EDP and Achilles – A Winning Combination!
Iberian energy company EDP – an established Achilles customer – won a top award for innovation at the recent ProcureCon 2007 conference in Brussels.
EDP’s winning submission detailed its approach to tackling the problems of supplier data quality and accuracy – and highlighted the way in which an Achilles service (Total Supplier Management Solution) is helping them achieve their goals.
“Our challenge was to find a better way of managing our supplier data,” explained EDP Procurement Director Luis Ferreira. “We had more than 19,000 suppliers’ details on our database, but only actively used around 6,500. Our existing solution only dealt effectively with our core suppliers, and trying to keep every supplier’s details accurate and up to date was just impossible.”
With a lack of time and resource available to deal with the remaining thousands of suppliers, EDP took a new look at the problem that faced them and proposed a new approach to Achilles.
Said Luis: “In my previous career in the motor industry I’d experienced first-hand the problems of trying to work with a large, out-dated supplier database and I was keen to find a new, different and workable solution.
“Initially, our Achilles contacts were sceptical about the idea, but to their credit, after going away and considering it, they came back with a proposal that more than matched our expectations and requirements,” said Luis.
The result is a top-to-bottom supplier management service which builds around EDP’s existing SAP and other internal systems, and RePro, the Achilles services which EDP already used to manage its strategic suppliers.
“TSMS gives us a number of benefits. It allocates one reference number for each supplier used, no matter which of our EDP companies around the world is using them. Previously, we had all kinds of different numbers and there was no consistency.
“All the supplier validation information is now collected in one database location and we no longer have correspondence coming in from a range of sources to a host of different addresses. Suppliers each have their own login which allows them to update their own details whenever it suits them, on-line.
“Achilles’ validation services mean that this data can be checked, to see for example, if the company is still trading, if the financial data is accurate, and so on.”
EDP has now sorted its suppliers into four categories, based on a risk-critical scoring. The zero and lower risk suppliers (categories one and two) are required to complete only a basic questionnaire and can join the approved database free of charge. The more risk-critical a supplier’s business, the more detailed the questionnaire is likely to be, and a subscription fee then applies.
According to Luis, the benefits of the new service are many. “Our supplier data is all valid and up to date, and only covers those with whom we continue to do business. The resulting information makes it easier for internal audit and tracking. We have better control across the business over what we’re spending and with whom, and because the questionnaires include specific categories of product and services for the suppliers to fill in, our purchasing choices are much easier.
“Suppliers have just one questionnaire to complete and their services can be seen across the whole of EDP.”
Luis is naturally delighted that EDP carried off the ProcureCon 2007 Award for Innovation. “Success is about being more innovative and creative than your competitors, and we’re pleased to have won the award against such tough competition.
“The award is, however, just one point on a much longer journey – the challenge is to keep on moving forward and look for the next opportunity!”
Said Achilles Chief Operating Officer Luis Olivié: “We were delighted to discover that one of our customers had won this award, especially as it recognised the contribution made by Achilles.
“EDP was the first major company to work with us to develop the TSMS solution, and they have set the standard for others to follow.
“Since implementing TSMS with EDP, we have been able to work with other organisations to apply TSMS to their own particular supplier management and sustainable procurement needs.”
Read the EDP customer spotlight
Learn more about Achilles' Total Supplier Management Solution