Royal Mail migrates entire procurement system online to e-sourcing (UK)

Royal Mail migrates entire procurement system online to e-sourcing making the process completely paperless

“The Royal Mail (RM) procurement team source around GBP 2.1 billion a year in goods and services. In an effort to cut costs, increase efficiency and deliver a higher level of service to British citizens, Royal Mail embarked on a three year transformation programme in July 2006, unify all procurement processes and stakeholders on the SAP E-Sourcing platform.

Previously sourcing was managed via paper files which was hugely inefficient and did not allow strategic visibility of vendors and contracts. With the new SAP E-sourcing platform, Royal Mail has eliminated all manual steps involved in the Source to Contract Process, increased visibility and compliance, enabled vendors to self-register via ‘Vendor Expression of Interest’ and saved the company GBP 300m.”

“SAP E-Sourcing in Royal Mail was rolled out in a phased manner starting in January 2007 with a month on month roll-out process to integrate all the elements of the procurement chain. When Release 1 Contract Management went live there was a cleansing and migration of approx 900+ contracts from the original procurement management system (PMS) to E-Sourcing. An innovative motivation tactic was deployed where different sourcing teams within RM like clothing, utilities, automation etc. competed against each other to be the fastest to cleanse and transfer their data.

Release 2 in June enabled ITT and eAuction functionality. This was a significant move to integrate all stakeholders under a common process leading to a high level of visibility and accountability. In addition to this, Release 2.1 allowed the vendors interested in participating in asourcing events to register electronically and this greatly improved the management & selection process for large scale deals.

Royal Mail migrates entire procurement system online to e-sourcing making the process completely paperless

“The Royal Mail (RM) procurement team source around GBP 2.1 billion a year in goods and services. In an effort to cut costs, increase efficiency and deliver a higher level of service to British citizens, Royal Mail embarked on a three year transformation programme in July 2006, unify all procurement processes and stakeholders on the SAP E-Sourcing platform.

Previously sourcing was managed via paper files which was hugely inefficient and did not allow strategic visibility of vendors and contracts. With the new SAP E-sourcing platform, Royal Mail has eliminated all manual steps involved in the Source to Contract Process, increased visibility and compliance, enabled vendors to self-register via ‘Vendor Expression of Interest’ and saved the company GBP 300m.”

“SAP E-Sourcing in Royal Mail was rolled out in a phased manner starting in January 2007 with a month on month roll-out process to integrate all the elements of the procurement chain. When Release 1 Contract Management went live there was a cleansing and migration of approx 900+ contracts from the original procurement management system (PMS) to E-Sourcing. An innovative motivation tactic was deployed where different sourcing teams within RM like clothing, utilities, automation etc. competed against each other to be the fastest to cleanse and transfer their data.

Release 2 in June enabled ITT and eAuction functionality. This was a significant move to integrate all stakeholders under a common process leading to a high level of visibility and accountability. In addition to this, Release 2.1 allowed the vendors interested in participating in asourcing events to register electronically and this greatly improved the management & selection process for large scale deals.

Further releases (3.1 and 3.2) have addressed the wider integration between E-Sourcing and SRM5, whilst Release 4 has integrated Project functionality and Category Management in E-Sourcing leading the complete elimination of all manual steps involved in the Source to Contract Process?a huge efficiency gain! The entire integration process to an electronic single source system has hence improved back-end as well as front-end processes reducing timescale of contract turn around from 40 days to 28 days.”

“For a procurement system to be successful, the main testimony is given by the end users of the new system. The following are some quotes from both Category Managers and vendors after the SAP E-Sourcing technology was implemented ? ?The system is user-friendly and intuitive to follow.? ? RMG Vendor ?Extremely easy to navigate, download & upload documents, input responses and keep track of the progress of the bid.? – Jason Soden, Procurement Manager ?I can’t see why you wouldn’t use it? ? Sally Woods, Senior Procurement Manager ‘I can’t believe what comes out of the back end’ ? Simon Giles, Procurement Manager”

SAP UK Pvt. Ltd. Technology used was SAP e-sourcing. This technology enabled us to take the entire process and different departments to a standardised electronic process.

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