CPO Strategy
Executive Insights

Veeam: a procurement transformation

click here to read this edition

CPOstrategy interviews Natalia Graves VP, Head of Procurement at Veeam Software to discuss the company’s procurement transformation

Natalia Graves is the first Vice President of Procurement at
Veeam Software and when she joined in January 2018, she was
asked to further evaluate already existing best practices at the
software company, broadening those practices across the
organisation, as well as introducing new ones “where it made
sense”.

Veeam Software is a privately held information technology
company and the leader in Cloud Data Management for
organisations, ranging from SMB to enterprise. As Veeam Software
grows so does its spend and Graves soon recognised the need to
have a more systematic, pointed focus on procurement as a
discipline. Graves was tasked with looking at the automating,
simplifying, and accelerating of Veeam’s procurement and travel
processes and systems around them, including evaluating and rolling
out a company-wide source-to-pay platform. “It has been an
incredible journey,” she tells us from her office in Boston,
Massachusetts. “We looked at simplifying our processes and putting
systems into place that allow Veeam teams across the globe to move
even faster.”

Veeam had many stakeholders participating in the transformation:
finance, technology teams, operations and business stakeholders
(the largest spenders) all participated in the enterprise-wide RFP,
going through the process to contribute, making sure Veeam picked
the right company. “We’ve looked at all the leaders out there and
through the process, selected Coupa as our Spend Management
Platform and KPMG as our implementation partner,” she explains.
“We looked to the likes of Gartner and Forrester, etc. to really
understand what they are seeing happening in the industry, and who
the leaders are, and how they evaluate them. We took that into our
internal decision-making process and then selected what was right
for Veeam.”

Veeam took the approach of going with industry best practice and
changing the processes only when there was a true business case to
do so. “We’ve done it through workshops that were enabled and
conducted by our implementer – KPMG – and really, I think that
spending the time to do that was what took the longest and was
probably the most difficult stage. First and foremost, the most
important step was really to observe what was happening, because
people were extremely overloaded, and procurement was viewed as
a black hole where things would enter only to come out months later.
We absolutely had to look at automation.”

First, Graves looked at the operating model. “It was clear that we couldn’t sustain the volume of transactions that we had in the
operating model that we had, so that had to be changed. We had
manual processes and the end-to-end operating model and proper
organisational structure had to be designed to effectively and
efficiently support our fast-moving and demanding business
stakeholders.”

The second part of the transformation was to identify the critical
roles that were missing and had to be filled immediately. “We brought
in a Director of Procurement Operations and a Director of Global
Contracts that allowed us to move more freely, quickly, and begin to
measure what needs to be done, and bring in the automation,” adds
Graves. The third point of the transformation occurred once the process blocks were laid out on paper, as a part of an end-to-end, cradle-to-
grave cycle.

“The candidates for automation and simplification just jumped out at you,” she says. “Existing processes were so painful
and manual, and the teams were in such a large backlog, that
transformation was inevitable. And so we went on a journey.”
The procurement teams had been working out of mailboxes, and
these were promptly removed before the team migrated to a centrally
automated portal for the tracking of all the procurement activities.
“We also, in parallel, with the help from IT and the CIO, launched a
new procurement portal on the corporate Veeam intranet, that all
Veeam employees could then access,” says Graves.

Another area for concern lay in the processing of contracts, as
Veeam was 100% manual. “In a company of our size and complexity
it became simply unsustainable, we outgrew our manual processes
and so we launched the electronic signature initiative. We saw a
stunning 72% improvement in obtaining digital vendor agreement
approvals and signatures by implementing DocuSign. Just think
about that for a moment. We’ve then taken it even further. As 100%
of our contracts get adopted from a procurement side, we’re now
starting to move this to sales contracts as well, so that’s a huge
enabler.”


SECOND PHASE
With the “low hanging fruit and no brainers” taken care of in the initial
phase of the transformation, Veeam turned its focus to a bigger
transformation. “Where do we go from here and how do we clean up
and prepare for the growth that is happening at Veeam?” asks Graves.
“What tools do we need, what platforms do we require? The
conclusion we came to is that the company needed to invest in a full
source-to-pay system. As I’ve mentioned we’ve gone through an
extensive RFP, with many future users’ and stakeholders’
organisations participating in the RFP, and eventually we landed on
Coupa, our spend management platform of choice.”

Veeam required an easy and mobile experience aligned for the
corporate strategy to enable employees to buy goods and services
quickly, safely, mobile, and cost effectively, while maintaining the overall visibility and control. “Coupa was definitely best-of-breed on
the P2P side and as we were going through the RFP it just clicked
with us. We launched in December 2018 for Souring and CLM
modules and then January 2019 we launched with onboarding our
pilot stakeholders’ groups.

Graves describes the digital transformation as a ‘three-way dance’.
“We kept a close eye on the parties involved with KPMG acting as
implementer for the source-to-pay solution. “We have gone through a
thorough RFP selecting Coupa, but it’s not all about the platform, it’s
all also about the implementer, who we also selected through a RFP
process. We were also truly saved by Consus; another technology
implementer who used their own AI tool to quickly clean up our large
supplier database, suppliers and supply records in the ERP, saving
months of manual work.” Transformations don’t happen overnight.
Just because the system is launched, it does not mean the
transformation journey is complete.

Saurabh Mehta, President and GM, Consus Global, explains,
“Veeam needed to quickly clean, reduplicate and group their
supplier master in order to meet tight project deadlines. Because
Veeam’s procurement operations depended on it, we appreciated the
high level of accuracy required from the output of this exercise.
Using our AI engine we were able to deliver clean and highly reliable
data to Veeam within 2 weeks.”

An automated system allows companies to perform some basic
things, quicker and better, but more than that, there is less of human
error so resources can be utilised on tasks that matter more, the
strategic tasks. “Then your resources can better align with the
business stakeholders, to make sure you listen and hear where each
stakeholder is going, so you can design your commodity strategies,
and your procurement strategies around that. A procurement
understanding of the business strategy is absolutely key. You need
to understand that strategy and incorporate it into your ways of
procuring. You have a successful procurement organisation when
you’re able to listen and translate what you’ve heard into sourcing
and procurement strategies.”

And so what is Veeam’s procurement strategy? “What’s important
to us is not only the price – price is very important – but we are also
driven by the overall quality of what we buy, the overall value,” she
says. “We don’t always buy the cheapest, but we do expect the best
price for what we buy, that’s for sure. We want to invest the right time
to negotiate that. Best value procurement is a concept that some
companies use heavier than others, but I think the elements of it
should be present in just about any organisation. In my opinion, the
procurement organisation is only successful when it is guided by at
least some element of best value, coming from understanding the
current business needs, combined with the ability to predict what the
future needs might be during said project implementation.”

Graves notes: “The first year our procurement evolution and transformation was focused on getting ourselves organised and
setting the foundation”. Veeam procurement cleared the huge
backlogs and put in the automation and undertook the sourcing and
understanding of what its spend management needs looked like
going forward. “Our transformation was possible because of our
best-in-class people. While we didn’t always agree, teamwork across
our large implementation teams representing the enterprise was a
must. Together we selected a platform, found an implementer,
partnered with them, launched the system, and embedded into the
company on a day-to-day. We’ve established some things from the
category perspective, which didn’t exist before. We have category
managers and specialists looking at each particular area, be it
technology, be it marketing. This year is a year of completing the
implementations, and further operationalising what we’re doing, as
we turn into an improvement cycle of continuous improvement.
While we have accomplished a lot, evolution and continuous
improvement never stops. As we go down the road this year, we
view best in class negotiation practices and agile procurement
processes becoming more and more a part of Veeam DNA.”

Graves believes that often times CPOs are still viewed as very
transactionally focused and an internal administrative hurdle to
overcome. “CPOs are sometimes viewed as someone whose
organisation will only make sure contracts are done with the proper
terms, someone who runs controls and enforces policy around the
buy-in process and someone who only cares about saving or cost.
However, I think these so-called ‘administrative musts’ are just the
foundation to the services the CPOs must offer to their companies.
The role of a modern CPO implies taking the time to understand the
business, and only then, design and run the best possible practices
relevant for that particular company. The role of a CPO is the role of
a business partner who designs a procurement organisation that
supports business priorities and needs, and that can adapt to the
ever-changing landscape.”

click here to read this edition

Leave a Reply

Your email address will not be published. Required fields are marked *