Intel s Indirect Procurement: Dedicated to Negotiations Center of Excellence

Transcription

1 Intel s Indirect Procurement: Dedicated to Negotiations Center of Excellence Mark Campbell C&N / PESPSL Sr. Manager Intel Corporation December 6,

2 Agenda Corporate Overview CSP Overview Key Drivers / Business Challenges C&N Center of Excellence Transformation Results / Lesson s Learned Q&A 2

3 3 Intel's Vision This Decade We Will Create and Extend Computing Technology to Connect and Enrich the Lives of Every Person On Earth

4 Intel Corporation: The World s Largest Semiconductor Manufacturer $43B 63 Countries Customers, 120 Countries >100,000 Employees ~$16B Supply Chain Top 10 Brand 10,000+ Suppliers 4

5 A Continuum of Consumer Experiences Desktops Laptops Netbooks Tablets Smartphones Smart TVs Embedded A Consistent, Familiar & Seamless Experience Across Multiple Devices Enabled by Internet/Cloud-Based Services

6 Intel Corporation: Corporate Responsibility Integrated into Our Business Continuing our commitment to the highest performance in all we do from product innovation to corporate responsibility is good business. Paul Otellini President and Chief Executive Officer Intel Corporation >1M hrs Volunteering Per Year >$1B Education, Last Decade >500 Awards, Last Decade 6

7 Corporate Overview CSP Overview Negotiation History Key Drivers / Business Challenges C&N Center of Excellence Transformation Results / Lesson s Learned Q&A 7

8 Corporate Strategic Procurement Intel Confidential

9 Corporate Strategic Procurement Org Structure Global Strategies Global Sourcing Global Supplier Mgmt Director Indirect Procurement Regional / Country Strategies Regional / Country Sourcing Regional / Country Supplier Mgmt IT HR / Mobility SMG PES / Legal / PS GER / LAR Regional GAR Regional Contracts & Negotiations 9

10 CSP Negotiation History Regional Purchasing Joe Lawyer E-forms ecommerce Internet Negotiations xmo Negotiations/ Coaching, Consultancy Academic Partnership Dossiers < Site specific sourcing & negotiations Boilerplate training Neg plan template Global Sourcing & Procurement Teams Improved Training, Central Repository Negotiation Center of Excellence Peer-to-peer reviews, metrics, formal BM s Sales Side Negotiations UET, Stewards Intel Confidential

11 Corporate Overview CSP Overview Negotiation History Key Drivers / Business Challenges C&N Center of Excellence Transformation Results / Lesson s Learned Q&A 11

12 Drivers / Business Challenges for Negotiation Center of Excellence 12 Continuous Improvement Needed in Neg s GSTs SSPs MI / Benchmarking SRCs, ERMs/MRMs inegotiation erfx GPR Supplier Segmentation Efficiency Challenges Process & People Glide-path set Starbuck s Model Relationship with Legal Relationship & Collaboration with SH Relationship with Suppliers Training / Competency P7th Contracting Complexity & Variability Multiple Agreements (100 Pages) Working with Ariba Taxation, VAT, Geo Specific Issues Commercial vs. Legal understanding Affordability changes

13 Negotiation Experience Comparison Materials Indirect Procurement vs. 9 Top Tier Suppliers Comparison of Annual Negotiation Experience Number of Strategic Negotiations A B C D E F G H I Before

14 Challenges Average Retention Rates 5% Lecture 10% Reading 20% Audio Visual 30% Demonstration 50% Group Discussion 75% Practice 14 90% Teaching Others Source: Adapted from National Training Laboratories. Bethel, Maine

15 Drivers Business Challenges Other Key Drivers Spend Managed per hc How long have you been a sourcing / procurement professional? Greater than 10 years 6-10 years 1-5 years Less than a year 3% 25% 28% 43% 0% 10% 20% 30% 40% 50% Direct Observation identified gaps in understanding / ability External BM s identified negotiation competency gap Complexity of agreements increasing Planning impacted Other Business Challenges Negotiation Post Mortems Negotiation Benchmarking Manage Tension & Collaboration Efficiency with Legal / Risk 15

16 Corporate Overview CSP Overview Negotiation History Key Drivers / Business Challenges C&N Center of Excellence Transformation Results / Lesson s Learned Q&A 16

17 Contracts & Negotiations Center of Excellence C&N Internet negotiations Tax / Risk Legal T&C s Profiling / Dossiers Strategy & Tactics Project Mgmt Teaching / Consulting / Academics 17

18 Corporate Overview CSP Overview Negotiation History Key Drivers / Business Challenges C&N Center of Excellence Transformation Results / Lesson s Learned Q&A 18

19 Transformation Activities Conduct Internal Survey Job Sat. Define Process R&R Hand-offs Comm s / Escalations Executive Partnering On-going Training Decision Framework Skill / Commodity Competency Stewards Defined Neg Strategy Developed Practice P7th 19

20 Negotiation Experience Comparison Materials Indirect Procurement vs. 9 Top Tier Suppliers Comparison of Annual Negotiation Experience Number of Strategic Negotiations A B C D E F G H I Today

21 Contract Cycle Time : Quick Turn < 7 days (n/a) Low Complex 17 days (42 days) Med. Complex 47 days (86 days) High Complex 162 days (192 days) Expertise / Continuous Improvement 65 classes delivered 4 Revisions, 2 New Strategy Classes Developed Commodity Specific T&C s University Engagement 50+ Consulting Engagements Peer to Peer Reviews xmo Negotiation Benchmarking Profiling / Dossiers Results Intel Confidential Affordability Growth: $57M, $155M, $204M, $257M, $307M 438% Connectivity / Health Job Satisfaction Legal, Risk, Tax Collaboration

22 Lesson s Learned Don t underestimate value of executive relationships Don t underestimate mine mine mine Job satisfaction revelation You don t need all Ferdinand's Negotiations determined by skill not placement yielded building block Post Mortems, Peer-to-Peer, Critical examination of Negotiations vital to improvement P7th 22

23 Contact Information Mark Campbell Intel Q&A

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