or payables, as well as operational processes like sourcing. We are now seeing emerging technologies starting to
impact more operational and strategic activities to increase the value generated by each technology.
For example, we now see technology automating the negotiation process for low value suppliers – AI-driven sourcing bots negotiating with suppliers to agree key commercial terms. There are examples of organisations delivering double digit savings in addition to efficiency gains just by using this technology.
Building on that example, when you talk about digital step changes, is AI at the centre of that transformation? And what are the typical outcomes at the other side of a proposed digital intervention?
AI has certainly been significant. For example, we’re seeing companies use GenAI to enhance the supplier risk management process – analysing risk data from multiple sources, evaluating that data, offering consolidated risk scores and proposing mitigations. This helped one pharmaceuticals client to reduce the number of heads focused on supplier risk assessment by 60%,
and allowed the smaller team to pivot activity toward proactive risk management and mitigation.
More broadly, we now see digital solutions helping to drive insight and automation across the end-to-end process. This spans category management, market intelligence, sourcing, negotiation, contracting, onboarding, buying, supplier performance management and payables.
We have run more than 200 digital procurement programmes for clients around the globe, redefining the technology ecosystem to provide end-to-end automation and insights that deliver high levels of user experience and satisfaction. Recent analysis of those projects suggests that clients typically achieve benefits worth 2-4% of spend impacted. In the case of one media sector client, the digital procurement programme delivered more than $300m in business value.
With the pharmaceuticals example in particular, the benefit seemed to be as much cultural and businessfocused as it was around
the specific technology. How often is the business case overlooked when it comes to digital transformation, especially when the speed of change is so pressurised?
There are huge opportunities to be realised through digital transformation. However, we often see clients’ digital efforts trip at certain hurdles. They fall foul of at least one of what we call ‘the seven deadly digital sins’. These are:
1. Missing the business case: as alluded to, with any change programme it’s vital to have a compelling case for change underpinned by a robust business case. This is vital to galvanise business support for the programme and secure the change attention the programme will need.
2. Thinking technology is a panacea: no matter how good the new technology is or how much the UI impresses, technology rarely solves challenges on its own. Successful digital programmes tackle the operating model (process, roles, skills, data, governance) as well as technology.
3. Underinvestment in solution scouting: there is a huge technology landscape that isgrowing almost daily. It’s fundamental to selecting the right technology that clients have both a strong understanding of the vendors and market trends out there, to match perfectly with their internal requirements and use cases.
4. A silo mentality: the key to unlocking the big benefits of digital transformation is creating a seamless end-toend process – automation from category strategy to vendor payment. A closed loop. Many programmes underestimate the importance of end-to-end thinking and languish in a patchwork of unconnected technologies with inconsistent data.
5. Underestimating change management: many solutions fail to achieve the desired levels of adoption. Often, this is not down to the technology, but due to the way the technology has been delivered to the business, and how unprepared the business is for the technology.
6. Forgetting the customer: users or customers are more digitally capable than ever before. Their expectations of technology and procurement are based on experience using retail platforms like Amazon. It’s imperative that technology is selected and configured with the customer at the centre.
7. Being late to the data consideration: data is at the heart of any digital ecosystem. It’s the lifeblood that flows through processes to deliver automation and insight. Thinking about data earlydefinitions, structures, curation, integration - is the foundation of a successful programme.
Presumably, part of your responsibility is to steer businesses away from these ‘sins’. But how does that play out in practice?
I firmly believe in a businessled transformation approach enabled by technology. This means starting with the business goals and performance ambition, then the procurement operating model, and finally
the enabling technology. An organisation’s digital landscape can look radically different depending on the relative priorities of cost, speed, time, quality, sustainability and risk.
As such, at KPMG we have built an approach called Powered. Powered is an outcome-focused transformation approach. What this means in practical terms is that we start with a very clear view of a client’s performance ambitions. For example, 70% of their transactional processes to be automated, and 90% of spend managed through professional procurement processes. We then build the operating model and enabling technology around those performance ambitions. Powered then accelerates this journey by providing leading practice reference operating models (processes, organisation structures, service delivery models, roles, controls, KPIs, governance, data structures, etc) as part of a transformation toolkit that guides clients from vision to results.
different, but are there certain technologies that you would always look to incorporate into a new-look procurement infrastructure? Or priorities that should always form the first step of a transformation?
I often get asked what I believe the leading technology solutions are, and how to create a digital ecosystem.
In 2023 we undertook an assessment of clients’ digital procurement strategies, to assess what approaches have proven most successful across different procurement functions. That work concluded that it remains important to have a core source-to-pay technology backbone (for example, Coupa, Ariba, Ivalua, Jaggaer) to best support a connected end-to-end process. However, we also found it is best to then augment that backbone with integrated best-of-breed solutions to exploit advanced emerging technologies (eg, Pactum, Cirtuo, GenAI).
part of seamless end-to-end processes and data flows. With the huge proliferation of procurement technologies available and the continuous development of the core source-to-pay backbone technologies, it can be hard to identify the right recipe of solutions.
Is that where that oft-used word, ‘agility’ comes into the mix? Establishing a culture that is flexible enough to find the best option – not just generally, but for each organisation’s specific business needs?
Of course, every client and business case is
The challenge for many organisations is identifying which of the backbone and best-of-breed solutions to use, and then to work out how to connect the ecosystem as
The challenge for many organisations is identifying which of the backbone and best-of-breed solutions to use, and then to work out how to connect the ecosystem as part of seamless end-to-end processes and data flows. With the huge proliferation of procurement technologies available and the continuous development of the core source-to-pay backbone technologies, it can be hard to identify the right recipe of solutions.
Is that where that oft-used word, ‘agility’ comes into the mix? Establishing a culture that is flexible enough to
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continued from page 21 find the best option – not just generally, but for each organisation’s specific business needs?
Yes, but there are three golden rules that tie in with that flexible culture and way of strategising…
The first one is to remember that digitalisation is a journey, not a destination. Leaders continuously evolve their technology landscapes over time – monitoring and managing the performance of the technology solutions (eg, driving adoption, addressing bottlenecks, etc), adopting new functionality from new releases or updates, or augmenting the landscape with new point solutions.
Moreover, they’re not afraid to step back and review the complete ecosystem. In the past six months alone, I have worked with two global multibillion dollar clients to do just that. With the pace of technology change and fastmoving consumer markets, it’s important to periodically reassess the whole landscape. Layering on new technologies has its limits. At times, it may be necessary to go backwards to move forward… to remove legacy
technology that no longer meets business requirements and replace it; rather than seeking to address gaps through a multitude of point solutions. You’ve got to be ready to fail fast!
…and that’s the second golden rule?
Absolutely. You can’t be afraid to fail. Not all new technology will succeed. Leaders are prepared to run rapid pilots, test solutions, to scrap them if they don’t deliver, or scale fast if they do. Not only does this lead to some really exciting use cases, like AI reading contracts identifying weaknesses and lost value, but it also helps to build digital skills and instil a culture of innovation within the procurement team.
In a world where digital capability is increasingly the mark of a leading procurement function, digital skills and that innovation culture are key enablers of competitive advantage. And the third golden rule?
Data has to be at the heart of design. Start with the decisions that need to be
In a world where digital capability is increasingly the mark of a leading procurement function, digital skills and that innovation culture are key enablers of competitive advantage.
made and work back to the data required to make those decisions. It sounds simple but it really isn’t.
Procurement is at an exciting nexus of internal and external data, uniquely positioned to provide insight that will drive real competitive advantage for their businesses. It leads to some fascinating, impressive case studies, such as a food company using weather pattern data to forecast future crop yields and associated market prices with the aim of adjusting ingredients to optimise product costs. Or the aforementioned pharmaceutical company looking back through tiers in the supply chain to manage supply risks, inform inventory planning and shape sourcing strategies.
Those leading the way when it comes to digital procurement aren’t the ones just giving themselves to the
most exciting new technology and hoping for the best. They’re the ones doing their due diligence but still moving quickly; making optimal decisions but being willing to fail; and - critically - the leaders are those that best nurture and exploit the vast swathes of data they have. To that end, and considering both the pace of change and the abundance of options out there when it comes to procurement technologies, what is your rallying cry to businesses in 2024?
Seize the opportunity now. Digitalising procurement is a fantastic opportunity for the function to be at the forefront of a change that is impacting all functions across the
business. Those procurement functions acting on the front foot will enhance their profile and build vital digital skills that will be highly valued by their business stakeholders.
Those that sit back and wait risk becoming an afterthought, relying on technologies that have bolt-on procurement capability rather than being best of breed.
And, critically, what can we expect from your team in the coming months to ensure you remain primely positioned to guide these businesses?
We strive to help our clients become digital leaders. That means: continuing to
scout the ever changing procurement technology market to provide vital insights; building client business cases to get programmes off the ground; sharing learnings from hundreds of KPMG Digital Procurement projects to de-risk client programmes; co-creating GenAI solutions with clients to harness the latest innovations; redefining procurement operating models to realise the digital potential; and driving customer-centric change programmes in a way that makes them resilient and sustainable into the future.
Sven Novak, Director of Global Indirect Procurement, alongside Antonio Battista who was until recently the Global Head of Procurement Excellence, outlined the need for Amer Sports to transform indirect procurement operations in recent years. For the global group of iconic sports and outdoor brands with a purpose to elevate the world through sport, the transformation was necessary to ensure each brand meets its own customers’ expectations, while keeping the wider group on track with strong sustainability targets in the years to come.
Hi Sven and Antonio. Amer Sports has a global reach, an abundance of leading sports brands and a history that stretches back decades. How would you introduce the company, bringing us to the modern day?
Indeed, Amer Sports has been in business for more than 70 years and has evolved to a global group of 11 sports and outdoor brands. These include the likes of Arc’teryx, Salomon, Wilson, Atomic and Peak Performance, confirming the company’s global influence and the Sven Novak
journey which originally began during the rebuilding of Finland back in 1950.
Transformation is in the company’s DNA, later expanding into shipping operations, publishing and printing, before international acquisitions led the organisation into the manufacturing world with ice hockey equipment. This new focus on sport focused attentions in that area of outdoor leisure.
And the transformation continues today. The
company’s focus on sports is stronger than ever, albeit with a new mindset which is built around consumer needs, sustainability and –where we come in (or used to come in, in Antonio’s case) –a fresh procurement model.
We will certainly come to this innovative and efficiency-driven procurement model. However, could you first confirm the broader operating model that now epitomises Amer Sports’ continuous improvement?
It’s all about putting brands in the forefront –encouraging autonomy in their own brand strategies and working closely with them to know which building blocks to put in place. Of course, these always align with grouplevel ambitions, but it’s important for our brands to cut through category siloes and ensure they are meeting their own specific customers’ needs.
Transformation is in the company’s DNA, later expanding into shipping operations, publishing and printing, before international acquisitions led the organisation into the manufacturing world with ice hockey equipment.
Where the group comes in is to focus on overall strategic guidance and governance for brands, while also taking a biggerpicture overview of potential scaling opportunities or synergies to explore. Support services are brand-neutral to provide bespoke commercial guidance, support each brand’s growth, and to reach their respective potentials.
It’s important to have this clear way of working so there is never an overlap in responsibility or
accountability, and so each brand is working with clear definitions of specs and service level expectations.
And finally, to set the scene, how would you describe Amer Sports’ purpose and values when it comes to both customer and brand fulfilment?
We boil it down to four values. First is to always be authentic as that’s the only way to guarantee trust with brands who depend on our decisions and group operations.
This leads into a belief that we’re better together, taking diverse expertise and making the most of it. We are also committed to impact, always keeping an eye on what’s up ahead and considering people and the planet in our decisions.
And the fourth value is that the company is driven to excellence – playing fair, aiming for excellence and celebrating wins.
All of these are overarched by a purpose to elevate
the world through sport. Each of the four values are quite critical right now, and especially in the context of a quite drastic, recent, procurement transformation.
Absolutely, and that leads nicely to an introduction of what it is you’ve been embarking on across procurement in recent years…
In a sentence, Amer Sports has been on an indirect procurement journey. As you can imagine, with so many products and services across the brand portfolio, this implicates many suppliers and stakeholders, and we realised digital intervention would be vital to keep up with the change of pace.
It has been an exciting journey so far that can perhaps be defined by three main solutions that we have introduced to make our indirect procurement activities more seamless, efficient and user friendly. These three areas span sourcing and delegated procurement courtesy of Mercanis; procure-to-pay via SAP Ariba; and category management thanks to Cirtuo.
I guess it makes sense to take us back to explain the timeline of progress so far?
Well, from a digital integration perspective, it would perhaps be better to pick up the journey in 2022 when the first team members joined our newly professionalised indirect procurement function. Our global indirect procurement journey was propelled from that, as mere months later the indirect procurement intranet pages went live internally, and this is where some of our solutions and key digital service providers began to integrate the new-look infrastructure.
First came Amazon Business to manage our tail spend in a more effective manner, building up to a critical moment later in the year when the Global Indirect Procurement policy came officially into effect. Emphasising the speed of implementation and the success of all preparatory work that had gone before this period, our team’s first calendar year ended with a strong level of sourcing projects and subsequent
savings – figures that have only improved over the course of 2023, and that will be even stronger this year.
Over the course of 2023, all brand category managers were onboarded with this new way of working, business travel was incorporated into the new suite via TravelPerk, and the Global Indirect Procurement policy e-learning was launched. More recently, in the past few months, Cirtuo has gone live with its category management tool to help with analysis and strategising. Finally, SAP Ariba has come online in 2023 to elevate our spend management activities ahead of another exciting year in 2024.
I’m intrigued by how these new tools are decided upon and assessed, and indeed the delegated procurement side of things; but it would also be great to get a bit of perspective on how this transformation has occurred from an internal perspective? Yes, this is where the journey does go back four years. It started with heavy due diligence and consulting assessments to see quite how much time and
In 2019, Amer Sports initiated the implementation of the SAP Ariba solution, extending its deployment to an additional twenty entities during the subsequent two years. The establishment of the Global Indirect Procurement team towards the end of 2021 marked a strategic move to refine procurement policies and reassess the system's configuration, with a particular emphasis on leveraging the SAP Ariba Guided Buying solution.
In a notable step toward system and process improvement, 2023 marked the beginning of a collaborative optimization project between LeverX and Amer Sports. This initiative aimed to enhance the system's user experience and ensure its alignment with updated procedures and policies. In October 2023, the enhanced solution was successfully launched. Simultaneously, efforts were initiated to expand the tool's utilization to an additional ten entities across Europe and North America.
Contact us: leverx.com
The project is divided into several workstreams:
Business Process Management
The team is dedicated to aligning the business processes with the system's capabilities, ensuring that SAP Ariba effectively supports Amer Sports’ operational requirements.
Technical Implementation
This team oversees the SAP Ariba optimization, further rollouts, and migration from CI9 to CIG, and conducts impact analyses during the optimization process.
Content Management and Supplier Enablement
Tasked with enabling suppliers into the Business Network and enhancing catalog enablement and user interface visualization.
Change Management
The team facilitates effective communication, engagement, and motivation among Amer Sports’ group functions, brands, and entities, ensuring smooth adoption of the changes.
backbone
The real power of Change Management is how it ensures everyone is ready and able to use all the new features of SAP Ariba. It's about making sure the technology change is smooth and everyone can be onboarded easily. This approach helps us make the most of what SAP Ariba offers, making the change as much about the people as it is about the tech.
From a Change Management perspective, the launch of SAP Ariba at Amer Sports was an exercise in precision, focusing on people as much as process. Recognizing that high user acceptance stems from inclusion, we ensured that communication was both targeted and comprehensive, which is vital for maintaining cost and quality within scope.
This was achieved through a strategic communication component, ensuring that each message was crafted with the audience in mind. An internal Change Management liaison became integral, leveraging intimate knowledge of Amer Sports' culture and communication channels to effectively disseminate information.
We committed early to audience-specific communication, pinpointing stakeholders through careful analysis. Our plan delivered tailored information packages via the channels most likely to reach and engage each group, a method proven more effective than the standard email barrage.
The project team went beyond emails, using the Intranet for active project marketing to frame the initiative in a fresh, positive light. Amer Sports' openness to innovation led to a series of interviews featuring a diverse group of stakeholders, from the project sponsor to key users. This approach not only placed current topics at the
forefront but also humanized the project, driving its success as a communication channel.
In terms of participation, we designed events allowing comprehensive project understanding and dialogue, preemptively addressing concerns. Motivation, often overlooked, was also a cornerstone of our strategy. Recognizing its importance, we took advantage of the holiday season to spread cheer—and information— globally, with treats and personalized sponsor letters acknowledging exceptional contributions.
Change Management, while sometimes operating silently, is never to be taken for granted. It’s a deliberate investment in the project's social fabric. Our weekly Change Management meetings allowed for a dedicated space to craft, debate, and refine our strategies, setting a standard for project collaboration that ensured efficiency and success.
In summary, Change Management at Amer Sports was a testament to the value of thoughtful, well-executed strategy and its ability to shape the course of a project positively.
As we move forward with the rollout of SAP Ariba Guided Buying in APAC and Canada, we remain mindful of the challenges encountered in past implementations, leveraging our experiences to navigate future initiatives with greater insight and efficiency.
Besides the technical complexities, we faced some challenges and worked on their mitigation strategies
Resistance from the brands and entities
Addressed through comprehensive change management initiatives, including clear communication about SAP Ariba's benefits, stakeholder training, and involvement of key influencers in decision-making.
priorities on the project's engagement from the Customer project team
Mitigated with a project governance structure, regular communication to ensure alignment and resolve conflicts, and dedicated project management resources for coordination.
Challenges in automated invoice processing
Mitigation involved robust testing and pilot phases, close collaboration with stakeholders for customization, and ensuring compliance with regulations and internal policies.
Lack of understanding of the processes in other group departments, brands, and entities
Addressed with a comprehensive communication plan, sharing best practices, cross-functional workshops, appointing process champions, and establishing support and feedback mechanisms for continuous improvement.
The implementation of SAP Ariba at Amer Sports brought significant benefits, enhancing their procurement processes and driving tangible value across the organization:
SAP Ariba helped mitigate procurement risks by providing greater visibility into procurement processes, ensuring compliance with regulations and policies, and facilitating better decision-making through data-driven insights.
SAP Ariba enhanced approval workflows by automating approval processes, increasing transparency into procurement activities, and strengthening governance mechanisms to ensure adherence to policies and regulations.
By automating and streamlining invoicing and payment processes, SAP Ariba helps Amer Sports avoid payment delays, ensuring timely payments to suppliers and fostering positive relationships with them.
SAP Ariba helped Amer Sports achieve greater operational efficiency and realized cost savings by streamlining procurement processes, reducing manual tasks, and optimizing supplier relationships.
SAP Ariba enforced procurement policies and procedures, ensuring that purchasing activities aligned with organizational objectives, regulatory requirements, and industry standards, thereby reducing the risk of non-compliance and associated penalties.
clients offices
9 countries employees successful projects years of close collaboration with SAP
“Helping companies leverage investments in SAP solutions”.
We have extensive knowledge and expertise in business solutions and technologies as well as comprehensive understanding of industryspecific requirements.
Unlike most companies, we distinguish ourselves by introducing and maintaining a team of LeverX employees rather than hiring independent consultants. This approach ensures alignment with our methodologies and values, providing you with a cohesive and dedicated team throughout the implementation process.
The relationship with SAP is crucial during SAP Ariba implementations, and our deep connection with SAP was solidified when LeverX became an SAP Global Strategic Supplier for Technical Services in 2020. Our multiple projects worldwide, including developing SAP Ariba standard functionalities and integrations, showcase our capabilities. Our Architecture Community can provide support and advice in case of any questions regarding standard solutions and customizations that are available.
We possess a comprehensive understanding of business processes and industry-specific requirements.
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money would be saved by professionalising indirect procurement. Little more than a year later, the decision to create an internal indirect procurement department was confirmed after realising through our due diligence that substantial savings would be possible.
It was then important to decide on the operating model between brands and group as discussed earlier, so everyone was reading from the same page; and then to discuss how the department should be set up as a result
Once this was decided, the new team started in 2022 as mentioned, the consultancy support we had been receiving stepped aside, and the new way of working began.
And I understand you’ve altered the way procurement tools are assessed in keeping with this new way of working and new model?
Yes, a formal assessment on procurement tools has been launched to help identify major issues and to work on potential solutions accordingly.
To explain, it begins with identifying a problem, pinpointing possible solutions and evaluating the pros and cons of each, analysing each’s impact on current processes, estimating the level of effort and cost required for integration against the time and money that would be saved on the other side of its implementation, before validating and including as part of our optimised ‘ToBe’
framework. Within this framework we can analyse each solution with external partners, and also weigh up how it fits in the overall procurement landscape – a landscape that must always remain coherent within procurement strategy and the new look policy.
Ultimately, the assessment seeks to prove which issues need addressing, where improvement can be achieved, and how each proposed solution would integrate alongside our other new functionalities.
The final solution you mentioned earlier but haven’t touched upon yet is Mercanis’ delegated procurement proposition? What have been the benefits of this particular step change?
I think you can pinpoint the benefits in five different areas. First it has helped us to focus more on strategic procurement, which has inevitably been crucial given the wider transformation journey we’ve been on. It has also helped us to improve productivity, which again aligns with the broader aims of the group and all of our brands of course. However, beyond that, it has been a huge benefit to our sustainability missions. – The three benefits here being to reduce resource usage, to implement more of a greenfield model, and to – ultimately – make our organisation more efficient. Delegated procurement thanks to the solution provided by Mercanis is pivotal to our indirect procurement journey and
the evolution of Amer Sports as a forward-thinking organisation committed to sustainability.
Critical to your recent success and transformation has been the renewed group structure as well as the introduction of LeverX?
Absolutely. Their flexibility and technical background have been instrumental to our recent successes. Of course, they are also a key partner of SAP Ariba, which allows us to optimise our use of this solution.
From a structure perspective, our steering committee and core team now have a strong balance of Amer Sports and LeverX personnel representing at each rung of the ladder. This includes collaborative representation
in areas of the steering committee itself, project lead positions, process and transformation strategising, technical and IT divisions, content management and – vitally, given the past few years – change management.
LeverX’s role in our ongoing development can’t be overstated. And as far as that latter change management aspect goes, they are aligned with our key focus on sustainability.
Again, it is this reliance on strong partnerships, while remaining to our values and purpose that have helped drive our Global Indirect Procurement transformation, and that will continue to do so over the course of a successful 2024, and beyond.
In the realm of procurement and supply chain management, women have navigated a complex landscape marked by unique challenges on their journey to leadership positions. From breaking through traditional gender norms to overcoming systemic barriers, their paths to the top echelons of leadership are often characterised by resilience, determination, and a commitment to shatter glass ceilings.
We spoke with a handful of female leaders to get their take on the changing views of women in leadership. Why do many women have to go that extra mile just to have a voice? Can technology become a leveller? What changes would these successful career women like to see implemented to help the path to leadership and recognition easier? For the answer to these and many more questions take a look below.
What advice would you give to any women now starting out?
Lifelong Learning on functional knowledge, technologies and new trends; Balance your emotional intelligence; Build strong arguments based on data; Take decisions evaluating the risks; Position yourself; And mainly, stand and do not give up.
Danielle Sampaio
What strategies would you recommend organisations implement to create change and equality for all?
Leaders should demonstrate their commitment to equity by setting clear goals and expectations, and by holding themselves and others accountable for meeting these goals. Provide regular training sessions to help employees understand the importance of diversity and inclusion. Implement hiring practices that promote diversity, such as blind recruitment processes, diverse interview panels, and targeted outreach to underrepresented groups. Encourage open dialogue about diversity and inclusion, and create safe spaces where employees can share their experiences and perspectives. Regularly assess progress towards equity goals, and adjust strategies as needed.
What advice would you give to Woman in your function?
Be brave, be yourself, be real and don’t compare yourself with anyone. Everyone is unique and different and that is the blessing to live and work with more people without matter the gender, we will collaborate and contribute to be a better person and consequently, a better professional. Have a specific goal and focus on it, enjoy that ride and reinvent yourself in the way. It’s not easy to stay motivated, however to have a defined purpose, a reason why, will drive you to do your best.
What are some of the biggest challenges women face in procurement & supply chain?
In general women face similar challenges across most of industries and professions, if not all. There are many challenges for women in Procurement and Supply Chain domain, but I will highlight two:
> To be accepted and valued for who we are- I do believe that the competition for equality with men is a waste of time, and while many women “put men’s shoes on” and reflect masculine behaviours in the workplace, this does not always result in “equality conformity”. Instead, projecting women qualities like empathy, attentive listening, analysing in detail and caring will help to close the authority gap, enhance confidence. I compare the qualities of women to those of water, saying that “Water’s patience and persistence allow it to cut through hard rocks.” As a result, I urge women to embrace their inherent qualities rather than comparing themselves to man.
> Managing career and family- dual role. Without a joke this requires “Superwomen” qualities, but “Superwomen” are frequently described as being “double-burdened” in the academic literature. This is stressful, tiring and not sustainable as women often may prefer to give more efforts to one and leave another with less attention. My advice would be to “balance it with joy” – every thought, word and action need to be made with meaning and ‘love” if possible”. Try to blend loving family with loving what you do without separating one from another and let it go hand on hand, I truly believe this will smoothly transit women to an enjoyable journey from being a “Superwomen” to a “Wonder Women”.
What have you seen change for women in procurement & supply chain over the years, and what changes would you like to see in the future?
Over time, I’ve witnessed notable shifts for women in procurement and supply chain, particularly as the focus has moved from simply cutting costs to creating value. This evolution has presented new opportunities for women to highlight their strategic prowess and leadership skills. As procurement transitions from a traditional emphasis on cost reduction to becoming a strategic driver of business growth and innovation, women have capitalized on their diverse skill sets to enhance value across the supply chain. Their adeptness
in communication, collaboration, and relationship-building has proven pivotal in nurturing partnerships with suppliers and internal stakeholders, driving cross-functional endeavors and sustainable value generation.
Yet, challenges persist, such as gender imbalances in leadership roles and unconscious biases. Looking ahead, I anticipate further strides towards gender parity, including greater representation of women in leadership, fairer compensation practices, and the fostering of a culture that embraces diversity. By championing diversity and extending support to women in procurement and supply chain roles, we can cultivate an environment that fosters professional advancement and prosperity.
What needs to change for Females to rise to the top of the ladder in the procurement & supply chain world?
Here’s my wish-list:
> More C-Suite seats: Remember my COPO LinkedIn article! Not only Procurement and Supply Chain Executives are overlooked in the market nowadays, but I’d also like to see more women in C-Suite roles. Women bring a unique blend of empathy, resilience, and multitasking skills. They really know how to handle chaos! Just ask any mom during back-to-school season.
> Equal Pay: Let’s bridge the pay gap faster! Women thrive, the labor market thrives. Look at the size of our global population and you will see the gender employment gaps persists. Many women may be reluctant to accept to be paid less than a men doing the same type of work, they’re challenging the status quo. I’m with them!
> Flexible Work Arrangements: Let’s embrace flexibility! Whether it’s remote work, compressed hours, or jobsharing, let’s create a workforce where everyone can balance work and life without feeling like they’re juggling flaming torches.
To see these changes, we need all hands-on-deck. Men and women working together to accelerate the much-needed changes we all want to see. So, let’s keep pushing those boundaries, and inspiring the next generation of supply chain and Procurement superheroes. And remember that behind every successful supply chain, there’s a woman who knows how to turn chaos into a beautifully orchestrated symphony!
How have leadership opportunities for women in procurement & supply chain evolved?
Over the years I believe there has been progress in increasing awareness of gender issues, overall, I feel millennials appear to have fewer gender-based preconceptions in the professional environments. I don’t believe any woman wants to feel part of a quota but be successful based on merit. It’s important that hiring processes are fair and that unconscious bias is eliminated.
I believe there are now more visible female role models that have broken the glass ceiling and making it easier for us today and inspiring junior professionals. I read that women make up around 60% of students in EU countries studying for a masters in procurement and supply chain, so there is a good chance that women will occupy influential positions
Do you see technology and innovation as enablers of gender equality?
As Plato said, “necessity is the mother of invention”. And, as I believe “invention and technology have no bias.” Therefore, women have the same opportunity to be the first to invent. Where women face headwinds in revolutionary ventures is securing funding and getting new product to market. In 2023, Northeastern University found that US start-ups with allwomen teams received only 1.9% of venture capital in 2022. What’s the solution? At its core, funding is about gaining followership. And that too is where women in Procurement and Supply Chain need to focus…securing buy-in. To do so they need to market their ideas in 3 ways:
> Explain the changing environment: Highlight how technology or marketplace has shifted and the problem that presents a real opportunity for the company.
> State the impact to the consumer and other functions: Show your knowledge of the customer’s experience and how they are affected by the problem. Underscore how you are aware of how other functions are impacted as well as Procurement and Supply Chain
> Pitch the solution: In one sentence, explain how your idea capitalizes on the opportunity, solving the problem while setting the stage for top-line wins!
What have you seen change for women in procurement & supply chain over the years, and what are some of the things that you would like to see change in the future?
I started my career in Procurement back in 2002 and at that time it was a very male orientated profession. I would often be the lone female at procurement meetings and was once asked if I was there to take the minutes! Fortunately, I have seen a lot of changes since then, although not at the rate that I would like to see it. There are far more females in the procurement profession in general now, but sadly still not that many at a senior level. I want to see this change as there are some amazing women out there who are at the top of their game but have not been recognised as such.
As the face of procurement has changed through the years, so have the skills that are required to excel in the profession, and I firmly believe that this is an opportunity for female procurement professionals to make their mark. Some of the skills required include good communication, relationship building, ability to connect with collaborative partners, balancing conflicting priorities, multi-tasking, championing supplier diversity, networking and mentorship. These are generally skills that females excel in so now is the time to make your mark and aim for the top – there is nothing stopping you but yourself!
Disruption is the new norm, especially for supply chains that have to function with greater efficiencies, for a more demanding customer base, while adhering to sustainability regulations. The result is the biggest technology acceleration ever seen hitting the industry, through the explosion of generative AI. John McNiff talks about SAP’s influence on companies, enabling smoother data flows across supply chain networks with more connected and intuitive technologies, for ultimate risk resiliency, agility, and in support of the green agenda. Here, he explains this complex landscape, and how far we are away from an autonomous, self-healing supply chain.
Hi John. You have been with SAP for more than 15 years now in various roles, leading to your current position as part of the global Centre of Excellence. Firstly and briefly, what does this entail?
Basically, we run a team focused on strategic go-tomarket topics. For example, right now we are working with customers to ensure we can articulate the business value of a supply chain that doesn’t run in silos. In general, for us, the digital supply chain covers quite a broad gamut.
Everything from PLM, product innovation, supply chain planning, logistics, manufacturing, the shop floor, but also operations and service.
We have a lot in the portfolio and already, with the speed
of innovation and rise of generative AI, there is a lot to look forward to and get stuck into.
From this multi-focus perspective then, you seem perfectly placed to pinpoint where supply chain challenges and disruptions are being felt at present?
Yeah, I’d say it’s good that we were talking now, because I think even in the past few months the talk track is changing.
First, we’ve had ‘VUCA’ (volatility, uncertainty, complexity, ambiguity) that people want to talk about, highlighted of course by the pandemic, Suez Canal, etc, etc. But that view is now evolving to be on a sort of rolling stream of disruption
Basically, we run a team focused on strategic goto-market topics. For example, right now we are working with customers to ensure we can articulate the business value of a supply chain that doesn’t run in silos.
rather than battling one particular ‘black swan’ event at a time.
To that end, the focus among companies is to be less reactive, and putting strategies in place to be more risk resilient and agile.
When there are so many potential disruptions, how does SAP plan and prepare to ensure you’re enabling companies with that risk resilience and agility?
It’s actually a case of looking at what the next potential gamechangers will be, and there are four main areas on our horizon. Yes, number one is that we are in the business of helping with risk aversion and business agility, but we can provide this by accounting for future
Issues around sustainability are growing and people aren’t ready for that yet from a technology perspective. They need to start thinking about how they embed traceability and provenance around CO2 and ESG into the supply chain.
– or escalating – challenges we see coming up; of which there are three more specific examples.
First, issues around sustainability are growing and people aren’t ready for that yet from a technology perspective. They need to start thinking about how they embed traceability and provenance around CO2 and ESG into the supply chain, when a lot of this data and information is outside of companies’ own four walls.
For example, with CO2, 90% of the CO2 footprint of most big manufacturing companies typically sits in operations and the supply chain, and more that 60% on average is in scope 3 (beyond the internal enterprise). Regulations around the world are now calling for reporting of this carbon footprint in a much clearer and transparent way, so there’s a need to connect this data from across manufacturing, operations, and the wider supply chain ecosystem to give accurate measures and not just averages.
The next area of focus is helping companies not to just report, but also using
this connected thread of data to make decisions around how operations and the supply chain are run. You work backwards along the digital thread to see where shortfalls or inefficiencies exist, and to then take steps to become more resilient or efficient. This not only effects regulation compliance, but also helps to adhere to a younger customer contingent who prize sustainability higher than before, while also making yourself more attractive to investors. So, we also need to make that link between having better connected information, and then acting upon it.
And then, there is the technology itself. There has been an explosion in generative AI in particular, which has refocused everyone’s mindsets, but that doesn’t mean they necessarily understand it or know how best to use it. Helping with this understanding and to take full advantage of AI’s potential is another remit for us, alongside these aspects of sustainability, and more insight and actionable data generated from connected sources.
A word that springs to mind here is ‘visibility’, enabling companies to get a better picture of what is possible, but also where their current bottlenecks exist?
It is absolutely a key word, however when you say ‘visibility’ to people, they still have an image of a control tower and just having that visibility in a first instance –tech giving a representation of the status quo. When asked whether they have complete visibility though, and whether they can make decisions from that picture including outside of their business’s four walls pertaining to the supply chain, very few can say they have that capability.
Where we focus our conversation around visibility is on the ability to act on the information being presented. The ability to connect pieces of information across functions and departments. The ability to process the information and respond in an optimal way. The ability to leverage new technologies to provide realtime, continuously updating insight so that companies can remain agile and risk resilient.
To SAP, visibility now isn’t just a picture. It’s the ability to connect external data, alerts and events with business data and transactional information, such as sales orders, production orders, transport orders, and all other elements that drift in and out of the immediate four walls of a business. Not only that, but it’s also then about understanding the impact of information you’re receiving on each strand of the operation. Effectively creating the digital twin of the ‘network’ at present, despite the promise of technology, this complete notion of visibility is unachievable for many.
You mentioned the term ‘digital threads’ earlier. Presumably, it is the formulation of these digital threads that you’re talking about when you describe this improved connectivity and flow of data?
Absolutely, but again it’s a bit of a misunderstood phrase in the same breath as ‘end-to-end visibility’. In some industries or contexts, it refers to an engineering change, for instance, that could then be applied across the board seamlessly thanks to all systems updating that information.
What we mean by digital
thread, however, is all the data, records, orders, communications and information that needs to be connected. But more than that backbone, it’s about having analytical capabilities and decision-making support on top of that information. Then, from a supply chain perspective, it’s also about bringing in external data from other systems and leveraging the complete ecosystem. This might implicate partners down the chain, but also systems around weather data for example, or transport complications in real time.
Everything that relates to a company’s ability to deliver on a promise to customers,
needs to be weaved into this thread, analysed automatically in real time, and lend to more efficient and informed decision making.
From a practical standpoint, where does SAP fit into this equation? In a perfect world, I’m sure you’d advocate a complete suite of SAP solutions for optimised synchronisation, but that won’t be feasible for all?
The first thing to do is take as much advantage as you can of the backbone and of the system of record, there is a wealth of hidden knowledge
Having consistent master data in a system of record is very powerful thing. But you’re right – transformation is big, intimidating and expensive, so there is much more of a shift to becoming as composable as possible. This means taking smaller pieces of augmentation at a time, and we help to make sure that everything is integrated and synchronised across the value chain.
Architecturally, there is also a shift from the rigid monolith setup versus best-of-breed alternative, to something in-between, which leverages
consistent platform. This helps from an IT perspective, where you’re sharing as much of that digital backbone master data as possible and embedding the bits you need to embed. For example, with the green agenda, you can connect material master data with emissions factors which is something that seems quite boring in the backend, but in the context of the users in the supply chain, if they can see the impacts of picking this material from this supplier, or routing it via this transportation provider, they can measure the emissions factor changing across each
Automation can drive efficient change but it needs to be connected and have a clear vision to realise its potential for boosting reputation and shareholder value, says Fred Akuffo…
A week doesn’t go by these days without a new supply chain challenge hitting the headlines. Whether it’s geopolitical issues, workforce shortages, new regulations or extreme weather events, supply chains seem to be coming under increasing pressure. While understandably, business leaders are concerned about the future viability of their organisations, at least according to PwC’s Annual UK CEO Survey, they are also fully aware of the need to transform. Technology and more specifically, AI, is seen as the essential differentiator.
Everyone is talking about generative AI (GenAI) and with good reason. AI will have the greatest impact on the supply chain industry over the next few years and GenAI will be a key player. From forecasting and managing risk through to optimising processes and sourcing new suppliers, GenAI will play an increasingly pivotal role.
Supply chain practises understand this – they are no strangers to automation having frequently adopted machine learning to monitor and manage resources and predict product demands, for example. However, much of this automation is in isolation. And we are also seeing this with GenAI projects, springing-up within departments as knee-jerk reactions to technology trends. For organisations to really see the benefit of AI-driven transformation in their supply chains, there needs to be a re-conne ction, a strategy, a removal of siloed operations and a unification of data to enable intelligent decision making.
To that end, we have compiled a list of the five moves organisations need to make in FY25, to lay solid foundations for AI automation, while managing costs, improving resilience, and easing sustainability pressures. These steps will springboard organisations into a more innovating FY26.
Visibility is crucial for effective supply chain management, enabling operational decisions and mitigating external risks. Digitisation of assets is the process of creating a cloud-based digital model of a supply chain, for example in an advanced planning system (APS). This allows for demand and supply forecasting and scenario testing.
Data generated from physical assets (eg. machines and lorries) helps businesses make real-time decisions. Technologies such as RFIDs, chips or integrated circuits (ICs) and satellite tracking enable organisations to understand fully the movement and production of goods. By creating a digital record with real-time asset data, organisations can monitor the movement of goods, identify potential delays and risks, while also facilitating emissions reporting.
Watch out for new partnerships between supply chain illumination tools and ERP and APS vendors. These partnerships enable the integration of external market events into a planning process, enhancing decisionmaking capabilities. Collaboration platforms can also help organisations collect data from suppliers and logistics providers.
Data readiness is crucial for effective AI implementation. Understanding the sources and value of data allows businesses to create a data value map, focusing on high-value datasets, while considering the overall data estate. This also presents an opportunity to consolidate AI projects, to ensure end-to-end supply chain impacts are considered. Even if a tech transformation is not currently on the roadmap, preparing data for the future establishes a strong foundation for implementing new technologies effectively when the time comes.
We find that businesses who embed data value maps in their supply chain strategy are proactive in responding to supply chain instability. They are also better at integrating sustainability at the core of their supply chains, and leveraging advanced technologies within industry 4.0 and AI, in a more cohesive manner.
To address data challenges, focus on three key areas:
> Data quality: Establish a master data management process to ensure clean and accurate master data.
> Data availability: Make sure data is easily queryable and accessible to other systems for seamless integration and utilisation.
> Data consistency: Consolidate data from multiple systems into a single location through data replication or real-time queries to ensure consistency and coherence.
Implementing a data lake is a common approach to address these challenges. This provides a cloudbased solution that can connect to analytics and decision intelligence platforms in real-time. It is crucial to integrate data from ERP and APS systems to establish a connection between the supply chain and the broader business.
With growing ESG reporting requirements and pressure to demonstrate Net Zero strategy, companies must have visibility of the carbon implications of their products and services. However, capturing consistent data to support this process can be challenging. Establishing data sources and responsibilities for carbon data capture is time-consuming but essential. Once in place, a baseline can be established, followed by target setting.
A centralised carbon ledger, integrated with the accounting system, supports decision-making and transparency. This ledger, similar to financial accounting systems, enables understanding, reporting, and compliance with regulatory requirements, such as CSRD.
By incorporating cost and carbon information, companies can make informed decisions and run scenarios to progress towards sustainability goals. Software vendors are supporting these requirements by launching tools which assist in data gathering from suppliers, measuring the carbon footprint of products, and creating a digital ledger of carbon accounting data. These tools can be used to track and manage a company’s carbon footprint, driving sustainability and meeting regulatory obligations.
Most supply chain professionals complex datasets can require visibility often leads to decisions
Data chatbots offer a quick designed to handle numerical their data and receive answers
Having instant access to data maker can quickly identify reports to be generated, they Keep an eye out for integrated your data into a 3rd party chatbot.
Fred Akuffo Supply Chain Operations Transformation Partner PwC UK
Tom Alesbrook Supply Chain Operations Client Relationships PwC UK
Authors:
Fred Akuffo, Kassidy Roussel, Niall Briggs
Think about the journey to multiple rungs on a ladder. the first step, with autonomous goal, the final step.
Many companies struggle to their workforce is not on board to a lack of user adoption and people-focused AI transformations the workforce, leading to sheet and profit and loss accounts.
Consider the following:
> Assess workforce exposure of familiarity and experience technologies.
> Develop comprehensive adequate training and Don’t underestimate the successful adoption of AI.
> Design AI-ready business redesign business processes
Avoid the risk of employees after training and technology
By investing in your workforce for AI, you can pave the way transformation in your supply
professionals would advocate for the use of data in decision making. However, obtaining new reports or insights from require weeks of work from analysts or data scientists making it impractical for off-the-cuff queries. This lack of decisions being based on gut feelings rather than concrete data.
quick and efficient solution to this. With a similar end user experience to ChatGPT, these tools are specifically numerical data. By integrating them with ERP and Advanced Planning Solutions, decision makers can easily query answers in real-time.
data empowers decision makers to make better-informed choices. In the event of a supply disruption, a decision affected suppliers, assess the overall impact, and prioritise materials accordingly. Instead of waiting for they can simply ask the data chatbot. integrated planning assistants embedded in your APS and ERP solutions in upcoming releases, or consider feeding chatbot.
to an intelligent supply chain as ladder. Complete end-to-end visibility is autonomous decision-making the ultimate
to get their foot on the ladder when board - 70% of transformations fail due and behavioural change. Prioritising transformations will drive efficiency across tangible benefits for the balance accounts.
exposure to AI: Understand the level experience the workforce has with AI
comprehensive training programs: Invest in change management initiatives. level of training required to ensure AI.
business processes: Thoroughly review and processes to align with AI capabilities. employees reverting to old ways of working technology investments.
workforce and considering their readiness way for a successful and impactful supply chain operations.
While 21% of UK CEOs say their organisation will not be economically viable within 10 years on current trajectory, not investing in these transformation strategies will see any organisation fall towards the back of the pack and face significant economic challenges. The visionaries and market leaders have clear transformation agendas around AI in particular. This brings competitive advantage, increasing market share and minimising operating costs. Supply chains are increasingly crucial to modern business and organisations have to take note. AI can have a big role in shaping decision making but navigating the complexity of change can be a challenge. While these five key moves help illustrate that challenge, operationally, environmentally and financially they are also an opportunity.
continued from page 49
Are you able to provide a couple of examples of how this composability is reflected in your evolving offering?
For a number of years we’ve been building products that integrate into different areas of business operations, but the important differentiation in recent times has been around this composability and synchronisation. So, making them composable but tightly coupling them with that master data, with the ability to add decision capabilities on top, underpinned by a common user interface as part of a bigger suite.
What’s getting really exciting is the move towards intelligent technologies, though, which a lot of people haven’t taken advantage of yet. So, moving to SAP S/4 HANA – it’s infused with analytical capabilities, with the ability to get out more data and do all this clever analysis and bring data together from different sources. Honestly, a lot of people have not really taken advantage as much as they could from that, because they’ve kind of shifted from what they had, to doing it the same way but with a different system.
Where things like AI come in now is we can start to build models that learn from the whole of the SAP ERP suite of 20,000-40,000 customer processes. Whereas at the moment, if people want to do digitisation, or add intelligence, they’re doing so on a case-by-case basis, using their own tools, and to some degree, creating a new spaghetti-soup bestof-breed landscape. What we’ve got the potential to do with the platform now, and especially with the explosion in AI capabilities, is to say, because it’s in the cloud, we can build these foundational business AI models and allow you to access them, fine tune and ground them responsibly, and apply them to your data; to become much more automated, intelligent and even generative.
This is where having all of these building blocks starts to become a real differentiating and transformative landscape. A lot are building data lakes and putting nice analytical tools on data lakes, which means they extract some information but then when they find out they’re missing some context, they have to go back and create new extracts. We have the
ability to get at any data or any information, keep its context where it exists, and bring greater analytics. And especially with AI, we can start building models that learn from previous incidents and relationships.
When you have a tech shift dovetailing with external events, changing customer demand and the sustainability aspect all at once, this need for connected and intuitive insight must be paramount?
We see it play out in examples all the time. For instance, logistics might know that something is delayed or short of required volume, but manufacturing would usually only find out when they book it into the warehouse. They then create a three-week plan based on materials that either aren’t coming or that will be late. It’s not just a system, but rather a process change that’s needed, where the system needs to enable better cross-departmental collaboration.
The above example also brings in other areas that SAP is working on such as starting to use natural language and analytics to enable more
seamless interactions, through foundational tools such as Joule and Just Ask. Here, you could ask what late shipments to expect, from who, and what impacts they will have on the shop floor, before making recommendations on how to resolve. These questions can only be answered if there is data feeding into each other, from logistics to warehousing to distribution and manufacturing; also incorporating the external aspects (weather, transport, etc) we discussed earlier.
It’s about mapping the complete situation to give a real time overview of what’s possible, so that smarter decisions can be made ahead of time, rather than having to react to a late shipment or delayed arrival and risking the ultimate delivery of items you’ve promised.
Where do companies start, then? It’s often the first step of a transformation that proves most daunting…
This is indeed the question, and where people are struggling. There are so many strands to it and so many exciting technologies implicating things like AI
and natural language as we’ve discussed. It’s not just a transformation of tech, but of ways of working and the people impacted within that. However, on the plus side, nearly all companies are aware that they do need to transform and to align themselves with these innovations. It doesn’t necessarily mean they know what everything means though – and that’s where SAP and our partners come in, not just as tech providers but as guides of each customer’s respective roadmap.
There’s a whole world of new capability, domain expertise, process change, where we really need to work together as technology providers, implementation consultants, business process consultants, and the companies themselves. The latter link in the chain can’t be overlooked, though. I see a lot of comments from decision makers pleading that we ‘stop pushing technology for technology’s sake’ – a comment I 100% agree with. But that statement can’t be an excuse to ignore the potential of tech like AI or cloud altogether. It should be a nudge to better
understand the applications at your disposal to then see the true impacts they could have on your business.
Obviously, we’re talking about your customers’ supply chains, but your own ecosystem must be so important in order to keep ahead of the curve and to keep delivering these futureproofing technologies?
When we talk about composability, about providing a platform, there is a mass of whitespace, especially around the usage and incorporation of data, and formatting things in a particular way. We have an industry cloud strategy where people can build applications that complement solutions, using the same business technology platform, using AI in different ways.
Partners like PWC have great business process experts in the context of the supply chain so bring knowledge to us around such tools and processes. Bringing that knowledge together for customers, we don’t have enough people to tell everyone how to go about it, what needs doing, the types of data needed, the AI
tools to adopt, how to adjust processes. Partners like PwC and others bring both solutions and consultation that complements our business technology stack and also fills the gaps where needed. It’s about offering an ecosystem that helps people go through a transformation, understand business impacts, apply technologies and solve very specific problems. Having those partners within that ecosystem, is hugely important.
Looking ahead as an ecosystem, but also as a global heavyweight such as SAP, what is your focus for the coming 12 months?
If you look at it strategically, I think SAP’s focus overall is to become the business AI backbone – this decision support platform for end-toend business. In the context of the supply chain, that brings opportunities for efficiency increases, for people to become more predictive, to connect processes, and get that context across the entire supply chain. People talk about things like the autonomous supply chain or the self-healing supply chain, and nobody is there yet, but it’s something we’re striving for and making steps towards. Over the next 12 months, we want to see those next steps of more autonomy and improved decisions off
the back of connected data for our customers.
This progress will focus on areas such as sustainability where transparency, connectivity, traceability and visibility are all bottlenecks for companies, but more generally we want the next year to be one of increased adoption of solutions that will make supply chains more resilient, more agile and more accepting of ground-breaking benefits such as AI.
In doing so, our customers will be better equipped to stay ahead of that new norm where disruption is a continuous state of play, rather than a series of individual events.
Marc Munier is the Founder and CEO of DitchCarbon, a climatetech venture that provides emissions intelligence at scale. He realised the need for a solution to help companies accurately measure then reduce their scope 3 emissions. This led to the development of the DitchCarbon platform which automatically calculates your suppliers emissions using their own data to provide the most accurate GHG approved emissions possible.
From this data DitchCarbon ranks your suppliers, finds alternatives as well as generating reduction plans for each of your incumbent partners. This information is then presented through a simple, intuitive SaaS tool and accompanying API, making it accessible to your whole procurement team – this is critical to embed sustainability into your process.
Marc’s background includes extensive experience in sales, revenue management, mentoring, and entrepreneurship, with a demonstrated track
Our primary challenge is helping procurement people understand that this doesn’t have to be hard, there are a lot of companies trying to make this complicated to sell more consulting hours, but it doesn’t have to be that way.
record of success in various industries and roles. He has been involved in significant entrepreneurial and leadership endeavours. His current focus at DitchCarbon reflects his entrepreneurial spirit and commitment to meaningful projects with real impact
Over to Marc to fill in the blanks on DitchCarbon.
DitchCarbon is the Bloomberg of carbon emission data, we research, normalise, benchmark companies on their climate action then uniquely provide clear actions to accelerate their decarbonisation.
What issue does your solution solve?
Procurement people are under increasing regulatory, customer and moral pressure to reduce the emissions
within their supply chains. DitchCarbon takes you from a list of your suppliers to a decarbonisation plan for each of your suppliers with zero manual effort from you. We don’t just measure and let you do the rest.
Who is your solution aimed at? What does your perfect client look like?
We tend to deliver the most value to procurement professionals with large distributed supply chains. It doesn’t matter where your suppliers are located or what they do, we give you and them the insights needed to reduce emissions. We condense huge volumes of data and sustainability expertise so you can focus on what you do best –getting the best deal for your company in terms of finance, quality and now carbon.
What is the biggest
challenge Ditchcarbon faces?
Our primary challenge is helping procurement people understand that this doesn’t have to be hard, there are a lot of companies trying to make this complicated to sell more consulting hours, but it doesn’t have to be that way. Identifying your biggest emitters, setting clear objectives with them is a science but it isn’t rocketing science.
Simple quick action on reducing emissions, fully integrated into where you already work. Whatever you use to manage your process, a huge SAP instance, a point supplier management tool like Graphite connect or a spreadsheet, DitchCarbon helps you take control and start to reduce your supply chain emissions.
Ivar Lammers has recently vacated his role as COO of Daily Banking and Treasury, to once again become Global Head of Financial Crime Wholesale Bank in 2024 - a role he previously held between 2017 and 2020. A “victim of his own success”, he jokes, as he is tasked with finding more innovative ways for ING, and indeed the wider financial services sector, to streamline the Know Your Customer (KYC) process and to ensure compliance, crime prevention, operational rigour and customer satisfaction in equal measure.
A “victim of his own success”, he jokes, as he is tasked with finding more innovative ways for ING, and indeed the wider financial services sector, to streamline the Know Your Customer (KYC) process and to ensure compliance, crime prevention, operational rigor and customer satisfaction in equal measure.
Hi Ivar. We seem to have caught you at a bit of a personal career juncture, but also at a crossroads from the perspective of ING and the finance industry more broadly. How would you surmise the current state of play in your sector?
The absolute key thing for us
We have vital internal and external partners, and the journey we have laid out has been considered and meticulous. It’s been designed in a way that means there needn’t be backward steps from here.
now, with the volumes and workloads we are facing, is to be data and intelligence driven.
When I look at the client services side in my former position of COO Daily Banking, I was in continuous interaction with clients, and clients have questions like “what’s the balance of my account?” or “where is the confirmation for my payment order?”. All of these interactions can be significantly automated, because if you have, for instance, an account number or payment date, you should
be able to wire that fully automatically through the customer portal to your system of record, and back to the customer. However, when we’re talking about large corporate clients, they have a centralised Treasury Department, and they deal with not just ING but different banks in different regions. So, they prefer to engage with you via the global universal banking portal, “e-mail”, where you get text instead of data points. The question becomes hidden in the blur of text, and more difficult
to translate into structured data points that allow me to automate interactions and to automatically query my systems of record. That is one aspect of data-driven challenges, although partially addressed by eBAM, that needs to be addressed more passionately.
However, there is another side to this data conversation, which more revolves around my role around financial crime prevention. And that is the Know Your Customer (KYC) process.
Also jovially known as ‘Kill Your Colleague’ sometimes, as I understand… what impact could automation play in this traditionally frustrating process?
There are a lot of redundant data points across the entire financial industry. Reviewing clients at regular timed intervals equates to hundreds, if not thousands of pages of data points across the industry, and those data points need periodic reviewing which is incredibly time-consuming and complex if done in an unstructured and manual way. Regarding the client’s digital identity (known as Identification and Verification of the ownership structure) this includes hard data points such as names or addresses, obtained from public trusted sources like trade registers. But there are also soft party data points which refer to the purpose and nature of business relationships, and therefore where and why transactions are done. Next to the digital identity, you must become familiar with and baseline the client’s transactional behaviour. This typically boils down to a per-individual relationship: “products vs jurisdictions”, “accounts vs
jurisdictions”, “flow fromand-to jurisdiction”, and an overview of booking and initiating offices. These data points allow a KYC operation to ensure that the correct local legislation and specific product legislation is applied to a Customer Due Diligence (CDD) review. Then there is something called verifiable evidence, where, for instance, identities of main principles within a legal structure identified in a trade register, need to be confirmed by an independent verifiable source which usually requires either an ID card or a passport.
The aim has to be to have this data, and to both see and review this data, in a more structured and continuous way. Yes, because it is more seamless for us; but also so I don’t have to confront a client with a cold call for an ID document every three years, but rather ask for reconfirmation on what we have already exchanged. Here I’d initiate a CDD review, not just for the sake of a timestamp, but rather because my continuous (perpetual) view of the client’s identity and behaviour surfaces a change that - in line with legislation
and policy - requires investigation or confirmation.
This would ultimately mean being able to do our work more effectively, with greater efficiency, while improving the customer experience. Because, at present, if I’m asking a treasury department to bother their CEO for a copy of their passport, they are typically not too excited about it. Whereas, if we’re just seeking seamless confirmation of data we already have as part of our continuous customer due diligence, then it’s much simpler for a treasurer to respond (reconfirm), everyone remains compliant, and nobody becomes fatigued by the process.
I’m sensing there is still some hesitancy among clients to make this transition, though?
Well, yes and no. They like the idea, but it’s not as simple as that for the larger clients with more complex structures, that deal with multiple financial service providers. The idea of interacting with structured data via a customer portal that automates parts of the relationship and makes their management more seamless,
is attractive. But a treasurer deals with numerous banks, and would be confronted with needing to log in and out of multiple bank portals, being exposed to multiple KYC policies. They want one multibank vault to store their KYC information in, where they can decide which bank they want to provide the key. This is where we use CoorpID as the multi-bank portal.
And that is where your recent initiated digital transformation comes in?
Exactly. For KYC, we have established, through our partner, Blackswan, a market data hub. This hub creates the international profile of a client through a global trusted source and overlays every entity’s data, based on the country of incorporation, with a local trusted source. This is primarily the trade register, but a Financial Economic Crime (FEC) policy typically has a confirmed trusted sources setup with primary, secondary and other sources as well. The Blackswan datahub allows us to apply that hierarchy and receive an alarm where different sources provide a different value for the same data point. It issues
a “distillate” of ownership that could not be identified (private equity, trusts, etc) that requires us to reach out to our clients. This automates the majority of the identification and verification of ownership structures, and reduces our dependency or vendor lock-in to specific data vendors significantly. Also, with it being digital and structured, it also allows us to perpetually compare the values in trusted sources to those in our systems, to identify - for instance - new main principles or changed ownership percentages.
For the aforementioned transactional behaviour side we perform the exact same perpetual comparison across our systems-of-record on a month-to-month basis for relevant data points, to identify any relevant change in transactional behaviour. This is done through our Domino system.
And as for the still required verifiable evidence, wehave the multi-bank vault through which we can publish questions to the client. This perpetual way of working allows us to stay away from “mechanical” questions and
engage in a more clientcentric way. Our data-driven foundation allows us to relay to the customer, ‘we are giving you advanced warning that your ID document, statement of non-polluted shares, trust letter, etc is up for reconfirmation’. Figure 1
and structured, it also allows us to perpetually compare the values in trusted in our systems, to identify - for instance - new main principles or changed ownership percentages.
If the identity and behaviour remains unchanged, and the verifiable evidences are reconfirmed, no full Customer Due Diligence process needs to be commenced, bringing significant relief to both customer and bank.
For the aforementioned transactional behaviour side we perform the exact same comparison across our systems- of-record on a month -to -month basis for relevant to identify any relevant change in transactional behaviour. This is done thr ough system.
And as for the still required verifiable evidence we have the multi-bank vault through can publish the questions to the client. This perpetual way of working allows from “mechanical” questions and engage in a more client- centric way. Our data foundation allows us to relay to the customer ‘we are giving you advanced warning document, statement of non-polluted shares, trust letter, etc is up for reconfirmation
Presumably with this perpetual KYC, you’re also only receiving automated red flags for things that require your time and attention, so you’re also channelling your own operations and resources towards necessary tasks; rather than just complete reviews of o ften-static client profiles?
Precisely, but BlackSwan, our systems of record and our customer portal, are not alone in facilitating this. They are part of a broader digital transformation.
and the verifiable evidences no full Customer Due Diligence process needs to be commenced , bringing significant
This is where Xlinq comes in. Xlinq secures the workflow across the above three. At first it verifies entities’ behaviour, flags any issues that it is potentially inactive with us, and where the Relationship Manager can respond within the workflow. For act ive entities Xlinq orchestrates what BlackSwan obtains to form a global digital identity profile to bounce that off against our internal system and to identify any changes. The changes are assessed within the workflow by the analyst to ensure we capture th e correct data within our client profile. Xlinq equally does that for the client behaviour. After applying the rules engine, Xlinq issues the proposed client outreach questions which are then reviewed in the workflow by both analyst and Relationship Manager before publishing these into our client portal.
Are you able to quantify the potential scale of this newfound efficiency?
When aligned with policy, all required data and evidence is obtained, and the customer file is complete, the actual review of that file can be done, which happens in our KYC orchestrator workflow system (KYCO)
To give an idea of the scale of data we’re dealing with and the need to perform pertains to the ownership structure of the client which can be up to hundreds address, the ownership main principles, industry code(s), which products are used in which jurisdiction, funds, purpose and nature of the relationship, what laws govern each of those jurisdictions, etc.
Presumably with this perpetual KYC, you’re also only receiving automated red flags things that require your time and attention, so you’re also channelling your own and resources towards necessary tasks; rather than just complete reviews of o ften
With this transformation ahead of us we will in the future have real -time visibility information as it changes. Perpetual KYC gives us a data profile that can seamlessly updated, checked or flagged; rather than putting our clients through the en tire, every one, three or five years where breaches or shortfalls could have also occurred driven way allows
Precisely, but BlackSwan, our systems of record and our customer portal, are not alone
This is where Xlinq comes in. Xlinq secures the workflow across the above three. At verifies entities’ behaviour, flags any issues that it is potentially inactive with us, and Relationship Manager can respond within the workflow. For act ive entities Xlinq orchestrates what BlackSwan obtains to form a global digital identity profile to bounce that off against internal system and to identify any changes. The changes are assessed within the workflow
Are you able to quantify the potential scale of this newfound efficiency?
To give an idea of the scale of data we’re dealing with and the need to perform regular CDD on, it pertains to the ownership structure of the client which can be up to hundreds of entities. For each of those entities we need to know the entity name, address, the ownership control, main principles, industry code(s), which products are used in which jurisdiction, source of funds, the purpose and nature of the relationship, what laws govern each of those activities in those jurisdictions, and much more.
With this transformation ahead of us we will, in the future, have real-time visibility of that information as it changes. Perpetual KYC gives us a data profile that can seamlessly be updated, checked or flagged; rather than putting our clients through the entire, strained process every one, three or five years where breaches or shortfalls could have also occurred between those timeframes. Maintaining our customer dossier in this
data-driven way allows for a continuous, fluid relationship with clients in the future.
Figure 2
Presumably with this perpetual KYC, you’re also only receiving automated red flags for things that require your time and attention, so you’re also channelling your own operations and resources towards necessary tasks; rather than just complete reviews of often-static client profiles?
Precisely, but Blackswan, our systems of record and our customer portal, are not alone in facilitating this. They are part of a broader digital transformation.
This is where Xlinq comes in. First, Xlinq verifies entities’ behaviour, flags any issues, and pinpoints where the Relationship Manager can respond within the workflow. For active entities Xlinq orchestrates what Blackswan obtains to form a global digital identity profile to bounce that against our internal system and to identify any changes. The changes are assessed within the workflow by an analyst to ensure we capture the
correct data within our client profile. Xlinq equally does that for the client behaviour side of things too. After applying the rules engine, Xlinq issues the proposed client outreach questions which are then reviewed in the workflow by both analyst and Relationship Manager, before publishing these into our client portal.
When aligned with policy, all required data and evidence is obtained, and the customer file is complete, the actual review of that file can be done, which happens in our KYC orchestrator workflow system (KYCO). Figure 3
But by then you have only performed what you call data & evidence gathering, right? The actual KYC review still needs to happen?
Indeed. The result is a more scalable operation. The Data & Evidence gathering is supported by this technology, performed by another team aside from the KYC analysts. This ensures we only deploy KYC analysts during the actual review of a customer profile against the policy, to rectify the KYC status of the client. Data (KYC) operations perform all the preparations.
continued from page 67
More than just creating a more satisfying customer relationship, this has alsoalready - had a positive effect on employee satisfaction as well.
So, if Blackswan is public customer data, and Xlinq allows you to model applications that helps workflow, where does PwC’s solution come into the mix?
In setting up this capability we obviously needed to account for any regulatory and policy requirement. This is where PwC comes in as that third party, to offer an external legal opinion on whether every step, rule and setup is compliant. They are also
working with the industry and, with most financial service providers moving in this direction, have constructively challenged us on directions and decisions taken.
And how are customers reacting to the shift so far? What do they think of the new and upcoming approach?
It’s interesting, because it’s not a process they enjoy anyway. That’s the nature of the beast. But from conversations with some of our larger customers that participated in the pilot, the consensus is that they appreciate the digital transformation, the emphasis on data, and on moving
away from time-based KYC to a perpetual KYC model. Their remaining frustration comes from what we have to ask them for to ultimately ensure compliance and to have that complete profile up to date. In that respect, they remark banks are almost more stringent than the law. But we have to be, and they understand that, and are very appreciative that we are making huge efforts to make it as “easy” for them as we can in the future.
Of course, a lot of this transformation is quite technical. Are you able to illustrate the ultimate, highlevel ambitions of this more data-driven approach?
SIMPLY,
Simply, we want to become even more effective and efficient. This means less strain on our clients and workforce, less strain on our partners, and more continuous KYC reviews.
We still have a long way ahead of us though. Yes, we successfully completed proof of concept and the pilot, but the actual migration of clients from the time-driven way of working to the new digital and perpetual way of working will take at least three years. This doesn’t happen overnight and will mean we have a hybrid model for the period to come.
How do you envision this transformation evolving into 2024, in line with your role change?
It started on January 1st, operationalising and rolling out the new way of working across 2024 and into the future. That means for clients that are expiring in 2024, we are already working ahead of the curve right now. Piece by piece, client by client, as their rulebased KYC expiration dates come into view, they will be migrated over to the new perpetual environment. But
it’s an exponential process because with each migration to the new way of working, capacity is released that we redeploy to the new way of working, further accelerating operationalisation.
I asked at the start how you would surmise the current industry challenge landscape. Circling back to that now, what do you believe ING’s role is in overcoming the KYC challenge in particular?
We, and probably the industry, needed an onoff time travel into what a perpetual KYC experience would look like for clients and employees. It’s an industry challenge we’re all facing and dealing with, and pioneers need to be brave enough to fast-track its introduction and to expose stakeholders to this topic… to create the proof points. From there we travel back in time to today, the apostle will spread and the journey towards something else starts. The most complicated part of building something new is getting out of PowerPoint and to operationalise. But that’s what we’ve done, and I guess that’s what the industry is doing.
We have vital internal and external partners, and the journey we have laid out has been considered and meticulous. It’s been designed in a way that means there needn’t be backward steps from here.
It is designed and built to be bank- and industryagnostic with an expectation that the gatekeeper role in KYC and financial crime prevention becomes an obligation beyond financial institutions to also implicate sectors such as casinos and government bodies. For each, more effective and less costly operational options need to become available to secure the gatekeeper role across all applicable industries.
I’m passionate about data’s role in all this, so the journey has been focused around not just efficiency at any cost; but very much also compliance, privacy and protecting customers through clearly established rules. It sounds restrictive, but if you have these elements clearly defined, it actually allows for more riskfree agility because you know exactly what boundaries you’re working within.
James Stirk originally joined Tradeshift almost 3 years ago to head up the sales function, having spent over 25 years building strategy, sales growth and business development for established Multinationals (Fortune 500) and smaller (PE-backed) organisations across finance, ERP, business intelligence and cyber. Now sitting as CEO he shoulders responsibility for scaling the business, strengthening its current proposition and partnering with clients to uncover new ways of delivering value.
We caught up with James to get the detail on a business that wants to ensure 100% digitalisation across every supply chain relationship.
James, what is Tradeshift?
Tradeshift is a leading B2B commerce and fintech platform that empowers finance and procurement leaders to optimise operational processes, reduce costs, mitigate risks, and foster transactional agility across the supply chain. We achieve this through a blend of e-invoicing, marketplace eCommerce, and embedded fintech services, providing businesses with tools to automate transactional processes, discover new suppliers, attract customers,
and optimise working capital according to their needs.
Our vision is to connect every company in the world, creating economic opportunity for all. At the core of this vision is the Tradeshift network. Today, Tradeshift is the world’s largest trade network, linking over a million companies globally, enabling seamless, digital transactions between customers and suppliers anywhere in the world.
What issue does your solution solve?
Digitisation within large enterprises is at a fairly advanced stage. The missing piece in the puzzle is digitisation between business partners across the broader supply chain ecosystem. Tradeshift simplifies and automates everyday business interactions such as purchasing, invoicing, and payments by offering a centralised digital platform where businesses can connect, collaborate, and transact efficiently.
The specific solutions we offer today are grouped into three primary areas:
Payment automation:
Tradeshift Pay, our e-invoicing and accounts payable solution, digitises the exchange of purchasing and invoicing information between buyers and suppliers. We embed automation and AI directly into the transaction process, eliminating huge swathes of manual work. Tradeshift customers have already seen AI reduce manual interventions by as much as 99.5%. This delivers huge efficiencies and cost savings. Last year alone, we saved our customer base over three million hours of time that would otherwise have been spent fixing errors, chasing approvals and responding to supplier inquiries.
Across the world we’re seeing an accelerated push towards mandatory e-invoicing as governments digitise their taxation. Controls and specifications differ from one country to another. The result is a complex patchwork of compliance rules that businesses must follow. For businesses on the Tradeshift network, we take that pain away by embedding global compliance-as-a-service capabilities directly onto our platform.
Last summer, we announced our intention to form a joint venture with HSBC which paves the way for us to embed financial services directly into the Tradeshift experience, providing businesses with access to working capital at the point of need.
What we’re doing with HSBC is a world-first in embedded finance. One of the first areas we’re working on together is receivables financing. Large enterprises want to keep cash on hand for as long as possible and suppliers wait 60+ days to get paid. Traditional financing methods have struggled to address this gap due to limited data for risk assessment.
As a two-sided network, Tradeshift gathers data from both buyers and suppliers. Leveraging this combined dataset with HSBC will enable us to provide financing and other bank services to both sides of every transaction. This will result in faster-flowing capital across entire supply chains with the potential to create new opportunities and stimulate growth.
Marketplace commerce:
We build online B2B marketplaces that we strongly believe are the future of e-procurement. In a world where more than 40% of online consumer purchases are made on marketplaces, the inflexible and often byzantine processes that dominate corporate purchasing look increasingly outdated compared with the proven convenience of consumer platforms. Our marketplace offering connects large organisations to prevetted suppliers in a curated purchasing environment that provides convenience, control and competitive pricing.
The B2B marketplace model is going to replace large segments of procurement over time, especially in indirect spending categories where businesses are routinely missing out on efficiencies and cost savings rising to 30% of their topline. What we’re creating is a ‘network of marketplaces,’ accessible through our platform, that businesses can punch in and out from according to their specific purchasing needs. Crucially, this can all take place on a single platform and through a single user interface.
Who is your solution aimed at? What does your perfect client look like?
We typically work with large enterprises and mid-sized businesses across various industries that have complex procurement, supply chain, and financial processes.
Businesses that get the most from Tradeshift see us as an integral part of their wider digital transformation strategies. Our solutions span finance and procurement and conversations with prospects will typically begin at the CFO and CPO level. Ultimately, we’re looking to talk to people who want to drive long-lasting and meaningful change within their organisation. We have a particularly strong presence in sectors such as transport and logistics, manufacturing, FMCG, retail, and pharma & healthcare, with clients including DHL, Kuehne + Nagel, and the NHS.
What is the biggest challenge Tradeshift faces?
Senior decision-makers will often tell us that their processes are already digital.
Across the world we’re seeing an accelerated push towards mandatory e-invoicing as governments digitise their taxation. Controls and specifications differ from one country to another. The result is a complex patchwork of compliance rules that businesses must follow.
Further discussion usually reveals that invoices are submitted using electronic means rather than collected in the post room. They might think of this as digital, but all they’re actually creating is an electronic copy of a set of systems and processes that had already been highlighted as failing. We spend considerable effort educating businesses on the true meaning of digitalisation and the broader transformational benefits it unlocks by connecting to a network comprising over a million potential customers and suppliers. Why pick Tradeshift?
The common thread that underpins everything I’ve described so far is our network and the connectivity it establishes between
every business that joins Tradeshift.
We are committed to achieving 100% digitalisation across every supply chain relationship. Inspired by consumer social networking sites like LinkedIn, Tradeshift facilitates connections between businesses on a single network, delivering compelling value propositions for both buyers and suppliers. Our commitment to creating value for any business that joins the Tradeshift network means suppliers onboard faster and buyers achieve their digitialisation objectives quicker.
This model creates a flywheel effect, making the platform increasingly attractive to join as more value-adding services are introduced. Partners like HSBC see Tradeshift as key to their own digital transformation initiatives and bring enormous value to businesses on the network. You simply can’t replicate this in an environment where things are not digital, or where the ecosystem is dominated by a single buyer or a single supplier.
Jag Lamba is the founder and CEO of Certa. Jag grew up in Bombay, India, and studied computer science before kicking off his career as a software engineer. After moving to the U.S. and transitioning into Product Management, he began pursuing his MBA from Wharton while working at McKinsey, eventually moving into its strategy consulting practice. Jag founded Certa in 2016 with help from Techstars and angels.
It has certainly been an upward trajectory since that point, so we spoke with Jag to get the lowdown on Certa
Jag, what is Certa?
Certa’s SaaS platform helps firms like MasTec, Indeed, Uber, and Box with global third party compliance, risk management and ESG. Certa provides a single place to manage all third parties globally, improves onboarding time by up to 80%, with 100% compliance and risk management, while freeing up time to work on more strategic projects. Thanks to a no-code studio and extensive library of over 120 integrations, Certa establishes a single, reliable source for up-to-date thirdparty data, empowering teams to focus on strategic growth.
What issue does your solution solve?
Today’s organisations are increasingly global interconnected ecosystems of thousands of suppliers, partners, and clients. Each relationship adds risks like data security, privacy, and fraud. Additionally, companies deal with everincreasing compliance burdens, such as the recent Uyghur Forced Labor Prevention Act (UFLPA) in the U.S. and the German Supply Chain Due Diligence Act (LkSG), along with pressing Environmental, Social, and Governance (ESG) goals. A firm’s competitive edge depends on its ability to work with third parties efficiently, safely, and swiftly. Existing systems at best offer point solutions which are often a pain to integrate, struggle to manage interconnected
Certa targets procurement, risk, and compliance teams across all industries globally, offering an AIdriven platform that simplifies and enhances third-party management. Our solution is ideal for any organization seeking efficient risk management, compliance adherence, and ESG integration in their third-party operations.
risks, and third-party data ends up siloed across multiple systems. Certa provides the most comprehensive and intelligent platform for global third-party management across procurement, compliance, and ESG.
Who is your solution aimed at? What does your perfect client look like?
Certa targets procurement, risk, and compliance teams across all industries globally, offering an AI-driven platform that simplifies and enhances third-party management. Our solution is ideal for any organization seeking efficient risk management, compliance adherence, and ESG integration in their thirdparty operations. With its comprehensive, customizable features, Certa is designed to empower teams to navigate the complexities of vendor relationships effortlessly, making it a crucial tool for businesses committed to operational excellence and strategic third-party oversight.
Certa faces?
At Certa, our biggest hurdle is staying ahead of the constantly evolving
regulations and risks that third-party management brings. The world of business is always changing, especially when it comes to staying compliant and managing risks. That’s why our main focus is to not only keep our platform up to date but also to anticipate what our clients will need next. We use cutting-edge technology like GenAI to make managing the entire third-party lifecycle smoother and more efficient. This strategic approach allows us to embed risk and compliance management seamlessly into the procurement process, providing our clients with a solution that simplifies these complexities, letting them focus on their core business.
Certa’s platform – powered by AI – streamlines otherwise slow, hard-to-update processes by connecting your siloed data sources, reducing IT resource needs, and giving you full visibility over every stage via continuous monitoring and alerts.
Personalize your workflow from intake to monitoring offboarding for true end-toend orchestration, all in one place.
Customise your automation journey, from complete streamlining to balanced control. Certa’s workflow automation tool can cut onboarding time by up to 300%, while maintaining full oversight at every stage.
Harness the power of
CertaAssist: use natural language to create and edit workflows, spark insights with on-demand data visualisation, and autofill cumbersome onboarding forms.
Easily implement Certa’s preconfigured modules – built based on best practices from Fortune 100 companies – to address your Compliance, Risk, and ESG needs out of the box.
Certa is proven at large enterprises with over 120+ readymade integrations, 41 languages, BYOK encryption for PII, WCAG accessibility compliance, SOC2 & GDPR Compliance, EU data residency.
