CLIENT CASE STUDY


Optus: Procure to pay transformation

Accenture helped leading Australian telcom player Optus streamline its contract management system by redesigning processes for its source-to-contract and purchasing functions.

Overview

The new processes have helped Optus increase contract compliance by 11 percent and deliver savings of $5 million–$7 million per year.

Opportunity
Optus spends more than $3 billion each year engaging hundreds of vendors on negotiated contracts. However, the telco did not have a central repository for contracts.

This led to:

  • Inefficiencies, duplication and noncompliance from employees not using approved vendors.

  • An inability to track spending against negotiated contracts.

  • Difficulty in knowing when contracts were expiring.

  • Less than optimal relationships with approved vendors.

As a result, the procurement function was mired in administrative, tactical tasks, rather than value-added activities that could position them as a strategic partner to the business.

Solution

The Accenture team initially developed a strategic roadmap for the source-to-pay function which was then implemented over 10 months. The transformation included business process redesign of the source to contract and purchasing functions, developing a spend taxonomy and associated reports and setting up an outsourced function to establish a help desk, assist Optus employees to purchase goods and services up to $200,000.

In particular, Accenture helped:

  • Redesign the business processes for source-to-contract and purchasing functions.

  • Develop a reporting and classification system for procurement spending “spend taxonomy.

  • Set up an outsourced help desk to assist Optus employees procure goods and services of up to $200,000.

Establish a master data team to create and maintain a central repository of up-to-date procurement data. Accenture deployed a cross-functional team of 45 people split between Australia and India, including specialists in management consulting, project management, technology and delivery.

With Accenture’s help, Optus can now:

  • Effectively manage its approved vendor contracts.

  • Drive compliance among Optus employees.

  • Provide a centralized procurement function for the business.

  • Improve efficiency with a streamlined procurement function.

Results

As a result of working with Accenture, Optus now has a streamlined contract management process that enables it to:

  • Increase contract compliance by approximately 11 percent.

  • Support strategic sourcing with meaningful spend reporting.

  • Deliver savings by approximately $6-7 million per year with new processes and a specialized buying function.

In addition, Optus’ procurement function is faster and more efficient, allowing the staff to focus on strategic activities to drive value for the business. According to Karen Carmichael, chief procurement officer at Optus: “The partnership of Optus and Accenture on this program was the key driving force behind its success. It has created a new benchmark for effective IT development in support of major business transformation and I am very proud to have had an opportunity to be part of it.”