Last week’s webinar by Jim Polak, PPG’s Director of General Purchasing, didn’t disappoint. If you didn’t catch the webinar (replay available here) or read the preview on Spend Matters, Jim is a procurement visionary - and I’m not using that term lightly. He went from 0 to 60mph (well really more like 0 to $7.5 billion in spend per year) over the last 7 years as he implemented a mix of technology and process that continues to surpass savings targets, cut delivery times and make life easier for PPG’s 35,000 worldwide employees.

Listening to Jim, it seems as though his vision revolved around 2 key principles. Their first priority was to gain visibility into spend in order to identify the right opportunities AND track results. Second, PPG’s process standardized procurement in many ways (pushed online auctions, mandatory compliance, cross-functional teams, etc), but that process never removed the power to make category and purchasing decisions out of the hands of the experts.

In the early days of Jim’s vision taking hold, the focus was on spend visibility, which meant categorizing what they were spending and with whom. A logical first step, but we’ve all worked in companies that not only missed seeing the forest for the trees, they actually tried to guess the trees they wanted to cut down before finding the forest on the map. Despite several internal doubters, who thought they were already optimizing their spend, PPG moved forward and immediately started blowing out their savings targets. Why?

PPG kept it simple. They quickly turned around some impressive results from the ‘low hanging fruit’ and parlayed that into longer term strategies, traction and savings. For the end-users, Jim’s objective was to make things intuitive, yet informative. Think of it like this, if you take an expert in something (like say category management) and push them towards a tool before even letting them get a glimpse of what that tool can do for them, adoption will be tough. Instead, Jim and his team gave them some simple dashboards and reports…then turned them loose.  Buyers got in, got their work done and got back to their “day jobs” as Jim put it. And speaking of day jobs…

The process puts a great deal of control (albeit structured within a repeatable, trackable system) in the hands of their experts. For example, the categorization process is left entirely up to the category managers. If they want to create a new category or consolidate some existing ones, they can. Although in the beginning, Jim and his team didn’t know if this hands off approach would mean more or fewer categories to track and manage, they had confidence that trusting the very people responsible for the categories themselves would result in the right balance. The other benefit of this approach is speed. Rather than perfecting their categories before flipping the switch, PPG launched and knew that their customized categories would evolve over time. In fact, as Jim readily acknowledges, they’ll never really be “done” categorizing since procurement’s challenges will continue to evolve forever.

Jim’s experiences and insights are certainly worth your time if you confront any similar issues with adoption, ease of use, “selling” the vision or, most importantly, reaching your savings goals. The webinar replay is here.

Justin Fogarty is Managing Editor of Supply Excellence. For any questions or feedback on the blog or its contributors, Justin can be reached at jfogarty[at]ariba.com.