Feedback: Why invest in a Procurement solution? How to choose the right tool? Jan Theissen, Strategy & Methods Director in AGCO, explains here the implementation of the eSourcing solution « SynerTrade Accelerate ».
AGCO: Implementation of an eSourcing Solution
AGCO, founded in 1990, is an American company which produces and sells agricultural equipments. In the past few years, the company has decided to centralize its activities as well as improve the internal collaboration: the implementation of its eProcurement solution has contributed to this change.
- What led AGCO to implement an eSourcing solution?
We did a very large organization transformation over the last couple of years. Decentralized organization has become a more centralized organization. With that, we really needed to bring the people together, so we spent quite some time on transforming our decentralized organization into a more central organization, (in material management, IT or category management), and with that in place, we need certain tools to help us to drive effectiveness and efficiency into the organization and eSourcing for us as two main drivers:
To drive global collaboration within the teams: to connect people that were very decentralized in the past, bring them together and have them working on the same challenges.
And secondly, we wanted to drive efficiency, having standardized processes, sourcing processes, supplier’s management processes. So basically, an eSourcing solution for us is not only something to improve the sourcing process, it’s also something to improve collaboration and drive a change within the company.
- Why did you choose Synertrade?
We did a very large project and investigation from what we have on the market -I’ve personally work in that area for now more than 15 years- and we also had certain requirements.
First of all, we needed a tool that is really working globally and that is mature enough to support a global organization. We needed a tool that is driving collaboration, within a production material environment, within an environment that is used to have development processes. And I think this is where Synertrade really delivers benefits and value to the company.
Second of all, we wanted to have a company with a global footprint, so that we can work with partners across all regions: we are present in nearly all regions of the world, and we have purchasers and buyers there. And we of course need to have someone supporting these people.
I think we had a very good cost value benefit with Synertrade, delivering outstanding functionalities and modern tools and – that was basically the message we were getting from our buyers involved in the sourcing process – the user interface, the usability, were way above what we’ve seen anywhere else on the market.
So overall the decisional team, composed by the leadership team as well as a large group of buyers, decided that Synertrade Accelerate is for us the tool that delivers the best value while also meeting the expectations in terms of usability and user-friendliness.
- What were the expected benefits from the “Synertrade Accelerate” platform implementation?
We saw the benefits pretty early. First of all, we have now a tool in place to connect people, so we saw individual people become a team, people working on the same sourcing project, and people in different regions start to collaborate with the global management team.
And we have also seen that our suppliers really appreciated the centralization and standardization of our processes.
In the past, we always had that stake: because of the decentralization, we had different approaches towards suppliers; and now, the suppliers understand that our sourcing projects are run as a standardized way.
We have also increased the results of the sourcing processes, especially on the quality of the quotes from the suppliers. For instance, the quality of the cost break down was much higher than in the past when we had to run this process manually.
Later on, we really could also speed up the sourcing processes thanks to our standardized tool, and we could eliminate certain tasks to make the entire process leaner. So overall there were a commercial and a process benefit.