AkzoNobel's Roadmap in Mobilising its E-Procurement Suite: A Success Story

In this day and age whereby there is an upward price pressure and an ever-growing need to gain visibility and transparency into the risks and opportunities CPOs are faced with, optimising end-to-end operations is a strategic imperative.

From supplier sourcing to payment management, it helps to streamline internal processes as well as continuously track and update where the firm stands against other competitors in terms of cost. Therefore, this gives them a much broader agenda in enhancing resilience, sustainability and value creation for the procurement function.

In the past, many companies have been operating in silos, wherein the processes are conducted by different people with different software technology supporting them. There was no single centralised environment for them; contract management, e-sourcing, e-catalogue etc., were run on their own respective platforms, which can engender fragmented and scattered data when users wish to glean insights from them.

Recognizing the need for a holistic approach, AkzoNobel embarked on a strategic system selection and implementation process.

Their e-procurement suite enables seamless access to multiple modules within a unified platform, ensuring a single source of master data for insightful decision-making.

The end goal is to have all this information stored in a platform, but therein lies no one-size-fits-all method when integrating such technologies into the system with the complexities of procurement needs. How did they materialise this and what were the steps taken to roll out this initiative for AkzoNobel?

The Inauguration of a System: The All-In-One E-Procurement Suite…

The implementation of the integrated system for 2 distinct stakeholder groups: procurement and users was span across 3 phases.

• The Preparation Phase
• The Implementation Phase
• The Hypercare Phase

The Preparation Phase

This phase is driven very much by user acceptance. They focused on gathering all necessary as-is process information and prepared a detailed implementation roadmap focusing on how the change will be carried out as well as crafting light communication for the commencement so that there was “mental preparation” of impending changes.

A Regional Project Group was formed to tailor the system to the specific needs of their region. Southeast Asia, South Asia and Oceania is a very diverse region with wide differences in culture and language. They took special care to make sure that “no one was left behind” by ensuring that training and communication were localised wherever possible in a bid to help better adoption.

The regional procurement team has long recognized that the key to a successful implementation is making sure that the roll-out is publicised successfully internally and getting people excited about the change.

The Implementation Phase

The global project team planned a global timeline for implementation spanning across 18 months; the processes started with 3 reiterative rounds of design, pilot roll-out in our headquarters, and global roll-out in 3 waves across different geographical regions.

Much of the initial phase of design was conducted by the project team to understand the key needs to be addressed by the new procurement system architecture and how it interfaces with existing systems such as ERP.

With regards to design, various procurement team members provided the project team with feedback on prototypes and their insights were incorporated in the final mockup to ensure a user-friendly experience.

The region eagerly prepared for the roll-out which was planned for the final wave. Although they were the last to implement, they did reap the benefits of learning from other regions and resolved similar issues more efficiently.

After all, the best system will not be effective if people are not even aware of its existence and the benefits such as seamless user experience as well as scalability and flexibility when using it.

The Hypercare Phase

After going live to all stakeholder groups, robust post-launch support was given. A daily call was set up in the first two months to address all the issues that were raised by various groups by the project team timely before moving the meetings on a weekly basis. Key Procurement Team Members were also present in person in key locations such as offices and factories to provide support and answer queries to the users.

In order for the project to be successful, a lot of efforts have been placed into training and communications which are elaborated in the following sections.

Training

Having a robust and well-designed system may create value for businesses and raise performance in terms of cost optimisation, but without the adequate experience, such an investment will not pay off. Therefore, effective training to both procurement and user groups remains paramount to fully unlocking the potential as well as realising the efficiency gains from adopting it.

The project team developed solid training materials for both procurement and user groups, with Procurement personnel being trained ahead of the user groups. They went through a solid phase of training, focusing on the “why” and “how” the new system will benefit them. A detailed “lecture” was conducted (including showing a live demo of how the system worked) and then going into practical exercises to familiarise themselves with the system.

Selected procurement personnel were asked to become trainers to conduct training for end users. Training was localised by leveraging on local nuances and some materials were also converted into local languages so that they could be more effective.

Communications

One of the principles that they adopted in communication was to make sure that they “repeat for retention” across multiple platforms. This is because they recognize that not everyone reads the corporate newsletter and has different ways of receiving information. The Corporate Communications Team was superb in crafting messages and supporting its plan.

These are some of the communication channels that they have leveraged on with eye-catching and effective visuals to solidify key messages, fostering a culture whereby conversations are exchanged, and peer-to-peer support, creating a vibrant and symbiotic ecosystem of knowledge sharing and leadership endorsement.

1. Physical Sign Boards and Posters - 3 months before the Go-Live, the procurement team put up sign boards and posters in all our offices and operational sites to create awareness of the impending system and process change.
2. Yammer – Given this channel is more casual, they used these to drum interest with separated communities with more interesting and stimulating posts. It is also an avenue where people can post questions and one of the project team members and/or procurement personnel will answer.
3. Emails – They provided an official update via emails approximately every 6 weeks during the implementation to keep regional stakeholders and users clearly informed of the progress.
4. Memorabilia and souvenirs – A small investment was also made to buy small memorabilia and souvenirs as gifts and prizes during training and roadshows. They were designed to be placed on the desktop so that people are reminded of the change and to actively use the system.

Over and above the channels shared earlier, they managed further communications via the AkzoNobel Intranet Landing Pages, Webinars, Roadshows, Focus Group Discussions with key stakeholders and users and created Frequently Asked Questions (FAQs) and Contact Information Pack.

Key Takeaways

AkzoNobel’s implementation, while successful, had some challenges.

One of the key focus areas during the HyperCare period was on interface issues with other systems.

For example, there was a digit limitation issue because a few currencies such as Indonesian Rupiah or Vietnamese Dong have a higher number of zeroes compared to other currencies. This was not an easy fix as they needed to investigate deeply into the systems setup. The project team stepped in and eventually found a solution that was fit-for-purpose and seamless.

With solid collaboration between users, procurement and project groups, issues were proactively identified and ironed out. After 1-2 months, most people were using the system.

Many users provided valuable feedback which was used to refine the system and processes. Here is some of the feedback from users.

• “The resources and support available at SmartBuy have been very helpful, making it easier to and faster for me to fulfil my customer’s request.”
• “Thanks to SmartBuy, I save a lot of time on creating POs when I need to order goods and services.

There were significant reductions in man-hours and turnaround time as well as drastic reduction of issues given the smoother connectivity with the new system. We received several “thumbs-up” from key users who shared with us how their processes have significantly improved post-implementation.

They hope to continue refining the system through improvements in areas such as connecting to other enterprise systems beyond procurement as well as looking at potential new technologies such as AI to further increase productivity.

Kai Yang Lee, Regional Procurement Director of AkzoNobel, predicts that corporate procurement systems will converge into consumer procurement systems with high user experience, intuitive and frictionless, and integration into e-commerce websites or platforms such as Amazon or Taobao.

The only difference between corporate and consumer procurement will be the need to insert effective corporate controls that have to be in place to prevent loose or maverick user purchasing. He is confident that this will be resolved by the swift advancement of procurement technology.

Hear from Kai Yang Lee, at Equarius Hotel, Singapore, on 10th July, 3:00PM Creative Boardroom: Revisiting and strengthening category management fundamentals: Assessing past practices, evaluating current complexities, and anticipating future trends. Find out more here!