Procurement's Year in Stories: June 2024
JTI: Co-Creation With Suppliers Drives Sustainability
As the cost of raw materials, transportation and labour skyrocketed, multinational companies with complex operations have been looking ever closer – and more creatively – at their supply chains to deliver efficient and more sustainable solutions.
With ambitious sustainability goals, and despite supply chain disruptions, JTI (Japan Tobacco International) had success with its lightweight carton board project, thanks to the close-knit collaboration with four key suppliers, who became true partners during the process.
Estella Gan, Global Supply Chain Procurement Vice President at JTI, comments: "Together, we successfully reduced more than 10% of our packaging weight, while maintaining the same high quality for our consumers. As a result, the total reduction in our carton board consumption is equivalent to saving more than 10,000 trees annually."
Packaging requirements in the tobacco industry are highly complex and specific and any changes to the specifications require a long qualification process.
When the lightweight carton board initiative kicked off in 2019, the aim was to work with suppliers and internal partners to develop and reduce the weight of the carton board, while maintaining quality and sustainability considerations.
"It was technically complex," said Estella, who describes herself as energised by challenges.
"However, by bringing the right partners together with the right mindset, we were able to simplify specifications and processes to meet our business objectives. In turn, this generated cost and time savings for all parties, and ultimately resulted in a more streamlined use of resources across our supply chain."
The initiative started off with just a few face-to-face meetings with partners, and then COVID-19 hit, requiring, as for most companies, the need to switch the project to 100% remote.
Ten people in JTI's core project group, located in different countries and across multiple time zones, worked with our partners – two printers and two board suppliers – to form a team and bring the partners closer to JTI's supply chain.
At JTI, more than 16,000 people located around the world have a role to play in contributing to a seamless and sustainable supply chain from leaf to consumer – transforming natural resources, raw materials and other components into finished tobacco products.
Amazon Business: Saving Time & Cutting Costs for Procurement
June saw Amazon Business, the company's online business-to-business procurement store, announce a number of new technology features designed to help large business customers.
Amazon Business also made a number of iterations to its existing Budget Management and Guided Buying solutions. All of these technologies are designed to help large business customers, including multinational enterprises, universities, government agencies, education organisations and healthcare networks, simplify and modernise the way they shop for business supplies.
"Amazon Business wants to change how companies shop for supplies through our unmatched selection, deep discounts and smart capabilities," says Shelley Salomon, Worldwide Vice President of Amazon Business.
"We don't just react to the biggest challenges our customers have shared with us; we get ahead of them with new technologies so our customers can use their resources to navigate the unexpected and continue expanding their business."
To help address this challenge, Amazon Business introduced and upgraded several tools available to business buyers in Canada, France, Germany, Italy, Spain, the United Kingdom and the United States.
The four stand-out tools are:
04: Amazon Business App Centre
Amazon Business App Centre is a new one-stop shop where business customers can discover, quickly set up and connect their Amazon Business account with more than 25 third-party applications from around the world.
Solutions in the App Centre include integrated shopping, accounting management, expense management, inventory management, rewards and recognition and business analytics.
The App Centre helps save leaders time and money through a single point of discovery, as well as eliminating or reducing the need to develop a custom solution for their organisation.
03: System for Cross-domain Identity Management
System for Cross-domain Identity Management is a new feature that automatically syncs users and group data from their organisation's identity provider with their Amazon Business account.
This feature helps administrators spend less time maintaining and updating their Amazon Business account.
02: Budget Management
Budget Management streamlines the process of setting and reviewing time-bound budgets across an organisation.
Now, business customers can set spend thresholds and make budget amounts visible to buyers to get ahead of overspending.
Amazon Business also launched new ways for leaders to actively manage their budgets, including real-time tracking and usage reports, notifications when a budget is about to expire, pre-purchase approvals and an option to create one purchase order (PO) instead of multiple, manual orders.
These updates empower procurement buyers to make informed purchasing decisions for their organisation while reducing the amount of time leaders spend auditing their purchases.
01: Guided Buying
Guided Buying makes it easier for leaders to manage employee spending by steering buyers to purchase decisions that align with their organisation's preferences and goals.
Through a new toolbar, account administrators can now instantly prefer products with sustainability certifications in the Climate Pledge Friendly programme with a single click.
Leaders can also restrict, block and require approval for certain product categories with an eligible Business Prime plan.
Through easy-to-follow visuals, Guided Buying helps procurement leaders save time educating their employees on what items they should or should not purchase.
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