WIK Group – Brochure 2020

At es eam that creates valu

HOW WIK GROUP POWERS ITS PROCUREMENT THROUGH SUPPLIER RELATIONSHIPS PROJECT PARTNERS

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At es eam that creates valu

HOW WIK GROUP POWERS ITS PROCUREMENT THROUGH SUPPLIER RELATIONSHIPS Daniel Chua, Head of Global Sourcing at WIK Group, discusses how supplier relationships are the cornerstone to success...

WRI T T EN BY PRODUCED BY 2

D al e Bent on Gr eg Chur c hi l l

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W

hen we talk of a procurement

on both internal and external relation-

transformation, we often focus

ships and what’s key to any relationship?

on a shift in process or the

Communication. By having clear, open

implementation of new technologies and

and constant communication across the

platforms in order to embrace a much

entire organisation and across your entire

more agile and “leaner” operation. More

supply base, only then will you truly

recently, organisations have started to

begin to see the real value that’s hidden

realise that all the best laid plans require

throughout the supply chain and procure-

the right talent and the right skill sets

ment ecosystem.

throughout the organisation, not just the

“Relationship management, for me, is

procurement function, to be able to fully

key,” explains Daniel Chua, Head of Global

realise the savings potential or the inno-

Sourcing at WIK Group. “I think that is one

vation and true value that procurement

of the very important factors and by rela-

can bring. But take it back even further,

tionship management I mean not only to

procurement and supply chains of all

the suppliers but also to my internal stake-

sizes, scope and complexities, are built

holders.”It’s also about understanding

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what we are going to be able to do to

responsible for creating and develop-

get support from suppliers, both finan-

ing hundreds of system solutions and

cially and non-financially. By non-financial

producing millions of products world-

support I mean in times of crisis, like right

wide. Perhaps most notably, WIK Group

now with Covid-19. If you have a good

has evolved into a global, full-service

relationship with suppliers, they actu-

development and manufacturing partner

ally allocate more resources to support

to many leading international brands. By

you. Procurement is all about relationship

its own admission, WIK Group believes

management that you build for a long

that “corporate challenges can only

time. You get returns when it is needed,

be managed by leveraging synergies

not simply on a daily basis.�

between capable people and financially

Founded in the early 50s, WIK Group

solid partners, driven by responsible

is a privately held German contract

sustainable change and innovation. We

designer and manufacturer (ODM/OEM/

focus our resources on personnel devel-

CM) for electrical appliances and devices.

opment and process excellence based on

Fast forward to 2020 and WIK Group is

a value-creating company culture.�

5

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As part of this corporate belief, WIK

Vodafone and Phillips, Chua was brought

Group embarked on a procurement trans-

in to deliver real change. Perhaps most

formation journey that will realign the

importantly for Chua, upon entering the

procurement function to collaborate more

business back in 2019, he wanted to make

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“PROCUREMENT IS ALL ABOUT RELATIONSHIP MANAGEMENT THAT YOU BUILD FOR A LONG TIME. YOU GET RETURNS WHEN IT IS NEEDED, NOT SIMPLY ON A DAILY BASIS” Daniel Chua, Head of Global Sourcing, WIK Group

going to be changes. At the same time,

going to be valuable for WIK,” says Chua.

there will be a lot of coaching required

“I want everyone to adopt a mindset of

towards a different way of thinking around

thinking outside the box and being far

procurement. Simply put, the only two

more vigilant and experimental in terms of

things that are normally discussed with

bringing different things to the table.”

suppliers are either cost or quality. End

To highlight his point further, Chua

of story. We need to explore the relation-

points to a more traditional approach to

ships further and so I want them to look at

the bill of materials (BOM). Previously,

it from a different angle and in much more

and much like many procurement func-

depth.”

tions, WIK Group would have a team

In order to achieve this, Chua would

focused entirely on BOM. Chua wants

accompany his team on supplier meet-

these people to input the BOM numbers

ings and gain an understanding as to the

but also to be able to think about those

way in which these supplier relationships

numbers, to analyze them and to under-

are handled. Only then, he feels, can he

stand more about the materials and parts

leverage this supplier base for greater

themselves. “Then they can ask and ulti-

insights which will then translate directly

mately answer the question as to why we

into greater relationships and ultimately,

are buying these parts at this particular

greater savings. “I’m slowly coaching my

cost?” he says. “Once upon a time that

teams that you need to bring in ideas

was a question that would be passed onto

about what the suppliers are doing for

the sourcing teams and forgotten about

other customers and how this is also

until next time. Now, we have people 9

asking more questions and understanding the business more.”

Changing a mindset and a culture within a business is no small feat, particularly when that business has been extremely successful operating in a specific way for a long time. This is a challenge that Chua has faced and will continue to face throughout this journey. It’s easy to say on paper that you will come in and instil this innovative cultural mindset that will guarantee success and cost savings, but being able to achieve that is a different story. Chua is a firm believer in being able to walk the talk and being able to practise what he preaches. Every step of this journey, every decision he makes and process he changes, he does so with purpose in order for both his people and his management to be able to see real value and benefit from those changes.

Any feedback he receives from above he shares with each and everyone of his team members. “It’s about reinforcing the notion that; all their efforts and hard work are being recognized by senior management. Not just by me,” he says. “This is important in building up a shared mindset so that we work as a team and move away from working independently in silos.

We work as a team and have shared responsibilities because ultimately, those 10

responsibilities will impact the entire business, not just one particular function.”

“We can’t operate to an out of date mindset of; once you’ve done your bit you move onto something else. If a mistake is made in your processing or it comes from the sourcing engineers, if you spot it and fix it you’re saving two people or even more. We’re working together and for one another. This is incredibly important for what I want WIK Group to achieve.” This is also key in establishing a sense of integrity for procurement. As with many organizations the world over, procurement has changed dramatically in the eyes of senior 11

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management and in the eyes of the busi-

complete the tasks but to complete them

ness. Chua and his team have witnessed

in a ‘better’ way than others.

this first-hand through this transformation

“The best way that we can see that the

journey. Where procurement was almost a

business now has complete confidence

business add-on, now Chua and his team

in our abilities is that we used to have key

see the other business units coming to

account managers being directly involved

them and wanting to become more like

in almost every part of our process,” says

them. The procurement responsibility of

Chua. “But now, after only six months,

WIK now takes on much more responsibil-

they don’t need to. They have confidence

ity. Historically, tasks would be transferred

in our abilities and they leave us to it as

away from procurement but now the tasks

much as possible.”

are coming into procurement because

As Chua has already noted, relationship

procurement now has the capabilities, the

management is key and as he continues

processes and the mindset to not only

to build competencies and drive change

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“ I INTRODUCED MYSELF TO EVERY SINGLE ONE OF THEM AND I SAT DOWN AND SPOKE WITH THEM OVER DINNER. OUTLINING WHERE WE WANT WIK TO BE IN THE FUTURE AND THE ROLE THEY CAN PLAY IN THAT” Daniel Chua, Head of Global Sourcing, WIK Group

internally, he must also look further at the way in which the supplier relationships are

and the role they can play in that.”

“Again, it’s about better understand-

handled from the supplier’s perspective.

ing the relationships so that we can grow

To best approach this, Chua kept things

these relationships together. Now, you’ll

simple. “After I looked at internal systems

see my team (where possible) travelling

and I looked at improving the way we at

around and meeting with suppliers and

WIK dealt with suppliers, I spent a month

sitting down with them and talking through

travelling outside the business to speak

our strategies and how we can better help

with all of our key suppliers,” he says. “I

each other. It’s all about rethinking what

introduced myself to every single one of

we think about our supplier relationships.”

them and I sat down, I spoke with them

At the time of writing, the world is

and I listened to them. It was about outlin-

currently gripped by the COVID-19

ing where we want WIK to be in the future

pandemic which has and will continue to

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define and redefine business practices

with regards to that changed mindset and

indefinitely. Risk and crisis management

shared responsibilities,” he says. “How we

is nothing new to procurement, but when

progress relies entirely on everybody’s

discussed it is often theoretical risks and

discipline.”

theoretical worst-case scenarios. As we

This discipline is crucial in reporting a

are currently experiencing a worst-case

process of Resume Work Status that Chua

scenario, businesses are now having to

has implemented, a process in which

act. Chua believes that the COVID-10

WIK can identify and better understand

crisis is actually giving credence to the

how and when its suppliers can return to

changes he has made and will continue

limited or full operating capacity. Given

to make to WIK’s procurement practice.

governmental restrictions and a number

“This situation has actually put us into a

of external factors, each supplier’s

spotlight that shines on us as individuals

status will vary and so the responsibility 15

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“THE BUSINESS AND INDEED OUR CUSTOMERS HAVE THE CONFIDENCE IN US TO BE ABLE TO DELIVER THAT INFORMATION TO THEM IN THE RIGHT WAY SO THAT THEY CAN BETTER UNDERSTAND WHAT’S GOING ON AND HOW WE ARE MANAGING THIS SITUATION IN A WAY THAT WORKS FOR EVERYONE” Daniel Chua, Head of Global Sourcing, WIK Group

rests with WIK’s procurement teams with regards to collecting the right qualitative

operate.”

“It goes back to what I said about confi-

data on these suppliers so that they can

dence. The business and indeed our

report back to key stakeholders with the

customers have the confidence in us to be

right insights in order to make the right

able to deliver that information to them in

decisions for the business. “These key

the right way, so they can better under-

stakeholders are external,” explains Chua.

stand what’s going on and how we are

“On a weekly basis we report back to all

managing this situation in a way that works

our external customers about the status of

for everyone.”

the current situations and what is going to

On paper, it seems as though this trans-

impact them and the number of suppliers

formation journey and indeed the meas-

that are working for their products,”

ures that Chua has looked to instil have

“Right now as an example, we are moni-

been entirely pain free. He is keen to admit

toring around 400 suppliers and my team

that this is not the case and that it’s impor-

can tell you exactly how many of those

tant for anyone enabling change to stop

suppliers are relative to just one of our

and look at the pain points you experience

customers. They can also tell you how

along the way a little deeper. “We still have

many of those suppliers are located in

a journey to go,” he says. “But what we are

areas that have different levels of lock-

doing is fine-tuning each and every step

down restrictions and how many can still

of the way so that people can get up to 17

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speed.”

The future of this journey is very bright for WIK Group and Chua breaks that future down into a number of key elements.

Firstly, he wants his procurement teams to be producing qualitative data while also bringing more valuable information into the business such as terms of technologies and new forms of supply base back into WIK Group.

Ultimately for Chua, it will always be about the people and the relationships.

Over his entire career he has always valued the importance of having key relationships built by people with the right mindsets. “What has been and will always be crucial to any form of success that I and WIK experience as part of this journey is that my team trust me in what I’m trying to deliver,” he says. “My team trusts that I’m willing to showcase their achievements and their success to our key stakeholders. What’s also key for me is that I have been blessed with management and senior stakeholders that truly support ideas and initiatives. This will only continue to enable great success for WIK Group from a procurement standpoint now and well into the future.”

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At es eam that creates valu

www.wik-group.com