“It’s really nice to have a bigger purpose and actually see the communities that you are changing, the lives that you are altering and impacting through the work that you do.” – Andrew Savage, Global Lead: Procurement Excellence at MTN
Building a large award-winning procurement center of excellence (COE) isn’t easy, but it can be incredibly challenging in geographically complex regions with highly disruptive political and economic roadblocks.
Andrew Savage, Global Lead: Procurement Excellence at MTN, knows this all too well. The company has a trophy case stacked with procurement awards and accolades and a global reputation for being a leading procurement COE, all while navigating sensitive regional landscapes.
In a recent AOP podcast episode, Andrew explained how operating in places like Sudan, Nigeria, or other countries across Africa and the Middle East comes with unique sets of challenges like war, inflation, and poorly organized supply chains. He also had ample opportunities to provide value, particularly, how he and the team at MTN built and scaled a highly-awarded procurement center of excellence even in some of the most challenging geopolitical and culturally complex regions in the world.
Here’s how they did it:
Hiring Right
Andrew believes building a successful center of excellence starts with assembling the right team. They actively seek out individuals who demonstrate an entrepreneurial spirit and are motivated by curiosity.
“We talk about MTN as a giant startup where people need a certain level of autonomy and want to do their own thing,” said Andrew. “Curious people create wonderful things. We have got people who have the freedom to explore different areas of the business. They walk the floor and find use cases to develop. That leads to creating great things.”
Diversity of thought and background also strengthens the fabric of a COE, offering different perspectives and approaches to problem-solving. Within the 60 procurement and supply chain experts on Andrew’s team, representation of 25 nationalities helps create the right kind of environment for inquiry, idea sharing, and growth within a global context.
Rethinking Your Operating Model
Finding the right operating model to meet the needs of the business is key, says Andrew.
“We reinvented our operating model about 18 months ago into an agile operating model,” he said. “Everybody is ccrum-certified now here at our global sourcing supply chain. It allows us the relative freedom to operate in these mini squads and pods to work on certain initiatives.”
They also have a very structured, well-governed procurement process that’s risk-averse and operates within clearly defined guardrails. But, within that clearly defined model, procurement has the freedom and autonomy to improve processes, find opportunities to create more efficiencies or develop new use cases without disrupting or degrading the larger structural procurement processes.
“We have a use case library which we work through as a procurement excellence team, and we check that off and keep developing and delivering,” he said. “It gets better and better.”
Dissolving Outdated KPIs
Part of creating a new agile procurement operating model for MTN meant restructuring the KPI framework to offer meaningful incentives and performance rewards. It’s a part of the change management process that comes when you’re building a strong COE, he says.
“All of the KPIs changed,” he said, when they adopted an agile operating model. “People were working in different ways. We had to effectively collapse the KPI bonus structure as well to make it more team oriented.”
They established a “black belt, green belt, yellow belt” concept, and structured teams into agile squads with shared team targets, becoming more of a one-sourcing organization. “That helps massively when you’re agile, and you need people to work cross-functionally,” said Andrew.
Andrew says that when team members are incentivized to think outside their traditional KPI ‘lane,’ that encourages the entrepreneurial approach, it helps create a center of excellence.
“We might have a category sourcer who has got a little bit of downtime, or they’ve finished an RFP or whatever, they can easily hop over and support another category manager in a sourcing event and don’t need to be worrying about who’s delivering the savings or who’s delivering a throughput time,” said Andrew.
Looking Inward for Tech
While it can be difficult or challenging for any procurement team to find a perfect fit-for-purpose tech solution, geographical complexity makes this even more challenging.
One of the ways Andrew’s team has been able to transform into a high-performing global center of excellence is to develop their proprietary procurement technology that meets their specific needs. It might take more time and effort than reaching straight for an off-the-shelf solution, but, he says, in many circumstances, the effort is well worth it in the long run.
“Our team works extremely hard and puts a lot of time and effort into developing our tech, but as long as you have the right people on board, I think you can develop it,” he said.
And, this can work for small teams as well. “I don’t think you need a large organization to do this effectively,” he said. “You just need a good understanding of the business and the use case, and you need somebody who is inquisitive enough and has the right capabilities to do it.”
Operating a leading center of excellence in regions marked by volatility, economic instability, cultural complexity, or geopolitical conflict seems impossible. But, says Andrew, all the effort he and his team have put into creating the right conditions for success – whether through hiring or finding the right operating models and tech support – bring value to the business’s bottom line and the population they serve.
“It’s a big cliché to say, but it’s doing work for a bigger purpose,” he said. “That is about enabling society. It is about enabling people. It is giving them the opportunities that you and I – and probably a lot of your listeners – take for granted. It allows our customers the benefits that we all take as second nature.”
Subscribe to Art of Procurement
Apple | Stitcher | iHeart Radio | Email
