A Profitero study showed Target’s online prices were 25% more expensive than Wal-Mart’s, which were just slightly more expensive than prices on Amazon.
Armstrong World Industries went from using roughly 20 different procurement tools to just one. And that cut by more than 80% the number of days involved in processing procurement contracts with suppliers.
Starting in the late 1990s, flooring, ceiling and cabinet manufacturer Armstrong World Industries began making a number of acquisitions. Each time it acquired a company, Armstrong also acquired a new set of procurement tools.
By 2010, when the company started to expand internationally it had roughly 20 different procurement tools that all did the same tasks.
“Our processes were inconsistent and that made everything extremely complicated,” says Scott Cooper, Armstrong’s vice president of global procurement and logistics.
The manufacturer needed a better system. After soliciting bids from five companies, it settled on Coupa Software Inc.’s Internet-based procure-to-pay procurement and expense management system. Because Coupa’s system is cloud-based, hosted by Coupa on web servers, it didn’t require Armstrong to acquire hardware or information technology staff to man that hardware. That helped the retailer to move quickly; it took a little more than four months to implement.
Once it was up and running, the system has been simple to use, Cooper says. “You don’t need a Ph.D. to navigate it,” he says.
The procure-to-pay system manages purchasing processes from the initial requisition to final payment. It’s designed with workflow for routing a product requisition for all necessary approvals by Armstrong procurement managers, followed by suppliers’ electronic invoices sent to Armstrong’s accounts payable system for processing payments. In addition, the system enables Armstrong’s personnel at locations throughout the world to process orders from mobile devices as well as desktop computers.
That has helped make the company’s teams around the world more efficient and better able to focus on negotiating pricing rather than pushing transactions through a complicated system, Cooper says. The system has cut by more than 80% the amount of time required to approve a supplier from an average of 80 days to 13 days, he says.
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