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A BETTER PATH FOR BUYING

Jabil utilizes Amazon Business to achieve greater purchasing visibility, drive
savings and elevate the employee experience.

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As a leading global manufacturing solutions provider, developing and building
products for some of the world’s biggest brands across automotive, renewable
energy, healthcare, AI, cloud data centers, and beyond, Jabil takes supply
chains seriously. “We are uniquely positioned to have supply chain visibility
across multiple global markets. It is a key differentiator for our procurement
and supply chain team,” says Heidi Banks, senior director and engagement
partner, source-to-pay services, at Jabil. “We use this experience as supply
chain and procurement practitioners to ensure we’re delivering best-in-class
service to our customers and the overall business enterprise.”

 

Responsible for more than 250,000 employees across 50 million square feet of
manufacturing space in 30 countries, Jabil must also meet its own needs around
indirect procurement. Managing over $6 billion in indirect spend across that
many regions and users represents a major challenge.

 

“As a procurement organization, we had to develop a clear and transparent
methodology that would effectively communicate to our business consumers about
the efforts undertaken to achieve competitive pricing,” Banks explains. “The
goal was not only to direct spending toward our strategic partners but also to
ensure policy controls and compliance were upheld efficiently.”

 

A major need, she notes, was bringing data-driven visibility and structure to
tail spend management—buying processes that were too often opaque and
disjointed.

 


DIGITAL INTEGRATION DRIVING IMPROVEMENTS

Enterprises typically employ a variety of tools and solutions intended to
promote digital transformation. Developing an architecture in which those
solutions work effectively together, though, can be difficult. As part of its
transformation strategy, Jabil onboarded Coupa’s Business Spend Management (BSM)
solution as a foundational component of its procurement infrastructure.
Subsequent capabilities, then, had to integrate seamlessly with Coupa in order
to maximize the potential benefits.



That led Jabil to Amazon Business, Banks says.

 

“Amazon Business was one of our first major deployments of a punchout catalog,”
she says. “Connecting into Coupa’s BSM platform, Amazon Business also became the
first supplier that we used with Coupa’s Open Buy functionality, enabling
cross-catalog searching without leaving Coupa. This simplifies the user
experience and creates competitive price transparency.”

 

Jabil’s procurement teams could then curate the vast scope of the Amazon
Business catalog, setting purchasing parameters and highlighting preferred
vendors, all within Coupa. Employees, meanwhile, could move through purchasing
processes quickly, without sacrificing choice or having to exit Coupa.

 

“It was a really big efficiency gain,” Banks says. “The end users love it,
because it takes less clicks to get what they need, which is always helpful. The
procurement team loves it because the open transparency keeps partners
competitive. With Amazon Business’ vast selection, Business Prime membership and
business-only pricing, Open Buy enabled them to win more and strengthen the
partnership.”

"As we drive spend into the right channels, it drives cost leadership. It makes
us more cost competitive as a manufacturing partner for our customers."

— Heidi Banks, Senior Director and Engagement Partner, S2P Services, Jabil

The before-and-after value proposition for Jabil through the Amazon Business
punchout with Coupa was clear, particularly in tail spend, where purchasing
levels on individual products might not be as large. Consolidating small
purchases to one supplier simplified order management and automated invoicing,
leading to a better user experience and overall reduction in the cost of doing
business.

 

Once requests to purchase are approved, Banks says 95% of Jabil’s purchase
orders are automatically routed, without the need for a buyer to manually
intervene. The invoices are also automatically integrated without human
interaction, generating efficiency gains for both parties. “Those things all
happen in an automated way, reducing tactical work and enabling procurement to
focus on strategic activities, such as sourcing and negotiating,” she says. “So
our people get to skip a lot of nonvalue-added steps and gain the benefit of
better price points because we consolidated our spend through strategic partners
like Amazon Business.”

 

But Jabil noticed that even though the seamless integration of Amazon Business’
capabilities were reducing maverick spend, there were still opportunities to
drive spend to Amazon Business.

 

“If we see something in the spend data from Amazon Business, or spend outside
Amazon Business that shouldn’t be happening, we can correct those processes
either through change management or Guided Buying, a Business Prime benefit,”
Banks says. “The analytics we receive from Amazon Business help us determine
where we should make those plays.”

 


TOP-LINE COLLABORATION, BOTTOM-LINE BENEFITS

The ability to use its digital stack to influence purchasing decisions was clear
almost instantly, Banks says. Once Jabil started using Amazon Business’
integration and Guided Buying, which highlights products badged as preferred by
the customer administrator to help guide purchasing choices, Jabil leaders noted
a 4% uptick in purchasing transactions moving to preferred catalogs rather than
freeform or nonstrategic suppliers. “Since then, we’ve driven more than 40%
improvement in our spend to catalog and to strategic partners,” she says.



Banks believes the downstream impacts of integrating Amazon Business have been
significant for Jabil. “As we drive spend into the right channels, it drives
cost leadership. It makes us more cost competitive as a manufacturing partner
for our customers,” she says. Moreover, Jabil has been able to take its
tremendous depth of knowledge in procurement, informed by Amazon Business, and
transform purchasing into a profit center. “We provide procurement and supply
chain services to other companies. The collaboration with Amazon Business has
given us great insight to be able to do that. We’re in the market, talking about
our successes with Guided Buying, communicating the critical foundation of
innovative partners such as Amazon Business and how to drive catalogs,
ultimately capturing the tail and reducing maverick spend.”

 

Taken as a whole, these outcomes reflect the high quality of Jabil’s
relationship with Amazon Business.

 

“Without collaboration, we wouldn’t be successful,” Banks says. “We have to know
we’re with strategic allies that are executing every single day, that we can
turn to and will walk lockstep with us to help us deliver our return on
investment.”

 

Originally published on the Wall Street Journal.


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PRODUCT UPDATES


 * AMAZON BUSINESS REVEALS THE 2024 STATE OF PROCUREMENT DATA REPORT
   
   The third annual study expands globally, with 95% of decision-makers saying
   procurement has room for optimization.


 * WHY AI SITS AT THE INTERSECTION OF PROCUREMENT AND INNOVATION
   
   Amazon Business Reshape will cover the evolving impact of AI on top
   procurement trends and challenges.


 * CREATE SMART BUSINESS BUYING EFFICIENCIES WITH INTEGRATIONS
   
   Integrations simplify the procurement process, reduce costs, enhance
   transparency, and allow for customization, ultimately supporting
   organizational goals and strategy.


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