Our “Procurement Experts on CPO Rising” series continues today with an excerpt from my 2021 episode of the Procurement Rising Podcast — Ian Maher, former Vice President and Head of Strategic Sourcing for Global Atlantic Financial Group (click to listen to the full interview). Note that this excerpt has been edited for readability.
This is Part Two of our two-part series (read Part One here) featuring Maher’s discussion of creating a contract repository where one didn’t exist in his new role.
Andrew Bartolini: Relationships still drive this business. If you can’t connect with the business stakeholders, with the executives, with your own team, you’re going to be swimming alone. That remains true even in this odd world in which we live.
Let’s now shift to the next phase. After you’ve done the diagnostic and the rounds and the investigation via the supply base (meeting with key people), how do you then prioritize your investments? Where do you focus your resources? And what types of resources are you trying to bring in?
Ian Maher: This ties nicely to the diligence question, because what I uncovered post-offer acceptance — the first two days on the job — was the absence of what I would call a contract repository. I still kick myself for not homing in on such a fundamental feature of what is needed in terms of understanding and supporting all of our areas of activity from a procurement and sourcing point of view.
So, in that first 60 to 90 days, having understood the lay of the land in relation to the distribution of the contracts and the state of the contracts, and the metadata that did or didn’t exist with those contracts, I realized I needed to put in place a working solution, if not a perfect solution. In many cases, good enough is sufficient. If you’re faced with this in the early days of a new role, you don’t have to necessarily achieve what you might be accustomed to. You just need something that is good enough for the environment that you’re in.
I looked across to the risk group because usually there’s some type of technology being used for operational risk reporting. That was the case with GA (Global Atlantic). It had a platform that was very configurable. And as it turned out, there was the ability to build a contract repository with the existing license agreement GA had. I was able to invest the time in capturing and ensuring that I could get my arms around the contracts and convert the contract artifacts so that they were readable. One of the things we all understand is that our life is only as good as the data that we’ve got in front of us. I absolutely believe that you have to extract and capture, and then reuse the data on our third parties as it exists within the contract for all the areas of the sourcing lifecycle.
I did invest in a BPO firm that did the conversion for me and at the same time mapped out my basic metadata structure to understand the contracts. In relatively short order, we went through 7.5 hours and 8,000 contracts, got them populated, and were able to provide some management information back to people that had had zero management information about our third-party inventory. They didn’t know how many third parties we had. They didn’t know how many contracts we had. They didn’t know when expenses expired. And they didn’t know what the contracts said or what the service levels were. These things are foundational to many people listening to this podcast. But that was the case. That was where we were.
I was able to create and have an early win by just giving some fairly rudimentary views to the CFO, COO, and risk officers. I provided my understanding of what we had. I didn’t say whether it was good, bad, or indifferent, it was just the current state. It’s where we were to date. That proved to be an endorsement for me that we were able to get to a starting point. And from there I started to drive investments as they related to the priorities of the near-term expirations, as well as build and look at the team for how we were going to establish the relationship structure between the procurement organization and our lines of business. That was job one.
From there, we started to develop the connections to our third-party risk groups using the same technology and moving them away from individual technology areas — so that we very much capture, write once, and read many. And then now be in a position where we can roll multiple risk areas on the back of my contracting environment. I can start to turn my attention to the pre-contract activities in terms of establishing our needs from a business case and purchase requisition-type process.
So, you can sense there wasn’t much in terms of a foundation to go with. But in many ways, I started with my contract repository. And now I’m spending more time working upstream to improve our whole planning activities, both for renewals and for discretionary spend.
MORE CPO TOPICS
Procurement Experts on CPO Rising — Assessing Your New Leadership Role
Procurement Experts on CPO Rising — Putting Your Skills to Work
Procurement Experts on CPO Rising — Planning for the Next Iteration of Source to Pay
Procurement Experts on CPO Rising — Changing Mindsets for Digital Transformation
