You know how it is when you travel – it’s great while you’re out there, but when you get back, your desk is buried beneath a pile of work that accumulated while you were gone.  And so it has been for me this week!  But alas, I still have several posts to write from my Planes, Trains & Automobiles adventure that ended last week.  I have Spend Samurai to showcase from a biotech startup in Cambridge, a business process outsourcer who manages the procurement function for his clients, a technology non-profit that provides information infrastructure services to a network of libraries in Pennsylvania, and the provider of those 50% off discount books that we’ve all bought at least once.  Today’s post, though, shines the spotlight on two Spend Samurai from temporary staffing pioneer Kelly Services, in Troy, MI.

I have a soft spot for Michigan – Saturday afternoons in the Big House, vacations on the shores of Lake Michigan, countless nights frequenting the excellent jazz clubs in Ann Arbor.  But the state has come on hard times.  The precipitous decline of the automotive industry has sent the state’s economy reeling.  You can almost feel the despair the moment you step off the plane.  You can see it when you pass driveways filled with cars belonging to workers who have nowhere to go.

So when I reached Kelly’s offices, I was feeling a bit melancholy.  That quickly changed though, and excitement charged the air when I started talking to Steven Collins and Charlene Kling, two innovative Spend Samurai in the Kelly purchasing department who are making a big impact by finding cost savings that hit the company’s bottom line.  Some of what I learned:

• A strong commitment to analysis and performance metrics will pay dividends. Steve and Charlene track a wide array of metrics, including cost savings (measured several ways, including “in the case of Coupa and capital requisitions, the actual source cost minus the approved requisition cost”), cost avoidance (a completely under-utilized metric), procurement value (i.e. cost of the procurement department as a percentage of savings) and diversity spend.  Steve and Charlene are part of a procurement organization that generates 9X their cost in savings – the benchmark for a services procurement organization is 5X.  So even though total procurement spend is small relative to company revenue, the savings generated by that department is significant.
• Get creative with how you make the business case for e-procurement. Charlene and Steve had to gain sponsorship for the purchase and implementation of their e-procurement initiative. Now that they have, they’ve had some impressive results.  The rollout included all of Kelly’s international offices, so they now have users on Coupa from  as far away as Russia, Norway, Sweden, and several countries in Asia-Pac, that are connected to HQ purchasing policies and processes for the first time.  The efficiencies gained from automating the company’s requisition and approval processes have already equated to 1/2 of an FTE – and the Coupa deployment has not even been extended to services requisitions yet, which represent the largest categories of spend.
• You can’t (and shouldn’t) accommodate everyone. While it is important to understand the needs and processes of your internal customers, you cannot accommodate every customization request.  Steve, Charlene and team took a very strong lead on the company’s e-procurement deployment, and allowed very few modifications to the system, which meant forcing business process changes on some constituents.  Watch the video for more tips on change management and deployment strategy.
• It’s better to be proactive than reactive. The automation efficiencies and greater visibility into company spending that Coupa allows has helped Kelly further transform the buyer role in the organization – by reducing the amount of  time spent  processing requisitions and generating orders, to a more strategic role where the buyer is analyzing spend and proactively finding cost-savings opportunities.  Like the buyer who worked closely with Kelly’s Marketing department to evaluate the spend on promotional items and discovered that promotional items were being ordered from twenty different suppliers.  Consolidating that supplier base created greater efficiencies, but also allowed the company to take advantage of volume-based pricing that resulted in a significant reduction on spend in that category.