“what lies ahead for the gpo”

The Shifting Sands of Transformation, Process & Automation

“What Lies Ahead for the GPO”

Dan French - Founder & CEO, Consider Solutions

27th September 2018

Global Process Owner Summit - London

This Session

Introduction

The Drivers for Digital Transformation

The critical need for end to end process thinking

Why simplification is no longer just ‘nice to have’

The role of the next generation Global Process Owner

Exploiting the Intelligent Automation opportunity –Learning from Success and Failure

Navigating the Waters to Success as a Digital GPO

Q&A

3 © 2018 Consider Solutions All rights reserved

Context & Perspective

© 2018 Consider Solutions All rights reserved4


Global Influences

https://www.google.co.uk/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=2ahUKEwiqkKT44cTdAhUMCcAKHfV1Ae8QjRx6BAgBEAU&url=https://worldvectorlogo.com/logo/salesforce-2&psig=AOvVaw0FC75OHzRjx0aW0nd0Ggyo&ust=1537367382715392

https://www.google.co.uk/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=2ahUKEwiH3O2j7cbdAhWPyYUKHSblCkUQjRx6BAgBEAU&url=https://www.google.co.uk/url?sa%3Di%26rct%3Dj%26q%3D%26esrc%3Ds%26source%3Dimages%26cd%3D%26cad%3Drja%26uact%3D8%26ved%3D%26url%3Dhttps://www.pagerduty.com/customer/picnic/%26psig%3DAOvVaw09SmE0AAIwhKRpdJbJrxH-%26ust%3D1537439147110036&psig=AOvVaw09SmE0AAIwhKRpdJbJrxH-&ust=1537439147110036

Digital Transformation – What’s Going On?

Disruption - Fundamental Structural Changes

‐ Society, Markets, Customers, Suppliers, Partners, Stakeholders, Investors, Employees

Catalysts

‐ Technology, Mobility & Volume, Transparency of Data

‐ The Consumer ‘Awakening’, Convenience & Intimacy

Stakeholder Mandated Imperatives

‐ LESS cost, cycle times, negative consequences

‐ MORE value, speed, impact, agility, resilience, transparency

Growing scrutiny of the “How” as well as the “What”

‐ It’s now a team game – Supply Chain partners matter

‐ Balanced “Principled Performance”


Technology is Transforming Core Processes


But Our Heritage is Efficiency in Silos:Rationalisation & Centralisation


“The typical organization loses the equivalent of 5% of its revenues to fraud & waste each year”

Source: Global Economic Crime Survey; PwC

Our Processes Used to Look Like This


“Just-in-Time” has reached a whole New Level


Acquire Service Provider

Acquire Customer

ProposeService

Commit Service Provider

Commit & ChargeCustomer

Pay ServiceProvider

Locate Customer

Select Service Provider


The Role of “Digital”Connection, Location, Knowledge, “Commit”, Funds

The Critical need for end to end process thinking

Executive Priorities & Alignment

Target Outcomes - Efficiency vs Effectiveness

Differing KPI focus

Silos and individual governance “lighthouses”


When the Consumer is King . . .

Convenience is key

Speed is of the essence

Quality at all costs

100% credit is cost of poor service

New KPIs emerge

‐ Time from customer selection to “ready to fulfill”

‐ Often before “commitment”

“Simple, Standard and Seamless” are key design criteria for business processes


Standardisation & Simplification- is in the eye of the beholder . . .


It’s not just about the “customer” but the “consumer”

Look beyond silos – efficiency and effectiveness beyond

Own the outcomes – assume responsibility, accountability and authority

Dive into Data – fuel the processes, analyse the nuances

Embrace Automation – explore, learn, strategize and exploit new ways of adding value

Focus on Talent – what is the future and what skills do we need to acquire, develop and retain


This Session

Introduction






Navigating the Waters to Success as a GPO

Q&A


RPA Buzz & Reality

“RPA is about fixing the potholes in the road. Do not confuse it with building the new highway”

Steve Gordon, VP Global Service Operations – BD

" Don't trade the entire toolbox for one screwdriver“

Sanjay Srivastava, Chief Digital Office – GENPACT

Software (bots) which allow enterprises to automate high-volume, repeatable tasks integrating existing applications for processing a transaction, manipulating data, triggering responses and communicating with other systems


RPA Projections


Source: The Hackett Group 2018

“Bot Plaudits”

Potential massive percentage efficiency gains

Cheaper and faster than ERP extension, integration

BOTs don’t get bored, tired or lose concentration!

Rapid implementation

Ease of development

Integrates technology gaps in end-to-end processes

Eliminates frustrating tasks from valuable people

Makes the workplace more appealing to hire into


“Bot Kicking”

400% task productivity increase may not be significant in the end-to-end process

“Bot-Sitting” control, oversight and governance – who is looking after the bots?

Bot-development still needs governance, control and process

Bots have no judgement and will repeat errors at scale if bot rules are not well designed and monitored

Powerful rules-based automation – but not AI, and for good reason!

If you don’t have detailed, task level, standard operating instructions (SOP), don’t bother with RPA

“Automation makes bad worse, faster”

38% of RPA implementations FAIL to achieve expected benefits


What about the role of AI?


Courtesy: Neota Logic

Applying ML in the Real World - Diagnosing Cancer


The AI Classifier found 92.5% of cases!


Diagnosis by AI

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

But the Human Pathologist was better – 96.6%!


Diagnosis by Human Expert

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

But AI supporting humans is even better! 99.5%

Diagnosis by Expert Human AND AI


The GPO Balancing Act


Efficiency(Task Automation)

Effectiveness(Process Optimisation)

Practical Insights: Purchase to Pay / Source to Pay

Demand Sourcing Contracting Ordering Fulfilment Settlement

Supplier Management

Working Capital Management

Spend Analytics & Cash Recovery

Performance Management (KPIs, Benchmarks, Trends, Process Variations etc)

Source to Contract Purchase to Pay

Source to Pay


Practical Insights: Performance Gaps


Peer Group Benchmark

Practical Insights: Process Exceptions


Practical Insights: High Priority to Fix Now


Practical Insights: Medium Priority to Fix Soon



Practical Insights: Process Cycle variations

Days 0 5 10 15 25 30


Practical Insights: Payment Terms vs Working Capital

Procurement

Sourcing

Operations

Finance

E-Inv

ERP RPA

P2P

Insight across End-to-End Process & Technologies



Getting Insight from Data – Old World

Requirements

Planning

IT Facilitation

Configuration

Results

Cycle Time


“Uberization” of Practical Insight

Results

“Connect &

Go”


Human Augmentation – “Humanistic AI”

Technology Disappointment CycleRobotics, AI, Blockchain, IoT, Autonomous


This Session

Introduction






Navigating the Waters to Success as a GPO

Q&A



Navigating the Waters to Success as a GPO:


Manage the Detail and the Big Picture


Navigating the Waters to Success as a GPO: Focus on Critical Business Outcomes

45

Increased Contract Compliance

Increased spend visibility

Bring more spend under IP control

Pay on time

P2P Efficiency

By implementing P2P Standardisation we will:

➢ Increase contract compliance

➢ Increase spend visibility

➢ Pay suppliers on time

➢ Increase the efficiency of the P2P process

➢ Increase reach of the P2P compliant solution; and

➢ Reduce risk by bringing more spend under control


Dual Operating System – source Kotter

Managing

1. Planning & Budgeting2. Organising & staffing3. Problem solving4. Doing what we know well5. Continuous reliable results

Leading

1. Establish direction2. Align and motivate people3. Inspiring and mobilising4. Exploring and creating5. Propelling into the future

Process OperatorRobust

Process OwnerAgile

46

Process Operator vs

Process Owner

No One Hit Wonders - It’s a continuous journey . . .

“We always hope for the easy fix: the one simple change that will erase a problem at a stroke. But few things in life work this way. Instead, success requires making a hundred small steps go right -one after the other, no slipups, no goofs, everyone pitching in.”

Atul Gawande, Better: A Surgeon's Notes on Performance

The “aggregation of marginal gains”, improving everything by a small percentage, is a proven recipe for success


Execute with Energy

But Watch out for Bumps in the Road!

This Session

Introduction






Navigating the Waters to Success as a Digital GPO

Q&A


Navigating the Murky Waters to Success as a GPO

Some Thoughts from a 3 minute TED Talk


“I skate to where the puck is going to be, not where it has been.”

Wayne Gretzky

Reputedly the greatest ice-hockey player ever

Questions or Research Participation? [email protected]

mailto:[email protected]

The Shifting Sands of Transformation, Process & Automation

“What Lies Ahead for the GPO”

Dan French - Founder & CEO, Consider Solutions

27th September 2018

Global Process Owner Summit - London

“what lies ahead for the gpo”

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