CPO Innovation Magazine - June 2019

VOL I / ISSUE 2 / JUNE 2019

CPO I N N O VAT I O N

Procurement Ahead: Your Action Plan to Prepare Now

Procurement Ahead: Your Action Plan to Prepare Now BIG INTERVIEW Nat Parameswaran Group Vice President, Global Procurement & Supply Chain, USG Boral Building Products

Price : ₹395

CONTENTS COVER STORY 05 Procurement Ahead: Your Action Plan to Prepare Now - Dr. Pankaj Aher, Head (Director)Procurement /Strategic Sourcing, Schneider Electric NEWS UPDATES 09 Indian Railways to induct country’s most powerful diesel locomotive soon Finance Ministry to prepare a fresh proposal for Air India sale Tech Mahindra inks deal with Airbus for cabin, cargo design engineering Amazon may invest in NinjaCart to enter India’s fresh produce sector ASUS eyes 50% share in gaming laptop market in India Aditya Birla Sun Life Mutual Fund launches Pharma & Healthcare Fund Tech Mahindra and SAP Collaborate to Create Fresh Food Supply Chain Management Platform Vodafone Idea, Jio Deploying Blockchain Technology to Keep Spammers at Bay

FEATURE 13 Action Plan for Future Procurement through Digital Strategies 15 Diversity Matters! - Seema Mohanty, Head Source to Pay Operations, Bayer India 19 Action Plans for Procurement in Cosmetics Industry - COO - Private Brands, Purplle.com 21 SCM & Reverse Logistics - Amit Verma, AVP Procurement, MetLife EXECUTIVE FOCUS 24 Contract Engineering with Innovative Technologies Leads to a Right Solution on Services & Supply Chain - GL Gupta, Senior Executive VP, Head - Corporate Procurement Group Reliance Infrastructure 28 Don't Wait for Tomorrow, Establish the Future of Procurement Today - Dr. Abhijit Sarkar, Country Head-Corporate RealEstate, Administration, Infrastructure and Purchase, Sharekhan 33 The Megatrends that Impact Procurement's Competitive Advantage PARADIGM SHIFT 37 Hyperloop: The Future of Logistics - Adhiraj A. Bhaduri, Senior Officer, mjunction services ltd (SAIL - TATA Steel Venture) 39 Is Blockchain a Gamechanger for Supply Chain - Syamaprasad Head- Supply Chain Management, Sheenlac Paints Limited

MERGER & ACQUISITION 43 Commission prohibits proposed merger between Tata Steel and ThyssenKrupp Radiant completes acquisition of Max Healthcare to create India's 3rd largest hospital chain Aditya Birla Fashion and Retail to buy ethnic wear brands Jaypore and TG Apparel & Decor Situs, American Mortgage Consultants to Merge GSK Consumers Healthcare gets shareholders' approval for merger with HUL TOP 10 46 Top 10 Challenges that will Transform Global Procurement CASE STUDY 49 NIKE - From Labor-Practice Compliance to Design Offensive 51 General Electric - An Opportunistic Push into Sustainable Business INTERVIEW 55 USG Boral's Procurement Transformation Journey - Nat Parameswaran at USG Boral Building Products

EDITOR-IN-CHIEF Razum Rajan

DESIGN & PRODUCTION Simran Verma

EDITORIAL BOARD Manya Singhania Priyanka Ghosh Tanushri Debnath

MANAGER – CONTENT Sejal Gupta

SUBSCRIPTION MANAGER Varun Natarajan

EVENTS & ADVERTISEMENTS Abhishek Saini

MANAGER SALES Shriya Fathwani

DIGITAL LAYOUT & FORMAT Puneet Dochania Rasum Rajan PRINTED AND PUBLISHED BY MSK BUSINESS CENTER

PUBLISHED CPO Innovation A26, Block A, Sector 03, Noida- 210301 U. P. India

NOTE TO READERS The views expressed in articles are those of the authors and do not reflect the views of CPO Innovation.

Although all efforts have been made to ensure the accuracy of the content, neither the editors nor the publisher can take responsibility for the consequences arising from errors or omissions in the information provided.

Reproduction in any manner without prior permission from the publisher is prohibited.

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here is a French phrase, ‘L’audace, l’audace, toujours l’audace’ (Audacity, audacity, always audacity). It is that which made many organizations successful and dramatically profitable. A willingness to take bold risks and look up, look down, look all around becoming truly aware of the new and the innovative opportunities around!

Innovation at all times has been vertical for us. That’s the path we strive to walk on always – UP! And despite the benefits that arise out of looking in this direction, we often miss out who stands beside us. And even if we out of a turnaround of events, look at our side, it turns out to as a challenge. But a wholesome growth is not always vertical and our efforts has to have a 360-degree approach.

Along the same lines, for our cover story this time, we have action plans to address the key challenges of procurement in coming future and how CPOs should plan their procurement transformation journey.

Shunning a long-standing norm, the first half of 2019 has proved to be a year of pragmatism in supply chain and procurement, 87% supply chain practitioners in India in Q1 had a green flag when asked, if2019 will see a huge spike in investments in SCM Tech! (Source: CPO Innovation Survey 2018-19). As with any transformation program, the real challenge is in the implementation of what can be rightly termed as innovation, our cover story also talks about how we can plan our procurement transformation journey with right set of advanced technology and proper strategy.

For the Big Interview, we have excerpts from our conversation with Nat Parameswaran, Group Vice President, Global Procurement & Supply Chain, USG Boral Building Products Ltd.! where he talks about USG Boral’s Procurement Transformation Journey.

We would be happy to hear your views, comments and suggestions regarding our stories.

Happy Reading!

Razum Rajan EDITOR-IN- CHIEF

Procurement Ahead: Your Action Plan to Prepare Now

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ver the last two decades, procurement function has not only become one of the most impor tant and power ful functions in organizations but has come to a strategic focus rather than an operational focus. Going forward this function is expected to mature catalyst for organizational transformation.

Considering the procurement managers as transformation catalyst, they will have multiple challenges and opportunities while managing this function in the future. The procurement manager can surely help the organization in a substantial way by successfully handling these challenges: Data management The MNCs with world-wise establishments have huge data for spend, supplier base, pricing, etc. and it's becoming more complex with variety of supply chain models and solutions. Management of the data and extracting the required information at the right time with appropriate analysis for designing solutions is the demand of the current and future procurement professionals.

The biggest emerging challenge in front of professionals is handling this easily available huge data.

However, this challenge is going to open up a lot of job opportunities like data analysts, data managers and senior data consultants. These jobs will further get developed toward senior positions which will support the CEOs and CPOs offices.

Digitization of procurement processes – less human interface Automatized triggering for floating RFP to suppliers, online benchmarking for competitiveness and direct system allocation of share of business volumes considering performance indicators is the upcoming procurement excellence.

This will help organizations to remove personal biases in decision making with minimal human intervention. This will minimize the face to face negotiations and reduce the negotiation lead timelines too.

Financial risk assessment Over the years, lot of cases of financial risks and mismanagement of working capital are cropping up from small to large organizations. This will remain a big challenge in front of procurement managers due to shrinking profit levels and scarcity of cash to run the business.

The procurement professionals would need to seriously look at this aspect while taking sourcing decisions and keep monitoring the financial performance of the business partners.

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Collaboration and business partnership approach than a supplier supplying parts or services – Integrated solutions Over the years, the buyer-supplier relationship has got converted into business partner relationship in which the business partners have been involved in lot of design, process optimization solutions for operational efficiencies. In future, the business partners will not only look at buyers as partnering for suggestions/ solutions for some processes but will be offering total end to end solutions so that their added value is more and can compete on value propositions than part level or process by process costs.

Cost optimization – new collaborative models needed The biggest upcoming challenge is the shrinking cost optimization opportunities. In last few years most of the matured procurement teams in organizations have been working on cost reductions from suppliers with operational efficiency improvements. Negotiations, cost models implementation, eRAs, benchmarking and other initiatives. These initiates have been quite successful for long years but in recent years the scope of cost reductions has started going down.

Keeping this in mind, the buyers will have to work for more collaborative, long term and total solution provider partnership approach rather than localized efficacies of cost reduction on parts or small processes.

Global sourcing Most of the organizations are working on best cost country sourcing and also moving the sourcing hubs to emerging economies like India and Eastern Europe. However, the governments in many matured economies are politically pushed to ensure that the businesses in home countries are protected.

For procurement professional, this is going to be a challenge as the local governments will push for antidumping duties for imports whereas the same quality partners might not be available locally. On the other hand, this will also open up lot of opportunities for localization with industrial growth opportunities locally.

Supplier responsiveness is the key In the changing market scenarios, the high level of responsiveness towards customer expectations and changing requirements is going to be very critical parameter on which the business partner performance will be evaluated. While selecting the suppliers/business partners the procurement profession needs to keep this in mind along with cost competitiveness and financial stability.

Supplier expectations in comparison against competition While organization expectations from business partners are increasing, the expectations of suppliers are also increasing from their customers. Many suppliers work with multiple customers which are competitors.

This gives privilege to suppliers to compare their customers with each other and naturally increases the expectation level for professional partnership. The suppliers are looking for more and more high level of long term visibility of business association, volumes and transparency in procure to pay process. They will also be expecting strong support in real sense in their bad time of financial or operational crises.aking sourcing decisions and keep monitoring the financial performance of the business partners.

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Networking, keeping updates Development of a strong network has always been a key success factor for procurement professionals which will further increase its importance. There is a growing need of developing a strong network to get quick information, alerts, faster and early signals of new happenings, upcoming trends, crises or emerging scenarios in various part of world.

Environment focus Whatever we do in business is ultimately for human being and the importance of preserving nature for human cannot be ignored.

Environmental protection is going to be a most impacting and inuencing factor in sourcing decisions as the long term sustainability of the business association will come at stake if these factors are not considered in advance.

Healthy Mind – Last but not the least There is a growing awareness in people for “peace-full mind''. Though lots of people around the world realize that only a calm and peaceful mind can generate ideas and innovation, very few really work on this.

With the bombardment of data, analytics and pressure for performance, one should not forget the importance of peaceful and calm mind. Procurement professionals will require to be in correct state of mind for the success of the business!

Dr. Pankaj Aher Head Procurement /Strategic Sourcing - Equipments and Transformers (India) Schneider Electric

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The Next Step In Procurement Compliance Is Waiting For You. Who We Are Zycus is a leading global provider of complete Source-to-Pay suite of procurement performance solutions. Our comprehensive product portfolio includes applications for both the strategic and the operational aspects of procurement – eProcurement, eInvoicing, Spend Analysis, eSourcing, Contract Management, Supplier Management and Financial Savings Management.

What We Do Zycus provides a centralized platform to govern all category management, sourcing, supplier management and new contract creation projects enabling you to manage the complete upstream suite of products.

www.zycus.com

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News Updates Indian Railways to induct country's most powerful diesel locomotive soon The country's most powerful diesel locomotive, WDG-6G, is set to debut in Indian Railways with South Central Railway (SCR) hosting the trial run. WDG-6G is the most powerful locomotive engine among those in use in Indian Railways, is ready to undergo Confirmatory Oscillograph Car Run (CDCR) trials and join the fleet of locomotives of Indian Railways.

It is based on GE's Evolution series and is fitted with a 16 cylinder V-16 Evolution series engine, a four-stroke fully turbocharged and inter-cooled machine and comes with an electronic fuel injection system for higher fuel efficiency and lower emissions as compared to any other diesel locomotive being used by the Indian Railways.

Finance Ministry to prepare a fresh proposal for Air India sale The Finance Ministry is preparing a fresh proposal for sale of Air India, incorporating issues like crude oil prices and exchange rate volatility, flagged by EY last year on possible reasons of the government failing to attract bidders for the national carrier. The Ministry's proposal, to be placed before Air India Specific Alternative Mechanism (AISAM), will also include option of selling either 100 % or 76 % government stake in Air India.

The AISAM, which is a Group of Ministers, has to be reconstituted as Arun Jaitley and Suresh Prabhu are no longer ministers in the new government. They will be replaced by Finance Minister Nirmala Sitharaman and Civil Aviation Minister Hardeep Singh Puri. Transport Minister Nitin Gadkari is likely to continue in the panel when it is reconstituted.

Tech Mahindra inks deal with Airbus for cabin, cargo design engineering Information technology firm Tech Mahindra on Thursday said it has signed a multi-year contract with Airbus for cabin and cargo design engineering.

“Tech Mahindra aims to capitalize on the specialized skills and competencies in growing cabin engineering business over the next few years. As air travel continues to surge worldwide, airlines are looking to deliver comfortable and memorable, digital travel experiences through path-breaking 'Cabin Innovations',” the company said in a statement.

Karthikeyan Natarajan, global head of engineering and IoT at Tech Mahindra, said the partnership will strengthen the company's aerospace engineering portfolio, especially in areas like cabin engineering and customer services.

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Amazon may invest in NinjaCart to enter India's fresh produce sector NinjaCart, a Bengaluru-based fresh produce supply chain that supplies 25,000 tonnes of fresh vegetables and fruits monthly, can help Amazon India expand the horizon of its Pantry.

Amazon is in exploratory talks with NinjaCart to make an investment in the Bengaluru-based fresh produce supply chain company.

Investment in NinjaCart can help Amazon India expand the horizon of Amazon Pantry. While it already sells select grocery items through Amazon Now and Amazon Pantry, Amazon is yet to formally enter the fresh produce space.

According to the report, Amazon started talks with NinjaCart when the latter was in the midst of closing its $100 million equity financing round led by New York-based investment firm Tiger Global Management.

NinjaCart was valued at over $350 million after the closure of its last funding round in April, which also saw hedge fund Steadview Capital invest an undisclosed sum in the start-up, added the report.

ASUS eyes 50% share in gaming laptop market in India Taiwanese electronics major ASUS is aiming for 50% market share in the gaming laptops segment in India while increasing its retail presence from 100 to 200 stores by the end of this year. The company is aiming to increase its share in the consumer laptops division in India from 11% to 15-20% by the end of 2019. The company said it is further expanding budget-friendly laptop offerings with new affordable models of Vivobooks which were introduced last year targeting mid-range buyers.

"We noticed that not everybody is able to afford the Rs 60,000 or Rs 70,000 premium laptops. This year, we launched the new generation of Vivobooks with which, we are expecting to grab a larger market share in India," said Arnold Su, Head of consumer Notebooks and ROG Business, ASUS India Aditya Birla Sun Life Mutual Fund launches Pharma & Healthcare Fund Aditya Birla Sun Life Mutual Fund has launched Aditya Birla Sun Life Pharma & Healthcare Fund, an open-ended equity scheme that will invest in pharma and healthcare services sector. The new fund offer (NFO) was made open for subscription on June 20 and will close on July 4.

Apart from the core pharma and healthcare space, the fund will also look at other large opportunities in sectors like hospitals and diagnostics, wellness businesses, or the global contract research and manufacturing services industry (CRAMS). The scheme can also invest in equities of listed overseas companies, in line with the RBI and SEBI guidelines.

“The sector has been a long-term outperformer over a 10-year period, except in the past two to three years.

The underperformance of the sector in the last three years was due to compliance issues coming from abroad and pricing pressures,” said A Balasubramanian, CEO, Aditya Birla Sun Life AMC.

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Tech Supply Chain Conference & Exposition 2019 BOM Edition

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he 2nd edition of Asia's largest supply chain conference is all set to come back more bright, more advanced, more powerful on 19th and 20th September in Mumbai.

TSC 2019|BOM Edition organized by CPO Innovation - Strategic Intelligence to Supply Chain is focused on improving your end-toend digital strategy with an emphasis on SCM Technology Transformation via talent and skills required to most effectively leverage data and technology. The conference is designed to provide focused best-practice-led debates on key supply chain issues.

In this hyper competitive world, the need for businesses to deliver more for less whilst meeting an increase in consumer expectations is ever more challenging. The Fourth Industrial Revolution comes with its technological advancements and at TSC2019|BOM Edition, attendees will witness the practical implementation of AI, IoT, Machine Learning, AR/VR, and Humanoid Bots in supply chain and procurement domain.

At the heart of addressing these challenges through a combination of cross-industrial methodologies, Tech Supply Chain Conference & Exposition 2019 will bring together the best of businesses, CPOs, VPs, Supply Chain Heads from leading Industries. A leadership focused platform designed around improving supply chain, logistics and procurement strategy across the globe.

The 2 Day conference is pressed on achieving innovation, maximizing supply chain profitability and increasing visibility and flexibility to mitigate risk.

At the Tech Supply Chain Conference & Exposition 2019, Shri. Suresh Prabhu, Minister of Commerce & Industry will be the Chief Guest.

CPO Innovation is hosting a startup show – TSCStart-up at Tech Supply Chain Conference and Exposition 2019 Bombay Edition. This start up show invites early-stage startups in the Supply Chain Management technology space to idea validate & gain visibility among the right stakeholders with an unparalleled opportunity to impress several billion dollars purchasing power in attendance along with other influential investors while showcasing their products to the decision-makers in the SCM domain.

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Asia's Largest Supply Chain Conference The companies will get a chance to participate in the conference and showcase at the Startup Zone for 2 days, and further, their product will be covered exclusively in the November issue of CPO Innovation magazine.

The Tech Supply Chain Innovation Awards 2019 will felicitate the best of innovative Supply Chain, Logistics, Procurement & Business win practices. These awards recognize different aspects of Supply Chain that have enabled SCM as function to strengthen its role in the larger business context making it mission critical to organizations.

The main highlight of TSC2019|BOM Edition is CPO Book Fair. CPO Innovation is going to host Asia's first ever supply chain and procurement book fair. At this book fair, renowned supply chain and procurement authors and publishers will exhibit their books to the largest gathering that will bring together the best of businesses, Global Chief Supply Chain Officers, CPOs,

Sourcing Directors, Supply Chain Heads, Head of Logistics, Chief Digital Officers & Vice Presidents from leading firms.

TSC2019 takes pride in bringing together the leading B2B and B2C companies to share their latest ideas and strategies. Join the TSC movement & take advantage of the best technology that is available to build the future of Supply Chain.

For further details visit TSC2019|BOM Edition: www.mumbai.techsupplychaincon.com T: +91 0120 42969 52 / Ext 4375 E: support@copinnovation.com 12

Action Plans for Procurement in Cosmetics Industry What is Procurement?

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he business textbook says 'Procurement' is an act of obtaining or buying goods or services. The process includes preparation and processing demand as well as the end receipt and approval of payment.

Procurement is an essential part of any company's strategy because of the ability of the procurer to purchase materials which will determine the course of action for the operations. It is also very important for procurement to be done in an optimum value, in order to ensure the profitability of the business.

A closer look into the Cosmetic Industry The cosmetics industry is growing rapidly and is mainly governed by the demands of the consumers and celebrity endorsements. With an industry as dynamic as the cosmetics industry it is important to pay attention to the trends and understand the demand and consumer sentiment towards the brand in order to maintain a balance with procurement and supply of products.

The Challenges In recent times, the cosmetic industry has seen an upsurge in the demand for natural and organic products. This has led to an increase in the already prominent challenges for businesses, namely: Ÿ

Sourcing Challenge: Procurement of natural ingredients has become a complex process due to their widespread geographical availability and durability.

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Transport & Storage: Raw material for cosmetics needs sensitive handling and specific storage to avoid them from losing their properties resulting in loss.

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Durability: Inventory management is the key. Any cosmetics come with an expiry date, making them time-sensitive for warehouse keeping and sales.

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Volatile Demand: With the ever-changing trends, the demand for a product may be in abundance today and may be obsolete the next day.

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High-Quality Expectation: Quality of a cosmetics industry product can have a huge impact on the brand image, business and consumer health.

All procurement processes and beyond, right from purchasing, merchandise control, climate, storage conditions, hygiene in the production process and the treatment of raw materials must be continually inspected. Transparency has to be ensured from the beginning of the chain until the finished product is sold.

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The Way Ahead A strong procurement plan can be the answer to each of the challenges faced by the cosmetics industry.

Managing the supply chain plays a pivotal role in maintaining customer satisfaction. Ÿ

Forecasting: The first step in the procurement process is to understand the current demand and keep in mind the changing trends. Accordingly, make an informed decision about ingredient purchasing and inventory placement for retail.

Cosmetics forecasting takes into account historical sales of existing product lines, planned advertising and promotion, seasonality, syndicated data available on category or similar product sales, customer demographics and, sometimes, intuition.

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Product Knowledge: An understanding of the formulation and manufacturing timeline comes in handy while making a procurement plan. For cosmetics, some ingredients may be perishable and thus, have expiry dates. With the knowledge of the raw material, special storage and handling arrangements can be made to avoid contamination.

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Shipment Packaging: Packaging may sometimes become a bottle-neck and may lead to a disturbance in the supply chain timeline. Packaging material procurement, as well as back-up planning, helps in keeping the process timeline on track, thus, preventing loss for the business.

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Logistics: Cosmetic products sitting in the warehouse will be of no good. Planning the distribution and transport for products to various retailers ahead of time shall facilitate the process of supply chain by maintaining a constant inflow and outflow of products.

In some cases, there also needs to be a plan in place for inbound logistics or product returns in order to avoid chaos and disruption of a set process.

The Bottom Line The cosmetic business is seasonal and new collections are introduced two or three times in a year. The supply chain process of products with a highly dynamic nature is shaped by many internal and external requirements and restrictions. With the rise of demand within the cosmetic industry, manufacturers and businesses need to continuously adapt to new technological processes in order to maintain supply and keep costs low.

It becomes important to have a sense of the market sentiment for the brand. Making use of digitization and a reliable database can further support the process of procurement.

Procurement is not only a data-driven process, but it also involves instinct and know-how of the intricacies of the business.

Abhishek Raj Pandey Cosmetics Industry Expert | COO - Private Brands Purplle.com

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Diversity Matters!

‌and we are more than just our genders. This is where most conversations stop, or rather, should start!

In today's dynamic markets, innovation is becoming increasingly important as a differentiator. Customer demands for new products, better service and faster deliveries are forcing companies to adopt new technologies and develop new solutions at an accelerating rate. A research by the London Business School concludes that when innovation is critical, the optimal gender representation in teams is 50:50. This clearly implies that diversity powers creativity and innovation, which in turn lead to business success.

Conversations around gender diversity and having more women representation in the workforce and governments are an important point of debate and discussion these days. The suffragettes imagined a world where men and women will be truly equally treated. But progress is still sluggish in many Studies have shown that companies with greater aspects and dialogues around these topics are representation of women in senior roles experience better business outcomes. Companies with the highly welcome. highest representation of women in leadership The starting point is to acknowledge that nature positions experienced a 35% greater return on equity has designed the world with almost an equal and 34% higher return to shareholders than those with proportion of both genders. So, it is quite logical the lowest representation (as per the report 'The that when we deviate from nature's designs, we Bottom Line: Corporate Performance and Women's Representation on Boards' published by Catalyst in end up in a dispersion which is not optimal.

2007). Whether a company is in a B2C or a B2B Men and women come with different skill sets. environment, women leaders can play an important Men are generally better equipped to learn and role in understanding customer perspectives and execute single tasks while women excel at multi- strengthening customer relationships. This tasking. Today's organizations depend a lot on corroborates the fact that when the number of women analytical decision making taking many co-related in decision-making capacity in an organization tends factors into consideration, which require multi- towards nature's designs, positive outcomes are tasking and multi-thinking. These are quite suited bound to happen. And this follows from simple laws of nature. to women's natural skill sets.

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While the above points highlight the importance of having an equilibrium in the number between men and women in any organization, reality today is not as such. Let me start with some facts. According to a 2018 'Women in Supply Chain' research conducted by Gartner and AWESOME, women account for almost 37% of Supply Chain organizations. But this percentage drops off to only about 14% as one reaches senior executive positions.

How many of us are aware of unconscious biases? This happens because of our experiences in life and how we have seen people around us responding. Many of us may seem as perfect ambassadors and evangelists for gender equality. However, many times we end up taking decisions that completely defeat this logic. For example, while recruiting, many of us tend to make our own assumptions about female candidates and become judgmental about their capabilities.

This has roots in the fact that traditionally men have been breadwinners and women, caregivers. But with changing times, there have been several role reversals. This is a trend across the world and more women are entering the workforce than ever before. However, there is still a long way to go – far from the ideal (almost) 50:50 scenario. We now increasingly understand the need for this.

One of the key things everyone needs to understand is that men and women are not biologically similar. So, what works well for men to remain and sustain a professional life may not always work for women. Basic amenities at the workplace should, therefore, be designed keeping this in mind. This can be a very simple thing like having a washroom for women or arranging for an easy parking spot for pregnant women. The next key thing is about the culture of the workplace. Culture starts with having the right policies but goes much beyond it. To make sure that there is an optimum representation of all genders, the organization culture must make sure that this change is for everyone. To gain buy-in, a culture of respect should be promoted. This will, in turn, encourage understanding and commitment for the cause.

Next is to make sure that a conducive environment is created at the workplace in terms of culture and policies. In addition to this, professional mentorship and networking play a key role in realizing the potential of any employee. It is increasingly observed that it is much easier for men to build a professional network and to get a mentor. The reason is simple. Since maximum number of leadership positions are held by men, it is easier for men to establish connections with each other. However, when women are involved, many men in leadership positions are not even comfortable being a mentor or being in the network and a lot of this happens due to cultural norms that we tend to hold.

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A key point to note is that we have too few women in leadership positions. A good way to make sure that women join the workforce and sustain in the work environment is by having more women in leadership roles. Female leaders and mentors can help both men and women to succeed. It is also important to increase the visibility of senior women leaders and their success stories. And yes, the optimal state will be reached when we have only leaders, and do not classify them based on genders!

There is no one answer to this dilemma – should we have a bottom-up approach with the right policies and work culture or should we have women at leadership positions to start with? The way forward is actually to do both. A gender diverse workforce promotes collaboration, tolerance and understanding. It drives innovation and retention of both men and women, thereby promoting the best talent for the appropriate roles. The need is to eliminate traditional gender barriers and biases and develop a culture of inclusiveness, such that diversity should stand on the strong foundations of talent alone. We cannot just have a Mary Barra or Indra Nooyi to look up to; we need to have many more as role models!

Diversity in Procurement is a subset of diversity at workplaces. There are finer nuances though. The Procurement environment has become much more complex in recent years due to intense competition and hyper-specialization of some supplier markets. Thus, the role and profile of a typical procurement professional is evolving. The ability of Procurement professionals to communicate effectively and drive change is an important factor for success today. Procurement professionals thus need a wider range of capabilities in addition to technical know-how. These competencies are mostly gender neutral.

The onus on leaders is thus twofold – to enable an organizational culture of inclusiveness and to ensure that merit is not compromised. It is thus important to accept the fact that a diverse environment is the need of the hour and making sure that diversity thrives in the truest sense. And it is not only about women, but it is also about men too. And it is not just about genders, it is about the whole ecosystem!

Note: The views expressed in this article are personal. This article has been adapted from one of author's earlier articles 'Women in Supply Chain'.

Seema Mohanty Head - Source to Pay Operations at Bayer India

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CFO STORY FORUM C

hief Financial Officers hold responsibility not only for today's results but also for tomorrow's reinvention. Strategy and operations, perspective and persistence, innovating and allocating all come into play.

Organized by Competitors View, the inaugural year of CFO Story Forum will be held on 6th and 7th November 2019 in Mumbai. It is Asia's premier CFO event bringing together C-suite financial executives from around the world. The annual event offers two days of interactive learning and thought-provoking discussions on the future of finance, the impact of disruptive technologies on global finance and the latest progressive strategies and patterns on the functionality of finance.

Through inspiring cases, panel debates and workshops, the CFO Study Forum will give insights into which tools you should invest in, what type of mindset is paramount to succeed and how you create more value for your customers.

The CFO Story Forum will revolve around 3 key themes that are, (1) Technology & Tools: Value Creation in which focus will be on leveraging the disruptive and right technologies in finance in order to create more value and lead to better business decisions; (2) Progressive Leadership & Strategy where effective leadership strategies will be made to capture full potential of new technologies and implement those strategies through inspiring leadership; (3) Today's challenges, tomorrow's CFOs: Future Trends in which recent and upcoming financial trends will be discussed and how these trends will change the mindset and foster the culture of change, innovation and entrepreneurship.

The attendees will witness an amazing Fireside Chat, a thorny conversation where the global finance leader at a fortune 50 organization and CEO of a financial technology company will answer some power-packed questions asked by the editor of CPO Innovation Media.

The CFO Story is a must-attend conference because here attendees will understand the latest trends in financial transformation through case studies from 50+ CFOs, they will meet and network with over 150 industry peers in cross-industry finance functions across Asia and will receive solution updates on Cybersecurity, RPA and AI from leading technology providers.

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Action Plan for Future Procurement through Digital Strategies

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igital Transformation in Business Services refers to improving customer experiences, operational efficiency and agility by fundamentally changing the way business services are delivered using digital technologies as the enabler of holistic transformation”. New & emerging digital technologies are - Smart Automation: RPA, Cognitive, AI, Machine Learning, Algorithms, Blockchain and Virtual, Augmented & Mixed Reality. Advanced analytics will make possible more accurate forecasting, leading to improvements across the entire sales- and operations planning process. This will also make possible better scheduling of batch production, shorter lead times, and lower safety stocks with a higher level of flexibility. Integrated “no touch” ordering and scheduling systems will help to stabilize production planning even further.

Moreover, e-tendering mode is also being implemented for enabling public procurement process in NIC portal. Due to which e-bidding in sale process was adopted for the first time with e-tender floated in the NIC portal. Also for the first time, e-tendering through International Competitive Bidding (ICB) on Spot basis was made to procure a single lot quantity of feed-stock through Import in the month successfully.

Single e-tendering for the highest ever value of more than Rs. 300 Crores was successfully made for hiring of transportation services for multiple activities at Pan India basis Digitization in tendering process has facilitated wider participation of vendors, increase in reliability in sourcing of customers/suppliers/service providers and better realization & accrual benefit to buyers and sellers.

Other than above, following innovative methods/systems and tools are in place in order to make the procurement process convenient and compatible to the organizational requirements:

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1. Bill Watch System (BWS) to ensure that P2P timeline is maintained and vendors are paid within the contractual period without delay. This process has enhanced the conďŹ dence among vendors towards participation in sourcing activities.

2. In house online system developed and implemented to track the sourcing activities start from requisition (through online mode) till issuance of awards for procurement of supplies and services.

3. In house online system developed and presently used to track the goods receipt and inspection activities at site made by suppliers/vendors to complete the procurement cycle with payment processing.

4. Online system developed with the technical assistance of IBM to monitor the health of the procurement cycle is in place which automatically records the ordering cycle time and compliances to various statutory obligations according to the law of land.

Engineering administration is one of the vital activities required to be followed on regular intervals to avoid mismatch of part numbers due to continual engineering development/ improvement made through R&D based on the market requirements, after sales feedback and also through concurrent engineering. In order to p ro c e s s t h e e n g i n e e r i n g a d m i n i s t ra t i o n effectively, online system is developed and implemented which also supports the MIS activities to all units of the business on real-time basis. The software is titled as DENIS(Design Engineers Information System).

Procurement of goods and services are also made from overseas vendors or establishments. The procurement process is made through e-tendering on either spot basis or international competitive bidding. Facilitating the entire procurement (goods & services) is digitized as detailed above, the tracking of orders (supply or services) postaward activities are also made online to avoid detention/ demurrages at India port, timely execution of supply orders, timely execution of service orders and contracts closures post completion of services.

Contract administration is part of the procurement process and needs close monitoring to avoid delay in execution, budget exceeds, abnormally high rates as against the Bill of Quantity (BOQ) as per the awarded contract(s) and to avoid sub-letting of the contracts. With the support of SAP ERP system, advance level monitoring of contracts are maintained in line with the project management principles. There are various big-ticket contracts being awarded during the project phase of the plant and proper controls on the execution is mandatory to avoid budget exceeds and to comply with statutory requirements and in return meeting organizational objectives.

Presently the focus is on the Big Data and ArtiďŹ cial Intelligence (AI) to achieve the goal of smart factory as this will enable the development of new operational models based on automation and augmented human activities which rely on predictive analyses for operations and m a i n t e n a n c e , p ro d u c t i o n a n d i n v e n to r y monitoring, and improving security.

But technology alone isn't the answer. In the chemicals industry, it's the use of technology against the right digital strategy that holds the real value. This requires a focus on implementing a true digital core that enables a common system of record through the business. It also requires a corporate mindset that embraces agility, adaptability, and innovation. It requires a mindset that is driven by a customer-ďŹ rst, design thinking perspective.

Dr. Pranjal Kumar Phukan Chief Manager Brahmaputra Cracker and Polymer Limited

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Supply Chain, Reverse Logistics and Indian eCommerce Industry Outlook

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his document will broadly cover information on different stages of supply chain management, reverse logistics and Indian eCommerce industry outlook. You would find key information regarding reverse logistics at a global level along with key statistics around various types of reverse logistics in retail channels and categories. Furthermore, you will also find specific focus on Indian eCommerce industry highlighting key metrics, challenges faced by industry, potential opportunities and future priorities.

Supply Chain To put in the simple language, supply chain is the process of ensuring raw material availability at different process stages till final product reaches end customer. The process of managing timely supply at all stages is called Supply Chain Management (SCM).

The broad process for supply chain management in a manufacturing set up include availability of 'raw material' in plant, supply of subcomponents till 'final product' is manufactured, product 'distribution' using different mode of transportations, product arrival at retail 'channels' and finally 'sales' to end customer.

Reverse Logistics Reverse Logistics starts where supply chain process ends i.e it is the reverse process of supply chain management and thereby target the system of managing goods returned from end customer. Organizations having best practices and systems for handling returns are better positioned to compete with competitors and yield better long term sustainable results besides increased profitability. An effective return process can transform 'trash' into 'cash'.

Returns are inevitable in any business operations and are major cost components in product pricing. As per study conducted by one of the global research firms, around US$ 650 billion worth of goods are returned each year globally. This constitutes around 4% of retail revenue which sufficient to make or break the organization in present cut-throat competitive environment.

Global Outlook – Classification of 'Return’ Return are broadly classified in two heads: Channels and Categories.

1. Channels - More than 50% of the "channels" returns are from 3 heads namely eCommerce, Department Store and Brick & Mortar whereas eCommerce carries the highest return rate of 30%. It is important to note that 89% of the online shoppers take final buy decision based on the return policies. Department stores hold the second position with return rate of 14% followed by Brick & Mortar at 8%.

2. Categories - 5 broad heads contribute more than 60% of return under Categories. Auto parts lead the race with 21% return followed by Electronics (12%), Home Improvements (11%), Apparel & Footwear (10%) and Sports goods (9%).

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Till now we would have understood the significance of reverse logistics in retail business, return categories and its role in an organizations growth trajectory. In following notes, we will focus out discussion around current India eCommerce industry, potential challenges to be fixed in order to create sustainable business model, key opportunities and future ahead.

India Outlook – eCommerce Industry As per study conducted by one the leading research firmŸ Ÿ

Internet users in India will grow by 564.5 million in 2019 as compared to 259 million in 2015 India currently has over 300 million smart users which is second largest smartphone market in the world

The above data points show the potential growth coming to Indian economy and it will help the eCommerce industry to reach estimated Gross Merchandise Value of USD 80 billion by 2020. As per survey conducted by a leading Indian business newspaper, ~ 70% of the total e-commerce business is led by 2 organizations.

Flipkart (along with its independent run subsidiary Myntra) owned 38.5% while Amazon holds 29% market share.

Challenges faced by eCommerce Industry While Indian business is on a growth path with anticipated annual GDP growth in excess of 7% but it requires few big rocks to be moved failing which it will not only challenge the industry growth path but also lead to other associated economic issues of unemployment, lower per capita income, etc. The two big challenges to be fixed by industry are Customer Experience and Logistics Network.

1. Customer Experience - Out of the multiple issues in this category, the top issues are pertaining to poor return procedures of goods, delayed refunds and improper value services like installation and product try-on which are widely acceptable in matured market worldwide.

2. Logistics Network - This is an ongoing issue due to lack of availability of cost-effective and professionally managed logistics service provider that is resulting in delayed delivery of goods including but not limited to lost parcels and thereby impacting the growth of business.

Opportunities for eCommerce Industry One of the established known phenomena is that 'where there is a challenge there lies a solution'. Below are the possible solutions to arrest the industry challenges.

1. Strategic partnership - eCommerce industry to work with the third-party logistics providers to create a strategic partnership by either taking their operations and manage them professionally or holding their hand by sharing their established best practices to run their business.

Industry has to break the notion of maintaining distance by 'arm length' and migrating to 'arm around' methodology by working with logistics service providers to ensure sustainable and cost-effective operating model and create win-win. For example, Alibaba invested money and best practices in third-party logistics firms namely 'Star Express' and 'Best Logistics' that helped improve their delivery and eventually contributed in increase customer experience index and sales.

2. Artificial Intelligence - Accepting Artificial Intelligence is going to be the fabric of any sustainable business model. This can be adopted in 3 ways:

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Robotic Process Automation (RPA) – This technology has quickly achieved industry-wide acceptance and maturing at a very fast pace.

Anything 'transactional by nature' can be managed under this technology where work is managed by learned machines (also known as Robot) that help in improving productivity and cost reductions for the organizations.

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Natural Language Processing (NLP) – This technology enables the understanding of 'voice and free text' commands. Most of the call centers are leveraging this technology by using Chat Bots or virtual call center agents to handle customer queries and act as the first line of respondent to customer.

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Predictive Analysis (PA) – This is a form of machine learning that involves data mining and analysis of both structured and non-structured data. This technology can identify patterns and make predictions based on various factors and strengthened by self-improving algorithms. This is very useful in spend classification.

To summarize, customer is the king and accepting change as inevitable is the key as what made organizations successful today will not make them successful tomorrow. The sustenance lies with quicker turnaround on last mile delivery with minimal cost and maximum value pass back to end customers. On the other hand, organizations will focus more on localizing their warehousing operations near customer demand locations, lower warehousing cost by increasingly improving 'just in time' methodology and leverage technology support for making informed decisions using big data analysis.

Author Profile – Amit Kumar Verma Amit has over 23 years' experience in managing Global Procurement, Strategic Sourcing, Consulting, Supply Chain, Third Party Risk and Real Estate function. He has extensive experience of working with Fortune 500 companies in Global Shared Services, ITeS, BPO and Manufacturing sector. He is a thought leader and eminent speaker in corporate world where has been being chairing and delivering sessions across India. He has worked with MetLife Global Operations, American Express, AON Hewitt, Convergys, Exl Services and Vanasthali Textiles.

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Contract Engineering with Innovative Technologies Leads to a Right Solution on Services and Supply Procurement

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he Procurement function and its approach has to be always adaptive to take challenges and must be aligned with the fast changing scenario in world. The technology has to play its role in organic growth of infrastructure to cope-up with the swelling demand of Infra-ways, the way Internet has played role for IT-ways.

When we talk about the booming infrastructure, basically it means all the associated factors across all the sectors are expanding. This create challenges to the existing players (vendors or organizations) and also gives an opportunity to the small and medium players to expand and boost their capacities and prove their innovativeness and dynamic approaches.

Days are gone where any vendor would approach to their potential client with the proven track record and repeat the same conventional approach for the new assignments.

Nowadays client and developer/vendor have become partner and more daring to talk with the fresh and young blood, start-ups, second generation young dynamic professionals and ready to take risk by giving them the opportunity to prove themselves.

Innovative or disruptive technology means a transformative change in the technology and approach to displace existing processes, systems, internal and external collaborations across all the functions of the Supply Chain Management arena.

This enables innovative solutions, new businesses, process models, various applications based software, etc. This changes the way of doing qualitative and quantitative analysis, contracting and supplies. Blockchain, AI, automation through latest ERP applications duly woven within suppliers and sourcing are some of the latest development to handle the procurement more effectively.

Following are the ways to lead through disruptive technology and stay ahead in a rapidly changing world.

Innovative / Disruptive Technology: A Strategic Procurement The procurement trend is showing a paradigm shift in the contracting strategy from a sub-contracting basis to a collaborative basis. The client does not want to depend upon the discretion and wisdom of the sub-contractor and thus to pay overhead and margin on that. Rather, it would be a prudent approach to work along with the best available consulting engineering company, the best structural based consultancy ďŹ rm and evolve the best engineered crafted solution in terms of basic theme/concept, methodology, cost and schedule.

Make your working contractor agree on the proposed solution and then plan optimum resources and time in terms of manpower and machinery.

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In the changing scenario, contracting strategy has become utmost critical and objective. In order to manage the cost and schedule, the dynamic change in division of responsibility between a buyer and seller have become a driving factor. The buyer wants to control big-ticket items like construction machinery, steel, cement, etc. under their control to mitigate the financial risk of seller and thus ensuring the smooth progress at site without any conflict and without letting the contractor into a financial crisis.

A Collaborative Approach through Crossfunctional Excellence: An Integrated Path No company which is in the progression and expansion mode horizontally and vertically can survive without consistent and uniform system and processes within the organization. It is always a progressive path since last more than a decade wherein companies could develop all the crossfunctional systems bench-marked with the best practices in world. Nowadays, ERP is used to integrate the cross-functional communication amongst engineering, user, project management, buyer, financial concurrence, budget control etc. There are various other tools and software/platforms which can be linked with SAP or any other ERP. This has made the process hassle-free, fast and trackable at each point of interference. With this, SLA can be fixed for each function's dependability and accountability. In the digitalized global economy, global supply chain can be managed effectively only with internal and external collaboration.

A Technological Approach: A Progressive Path towards Excellence One of the most important technical tools for a cost-effective solution is “reverse e-auction”.

This gives an opportunity to each of the bidders/suppliers/sellers/contractors to know their ranking online during the auction process and reduce their prices to improve their ranking and chances of becoming L-1. Nowadays procurement process has become effectively technology driven through the easy and fast Internet accessibility and various professional sharing platforms like LinkedIn, YouTube in terms of new engineering aspects, innovations in c o n s t r u c t i o n t e c h n o l o g y, n e w m a t e r i a l development, globalization of companies, etc.

The buyer needs to take into account all these aspects while deciding the LCC and to analyze the TCO.

The basic principle on which these are developed is Safety, Quality, Cost, Timeliness & Sustainability. The cost is analyzed not only on the individual parameter “Cost” but it is valued at “Total Cost of Ownership (TCO)” and “Life Cycle Cost (LCC)”. All the procurement systems are standardized in form of documents and in electronic form and built-in and controlled by the various software platforms of ERPs. There is a seamless link right from raising the requisitions by the user, in what form it is to be raised, what are its pre-requisites, will travel through the built-in tracker system to the buyer, will go to the bidders and receive on-line through a welldefined encrypted system, reverse e-auction, till the completion of internal approvals and award to the vendor. With this system, there is a good potential of optimization of engineering, specifications, obtain the best rate and fair level playing field through the reverse e-auction process for all the potential bidders.

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Value Engineering: The Optimal Tool 'What could', 'what would' are questions that usually shake to leadership to bring value engineering into the system. To overcome that buyers are encouraged to challenge engineering with his sheer knowledge and experience and exposure to the universe of vendor and new product by virtue of his function and interactions with the external world.

The tattoo of working in isolation of boundaries are gone. Leadership has to play a pivotal role in balancing the conicting scenarios, the 'egos' of the respective self. The CPO has to analyze how he could implement new and growing source of information, automize the process and built-in human interactions to categorize the information and reach to the respective buyers or sellers.

'Think out of the box' is simply to say but should be supported morally by the senior management to absorb the risk and ready for the mitigation plan.

Nowadays this has become a speedy trend for the organizations. Procurement strategies are being made on optimistic approach rather than a pessimistic approach (loading with all factor of safety and thus leading to the heavy cost an time overrun).

An Innovative Development: Think the Unthinkable The accessibility at global level to the new technology and innovative development have b e c o m e i n s t a n t a n e o u s l y. T h e s o c i a l a n d professional platforms like LinkedIn, Youtube and other similar media are sharing these lightning thoughts which happened any corner of the world and are being used as a reference points to invent new approaches.

These young and small players' echoes are creating a new level ďŹ eld of competition in manufacturing and infrastructure sectors. The role of a procurement person has become more challenging and alerting to use these new era of players.

The leadership should nurture and drive an innovative mindset. It requires patience, time and a right resource with a clear guidelines.

A New Constructive Approach: Agility Disruptive technology is basically a synonym of a new constructive approach of technology which is replacing the conventional thought process and overall approach in many ways. Some of these are: 1. Innovation of new material and technology in construction, 2. Manufacturing of construction equipment to maximize the elimination of manpower (which is scarcely available) 3. Basic engineering has become crucial for optimizing the resources and crashing the timelines.

4. Change in construction methodology from Castin-situ to Pre-cast Concrete and prefabricated structure.

For example the use of new-age shuttering and formwork (maywan shuttering) for the mass housing buildings, industrial buildings have changed drastically to get faster erections, less involvement of manpower, fast and early removal and high repetitions. Pre-cast segment is used for elevated highways and erections by launching girders. These are almost twice fast and safe to construct in urban areas especially.

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A Change Management: Flexibility and Speed “What is the rule of negotiation?” Somebody asked me. I told him that the first rule of negotiation “there is no rule of negotiation”. Nowadays, the way Procurement and specially Contracting is done have been changing rapidly. In India, this is supposed to be the boon time for the Infrastructure Sector and all related construction and its enabling industries. The so-called big companies are overloaded and leading to nonperformance zones. The middle size construction companies are becoming larger and being saturated. The small contractors are qualified for the bigger jobs and positioned themselves at threshold to be launched in the next category.

In my personal opinion, with all these dynamic changes in booming Infrastructure scenarios, one has to be at their toes to keep up with the razor-edged margins and on top of that bring value engineering into their system to cope up these thin margins. This brings huge amount of pressure on the contracting person. In India, the model of awarding the Projects have changed substantially from a profit/cost sharing models to EPC based models in the recent past.

The Bottom Line Technological adoption is the success driver of the future and should be envisioned by the procurement managers. The success of future procurement lies with the competitive workforce, encouraged digital innovativeness, understanding of the principle of change management, organizational zeal, understanding users requirements and most importantly ability to adapt dynamics of fluctuating market.

Hence, the Procurement team must prepare themselves to become the visionary leader of the organization.

GL Gupta Senior Executive VP, Head - Corporate Procurement Group Reliance Infrastructure

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Don't Wait for Tomorrow, Establish the Future of Procurement Today

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s procurement heads its known fact as to how digital technology and analytics will revolutionize tomorrow's procurement function. CPOs around the world are stepping up to take advantage of the digital revolution.

With digital transformation, procurement teams are in a unique position, as not only can they bring in technology to significantly improve their function but they can also help the business with broader initiatives.

It's however also an important fact that only investing in technology and analytics alone will not deliver results. What's more important is to combine it with robust processes, deep functional knowledge, and the right talent.

In Order to derive value from digital, it's imperative to have some of the following accelerators to be followed so as to take the full advantage of new technologies:

1. Be clear in your objectives It's important for the CPO, before setting the objectives bring in the knowledge of the wider business strategy and targets. Have an active voice in the organization's strategic direction. Go beyond cost savings and focus on outcomes such as: Ÿ

Profit growth: Drive revenues by improving time to market, accessing supplier-driven innovation, enhancing price-point elasticity, and developing new products and services.

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User experience: Give business users a seamless experience when ordering products and services and improve supplier experiences to become their customer of choice.

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Risk mitigation: Segment suppliers against a risk framework that includes financial risk, supply assurance, and reputation.

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Operational efficiency: Standardize and automate processes to improve productivity, efficiency, and outcomes.

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Working capital: Dynamic discounting can provide data and insights into asset utilization and lease versus buy strategies.

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Innovation: Collaborate across the supply base to access new ideas.

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Only then, with clear, business-aligned goals, can you decide which digital technologies procurement needs.

2. Based on the Procurement model create a technology roadmap To gear up for digital, it's important to have answers for the following questions: Ÿ

Are your policies and processes standardized to simplify digital implementation? For example, many companies have rushed to adopt robotic process automation, but without standard processes, this technology will struggle to meet expectations.

Do you have the right resources and skills to deploy digital solutions? For example, if the function has a high number of category managers but few process or systems experts, a new digital solution could be tougher to implement first time. And once you start gaining new insights from data, do you have the skills to apply critical thinking and make more informed decisions. Ÿ

Do you have a technology roadmap? If you want digital to deliver long-term gains, assess technologies across four horizons: Ÿ

Legacy technology: Your existing technology that delivers value and can inform your digital plans.

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Latest technology: Solutions like robotic process automation, analytics, artificial intelligence and dynamic workflows. Procurement must understand how they deliver the best ROI.

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Emerging technology: Keep an eye on what's at the prototype stage, such as blockchain, so you know how they will affect processes and future requirements

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Future technology: Understand solutions such as cognitive strategic sourcing, where a robot does much of the sourcing activity, so you make long-term decisions today.

3. Integrate end-to-end processes Procurement doesn't operate in isolation. The function must be integrated across its own back, middle, and front office. And also across the business as a whole, with finance and the supply chain, in particular, to create an end-to-end process. Procurement also plays a critical role in forecasting, planning, controls, and budgeting. That way, budgets and approvals can then appear automatically in the ordering system.

And in supply chain and accounts payable processes, procurement can influence how goods receipts are assigned correctly and consistently, and link through to invoice approval. This will help suppliers get paid ontime with no need for manual intervention.

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4. Build collaborative relationships Having strong relations across the business makes a difference. Technologies need consistent data to be effective and this data sits across functions. For example, when it comes to IT category sourcing, all business functions need to be involved: Ÿ Ÿ Ÿ Ÿ Ÿ Ÿ

Finance agrees the budget, accounting codes, volume forecasts, and auto approvals IT confirms the specification and product availability in systems, budget approval, and demand forecasts HR shares the organization's team structures so you can apply the right workflows Supply chain or finance details the goods receipt process Legal approves the supplier contracts Suppliers, once on board, must become part of the end-to-end process so products or services are delivered on time and to the contract

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Collaborating in this way makes everyone aware of their roles, which means data from the sourcing activities is where it should be in the ordering system.

5. A culture of change With a culture that embraces rapid change, experimentation, and innovation, new technology will take hold and create competitive advantage. And as the pace of change is not slowing, procurement functions with streamlined operations will adapt more quickly and be ready to support the business.

Conclusion With these accelerators in place, procurement team will be definitely ready to realize the full power of today's digital solutions. What's more, the impact helps business grow profits, and manage risks. Digital technologies are opening up boundless opportunities for procurement. These five accelerators will bring the possibilities of tomorrow to you today. Think big! Reconsider what's possible. You're not looking for minor adjustments. You don't want to be restricted by what's considered best in class. You want a major shift that revolutionizes the user experience and operational efficiency. There are many opportunities to reach right now if you combine design-thinking techniques, domain expertise, and digital technologies.

Dr. Abhijit Sarkar, MRICS, MLE, PSCM Country Head-Corporate RealEstate, Administration, Infrastructure and Purchase Sharekhanh

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Certified Purchasing & Supply Chain Manager™ The Fortune 500 Certification Program of Choice™

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he Certified Purchasing & Supply Chain Manager (CPSCM™) certification program is world's most advanced, interactive and prestigious purchasing and supply chain management certification training system.

The CPSCM™ is originally approved by the prestigious University of Houston (UoH), and accredited by the Center for Purchasing and Supply Chain Management Excellence (CA, USA). In India, only Competitors View has the sole authority to provide this certification.

This certification program captures the essence of the top issues and opportunities that purchasing and supply chain senior executives need to know and need to be doing to enable their success, delegates will have proven tools that not only demonstrate how the organization can do better today, but also leverage on research and practise that has been tested with dozens of executive interviews, hundreds of global corporations and with advanced higher education institutions as well.

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The CPSCM™ Graduation Program is for experienced practitioners and those who are in senior leadership positions.

Ever ything learnt will be actionable immediately, with templates, process steps and examples to get your organization going. You will know exactly how to drive these strategies yourself, and will know how to drive them in your organization. This is not something that can be taught in any other seminar or certification series, nor should you be obtaining those other certification by ordering and reading books and taking exams.

Omid Ghamami is CEO & Chairman of the Board at The Center For Purchasing & Supply Chain Management Excellence, the world's most powerful and prestigious purchasing and supply chain management Cer tification Institute. Since 1995, he has taught thousands of hours of courses, workshops, and seminars in 21 different countries on topics related to the entire spectrum of purchasing, supply chain m a n a g e m e n t , p u rc h a s i n g c o n t ra c t l a w, negotiations, and supplier management. He has trained all 50 Chief Purchasing Officers of the United States, been published in global journals i n c l u d i n g Fo r t u n e M a g a z i n e , p u b l i s h e d bestselling purchasing and negotiations books, has presented by request to Harvard U n i ve r s i t y 's S u p p l y C h a i n M a n a g e m e n t program many times, and has worked with over 50% of the Fortune 100.

“The CPSCM™ Certification is an absolute game changer and is by far the most valuable Purchasing and Supply Chain Management certification program available today.” – Professor Zal Phiroz, Supply Chain Management Instructor, Harvard University Obtaining a CPSCM™ certification indicates that candidates have enhanced their knowledge and practical skills in the supply chain and procurement domain. Current evolution of the profession dictates that a strategic level certification is needed for the professionals in supply chain and procurement to effectively implement innovative strategies in their entire organization. The CPSCM™ certification is a milestone for those professionals who take ownership of their careers.By undergoing this certification program, candidates will learn a proven method to know when a supplier is bluffing when they say they will walk from a deal, they will learn how to anticipate, recognize, and respond to supplier negotiation tactics. Candidates will be able to perform total cost analysis and price benchmarking to deliver best possible procurement results, they will learn how to slash negotiation cycle time using a critical procurement & purchasing technique and much, much more!

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The Megatrends That Impact Procurement's Competitive Advantage

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n coming years, procurement will play a key role in helping companies cope with the new challenges and opportunities of this increasingly dynamic global economy.

What are the major changes to expect in the decade ahead? What questions should CPOs and other company leaders be thinking about to prepare for these changes?

Here are 5 megatrends that will shape the new global economy and will have a profound effect on how CEOs, CPOs and all C-suite executives will lead their organizations in upcoming years.

1. The Great Global Rebalancing The vibrancy of emerging-market growth may prove to be the most profound disruption reshaping the global economy in the next decade.

The next decade marks the tipping point in a fundamental, long-term economic rebalancing that will likely leave traditional Western economies with a lower share of GDP in 2050 than they had in 1700. Successful companies will embrace the new opportunities that arise from this Great Global Rebalancing in the form of talent, innovation, and new business models.

Private Consumption in Emerging Economies Will Grow, but Capturing the Opportunities Will Require Cost Innovation

The Great Global Rebalancing will force major adjustments in strategic focus, as emerging economies will increasingly become centers of consumption as well as production. More than 50 percent of the world's real gross domestic product (GDP) growth is expected to come from non–Organization for Economic Cooperation and Development (OECD) countries from 2008 through 2023, compared with only 36 percent during the previous 15 years. Virtually all major emerging markets are undergoing demographic shifts, well proven to unleash an economic miracle: More workers plus fewer mouths to feed equals more disposable income.ovation, and new business models.

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Emerging Markets Are Becoming Sources of Innovation and Talent The Great Global Rebalancing isn't simply a story of increasing consumption. Emerging markets will also be the world's next fount of innovation. Companies that can innovate to reduce cost structures to 20 or 30 percent of developed-world levels can unlock a tidal wave of unmet demand. GE developed an electrocardiograph for sale in India that could be sold profitably at just 15 percent of the developed world's price point. The company built upon this effort to create a lower-cost monitor to sell in the developed world as well.

Is Procurement Ready?

Production in emerging economies is becoming more sophisticated, consumption in these markets is increasing, more products are being customized, and innovations are being developed and are spreading across the world. In this dynamic global marketplace, procurement must play a leading role in capturing the value at stake. But is your organization ready? Ask yourself the following: Ÿ

Are we set up to continually challenge and adapt our global sourcing footprint in order to take advantage of changing “best cost” sourcing factors such as labor cost, tax incentives, and inflation rates?

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Is our local sourcing sufficiently supporting other company functions to deliver “glocalized” products that meet the increasing demands of middle-class consumers in emerging countries? How many of these products can we take back into Western markets to drive down cost?

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Do we employ the skills, market intelligence, and organizational assets required to tap into the vast innovation opportunities and capabilities offered by the emerging market?

2.The Productivity Imperative The growth equation is simple: Growth comes from an increase in the amount of labor employed and advancements in an economy's productivity. And while emerging markets ride a positive growth cycle propelled by larger and younger working populations, the developed world deals with lower birth rates and graying workforces that make it difficult to maintain what economist Adam Smith called “the natural progress of opulence.”

Functional Specialists Are Needed to Drive Productivity Companies have increasingly turned to external functional specialists to address the productivity imperative.

More than two-thirds of productivity growth comes from product and process innovation, and companies must source even core functional activities from specialists to foster this innovation. This has resulted in a growing network of partners to manage along an end-to-end value chain.

Better Management Principles Drive Productivity More Than All Other Factors The quality of management is a much better predictor of improved productivity than is the industry sector in which a company competes, the regulatory environment that constrains it, or the country where it operates.

Good management—be it the management of internal functions or external providers—is about methods, style, and skill, not hours clocked on the job. But what does good management look like? Well-managed companies have fostered adaptability by offering more flexible working arrangements (telecommuting options, leeway to care for sick children, choice in part-time or full-time careers, job sharing for nonmanagers), greater autonomy over decision making, and better training.

Is Procurement Ready?

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Considering that external functional specialist will likely be a primary source of increased productivity for your own company, how well is your procurement function set up to successfully drive productivity in your external value chain? Ask yourself the following: Ÿ

Do we have a clear idea of which parts of the company's value chain need to be executed in-house and which are better shopped from the market?

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How well do we tap our provider network for benchmarks and competitive insights to challenge internal functions, including manufacturing, logistics, and services?

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Have we identified the best-practice providers available, and do we understand how they will evolve? How are our competitors planning to leverage their scale, low cost, and skills in the near future? How well are we equipped in procurement to truly manage our providers in an integrated way, or to orchestrate the full endto-end value chain of external partners along with a common framework, ensuring effective interfaces between external providers?

3. Big Data & the Global Grid The past two decades have witnessed the rise of digital networks of unimaginable density and reach. These networks have converged to form global communication and information grid that enables real-time interactions at scale. Old lines blur within this densely woven digital fabric. Cross-border capital flows are also information flows. Just-in-time supply chains are just-in-time information chains, too.

An Explosion of Information Will Lead to New Methods of Global Connectivity The greatest globalizer is neither capital nor trade; it's information. And the IT revolution has only just begun.

Global Internet traffic will be 5.3 Exabytes per day in 2020. More than 35 billion objects are connected to the Internet, including sensors, routers, and cameras. More than two-thirds of new products feature some form of smart technology, which is being used in a dizzying array of ways.

Is Procurement Ready?

The ability to use data and connectivity to develop insights and drive superior performance has become a critical source of competitive advantage. Procurement is at the center of various data flows and connections—between internal functions and, for example, external vendors, research partners, and intellectual property (IP) providers. What can this mean for procurement? Ask yourself the following: How can our procurement function leverage its position at the intersection of numerous big data flows to and from the outer world, applying new analytics to create additional value?

How can procurement, utilizing this information and analytics, deliver completely new value propositions, be it for sourcing innovation, reducing corporate risk, aiding strategic planning, or driving monetization of information to generate revenues?

Is our category management ready for a new world of big data and sophisticated analytics?

4. The Volatile New Normal The tension between rapidly rising resource consumption and environmental sustainability is sure to become one of the next decade's critical pressure points. Natural resources and commodities account for roughly 10 percent of global GDP and underpin every sector of the economy. And as the earth's resources are impacted by natural disasters, fluctuate in price, or worse, run out, the reverberations will be felt across the globe.

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Demand for Many Natural Resources Is Outstripping Supply Even the most conservative projections for global economic growth over the next decade suggest that demand for oil, coal, iron ore and other natural resources will rise by at least one-third. About 90 percent of that increase will come from growth in emerging markets. Yet, easy-to-tap and high-quality reserves are nearly depleted, and supply will have to come from locations that are harder and more costly to access and, possibly, politically unstable.

Is Procurement Ready?

More than one CPO has lost his or her job for not being able to “supply the factory”—the primary objective of any procurement organization and one that, in this volatile world, is getting harder to master. Responding to the volatility simply by paying insurance premiums is not an option, and it is the defensive view. Instead, how can procurement help turn volatility and scarcity into competitive advantage? Ask yourself the following: Ÿ

How transparent are the various risks in our supply chain to us as the decision makers? Do we know which risks to examine more thoroughly, determining those that require mitigating action, and which to accept?

Ÿ

How adequate are our current business-continuity plans for coping with the most virulent supply risks?

Will they save the company?

Ÿ

How can procurement turn better market insight and understanding of risk exposure into a competitive weapon, by reacting faster or even barring competitors from access to scarce resources?

5. The New Economic Drivers While we expect the steady advance of market capitalism to continue, governments are likely to play an even larger role over the next decade. The financial crisis prompted governments everywhere to mitigate the negative impact on their individual citizens—by providing fiscal stimuli, shortening the balance sheet, and calling for increased regulation. And as the number of regulations increases, so do the calls by consumer and advocacy groups for increased stewardship of the environment and improved working conditions for employees. The influence of environmental, social, and regulatory (ESR) issues will be greater than ever. One common characteristic of all these interventions is that they are almost all sudden and drastic.

Is Procurement Ready?

Addressing new standards imposed by consumers, industry, advocacy groups, and governments will be a daunting challenge, but one that procurement is well positioned to help the company meet. Quite a few CPOs have already taken on responsibility for driving the sustainability agendas of their companies. But there is more opportunity. Ask yourself the following: Do we understand the total ESR cost and risks of our supply? In other words, the total impact of ownership? Ÿ How good are our sourcing decisions today, and to what extent do they already reflect full ESR costs and risks? Ÿ How can our procurement organization help drive these costs down, making them transparent, establishing them as an important element in sourcing decision making, and even proactively supporting our lobbying efforts and efforts to build relationships with nongovernmental organizations (NGOs) and governments? Ÿ How can we leverage advanced ESR best practices in our supply chain for the entire company's sustainability profile and positioning? Ÿ

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Hyperloop: The Future of Logistics T

he word Hyperloop has been much 'hyped' a term these days and is in the news for some time now.

Beyond car, rail, water and air it is being considered by its proponents as the “fifth mode of transportation” and is getting faddish in logistics innovation today. It is new hope for the future of commuting. With the fast-multiplying global population and equally increasing traffic congestion, the demographic density across the network of roadways in the next 50 years looks quite alarming. Business processes will improve, automation and robotics will minimize turnaround time and man will have to find out means to minimize transit time drastically amidst exploding congestion. Hyperloop thus emerged as the latest concept in transportation introduced by the maverick innovator and entrepreneur, Elon Musk, who owns the twin companies SpaceX and Tesla. It is a concealed tube through which air capsules or pods would travel friction-free at a speed which is non-existent as of date.

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The idea of hyperloop has its origin in vactrain or 'vacuum train' which is a concept train that can run at a speed faster than sound. Whether the reality of traveling faster than sound can ever be materialized is debatable, but what looks a possibility is that hyperloop might remove tube rails with its unimaginable pace and could even beat the speed of airplanes as well. Elon Musk was the proponent of its concept in 2012 which he further refined through a research-based whitepaper titled 'Hyperloop Alpha'.

Interestingly he has not claimed a patent for it but made it open sourced to allow others to join the party to innovate upon the concept for a wider change across the globe. According to the concept, there is an air-free vacuumed tunnel which is closed at both ends and a pod travels along the tunnel in an astonishingly high speed. Imagine a speed at which the distance between Mumbai and Pune can be covered in approximately 30 minutes. It may sound absurd at the moment but even if it can shrink the travel time by 50% of what it is today, a huge leap in transportation will be achieved.

Often when I read about a new technology these days, I wonder whether I am reading Arthur C. Clarke or Carl Sagan. When I ponder upon how hyperloop might impact the future of logistics it seems much like that.

California based Hyperloop One, the leading player in the domain which has now found a lead investor in Richard Branson has become Virgin Hyperloop One (VHO). It is working on an underwater infrastructure for freight shipment also. The company believes that artificial ports would be developed around 10 miles into the sea where the ships can be docked and the underwater hyperloops would be used to transport the cargo to the coastlines. Thus eliminating the congestion along the shores and develop tourism across the coastline. However, the submerged transit corridor would not only revolutionize commercial transport but I feel it can emerge as an alternative to air transport by connecting nations across the oceans. The VHO has already partnered with a global supply chain logistics major DP World to develop a new cargo brand called DP World Cargospeed, whose objective is to transit freight at the speed to airplanes with a minimal expense.

Endeavour is on in making this concept more sustainable and low cost, through utilizing solar energy instead of electricity wherever possible.India has also started claiming its stake in the global hyperloop portfolio.

The VHO is working to develop a network across a distance from Mumbai to Pune. It is expected to get operational by the next decade. The main competitor of VHO, Hyperloop Transportation Technologies has also proposed a route linking the newly born Amaravati to Vijayawada in Andhra Pradesh. Elon Musk owned SpaceX, which is so far only promoting the concept rather than going commercial themselves, is organizing a competition since 2017 called Hyperloop Pod Competition to inspire innovation in high-speed pod transition through hyperloops for student teams. One of the main contenders of the 2019 edition is a team from IIT Madras called Avishkar Hyperloop. It is the only Asian team to enter the finals this time to be held on 31st July. As per the projection of Avishkar Hyperloop the distance between Chennai to Bangaluru which is approximately 350 kilometers, might take even less than 20 minutes. I will not wonder if fifty years hence the Indian railway system gets redundant making way for this new technology.

We are going through a technological revolution at the moment which is nothing less than a paradigm shift and I will not be surprised if later it is referred to as a period of technological Renaissance. At the end, I am reminded of a scene from the movie Interstellar where the protagonist travels through a black hole to save time, since time has no existence in a black hole. Well that may not be realistic but the way technology is transforming, much of what looks fictional today would become a reality tomorrow.

Adhiraj A. Bhaduri Senior Officer mjunction services ltd (SAIL-TATA Steel venture)

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Is Blockchain A Game Changer For Supply Chain?

T

he application of Blockchain in the supply chain is among the greatest innovations to take root in the shipping industry. Application of Blockchain holds promises to increase visibility, renew viability, reduce inconsistency, increase payment processing accuracy, and eliminate compliance problems. Even though the technology is still new, its potential cannot be ignored, and supply chain executives need to know why.

How shall Blockchain impact Supply Chain?

Blockchain technology allows us to more securely and transparently track all types of transactions, hence it will present across the supply chain. Every time a product changes hands, the transaction could be documented, creating a permanent history of a product, from manufacturer to seller. This could dramatically reduce time delays, added costs, and human error that plague transactions today. Blockchain is going to impact supply chain in following ways: Ÿ

Enhancement of Transparency: In a Blockchain-based supply chain management, record keeping and provenance tracking become easy as the product information can be accessed through the help of embedded sensors and RFID tags. The history of a product right from its origin to where it is in the present time can be traced through Blockchain. Moreover, this type of accurate provenance tracking can be used to detect frauds in any part of the supply chain.

Ÿ

Greater Scalability: Virtually any number of participants, accessing from any number of touch points is possible.

Ÿ

Better Security: A shared, indelible ledger with codified rules could potentially eliminate the audits required by internal systems and processes.

Ÿ

Increased Innovation: Opportunities abound to create new, specialized uses for the technology as a result of the decentralized architecture.

Ÿ

Cost Reduction: The real-time tracking of a product in a supply chain with the help of Blockchain reduces the overall cost of moving items in a supply chain. According to a survey of supply chain workers conducted by APQC and the Digital Supply Chain Institute (DSCI), more than one-third of people cited reduction of costs as the topmost benefit of application of Blockchain in supply chain management.

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In Blockchain applied supply chain always speed up administrative processes, the extra costs occurring in the system are automatically reduced but still guaranteeing the security of transactions. The elimination of the middlemen and intermediaries in the chain saves the risks of frauds, product duplicity and saves money too. None the less, efďŹ ciency will be improved as well as the risk of losing products will be reduced with accurate recordkeeping.

Establishing Trust: Creating trustworthy in complex supply chains with many participants is necessary for smooth operations. For example, when a manufacturer shares his products with suppliers, he/she should be able to depend on them for factory safety standards. Also, when it comes to regulatory compliances such as

customs authorities or other legal bodies, trust plays a vital role. The immutable nature of Blockchain in the supply chain is well-designed to prevent tampering and establishing trust.

Another beneďŹ t of Blockchain technology is data visibility throughout the chain. Due to this, it becomes easier for companies to share information and data with manufacturers, suppliers, and vendors.

Transparency in Blockchain helps reduce delays and disputes while preventing goods from getting stuck in the supply chain. As each product can be tracked in real-time, the chances of misplacements are rare.

It offers scalability through which any large database is accessible from multiple locations from around the world. It also provides higher standards of security and the ability to customize according to the data feed.

Moreover, Blockchains can be created in a private manner too which will allow the data to be accessed explicitly between the parties who have permission for it.

The value of adopting Blockchain technology can be taken from the fact that it has the potential to connect different ledgers and data points while maintaining the data integrity among multiple participants. The properties of transparency and immutability of Blockchain technology make it useful for eliminating frauds in supply chain and maintaining the integrity of the system.

Other than these, a few other beneďŹ ts of adopting Blockchain technology in the supply chain industry are: 1. Reduce or eliminate fraud and errors 2. Improve inventory management 3. Minimize courier costs 4. Reduce delays from paperwork 5. Identify issues faster 6. Increase consumer and partner trust

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With its increasing popularity, Blockchain technology seems like the solution to the problems of many industries today. Supply chain being one of the most populated industry holds certain use cases where the application of Blockchain technology can make a difference. A single shipment of goods can have at least 20–25 people or organizations in the process which leads to roughly 200 interactions between them thus, leading to a lengthy process.

If applied correctly, Blockchain technology can assure provenance tracking and traceability across the supply chain. This, in turn, will lead to fewer counterfeiters and ensured safety in the processes. Blockchain in the supply chain will also allow manufacturers, transporters, and end-users to collect data, study trends, and apply predictive monitoring process for better product experience.

Conclusion Blockchain has introduced its potential to bring out positive changes in many industries and businesses till date including the supply chain industry. In fact, the supply chain management is one of the most obvious and useful applications of Blockchain technology, therefore, we can expect it to grow at a very fast pace in the near future. The source of successful operation of a supply chain management system is to keep a robust, transparent and end-to-end communication.

Companies are exploring ways to filter their supply chains and adopt the change that the Blockchain technology has to offer. Once businesses see the bigger picture, they'll eventually go through the hassle of applying newer systems embedded with Blockchain in order to reap bigger benefits in the future. Dumping the paperwork and centralized databases will bring effective change in terms of higher rewards and increased performance among the supply chain teams. The use of Blockchain in supply chain management will work as a game changer by eliminating the vulnerabilities and inefficiencies of the current system.

Syamaprasad Head- Supply Chain Management Sheenlac Paints Limited

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MERGER & ACQUISITION Commission prohibits proposed merger between Tata Steel and ThyssenKrupp The European Commission has banned the creation of a joint venture between Tata Steel and ThyssenKrupp under the EU Merger Regulation. The merger would have reduced competition and increased prices for different types of steel. The parties did not propose adequate solutions to address these concerns.

“Steel is a crucial input for many things we use in our everyday life, such as canned food and cars. Millions of people in Europe work in these sectors and companies depend on competitive steel prices to sell on a global level. Without remedies addressing our serious competition concerns, the merger between Tata Steel and ThyssenKrupp would have resulted in higher prices. So we prohibited the merger to avoid serious harm to European industrial customers and consumers”, said Commissioner Margrethe Vestager, in charge of competition policy.

This decision follows an in-depth investigation carried out by the Commission on the proposed joint venture, which would have combined the flat electrical and carbon steel activities of ThyssenKrupp and Tata Steel in the European Economic Area (EEA). ThyssenKrupp is the second largest producer of flat carbon steel in the EEA, while Tata Steel is the third largest. Both companies are important producers of laminated and metalized steel for packaging applications and galvanized carbon flat steel for the automotive industry.

Radiant completes acquisition of Max Healthcare to create India's 3rd largest hospital chain Radiant Life Care has completed the acquisition of 49.7% stake in Max Healthcare from South Africabased hospital operator Life Healthcare. Max Healthcare will now lead by Abhay Soi. He will be the Chairman of its Board and Executive Council.

Radiant's stake acquisition is one of several steps that will eventually result in acquiring a controlling stake in Max Healthcare by combining the health care assets of Max Healthcare, Max India and Radiant. The combined assets would make it the third largest hospital network in India and the largest in North India.

As part of the transaction, Max India's promoters have received an advance of 361 crores in exchange for a 4.99 percent stake in the merged entity. Max India's promoters have used the funds for reducing debt.

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Aditya Birla Fashion and Retail to buy ethnic wear brands Jaypore and TG Apparel & Decor In order to strengthen its presence in ethnic apparel and accessories, Aditya Birla Fashion and Retail Ltd (ABFRL) will acquire ethnic wear brands Jaypore and TG Apparel & Decor.

Aditya Birla Fashion and Retail Ltd will acquire Jaypore for an enterprise value of upto 110 crores.

Launched in 2012, the online and offline retailer Jaypore that offers handcrafted collections of clothing, jewelry, home textiles and handmade accents, woven and handmade apparel from across the country, clocked a revenue of 38.9 crores in Fy2019.

TG Apparel & Decor which is into apparel and accessories space had a turnover of 33.7 crores in FY19 and ABFRL will acquire 100 percent stake for an equity value of upto 25 lakhs. Commenting on the 100 percent acquisition of Jaypore, ABFRL Managing Director Ashish Dikshit said, “Ethnic wear is the largest segment in the Indian fashion apparel market. While we have built a diversified portfolio of brands across different segments, ethnic wear space is currently under-represented in our bouquet of offerings to consumers.”

Situs, American Mortgage Consultants to Merge Situs Group Holdings Corp. and American Mortgage Consultants Inc. plan to merge and change the name of SitusAMC, a technology and services company that will provide unified solutions to commercial and residential real estate lenders and investors around the world.

Once the transaction is completed, the merged company will have more than $ 175 billion in commercial assets and provide quarterly fair value measurements of more than $ 290 billion in real estate assets. The company will cover approximately 60% of the secondary market private-label securitization transactions in the residential market. The combined company will have more than 3,300 professionals in 27 markets across the United States, Europe and India.

“This merger will uniquely position us to support our clients across both their commercial and residential debt and equity activities and will create new opportunities to advance their agendas and transform their business through industry-leading services and innovative technologies,” said Steve Powel, current CEO of Situs Group Holdings Corp. & future Co-CEO of SitusAMC.

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GSK Consumers Healthcare gets shareholders' approval for merger with HUL GSK Consumers Healthcare Ltd said that its shareholders have approved its proposed merger with FMCG major HUL. "The proposed resolution approving the Scheme was passed by the requisite majority of the equity shareholders of the Company," said GSK Consumers.

Earlier in January, GlaxoSmithKline Consumer Healthcare had informed that it has received approval from the fair trade regulator CCI for its merger deal with HUL. On December 3, 2018, Unilever, the Anglo-Dutch consumer giant, announced the acquisition of a healthy food portfolio that includes the popular brands Horlicks and Boost, from GlaxoSmithKline in India and more than 20 other markets for an amount of 3.1 billion pounds (around 27,750 crores).

As part of this agreement, Unilever's Indian subsidiary, HUL, acquires GSK CH India through a capital merger, valuing the total of its activities at 31.7 billion. GSK CH India is the market leader in the category of healthy drinks, with popular brands such as Horlicks and Boost.

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Top 10 Challenges that will Transform Global Procurement

F

or years, procurement officials have focused on reducing the cost of purchasing materials and services and on the timely delivery of goods and services. Nowadays, they face an increasingly complex panorama, dominated by legal issues, sustainability concerns and regulatory and ethical considerations that can not only impact the results of their business but also their brand and public image.

Over the next decade, procurement managers will have to take on broader roles within their organization. They will have to become the custodians of the company's brand, the advocates of sustainable business practices and the innovators who contribute to the development of new products and services. Companies that adopt this broader perspective for their purchasing teams will be better positioned to address the dimensions of change, from risk management and anticipation to the need for greater transparency in the supply chain – that will transform procurement by 2025?

Here are the top 10 challenges that have the potential to disrupt the dynamics of current supply chains.

Procurement officials who proactively address these issues will be taking a major step towards helping their organization prepare for the future.

RISK

INTEGRATION

In coming future, procurement risk management will undergo a major change from the application of compliance to the adoption of a more comprehensive strategy that includes total exposure to risk, mitigation of risks, investments and risk transfer pricing. To enable this transition, procurement managers must develop category leaders who can develop risk management approaches for next-generation suppliers and take into account new metrics in key procurement and supplier management decisions.

By 2025, savvy procurement teams will begin to play a critical role in sharing information about internal and external costs throughout the organization. They will also become the source of information tracking beyond costs, but also on how the organization is fulfilling its commitments to sustainable development and social responsibility. In addition, through information on business-to-business performance metrics, procurement will also help identify suboptimal business processes.

SUSTAINABILITY Procurement functions will go beyond cost management and seek to develop a supply chain that creates and maintains economic and social value. Young professionals are especially likely to adopt economic growth that does not depend on resources and, ultimately, lead companies to reject the "linear economy" in favor of a "circular economy" based on and continuous reuse.

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GLOBALIZATION As emerging markets play a more important role in the global economy, the traditional supply and demand that have shaped world trade in the last 50 years will change drastically. In the Americas, Brazil will become an important source of supply and demand for global companies. To carry out this task, procurement teams must begin to gain experience in sourcing from local emerging markets in China, Brazil, Russia and India, as well as in other developing economies.

FINANCE In future, procurement managers will develop their skills to help their organizations adapt to the complex challenges of managing the global supplier base. Many will have to develop a financial sense that competes with that of their financial counterparts. Large companies should start taking measures to strengthen the links between finance and purchases and strengthen the financial skills of their purchasing teams.

INNOVATION

PEOPLE

By 2025, leading supply chain and procurement organizations will serve as the main channel to find new ways to create value from the base of global suppliers, either by rationalizing the development of new products or outsourcing non-core functions. In order to move this way forward, procurement organizations must better understand the role of external entities in bringing innovation in their industries. To do this, many supply chain and procurement teams will need to expand their experience in engineering, design and development of new products.

The above nine challenges make the case for an extremely different supply function within 10 years. Even if only half of these predictions are fully identified, tomorrow's procurement managers will have to adopt a different view from their counterparts in the past. To adapt to this change, CPOs are already thinking of ways to find and train the next generation of procurement managers, which will require them to assess their intellectual and geographical diversity and sources of recruitment.

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COLLABORATION In the future, leading purchasing organizations will deploy external collaboration models far removed from the traditional "purchase and audit" models.

Procurement officials will need to organize complex service management and subcontracting agreements with multiple suppliers. Now, procurement organizations must begin to establish subcontracting models and collaboration services to replace conflicting constructions that foster zero-sum or win/lose scenarios.

INFORMATION Since big data is increasingly interweaved into corporate decision-making processes. Leading procurement organizations will need to become more flexible with advanced data mining and business analysis techniques. By 2025, procurement managers will live in a very different world, based on data, in which they will have access to real-time updates on transactions and financial activities in a broad spectrum of the business. Leading companies must begin to evaluate their baseline data, data management and analysis capabilities, and how these skills and technologies need to evolve in the next decade.

TRANSPARENCY Social media platforms and the growing acceptance of information transparency will magnify the degree of supervision over procurement agencies. This disruptive change, together with the adoption of social technologies in real time, will make procurement one of the most visible business functions for the outside world. To this end, purchasing managers should encourage their teams to adopt a social mindset and an operating model that will maintain the company's brand in this era of transparency. By 2025, the best procurement officials will feel comfortable interacting with their consumers, regulators and the press as they are with suppliers.

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Mini Case Studies

From Labor-Practice Compliance to Design Offensive Backstory: Trapped by a campaign against its labor practices in the 1990s, Nike embarked on a long process to reinvent its operations and reach important sustainability parameters by 2020.

Challenge: Can it go beyond "compliance" and capitalize sustainability by integrating it into the fabric of a company, from design to the supply chain and manufacturing?

Key movements: Nike began to closely monitor its activities in the early 1990s, after facing a wave of criticism of the labor practices of its Asian suppliers. The initial efforts were diverted to a team focused on compliance and social responsibility.

The team began asking questions about the long-term implications of product design and manufacturing decisions for the company. Where do the product materials come from?

Were they toxic? What happened at the end of the life of a product? When looking at the manufacturing sector, they found three shoes of sufficient value to produce two: a shoe finished as waste, at a cost of $ 700 million a year. As a result, the goal of zero waste has caught the attention of top management. It has become one of the many long-term goals to be achieved by 2020: zero toxic materials, closed cycle systems, sustainable growth and profitability. Nike has also created an internal index to measure the design of the product in relation to these objectives.

The company has integrated partners in the process, such as Dow Chemical, DuPont and BASF, because it could not achieve its objectives without working in the supply chain.

Then he began to reinvent the design process. If the sports shoe was optimized to reduce waste and materials by reducing the number of components, the efficiency of production could offset the cost of the most durable materials.

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Impact: Nike began to implement zero waste production and optimized production around its considered line of footwear and sportswear. This leader line now includes 15% of its products.

The company aimed to convert all sports shoes to their design standards considered for 2011, all clothing for 2015 and all equipment, such as balls, gloves and backpacks by 2020, reduced their energy consumption by 37% and their solvent consumption by 80% compared to other Nike products.

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An Opportunistic Push into Sustainable Business Backstory: General Electric Co. decided that sustainable development was a business rather than an economic opportunity and was launched on the ground in 2005 with its ecomagination initiative. But the products and services were not just for their customers, they ďŹ rst transformed GE. Challenge: How to create a new business in sustainable development and enter the big leagues?

Key GE began to see sustainability as part of a demographic trend, realizing that scarcity would increase with population growth. Consumption of energy and water, waste, carbon emissionseverything would be reduced among the most efďŹ cient and sustainable companies. GE has seen a proďŹ table business opportunity to help businesses on this sustainable path. He has created his ecomagination unit to offer environmental solutions.

GE also argued that carbon could eventually be a cost, after the implementation of previous regulatory regimes, such as the limitation of acid rain. Although the precise way to reduce carbon emissions is regulated, the company has little doubt about the adoption of the regulation.

Instead of waiting, GE partnered with the climate coalition with nongovernmental organizations to push for a system of ceilings and trade to create certainty for the future.

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Within the company, GE began to involve employees to see where energy savings could be obtained. This could include turning off the lights when a factory was idle or even installing a switch to turn off the lights. Ecomagination has sold solutions within GE, from the installation of LED lamps in a plant to the recycling of water in a nuclear power plant to the supply of combined heat and power plants. In a factory in Australia. Within GE, managers have begun to measure the amount of energy savings made.

Impact: Up to now, the company has saved $ 100 million from these measures and reduced its greenhouse gas intensity by 41% (a measure of emissions relative to production), according to its report on sustainable development. The work at GE has become a proof of concept for external clients struggling with similar problems.

Ecomagination has approached C-suite executives to develop this activity, since most of the problems cut across several divisions (for example, improving energy efďŹ ciency).

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The CGNE™ Certification N

egotiation research shows that the biggest factor is your ability to influence – your ability to negotiate. Have you mastered the art and science of influencing? Are you a Master Negotiator?

To enhance your negotiation ability to the next level, Competitors View comes up with a unique certification course named, CGNE™ - Certified Global Negotiation Executive™ which is designed to help senior executives become successful negotiators, deal with difficult people and hard bargainers, structure deals, and manage conflict productively. Certified Global Negotiation Executive™ distils cuttingedge research and real-world (Indian) examples into two days of targeted executive education negotiation training.

At CGNE™, attendees will test their beliefs and assumptions, overcome emotional and rational biases, examine complex negotiation scenarios, and discover a range of competitive and cooperative, integrative negotiation strategies. They will build on their accumulated knowledge to generate descriptive insights for negotiating across a variety of competitive contexts.

They will learn what tools work best for managers who need to shape agreements and informal understandings within a complex web of relationships. CGNE™ attendees will discover strategies for anticipating and responding to an array of complicating factors — from multiple parties and value differences. The relevant case studies will help them in applying negotiation theory to real-world situations.

The CGNE™ certification course will be a 2 day program from September 19th to 20th of this year in Mumbai.

The main highlight of this certification program is its instructor. This course will be facilitated by the one who has been hailed as “The Godfather of Negotiation Planning”, Mr Omid Ghamami. Mr Ghamami is CEO & Chairman of the Board at The Center For Purchasing & Supply Chain Management Excellence, the world's most powerful and prestigious purchasing and supply chain management certification institute.

Since 1995, he has taught thousands of hours of courses, workshops, and seminars in 21 different countries on topics related to the entire spectrum of purchasing, supply chain management, purchasing contract law, negotiations, and supplier management. He has trained all 50 Chief Purchasing Officers of the United States, been published in global journals including Fortune Magazine, published bestselling purchasing and negotiation books, has presented by request to Harvard University's Supply Chain Management program many times, and has worked with over 50% of the Fortune 100.

With the CGNE™ certification, attendees will achieve better outcomes by gaining the negotiation strategies they need to negotiate in uncertain environments, deal with difficult people, and manage conflict. They will explore a specific aspect of negotiation such as leveraging the power of emotion. This course will help them to recognize the most common manipulative negotiation tactics used by difficult people —and ways to neutralize their effects.

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™

Book your seat in order to pursue the world's most advanced, flexible and interactive master negotiation training for senior executives – the Harvard University Approach and become a CGNE™ and take your organization to the pinnacle through world class negotiation excellence.

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Featured Interview I

n a conversation with CPO Innovation Media, Nat Parameswaran, Group Vice President, Global Procurement and Supply Chain at USG Boral Building Products talks about USG Boral's Procurement Transformation Journey.

A Brief about Nat Parameswaran Nat Parameswaran is currently the Group Vice President, Global Procurement & Supply Chain, at USG Boral Building Products Ltd., a US$ 1.1 Billion building materials manufacturing company that operates in 12 countries across Australia & New Zealand, South East Asia, China, Korea, India and Middle East geographies.

Nat Parameswaran has global responsibility of Procurement and Supply Chain function across the company and is accountable for managing spend of over US$500 Million across a network of 12 countries.

Nat is highly accomplished Supply Chain visionary and leader with extensive experience in Global Supply Chain Strategy and Management, Global Strategic Sourcing, International Manufacturing Start-up Operations, Manufacturing Execution Systems & Strategies, Automation and Business Transformation Programs.

Q. Please provide a brief synopsis of your company and how you launched the transformation program at USG Boral?

USG-Boral Building Products is a company that was formed as a joint venture between USG Corporation (USA) and Boral Limited (Australia). Headquartered in Singapore, USG Boral is a $1.1 Billion leading manufacturer and supplier of gypsum-based wall and ceiling lining systems, mineral ďŹ bre acoustical ceiling systems, metal framing, joint compounds, high-performance panels and accessories throughout Asia, Australia and the Middle East. USG-Boral operates across 12 countries with over 35 manufacturing locations spread across this vast geography in a complex supply chain environment. USG-Boral holds unparalleled leadership in innovating new products that can change the way buildings are designed and built. Our portfolio of products include the SheetrockTM brand of gypsum plasterboard products, joint compounds, acoustical ceiling panels & systems, steel framing, exterior sheathing systems and tools & accessories.

Q. Can you walk us through the Procurement Transformation Journey at USG Boral?

As I had mentioned earlier, USG Boral operates across 12 countries across Australia & New Zealand, South East Asia, China, Korea, India and Middle East geographies. At the time when the company was formed, each of the 12 countries operated autonomously in the Procurement & Supply Chain space. Each country operated in a silo in terms of organization structure, strategic sourcing & procurement, supplier management, demand and supply planning, contract management and handled the tactical execution of the procurement function at a country-level.

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In 2015, we embarked on a transformation journey to evolve the Procurement function as an integrated, strategic and center-led operation where collaboration, data sharing, governance and communication across the 12 countries would allow us to leverage the total sourcing power of the entire company, rather than act as individual business units representing each country.

We instituted the philosophy of "Global Sourcing-Local Procurement" across the organization that drove efficiencies in developing consolidated commodity strategies, identifying key leveraging opportunities across the division, driving key cost savings initiatives, managing risk and allowed for mutual sharing of information amongst the different business units. The results of the transformation have been fantastic, both in terms of cost savings and for the team as well that is now driven as one cohesive unit.

We also introduced the concept of Procurement Summits that brought together multi-disciplinary teams internally at USG Boral from Sourcing, Logistics, Marketing, Technology, R&D and key suppliers that allowed for us to collaborate across functions and in driving “Procurement-led innovations” with our supplier base as well.

Q. Describe briefly the main drivers and aims of the procurement transformation and benefits achieved.

USG-Boral's footprint of plasterboard manufacturing plants is spread over a geography of 12 countries in Asia, Australia and the Middle East with a complex heterogeneous procurement and transportation operation. With a combined spend of over $500M in direct raw materials procurement, energy and transportation, it was evident that we need to evolve from a "country-specific" sourcing organization into a "global sourcing" organization. We also realized that this transformation needed to happen without disrupting the "country-specific" nuances in terms of regulatory and purchasing standards. Hence, we developed a strategy around Global Sourcing-Local Procurement philosophy that transformed USG Boral's Procurement organization into a truly integrated function.

The key drivers for this transformation were the following: Ÿ Ÿ Ÿ Ÿ

The need to function as One Global Organization To drive global spend leverage with suppliers The need to drive key raw material commodity strategies globally To gain detailed visibility into enterprise-wide spend, thereby driving cost savings opportunities.

Transformation of the Sourcing process into an integrated function yielded significant cost savings across the enterprise and directly contributed to the EBIT performance of the corporation over the past few years.

The total savings we achieved as a company under this transformation of becoming an integrated sourcing function was about US$65 Million in the 3-year period of 2015-2017. Even after factoring in the favourable fuel prices and deflationary commodity prices in 2016 and 2017, it was still a significant achievement as the Procurement team did not just rely on market conditions alone, but rather it was through combined efforts of leveraging volumes, driving global RFP events and changing the roles of country Procurement managers to be accountable for specific commodities that delivered significant benefits in terms of cost savings, risk mitigation and enabling supplier-partnerships.

Q. What digital transformation really means to procurement and what initiatives you are taking or have taken at USG Boral to create a future-proof Procurement organization?

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Our focus on digitization at USG Boral relating to Procurement & Supply Chain has been focussed in a nontraditional manner. Since each of the 12 countries run their own ERP systems (and sometimes in local language), we needed to first focus on how to extract, harmonize and analyze the data that would drive cost leveraging opportunities globally, as well as provide us with benchmarking costs across each business unit.

Therefore, we focussed more initially on data extraction tools that would allow for our transformation to be successful. Now that we have derived significant benefits from this transformation journey, we are now focussing on BI solutions, exploring the potential of where AI-based tools and Blockchain could be used, and understanding the limitations of the envelope of digitization as well. In addition, we use “best of breed” digitization through 3rd parties in terms of market intelligence gathering, supplier qualification etc., by working with companies that focus specifically on those type of analysis, which allows us to understand in great detail the macro and micro impact areas for our suppliers' input costs, thereby allowing us to drive “fact-based and market-based” negotiations.

Q. Can you help and explain the differences between a decentralized procurement models V/S a Center-Led Procurement Model? Limitations and Benefits?

As I had described earlier, we operated in a significantly decentralized model across our vast geography of 12 countries before embarking on the transformation journey. The main limitations of the decentralized model in Procurement & Supply Chain were the following: Ÿ Ÿ Ÿ Ÿ Ÿ Ÿ Ÿ

Lack of scope and clarity Lack of alignment of business strategies Sourcing not considered a strategic function Decentralized supplier relationships (even when the supply base was the same) Governance & Control Skill set imbalance and lack of career opportunities.

Inherent model of high costs

While there was clear merit in having the tactical part of sourcing & supply chain operations at a country level, there were significant limitations in the model that had to be overcome in transforming the Sourcing & Supply Chain area into a high-performing, strategic and collaborative business function across the entire division.

Moving to a Center-Led model along with executing the philosophy of “Global Procurement / Local Sourcing” framework, allowed us to take advantage of both the decentralized model and centralized model.

The center-led procurement focussed on the following areas – Sourcing as a strategic function Market and competitive benchmarking Single voice to suppliers Global commodity strategy and cost management People development across all business units Standards, compliance and risk management

Ÿ Ÿ Ÿ Ÿ Ÿ Ÿ

In addition, we created a matrix organization where the country procurement heads were also made accountable for certain key commodities globally. For Example - The Procurement head of China (that reports to me), is accountable for sourcing activities within China to support the China manufacturing footprint. In addition, as part of the center-led model, he is also accountable for global steel sourcing strategy across the enterprise at USG-Boral.

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This provides an automatic incentive to work across the countries in driving "enterprise-wide" sourcing strategy for key commodities. This allowed for easier change management and motivated the entire procurement team to work collaboratively across the division.

Q. What are the biggest Procure to Pay challenges that most of the organizations are facing in their procurement domain? What value does digitization bring in here?

I would say that gone are the days when negotiation takes across a table where the supplier and customer present their positions and handshake on mutually agreeable pricing that fits both their budgets. These days, negotiations are extremely complex, especially when it involves global footprint of plants such as in our case at USG Boral. The impact of macro-economic movements, currency fluctuations, trade wars, fuel volatility, demand and supply imbalances, etc., impact prices of commodities. Therefore, I would say that strategic sourcing these days involve scientific negotiations that understand the above factors and how it impacts the suppliers' cost input. In addition, since many of the commodities can be “indexed” through published global indices, I would say that negotiations involve a lot of research beforehand to drive a cost position with the supplier that maximizes the benefit and manages the risk at the same time.

While the tactical part of procurement such as RFPs, RFQs, Purchase Requisitions, Purchase Order Release, Approvals, Payments, Supplier performance, etc., can be digitized using AI and other machine learning technologies (that will certainly driver efficiencies in the day-to-day procurement activities), the challenge for tactical procurement professionals is to now perform higher-value role of a procurement “scientist” that would perform the strategic aspect of sourcing as described earlier.

Q. What have been the most significant achievements with the procurement transformation journey at USG Boral?

From USG Boral perspective, we were able to generate significant cost benefits as a result of our transformation journey. Over a 3-year period (from 2015-2017), we were able to save over US$65 Million in procurement costs. This was done due to our leveraging capabilities globally due to the integrated sourcing efforts. In addition, we now have an organization where we have a set of professionals that now can collaborate across the division in any area of Sourcing or Supply Chain to drive efficiencies and improve our cost position.

This journey also has resulted in our transformation being a showcase for other shared service functions within our organization that also embarked on a similar “center-led” model to drive efficiencies and collaboration across the enterprise.

Our transformation is now mature and so successful that collaboration, camaraderie and communication are part of our core DNA of the entire Procurement & Supply Chain team. Each member of our team knows that they are part of a global organization and take pride in being part of a collaborative and high-performing team.

Q. How can a CEO help elevate procurement as a strategic function and add value?

Every CEO understands how costs impact their bottom line in terms of contribution margin and EBIT. Therefore, the onus is on Procurement Heads and CPO's to elevate their roles to demonstrate strategic value to their organization in terms of providing “cost competitiveness”, not just negotiating a better price than previous year.

CEO's believe when the CPO's can effectively answer the “Show me the money” and “Are we doing better than our competition in sourcing costs?” questions. Once that is demonstrated, and the CEOs can see the transformation of sourcing being just an operational procurement function to more of a predictive driver in terms of cost competitiveness, CEO's will embrace procurement to be a strategic function.

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