coupa roadshow master deck chicago
TRANSCRIPT
Agenda Time Item Presenter
8:30 – 9:00 Coffee All
9:00 – 9: 30 Welcome – Coupa Roadmap Tony Wessels, V.P. Marketing
Coupa
9:30 – 10:30 Amplifying Procurement’s Role Ravi Thakur, V.P. Customer Success,
Coupa
10:30 – 10:45 Break All
10:45 – 11:30 Spend Smart Kerry Clare-Piantek , e-Procurement
Manager, McDonalds
11:30 – 12:15 Strategic Supply Chain Management Eric Lynch, IBM / Emptoris
12:15 - 12:30 Break
12:30 – 1:15 Ask The Analyst Jason Busch, SpendMatters
1:15 – 1:30 Closing Remarks Tony Wessels
1:30 Coupa Demo Ravi Thakur
Purchasing
Purchasing
Procurement
Purchasing
Procurement
Spend
Management
Purchasing
Procurement
Spend Optimization
Spend
Management
Coupa Overview
Tony Wessels
Vice President, Marketing
Coupa’s Mission
Delivering software innovation that
breeds responsible spending while
impacting the company bottom line.
Innovation
Responsible Spending
Bottom Line
Spend Optimization
Coupa’s Explosive Growth
180% Bookings
YOY
+95% Renewal Rate
YOY
150% Platform Usage
YOY
One World, One Platform
10 Languages
40 Countries
100,000 Users
Customers Highlights
Retail Finance Mfg. Health Care High Tech
Amplifying Procurement’s Role
Ravi Thakur
Vice President, Customer Success & Services
CFO Financial Books
HR Personnel Files
Sales & Mktg Customer Records
Procurement Needs To Own Spend Transactions
Own The Transaction
Optimize Spend
Spend Optimization Platform & Processes
Procurement Must Orchestrate
VS.
How Do You Do It?
Proactively participate in growth strategy
Manage change effectively
Measure & demonstrate success
Participate In Growth Strategy
Understand Growth Strategies
Geographic Expansion
Understand Growth Strategies
Geographic Expansion
New Lines Of Business
Understand Growth Strategies
Acquisitions
Geographic Expansion
New Lines Of Business
Provide Truly Strategic Value
Ensure executive team supports your Spend Optimization strategy
Work with R & D / Product Development Be aligned with M & A and global expansion
Develop Agile Spend Processes
Bring distributed locations under management
Involve all stakeholders e.g. facilities, marketing
Proactively integrate acquisitions
Managing Change
Change Management Requirements
Leveraging change agents
Frictionless transition
Leveraging Change Agents
Functional Users
IT
Procurement
Payables
Suppliers
Functional Users
Familiar user interface
Support for function specific spend
Solution
A solution that they can use
Not stand in their
way
Needs
Procurement
Enables transaction ownership
Measurable results
Solution
Ensure policy compliance
Attain savings goals
Needs
Payables
Automation for invoice processing
Eliminates tedium
Solution
Reduce manual & error prone steps
Simplify tasks
Needs
IT
SaaS/Cloud based platform
User configurable
solution
Solution
Reduce burden on IT resources
Focus on value-add
tasks
Needs
Suppliers
No network fees or processes to support
Innovation e.g. Universal Search
Solution
No additional cost of doing business
Ease of adoption
Needs
Frictionless Transition
Familiar & convenient user interface Weave into daily life
Demonstrate Success
Set Targets
Measure Success
• Establish benchmarks and determine targets
• Use data to analyze: • Tradeoffs and interdependencies • Root cause
• Measurement excellence = capability to improve and stay ahead Be Excellent
Achieve Targets
Benchmark Success Productivity
Transaction cycle time
PO & invoices processed
per FTE (#)
Support costs – not just IT
Effectiveness
Spend under management
User adoption = customer satisfaction
% saving / spend
Communicate Success
CFO Financial Books
HR Personnel Files
Sales & Mktg Customer Records
Procurement Spend Transactions
Break
Kerry Clare-Piantek
44
e-Procurement Manager
McDonalds Restaurant Operations Inc.
Spend Smart
45
Coupa User Group Meeting May 3, 2012
46
E-Procurement
Manager
Joined McD in 2008
Charged with
building/rolling out a
Marketplace
Focus is on indirect
spend
About Me
47
McDonald's brand mission is to be our customers' favorite place and
way to eat. Our worldwide operations are aligned around a global
strategy called the Plan to Win, which center on an exceptional
customer experience – People, Products, Place, Price and Promotion.
We are committed to continuously improving our operations and
enhancing our customers' experience.
Some fun facts –
– We have more than 33,000 restaurants world wide
– 1.7 million employees
– Restaurants in 119 countries
– 80% of restaurants are franchised
McDonalds at a Glance
48
Identified some trends indicating we had some opportunities
– G&A growth as a % was growing
– McOpCo Margin was decreasing (company owned restaurants)
– ROI was strong but growing at a slower rate
Put together a business case for an indirect procurement
process/team
– First category sourced was safety shoes
– Savings of over 25% achieved
– Proved to the company that there was substantial opportunity
Tried to implement a solution at least 3 times previously
unsuccessfully
Business Opportunity
49
McD was rolling out Oracle in the US so options were limited
Previous attempt to roll out Oracle iProcurement was unsuccessful
- change management largely ignored
- different processes existed for purchasing capital items vs.expense items
- authorization limits and approval process complicated
- required purchase order number for payment to supplier
Field wrote a compelling letter to management about what needed to
be fixed if folks were going to use the system
Deciding the Best Course of Action
50
We engaged the hearty few that were still using the system to help us
drive the system changes to make it “user friendly”
Engaged influential folks internally to participate in a pilot
Designed system initially knowing that eventually we would want to
extend system to the franchisees
Held several conference room pilots including job impact analysis
Included operators to participate in the RFP to pick the system for the
operators
Piloted system with a handful of operators
Managing Change
51
Several hurdles had to be overcome
–Operators not always supportive of Home Office Programs
– Information for operators is considered confidential so home
office access had to be extremely limited
–McDonalds doesn’t mandate programs
Took feedback from pilot and incorporated changes into
the system
–Needed to accommodate “combo operators”
–Single sign on mandatory
–Needed to build champions
–Focus on large operators first
Managing Change
52
Over 1,100 operators are now using Coupa representing 5,200 user
and over 6, 100 restaurants
Mainly using it for expense items, slowly moving to capital (uniforms,
office suppliers, small kitchen wares)
Metrics we use include:
–Weekly spend/number of purchase orders
– Embedded users
– Average spend per restaurant
Feedback indicated biggest benefits are time savings and
control/visibility
Operators think what we are doing is “a no brainer”
With Coupa Today
53
Next steps based on our user feedback
– Leveraging the reporting capabilities
– Instituting a budget component to the system
– Being able to control what suppliers their employees can purchase
from
– Added services to the system
– Potentially doing orders on behalf of our operators
With Coupa Tomorrow
54
Recommendations
–Change management is key
–Don’t try to onboard everyone – be realistic
– Build champions
–Make sure you include the users in the decision making process
Opportunities
– Looked for broader groups to engage to help spread your message
– Staff appropriately
– Simplify the on-boarding process (set up is complex due to
structure)
Best Practice Recommendations
Confidential and proprietary
Strategic Supply Management Overview
55
Eric Lynch
Director, Global Alliances and Channels
IBM - Emptoris
Emptoris Strategic Supply Management Overview
Powering Procurement Transformation
Eric Lynch – Director, Emptoris Global Alliances and Channels
© 2012 IBM Corporation
• Emptoris/IBM – Director, Global Alliances and
Channels
• Location: Chicago
• Alliance & Channels Business Development & Sales
experience consulting clients around Strategic
Supply Management best practices, processes and
use of SSM Solutions.
• Started Supply Management career with A.T. Kearney
Procurement Analytic Solutions in 2000 at the onset
of eSourcing.
• Experience selling eSourcing, Spend Analytics,
Enterprise Contract Management, Supplier Lifecycle
Management solutions and consulting.
Eric Lynch
© 2012 IBM Corporation
Our Mission…
58
Delivering strategic supply and contract management solutions that enable Global 2000
companies to maximize financial performance and optimize commercial risk around the world
Ensure Flexibility Optimize Decision Making
Gain Visibility And Control
Manage 100% of Spend
© 2012 IBM Corporation
Today’s Operating Environment
59
Increasing Risk and volatility
Increased reliance On suppliers
Complex economic environment Western cool, growth in emerging
From commodities to currencies Globalization fuels increased risks
Increased outsourcing Globalization of supply base
Continued Globalization Globalization accelerates
New global opportunities
Tepid economic environment
© 2012 IBM Corporation
Pressures on Procurement
Top Pressure Points
“The State of Strategic Sourcing: Building a Context for the Next Decade”, published by Aberdeen, April 2011
60
© 2012 IBM Corporation
Why the supplier is so important
61
Commodity Price Volatility
Increased Reliance on Supply Chain
Customer Demands Good Corporate Citizenship
Regulatory Pressures
Brand Protection
Missed Revenue Opportunities
CAPS Research Cross-Industry Report
of Standard Benchmarks
“On average, 50% of the value (and costs!) of your
products and services are in the hands of
your suppliers”
© 2012 IBM Corporation
Strategic Supply Management (SSM)
62
B O R D E R E N T E R P R I S E
© 2012 IBM Corporation
Enabling CPOs to Drive Business Success
63
Manage The Risk
Believe The Plan
Connect And Automate
Achieve Compliance & Savings
Data, Visibility, Opportunity
Price changes, Contract Terms, Supplier Evaluation
Manage Complex Data and Categories
Commodities, Currencies, Country Regulations, Natural Disasters
Source to Settle Process
© 2012 IBM Corporation
The solution for Strategic Supply Management : Emptoris Suite V9
64
Procurement Intelligence Global, enterprise-wide visibility into spending and suppliers to drive operational and supplier performance improvement
Source to Contract Advanced sourcing and enterprise contract management capabilities maximize and lock in savings
Category Spend Management and Compliance Manage complex spend categories and ensure compliance of service providers and outsourced workers
Program Management Powerful, cross-suite program management capabilities to drive savings, risk and compliance programs
Virtual Supplier Master A global master repository for supplier and category information and flexible supplier discovery capabilities
© 2012 IBM Corporation
Program Management
Program Management
Spend
Analysis
Supplier
Performance &
Development
Category
Spend
Management
Enterprise
Contract
Management Sourcing
Risk
Management
Supplier
Classification
Supplier
On-Boarding
Spend
Analysis
Improve Management Control and Accountability
– Provides a framework through which all procurement programs can be managed, including budget and savings programs
Improve Productivity and Increase Organization Capacity
– Improves global coordination of procurement activities and the allocation of resources
– Provides a central, configurable workspace that simplifies communication, with tools that automate standard tasks and provide alerts for exceptions
Ensure Compliance – Guides users to follow pre-defined processes
and data collection guidelines compliant with corporate rules
65
© 2012 IBM Corporation
Rent-A-Center Case Study
The largest operator in the United States rent-to-own industry with ~35% market share based on store count
Number of stores: more than 3,000
Number of employees: over 18,990
Annual revenues (2009): $2.752 BN
© 2012 IBM Corporation
Sourcing Engine Transaction Engine
What does best of breed combination really mean?
Negotiate Savings & Favorable
Terms
Identify & Contract With
Preferred Suppliers
Channel Spend Through
Preferred Suppliers
Ensure Compliance To Realize
Negotiated Savings
© 2012 IBM Corporation
REAL RESULTS
SAVINGS $1,000,000 in 3 months
enough for more than
sofas and flat screen televisions to rent to consumers
1,000
© 2012 IBM Corporation
To Learn More…
Visit www.emptoris.com
Resources available: http://www.emptoris.com/resource-library
Customer Video Testimonials
Meet The Experts Videos
Thought Leadership White Papers
On-Demand Webinars
Podcasts
Contact us at: [email protected]
Ask The Analyst
Jason Busch and Thomas Kase
SpendMatters
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
Ask the Analyst (but first … what’s on
our mind these days)
Jason Busch and Thomas Kase
April 2012
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
Who we are
The team
The sites
www.spendmatters.com
First blog in sector, now much more
www.agmetalminer.com
4 years old, largest metals pub in NA
www.spendmatters.co.uk
Launched in 2010
www.hcmatters.com
Launched in 2011
Former:
Strategy and sourcing consultants
Metals traders
Heads of procurement
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
Our supply markets still won’t rest!
• Total cost/labor cost on the rise – Country-specific labor
– Trade/export policy
– Shipping (fuel surcharges, bunker charges)
• Currency volatility
• Production capacity constraints
• Lean extremes
• Raw material availability (e.g., rare earth metals)
• New regulations
• Black Swan events
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
Think big for a moment …
stepping into global procurement
and finance shoes today
Currency & commodity volatility
Currency madness (Dollar, Euro, RMB, Pound, etc.)
Coming soon or already here: currency inflation (or deflation)/commodity inflation
Economic uncertainty
Quantitative Easing (continued)
Weak demand
Liquidity concerns, supplier access to capital
Globalization challenges
Trade imbalances, total cost hiccups (and missteps) and policy uncertainties
Different definitions of acceptable behaviors
74
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
When it comes to our procurement and finance groups,
these trends and issues have often upset the apple cart
Working capital concerns As much as $5 million in direct costs for each supplier bankruptcy; which direction will suppliers turn if Europe and China tank the rest of the world economy
Trade worries Currency manipulation, inflationary commodity pressure, supply shortages
Corporate cost cutting Fewer resources to accomplish more aggressive margin improvement goals (not to mention lower SG&A expenses); CEOs looking at supply chain organizations as profit, not cost centers
Sustainability & CSR
CEOs looking for financial impact from sustainability (and no surprises) when it comes to CSR programs
75
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
What were the top procurement and supply chain priorities we
observed last year (inclusive of finance)?
• Incremental cost reduction (including cost reduction based on total cost analysis)
• Dealing with capacity challenges (in certain markets)
• Managing the workforce:
– Contingent/services procurement
– Getting more from the procurement group
• Compliance and risk: supplier performance, supplier visibility, operational/financial stability, etc.
• Balancing demand/supply volatility (e.g., part/component shortages for the holiday season)
• Evaluating alternative models vs. business as usual – shared services, BPO, contingent staffing (for both procurement and A/P)
76
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
What will the top procurement and supply chain priorities
we’re expecting for the rest of 2012 and into 2013?
• Continued focus on cost savings either to protect fortress balance sheets that companies have amassed or just to survive
• Anticipating/forecasting (cash, revenue, demand, etc.) and mapping to procurement and working capital strategies in a questionable recovery or possible recession
• Continuing to find new ways of becoming more efficient on the periphery (e.g., A/P, indirect spend) to focus on core operations
• Commodity, cost volatility and reducing exposure/risk
• Optimizing for total supply chain/supply management costs for procurement and payables (inventory, working capital, unit cost, logistics, tax implications, etc.)
• Risk management, albeit from an expanded perspective/definition
77
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
Restructuring the market – translating priorities to ten
broader organizational tactics
1. Building the right teams and talent to meet changing requirements
2. Investing in systems to support functional business users capable of shaping strategy and driving results (not just on maintaining systems of record and building better transactional environments)
3. Finding ways to do more with fewer (or flat) resource levels
4. Developing strategies, teaming approaches and supporting tools that bridge functional groups such as procurement, A/P, treasury, internal audit, etc.
5. Getting more from information that should already exist internally (but often doesn’t)
6. Bringing external information and insight into the organization (e.g., risk, supply markets, commodities, etc.)
7. Taking a portfolio/finance and risk management view of suppliers and spending
8. Migrating to systems that support emerging business needs and objectives (keeping an open mind)
9. Deciding what must be done internally (or not)
10. Learning to think globally (not just act globally – a major difference!!)
78
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
2020: Five procurement scenarios to consider 1. Extreme localization and decentralization require new approaches
2. Beyond process: politics, regulation, philosophy and economics define procurement’s focus
3. Technology proves more then transformative: emerging enterprise applications, mobile computing, social “intelligence” and technology democratization change the possibilities (and priorities) of procurement
4. Global supply chain intelligence dictates winners and losers
5. Core procurement is absorbed (e.g., by shared services such as corporate Six Sigma, finance, operations, HR, etc.)
79
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
1) Extreme localization and decentralization require
new approaches
Themes
• Speed to support constituents/customers in the business (e.g., local work, labor and employment rules)
• “First wave” savings initiatives (and beyond) from sourcing have long been exhausted
• Supporting sourcing in local geographic markets
• Government-directed spend
• Green/CSR
• Shipping costs continue to rise
• Localization of products/services requires localization of part, material and services inputs
• Continued supply risk incidents force the need to limit the potential damage that centralization/concentration of procurement efforts can create when risk strikes
80
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2) Beyond process: procurement on the global
chessboard
Themes
Economic uncertainty and market volatility
− Continued “jobless” recoveries, EU/debt hangover that won’t quit?
− Austerity programs European disunity
− Flexible workforce
• Supply chain regulations / traceability
− REACH, ROHS, beyond
− Industry regulations (e.g., pharma)
− Labor practices
A superpower smack down
− Behind-the-scenes battle for raw materials (metals, oil/energy, other base materials)
− Punitive measures in response to protectionism
Blood, sweat and tears
− Traditional military conflicts (e.g., Iran)
− Non-traditional dangers (e.g., terrorism)
81
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3) New technology models prove “insanely great” and
change the game for good
Themes • Emerging enterprise applications, mobile computing,
analytics / “intelligence” and technology democratization change the possibilities (and priorities) of procurement
• Social applications models, social connectivity
• Interfaces
– iPad/iPhone (i.e., touch)
– Video (phones, PDAs, Flip cameras)
– Voice
• Enabling technologies
– In memory DB
– Virtualization (i.e., cloud)
– MDM/CDI (encompassing structured and unstructured data sets)
• Networks
– Supplier monitoring, collaboration and development
– On-boarding / enablement
– Benchmarking
82
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4) Global supply chain intelligence dictates winners and
losers
Themes
Supply chain risk
Financial
Labor
Product/material compliance
CSR
Natural disaster/weather
Etc.
Commodity insight
Forecasting
Budgeting, planning
Sense and response time – lead-time to respond to issues
83
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5) Core procurement is absorbed
Themes
• Procurement absorption (e.g. shared services such as corporate Six Sigma, operations, IT/CIO, etc. take on certain aspects of the function)
• Supply chain and finance/internal audit absorb risk
• Direct materials continues to stay with the business
• Complex services never make the transition
• Finance, finance, finance – clear reasons to take ownership
– Savings implementation vs. identification
– Challenge of forecasting earnings and mid-term cash flow
– Credit lines are still very tight – suppliers and buyers often alike
– P2P strikes back: working capital strategies working their way into procurement strategies – and services procurement tactics and technologies as well
– Speaking the language! margins, gross profit, EBITDA, OIBDA
84
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Contact details
Jason Busch Managing Director, Spend Matters and Azul Partners, Inc. Founder and Executive Editor, www.spendmatters.com Email: [email protected] Phone: 773-525-7406
Thomas Kase Lead Analyst, Spend Matters Email: [email protected] Phone: 404-791-3854
85
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Closing Remarks
Copyright © 2012 Azul Partners Inc. All rights reserved. Not for distribution. www.spendmatters.com - spendmatters.co.uk - www.agmetalminer.com
Coupa Demo