BT's Journey So Far - IQPC.com
BT's Journey So Far - IQPC.com
BT's Journey So Far - IQPC.com
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BT’s eStory and the BT Chorus Programme<br />
Finance & Procurement Transformation and opportunities<br />
Dave Meadmore<br />
Lead for Order to Invoice<br />
BT Procurement
Agenda<br />
• BT’s eStory<br />
• BT is changing<br />
• BT Chorus Programme<br />
• Progress to date<br />
• Key points
Total Global External Spend = £13.399bn<br />
(UK- £10.520bn & Global- £2.879bn)<br />
Procurement/Contracted = £8.644bn<br />
Interconnect= £3.669bn<br />
Specialised Sites= £1.086bn
BT’s eStory P&SC – Our Vision Strategy<br />
• Single Purchasing portal<br />
• Visibility of <strong>com</strong>mitment as well as spend<br />
• Appropriate Approval and Control<br />
• Richer supply chain (order status, receipt etc)<br />
• Lower invoice costs<br />
• Accurate allocation of expenditure<br />
• Cost reduction in Supply Base
Purchasing BT’s eStory Online – 1995 - 5 to Key 2004 Stages<br />
• Stage 1 - Simplify & Consolidate<br />
• Stage 2 - eEnablement of High Transactional Volumes<br />
• Stage 3 - Drive up eUtilisation<br />
• Stage 4 - High Value Commodities<br />
• Stage 5 - Channel rationalisation<br />
• Stage 6 - Richer supply chain with Supplier
Type of Order Channels Lessons Created Learned<br />
• Travel applications for Flights, Hotels, Hire Car and Rail tickets<br />
• Online ordering of Stationery and other corporate services<br />
• Development of “Best in Class” channels such as CAMERA<br />
Marketing and its clone CAMERA Consultancy<br />
• Lines of Business (LoBs) developed their own channels that have<br />
other integrated processes such as planning built in.<br />
• iProcurement used for all other products and services
Simplifying the User Interface<br />
Gatekeeper<br />
Sign Gate<br />
Keeper On<br />
Purchasing<br />
Online<br />
Commodity<br />
selection<br />
• single sign on<br />
• controlled access<br />
• no more system acronyms
Transparency of purchasing channels<br />
Selection is by <strong>com</strong>modity<br />
name<br />
Channel transparent to end<br />
user<br />
Controlled ordering channels
Where a <strong>com</strong>modity specific channel didn’t exist we used<br />
Oracle iProcurement
Accessing Travel Applications<br />
Using Supplier Sites
Stage eStory 4: High - Achievements<br />
value <strong>com</strong>modities<br />
• 52% of P&SC procurement spend was via a recognised order channel by<br />
March 2002<br />
• 77.1 % at March 2003<br />
• 85% of our spend through recognised order channels by March 2004<br />
• In excess of 99.5% spend via recognised channels by 2005<br />
• 97% of High Volume Commodities eEnabled with 98% eUtilisation<br />
• Removed orders via Phone, Fax and Personal Email.<br />
• Introduction of NO PO NO PAY if not on an agreed channel
• Cost effective<br />
– Around £120k a year to provide and support<br />
– Over £1.1bn has passed through this system over its life<br />
• Intuitive<br />
Why is CAMERA Marketing considered “Best Lessons in Class” Learned<br />
– Takes an end user through the process<br />
– Its in the language of the user <strong>com</strong>munity<br />
– Reflects the <strong>com</strong>modity/industry being purchased<br />
• Additional functionality<br />
– Collaborative environment,<br />
– Allows for RFQ and responses<br />
– Supplier access via the internet<br />
– Electronic invoicing<br />
– Acts as a library of all campaigns including TV ads
Lessons Learned<br />
Why have some of the Corporate services <strong>com</strong>modity specific<br />
channels been so successful?<br />
• Cost effective<br />
• Intuitive<br />
– Reflect the <strong>com</strong>modity being purchased<br />
• Ease of use<br />
– User hidden from accounting or budget allocation issues<br />
– No approvals (travel retrospective via expenses)<br />
– Single sign-on – no user IDs and passwords to remember<br />
– No or little training material required
Lessons Learned<br />
The down side?<br />
• UK centric<br />
• We could not sustain separate order channels for every <strong>com</strong>modity<br />
• No <strong>com</strong>mon trading interface or process with our suppliers<br />
• No visibility of spend until Accounts Payable<br />
• Mixture of technologies and approaches<br />
• Issues if we wanted to change out a supplier
BT is now under continuous transformation<br />
Lessons Learned<br />
• BT now operates in 176 countries<br />
• 20% of the workforce now outside the UK<br />
• BT Global Services signed up 136 new corporate customers outside<br />
the UK in the last quarter of 07/08<br />
• BT has acquired 19 <strong>com</strong>panies in the last year.<br />
• BT workforce in Asia has increased by 30%<br />
• BT workforce in Americas up 45%
Our business challenges<br />
• The ability to be<strong>com</strong>e more agile<br />
• Constant internal business change<br />
• Support global contract wins<br />
• To have an end to end view of BT’s performance<br />
• To have an holistic view of supplier spend<br />
…. challenges facing BT are <strong>com</strong>mercial, economic and<br />
operational
Our position was not world class<br />
• A stable organisational model<br />
• Multiple processes<br />
• Multiple data sources<br />
• 400+ separate systems<br />
• 30+ instances of Oracle alone<br />
• 33 chart of accounts
What we want to achieve<br />
• Standardised business processes by LoB and move towards<br />
pan BT processes<br />
• Common group wide definitions and understanding of all key<br />
standing data<br />
…. supported by a simplified and centralised technical<br />
infrastructure
What does Chorus mean for Procurement?<br />
One System Platform & One Procurement Process<br />
One Data<br />
<strong>So</strong>urce<br />
One Electronic<br />
Supplier<br />
Interface<br />
Common<br />
Order Channel<br />
Visibility Compliance Control<br />
Enabling BT People to do the right thing<br />
Profitability & Cash Flow = Competitive Advantage
Key enabler - Global Vendor Data Master (VDM)<br />
• a unique global reference for each legal entity including:<br />
– consistent supplier naming<br />
– recording of external references such as <strong>com</strong>pany, Dunn &<br />
Bradstreet etc.<br />
– hierarchical linkage between Vendors and their subsidiaries<br />
– hierarchical linkage between Vendors and their distributors via<br />
Contract Agreement and Supplier site<br />
• a single One BT Supplier registration and creation process<br />
• BT Group wide vendor reference source<br />
– ERP platforms<br />
– ASC and other systems<br />
– consolidated Procurement MIS
Key enabler - Standard Functionality, Configuration, and<br />
Customisation<br />
• Common implementation to agreed design unless there are legal or regulatory<br />
requirements<br />
• Vanilla ‘Oracle’ does not mean no custom code<br />
• Custom code only needed for things like:<br />
• Interfaces with legacy (e.g. invoicing) or external (e.g. banking)<br />
systems<br />
• Workflows (e.g. for account generation or approval hierarchy routing)<br />
• Reports<br />
• Additional data (e.g. flexfields in Oracle or external databases)<br />
• Intrusive customisations to be avoided <strong>com</strong>pletely<br />
• Oracle Corp. provides guidelines for development of custom code to ensure<br />
support arrangements are not <strong>com</strong>promised.<br />
• Signoff by senior stakeholders within the business
We are basing our implementation on the ORACLE eBusiness<br />
Suite 5.10 and Procurement will use new modules to enhance<br />
their processes<br />
Rich content, navigation and<br />
service forms<br />
Replaces Purchasing On-Line<br />
even for services fulfilled<br />
outside ORACLE<br />
Contracts integrated directly with<br />
Purchasing. ensuring <strong>com</strong>pliance<br />
Contract<br />
Management<br />
Payables<br />
BT Group<br />
Payment<br />
Policy<br />
iProcurement<br />
Workflow<br />
Approvals<br />
Purchasing<br />
iSupplier<br />
Web based<br />
supplier<br />
interface to<br />
<strong>So</strong>urcing,<br />
Orders,<br />
Invoicing &<br />
Payments<br />
Consistent Approvals<br />
and Control<br />
Procurement<br />
involvement where<br />
required<br />
<strong>So</strong>urcing<br />
Single platform for all<br />
RFI, RFQ, Tender and<br />
Auctions<br />
B2B Interface<br />
Single Supplier B2B<br />
and improved ROI<br />
based on open<br />
standards
UK Approach<br />
(Running on BT servers)<br />
Other order<br />
channels<br />
Single iSupplier<br />
for our UK<br />
Suppliers<br />
WH<br />
EQ1<br />
iSupplier<br />
Purchasing<br />
Link for UK on<br />
BT Home Page<br />
iBuy<br />
EQ2<br />
(Fleet,<br />
Openreach<br />
& Rest)<br />
BT1P<br />
EQ1<br />
Single MIS<br />
All UK P2P Order<br />
to Invoice in one<br />
place<br />
SOLUTIONS<br />
EQ1<br />
Punch-out<br />
to Supplier<br />
site if<br />
required<br />
AP transactions<br />
passed to<br />
account ledgers<br />
on existing<br />
installs<br />
UK&I<br />
BT Design<br />
BT Operate<br />
BT Wholesale Markets
Proposed P2P Platform Roadmap<br />
November<br />
2006<br />
Spring<br />
2007<br />
Summer<br />
2007<br />
Winter 2007 Spring 2008<br />
08/09<br />
Close 10.7<br />
Invoicing<br />
via EQ 2<br />
Close 10.7<br />
Invoicing<br />
via EQ 2<br />
Close <strong>So</strong>me UK<br />
Order Channels<br />
Close UK<br />
Equinox<br />
iProc<br />
Agreed<br />
Global Design<br />
iBuy/EQ 2 (BT servers)<br />
Contracts &<br />
<strong>So</strong>urcing<br />
introduced<br />
Asia PAC<br />
GFP (ORACLE On-Demand)<br />
Europe<br />
5 Live Delphi<br />
stabilised<br />
on 5.10<br />
Nordics<br />
& Switzerland<br />
Netherlands<br />
US Reston<br />
and Americas<br />
(91 legal<br />
entities)<br />
Global Design<br />
aspects<br />
reflected<br />
in GFP<br />
Infonet,<br />
Italy & Spain
Using Supplier Sites<br />
Demo Videos<br />
Car Hire<br />
Punch-out
iProcurement Content<br />
iProc homepage<br />
‘Purchasing Online’<br />
‘Stores’ created for ALL major<br />
categories of spend and direct<br />
users to the appropriate<br />
channel/content<br />
Catalogues<br />
Commodity<br />
Forms<br />
Informational<br />
Catalogues<br />
•Individual goods/services<br />
held internally with fixed<br />
prices<br />
•Items held externally by<br />
supplier and accessed<br />
through punchouts<br />
• Request Forms created for<br />
each type of spend to direct<br />
users to the relevant<br />
supplier/contracts<br />
•Information templates used to<br />
capture additional information<br />
•Links provided to external<br />
channels for all types of<br />
expenditure not purchased<br />
through iProcurement
Procurement Approval.<br />
(by exception)<br />
Finance<br />
Procurement Authority<br />
Cost Centre<br />
Approvals<br />
Procurement Compliance<br />
(above £ x Value)<br />
New Supplier<br />
Self Approval<br />
Project<br />
Approvals<br />
Off Contract<br />
(above y Value)<br />
• Procurement Authority<br />
Finance<br />
– Individual specified against a specific contract can<br />
be included at the END of the approval process<br />
– All non-contract purchases over a specified value<br />
(by category) routed to a procurement individual for<br />
approval<br />
– Process to enable procurement validation of<br />
contract terms etc. and provide formal authority to<br />
proceed<br />
• Procurement Compliance<br />
– Individual specified against a category of spend or<br />
supplier site who can be included at the START of<br />
the approval process. E.g. validating correct<br />
channel/supplier/contract used<br />
• New Supplier<br />
– Individual in procurement required to approve all<br />
new supplier purchases (specified by category)
Progress to date<br />
• December 2006 – European countries re-stabilised on the new<br />
ORACLE 5.10 software<br />
• April 2007 - Global VDM created across BT<br />
• 07/08 Contract register and <strong>So</strong>urcing modules rolled out across<br />
Procurement (mandatory except for eAuctions now via Ariba).<br />
• December 07 – Netherlands transferred to GFP<br />
• January 08 – US Reston managed entities transfer (91 legal entities<br />
all around the world).<br />
• May 2008 – UK Lobs transferred to iBuy<br />
• Preparation being made for our US <strong>com</strong>pany Infonet to go live<br />
August 2008 (6 legal entities)<br />
• Preparation underway to implement Global design aspects on GFP<br />
• Reusable <strong>com</strong>ponent being developed to speed up the transfer of a<br />
legal entity to GFP which can be repeated as required.<br />
• Feasibility studies for Spain and Italy.
Key points<br />
• Sizeable implementation stages that can be fully<br />
monitored and delivered<br />
• Agreed Global Design so that all business issues are<br />
resolved in advance and we don’t delayed due to local<br />
practice or requirements<br />
• Keeping to Vanilla and restricting requests for<br />
enhancements.<br />
• Prioritise <strong>com</strong>modities keeping existing processes if<br />
they are working
BT’s eStory and the BT Chorus Programme<br />
Finance & Procurement Transformation and opportunities<br />
Dave Meadmore<br />
Lead for Order to Invoice<br />
BT Procurement