How Dave Picarillo, Ahold’s sourcing guru, is saving millions on the web
As vice president of BrainTree Sourcing, responsible for the sourcing of goods and services for Royal Ahold’s U.S. supermarket and food service operations, Dave Picarillo has saved $350 million over the last three years through a web-based sourcing system.
The web-based system from Emptoris Inc. is replacing the traditional method of relying on widely distributed teams of category managers managing procurement on lengthy spreadsheets and extensive volumes of phone, e-mail and other forms of communication with suppliers. Because the old system was not tightly organized at the corporate level, it made it difficult for Ahold to get a corporatewide view into what it spent, the quantities of materials it bought, and the overall efficiency of its sourcing, Picarillo says. “We had to do something to be more efficient as an organization,” he says.
The Emptoris system provides a headquarters view into corporatewide purchasing and a central ability to analyze and improve the procurement process. “Before we were centralized on the web, we didn’t know how much we spent,” he adds. “Now with our web-based spend analysis, we can come up with a number.”
But the $350 million in savings Ahold has realized so far is just the beginning, Picarillo says. Ahold expects to realize more savings as it applies the web-based system to a broader range of goods and services, including those acquired for resale to customers as well as materials and services used to maintain Ahold stores.
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