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Lloyds TSB banks on SAP SRM

Case study: How the high street banking group has undergone a procurement makeover...

Tags: savings, integration, procurement, sap

By Tim Ferguson

Published: 12 June 2007 14:35 BST

Lloyds TSB has rolled out a new e-procurement system which it hopes will reduce costs and make its overall procurement process much more efficient.

The bank recently completed the rollout of a supplier relationship management (SRM) e-procurement system from SAP to provide a single and easy to use purchasing system.

Mark Swyny, service and systems director of group procurement at Lloyds TSB told silicon.com: "The system strategy (SRM) is one strand. It's one of the enablers [of transformation]. We wanted to kick start our procurement process."

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Swyny said the bank was keen to streamline the purchasing process with the SRM.

It has made a catalogue of commonly bought goods available to users to make it easier for them to locate what they want. If goods are not held within the catalogue, users go through preferred external supplier websites.

Swyny said greater visibility of contracts with preferred suppliers is important to ensure the bank has more control over what is spent - while also reducing overall costs.

Bank staff communicate more specialist requirements - for goods not commonly bought - to the procurement team, which can work out how to get hold of them.

Swyny said: "All of those things drive value."

The decision to use SAP software in particular was based to some extent on the fact the bank was already using financial and reporting apps from the business software company.

Swyny said bringing in the SRM was partly aimed at improving the integration of the buying process, "linking the procurement, invoicing and payment systems".

The transition project was started in August 2006 and the system went live on time, towards the end of March.

Capgemini assisted the transition to the new system, by advising on supplier engagement and providing the change management involved in moving staff onto the new system.

At present around 10,000 of the bank's 72,000 staff use the SRM. Swyny said this figure may not change significantly as individual departments only have a small number of people dealing with procurement.

Now the transition has been carried out and the system has bedded in Swyny said the main aim will be to make the system "flexible enough for the business to use as it sees fit".

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