Keolis - Brochure 2021

One Keolis Project partners

Collaboration and alignment under

One Keolis How procurement successes born out of cross-company collaboration and sponsorship have become second nature to the business for Keolis NA, truly feeding into a One Keolis vision.

Written by

Dale Benton

Produced by

Richard Deane

C o l l abo rati o n and alignment under One Keo l i s

3

Y

ou’ve heard it before.

A procurement transformation journey is underway as

an organisation has come to realise that procurement is well and truly a key cog in its operations, if not the key cog.

Procurement isn't simply cost savings or filing through the data and identifying some capital that could be clawed back to better serve the bottom line.

Make no mistake, this is a core element of procurement, but there’s a lot more to it than that. A company has to simply let procurement capitalise on one of its biggest strengths: opportunity.

Take Keolis for example. As one of the world’s leading public transport operators, Keolis has operations the world over from the UK and Sweden, to Australia, USA, Luxembourg and China. It goes without saying that a company of this size and scale has tremendous opportunity in

the job to reengineer our procurement

its procurement functions, the question is

process, to transform it to become more

whether it realises this?

profit-oriented for Keolis, and to consol-

In Keolis North America, CPO Abraham

idate our volume and rationalize the

Saxionis is the man in charge of all

supplier base, which has grown exces-

procurement operations. More specif-

sively high,” he explains. “We have over

ically, he’s spearheading a significant

3,500 suppliers which we do business

re-engineering of procurement for a

with and as we progress, we want to

company which, while smaller in size than

establish more strategic relationships

its parent group, is experiencing tremen-

with outside companies, ones that we can

dous growth.

consolidate more of our volume with and

“Just over a year ago now, I was given C o l l abo rati o n and alignment under One Keo l i s

consider long-term improvements in what

we provide to our end customer.”

Simple enough on paper, but as any

early 2021, Saxionis can already point to significant successes that he has been

procurement professional will profess,

able to unlock together with his procure-

there are many steps to take even before

ment team.

one begins a journey like this. Most nota-

“Truth be told, in the past the company

bly, gaining the trust and the so-called

hadn't been tracking savings and

‘operational buy-in’ from the executive

reporting savings or even the impact of

board. Thankfully, Saxionis can boast of

procurement on profitability,” he contin-

being blessed with an executive team well

ues. “Through the initiatives we have

and truly behind this journey before he

undertaken, we have been able to save

even set foot in the business. This alone,

millions of dollars in this one-year period.

clears some of the initial hurdles that can

We can demonstrate this right down

often slow down progress.

to the nearest dollar and cent, and our

“I enjoy the sponsorship not just of the North American CFO, but also of our CEO of North America, and the CEOs of the

intent is to continue to do that as we move forward.”

Saxionis, a seasoned procurement

different divisions out there, who all real-

professional with a wealth of experi-

ize the power of procurement,” he beams.

ence working with IBM, EY and the Bank

And why wouldn't they? As we speak in

of America, knows all too well of the

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growing significance of procurement. As

there is a need to improve profitability. It

a procurement professional, he’s known it

should absolutely be the first area that

all along and his experience coupled with

they try to reengineer or improve, but

an intense enthusiasm for procurement

it's typically an afterthought. Because

means he is well and truly the right man

while this is happening, suppliers are

for the job at Keolis NA. Not that there

enjoying the freedom of increasing

was any doubt. “I realized a long time ago

prices and making a profit that's typically

that there is a humongous opportunity

much higher than what we were doing

for any company when you're looking at

at the time.” This is where the company

something that has the effect of directly

follows the One Keolis principle. Keolis

increasing profitability. Clearly, you want

looks to no longer be defined by Division

to do more,” he says. “As I have worked

A, Division B, or Division C, rather it is

in over a dozen companies throughout

one company that integrates all of its

the years, personally, I have found that

resources, not just technologies, but also

procurement was always the last place

its people.

companies look at to reduce cost when

ELEVATE THE ROLE OF PROCUREMENT Our Procurement Performance Management platform enables teams to manage their sourcing pipeline — all while sharing their performance with Finance and stakeholders.

Keolis by its very definition is

“ Through the initiatives we have undertaken, we have been able to save millions of dollars in this one-year period. We can demonstrate this right down to the nearest dollar and cent...”

— Ab ra ha m Sa xi oni s C hief Procurement Officer at Ke o l i s N o rth A m e ri c a

low-margin business which enters into

to the bottom line through automation

very competitive contracts and agree-

of manual processes. Procurement is

ments to serve the local governments,

the prime game for that, because of the

municipalities and so the company must

number of transactions that we support

always be looking to find ways to continue

on a monthly basis,” he says.”

to improve profitability in order to make

“We’re able to showcase the fact that if

those contracts sustainable over the long

we do a good job dealing with suppliers

term. The key to doing this speaks to a

while also gaining an understanding of

broader procurement conversation that's

the internal processes of the company,

happening the world over; the consoli-

bring ideas to the suppliers and part-

dation of, access to and analysis of data

ner with suppliers to improve internal

from both the external suppliers but also

processes of our own company, then

from internal processes.

will have a significant impact on the effi-

“It's no secret that technology has had a significant impact on how we do things.

Where we were very manually intensive

ciencies and the effectiveness of internal operations.”

An example Saxionis points to high-

in the past, we now have opportunities

lights is perhaps one that will strike a

to leverage technology to automate all

chord with many procurement profes-

those processes, and we have the ability

sionals. More often than not, indi-

to identify the opportunities for further

vidual commodities in which Keolis

improvements with significant impact

purchases from individual suppliers or 7

C o l l abo rati o n and alignment under One Keo l i s

manufacturers may end up being billed for individually. “We definitely don't want them to be billing us by division,” he laughs. “So one of our main objectives is to bring efficiencies to the company through vendor consolidation as well as invoice consolidation and summarization of what we do, including POs and all that kind of stuff, through data analysis.”

Saxionis and his teams had to collect all the data that would enable them to perform the analysis and identify opportunities that represent the biggest return for the business so that procurement could also prioritize its efforts. In his experience, Saxionis has seen far too many people “put their jogging shoes on and run in the wrong, or even opposite, direction of where the end line is”.

“For us, it was important from the beginning to know which direction to run once we put our sneakers on,” he says. “To assist in change management, we had an external consultant come in and perform an assessment of the different divisions, which yielded some insights that we were able to use as the springboard to launch a handful of initiatives that were fairly simple to target and undertake and which helped us score some early successes.”

These initiatives were created in line with the overarching strategy of fostering collaboration among the divisions in order 9

“ We don’t just want to do business with the largest suppliers for the benefit of saving a dollar. We’re very community-oriented and so we award contracts to smaller businesses that are minority-owned” — A b ra h am S a xi oni s Ch i ef P ro cu rement Officer at Keolis N o rth A m e ri c a

C o l l abo rati o n and alignment under One Keo l i s

to get everybody to look at the same

stressed through working with us. We

data together and determine what the

want suppliers that are healthy and ones

most efficient way would be to improve

that can support us in our journey for

cost structure. This approach allowed

years to come. But at the same time, we

Saxionis to prevent the aforementioned

don't roll over and take the first price

individual bills per category per supplier

offered to us without consideration. We

per division. Having the data and the

have that understanding early on with our

collaboration meant that procurement

suppliers. We want a balanced relation-

could serve as a counterweight in the

ship, a fair handshake and to be able to

middle of the whole negotiation to make

both come out winners out of the partner-

sure the cost picture remains balanced.

ships we form. So long as you have the

“We want our suppliers to be profita-

data and you lay out the facts, there isn't

ble, by the way,” he interjects. “We never

much subjectivity that goes into the deci-

want our suppliers to become financially

sions at that point.”

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So it’s clear, and of no surprise to anyone, that data-driven analysis is critical. Fact-based analysis is what creates success in procurement. Keolis, a relative newcomer to North America, was in a position where its procurement systems were not integrated. With an operating model built around acquiring transportation contracts either run by governments or other companies, turning around those businesses is critical to Keolis’ success.

It's a strategic advantage for Keolis to bring in companies in which it can make a profit at the end to support its stake-

gathering capabilities presented in real

holders. Through this, Keolis also inherits

time. This implementation is geared

technology, which is then integrated into

around bringing consistency and integra-

its own ecosystem. “The processes, the

tion across the footprint to support not

basic systems and capabilities are not

only procurement, but the entire busi-

there for us to get the data. So we work

ness. This is where Keolis works closely

to understand how we can get to the data

with Per Angusta, a SaaS Procurement

and how we can integrate them into our

Performance Management Software.

reporting and analysis structure,” says

Designed so that Keolis can gain a clearer

Saxionis. “And that’s where the journey

picture as to the savings, budget plans,

was born as we realized that we cannot

targets and forecasts, Saxionis describes

continue on this path without a technol-

Per Angusta as “a great tool in our

ogy solution that would make all of that

toolbox”.

easier, more seamless, and more transparent for us, while improving controls.”

And thus, towards the end of 2020,

“It brought a lot of discipline in our environment because it serves as the certified source of information for savings

Keolis began the process of select-

that we are generating,” he says. “We

ing and implementing a new ERP solu-

have closed the loop between procure-

tion across the entire footprint. Upon

ment and finance, where in the past, a lot

completion, Keolis will have better data

of things would fall through the cracks.

C o l l abo rati o n and alignment under One Keo l i s

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“ It gets to a point where, in order to continue to expand and to be able to take advantage of the value that the company brings to the table when dealing with customers or suppliers, we need to be more united.

That’s the concept behind One Keolis” — Ab ra h am S axi oni s C h ief P ro cu rement Officer at Keolis N o rth A m e ri c a

C ol l a bo rati o n and alignment under One Keo l i s

It's both a method to capture initiatives,

the same causes we do. For example, if

but it's also a communicator tool in that

we take out trees and vegetation in doing

it allows us to integrate the fruits of our

something, we work with suppliers to see

labors and make them visible into the

if they could actually plant a tree and help

reporting of the business."

in that aspect of the business.”

As highlighted throughout, there is a

Elsewhere, Keolis works closely with

desire through procurement to improve

distressed business enterprises (DBE),

the financial and operational perfor-

smaller minority-led companies that can

mance of Keolis and while it’s clear that

be supported in order to grow. This is not

Saxionis subscribes to the school of

simply hearsay, as Saxionis certifies: “We

thought that it's not just about surviving

don't just want to do business with the

and making sure that the P&L is growing,

largest suppliers for the benefit of saving a

he also understands the societal respon-

dollar. We're very community-oriented and

sibility that rests upon Keolis’ shoulders.

so we award contracts to smaller busi-

This feeds directly into the procurement

nesses that are minority-owned. That's

reengineering journey.

another aspect that's also important to

Keolis operates with a “Think like a passenger” motto. A passenger is very conscious of safety, that’s undenia-

procurement. We have to take certain steps to meet our objectives in that area.”

So Keolis is reengineering its procure-

ble, and Saxionis does highlight how

ment processes, implementing a new

the suppliers it works with must align

ERP system to gain a better understand-

with Keolis’ commitments to safety.

ing of both its internal processes and that

The modern day passenger is also very

of its suppliers, and indeed consolidating

conscious of the world around them and

those suppliers in order to unlock great

what businesses like Keolis do to make

efficiency and opportunity. This is all well

the world a better place.

and good, but what about the people

“Keolis is very focused on its impact

behind the scenes? A new process or

and is sensitive to its impact on the envi-

technology is nothing if it isn't powered by

ronment. Our discussions and our logic

people with the right skillset and know-

in dealing with suppliers is ensuring we

how to leverage these changes.

do the right thing for the environment,”

“We are in the process of form-

he says. “We're working with suppliers to

ing a shared services organization for

ask them to believe in and contribute to

procurement, and for other areas in 15

the organization,” says Saxionis. “As a company starts out and we begin to grow organically, we all are working more like independent businesses. It gets to a point where, in order to continue to expand and to be able to take advantage of the value that the company brings to the table when dealing with customers or suppliers, we need to be more united. That's the concept behind One Keolis.”

Keolis is looking to establish a center of excellence and shared services environment at what Saxions refers to as the “platform level” or, headquarters to support the local needs of the divisions in a strategic manner. “This needs a lot of change management knowledge and skills to make it possible without disrupting the business by alienating the people who are already doing a fantastic job supporting their individual businesses,” he adds.

As we speak in 2021, officially one year into this journey, Saxionis has already highlighted the demonstrable impact of the work he and procurement are doing to the bottom line of the company. Again he highlights that the bigger successes for procurement are the ones where cross-company collaboration and sponsorship has become second nature to the business, truly feeding into the One Keolis vision. This collaboration is the key C o l l abo rati o n and alignment under One Keo l i s

to success for Keolis overall, not simply for procurement.

“There are so many times where you hear management saying one thing, but the troops are not following it. For us, it was very important to get the buy-in and the support of the people who actually do the work, the directors and their teams in each of the divisions to realize that they no longer should be working on their own when they are dealing with a particular vendor; they need to leverage the power of Keolis to succeed in what they do,” says Saxionis. “We have been able to demonstrate this through facts. That's the successful formula to use in this.”

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