Harvey Nash Interview
With Timm Hemmert, Senior Partner of KPMG and Reinhard Plaza-Bartsch, Head of SCM Supplier Management Operations at Vodafone Procurement Company (VPC)
Michael: So we`re here with Timm Hemmert, Senior Partner of KPMG and Reinhard Plaza-Bartsch , Head of SCM Supplier Management Operations at Vodafone Procurement Company (VPC) following the Future-Proof Procurement Roundtable which we´ve just held this morning at the KPMG Ignition Centre in Cologne.
So to kick off with a question to Timm. How long have you been collaborating with VPC on this initiative? And how did you get started?
Timm: well we`re in collaboration with VPV now for two years in the area of Digital Procurement and it all started with an inspiring dinner between the head of VPC and a board member of KPMG, with the idea to do something together around Digital Supply Chain Procurement, and since then we are in regular contact with them; starting in the area of Design Thinking workshops and ending in a software product, the development of which we jointly work on.
Michael: there is a lot of conversation, Reinhard, around Supply Chain Management (SCM) 5.0. If you look at SCM 6.0, 7.0, or even 50.0, what do you think we can expect to see from VPC`s point of view?
Reinhard: well, I think it`s something that's an evolution; and something that we reckon, is that the only constant thing is change; and to keep up and to stay current and to continually evolve and keep looking for new opportunities that add value to the business. We want to keep evolving our supply chain functions and keeping it up with digital developments is just a MUST to drive things forward.
Michael: Disruptive technologies, Predictive Procurement , Automation, etc, all these words we keep hearing so much of, they seem to be real game changers. But how do you see the future of the procurement executive in light of these changes?
Reinhard: So, in terms of all that surrounds us, all of that is leading to a significant change in the role of the procurement manager. In the past, the share of time that we used to spend on analytics and on doing research; this will go down and down and we will find that we have more and more of this information at our fingertips; and we will focus more on activity around partnering with the business, partnering with our suppliers, really focussing on actually shaping our market place and its evolution over time. So that`s the dynamic I see, really moving from removing transactional activities to more the "soft-skills" and really bringing the different parties together.
Michael: Timm, next question for yourself, one of your key messages is that companies need to understand what "wall the ladder needs to be leaning against" in terms of what companies want to achieve when it comes to their procurement agenda. What questions need to be asked within companies in order to make sure that the ladder is indeed leaning against the right wall?
Timm: well, a company needs to determine for itself, where it wants to get, strategically, and then it needs to derive how digitalisation can help to achieve that aspiration. So it`s kind of "well, where do I want to get to, and how do I get there?"; and when thinking about how to get there, to be aware of how digitalisation can be used as an enabler. And so that`s a bit of an iterative play between "where can I get with what is available to get where?".
Michael: Most of the participants, Timm, at the event today were from multinational companies, global organisations, but we know, particularly in Germany, that the motor of industry is the small and medium-sized enterprise, "der Mittelstand". Is there such a thing as "future-proof-procurement LITE" for the Mittelstand? Is the digital journey different for them?
Timm: well, I think for them it is the same question, and the journey might be different in terms of enablers, maybe not necessarily going into SAP Ariba, but the tools are there. And through digitalisation for such companies there is a way broader variety of tools and support services now so that they can leverage them and bring them in to their procurement operations to make them more effective.
Reinhard: if I can add to that, I do think that what the "Mittelstand" has now is more flexibility compared to wider organisations for who it is actually a titanic effort to steer them in to the digital path. I would see it as an advantage, that they can take on new things, try new things faster and really work it through in a more seamless environment.
Michael: If I can ask you on that point, Reinhard, what can the procurement executive in his own sphere of influence do to enable change in his organisation, for example in a company that has a long journey ahead of them in terms of digitalisation?
Reinhard: I think as Timm mentioned, it all starts from a Vision, from where we want to be and how to get it done. It´s clearly a step-by-step approach. What we`ve seen in the market is different solutions, different parts that form the wider puzzle of what a wider digital solution is for your company. Taking those parts bit-by-bit is actually what will take them forward, and taking those conscious decisions that there are also some risks, some of which may and that others might not work so well. So I think it`s really about taking on that challenge.
Timm: I`d like to add to that and underline the point just made before about the "failing forward culture" and that if there is a CEO who endorses that by himself and who says, "look, here are a couple of initiatives and some of them we will see if they work or fail". It gives encouragement to the employees to be way more creative and open to play with these technologies when they don't know upfront if that will lead them to an end that they intended.
Michael: Last question for Reinhard. VPC clearly has a very high level of maturity in terms of Digital Procurement and is seen as an industry leader in this field. How will VPC keep its competitive advantage in light of adapters and followers in the coming years?
Reinhard: well, I think from our perspective we are constantly challenging the status quo. Even today we are already thinking around how will things evolve in the future and what else do we need to do differently? At some point in time, it`s a little like it becoming part of your DNA to continuously look for new ways of working. I think we are on that path and always aim to develop further and further. So I think that`s how I see us, on an ongoing journey. I don't think it`s going to stop, ever.
Michael: well thank you both for presenting and participating at today`s event and have a good day and a lovely weekend.