BT Group connects with AI to get a grip on procurement spend
Globality’s AI-based sourcing platform is helping BT to optimize its multi-billion-pound annual investment in third-party resources and activities.
BT Group is using Globality’s AI platform to boost the effectiveness of its procurement processes and give key staff more time to concentrate on value-adding activities.
Cyril Pourrat, BT’s Chief Procurement Officer (CPO) and Chi0ef Executive of BT Sourced, which is a standalone procurement company within BT Group, says his team is adopting a range of digital technologies to support the move towards a simpler procurement model that allows professionals across the rest of the organisation to self-serve.
One of these tools is Globality’s AI-powered sourcing platform, which gives BT business users the opportunity to search for suppliers that meet their specific project requirements, so that the team now spends less time on administration and more time on tasks that add value to the business:
Instead of having the procurement team doing the statement of work, we can delegate that effort directly to the users. The AI walks them through the process step by step, asking questions – they just have to answer in natural language, and then the documents can go directly to the suppliers without any support from procurement.
With annual third-party spending of around £14 billion globally, BT’s leadership team is eager to find substantial savings through digitalization by 2025. More than £2.5 billion of project spend is already being managed on Globality’s platform. By adopting emerging technology, Pourrat says BT Sourced is changing procurement processes across a range of areas, from IT services to marketing and onto real estate and consulting projects:
It’s time to introduce tools that make an impact on how we procure the things we need. Instead of spending millions on software suites, which will not be used to their full potential, I'd rather spend slightly less money on specialist tools, such as Globality, that really meet the needs of my team.
Taking a new approach
The shift to Globality is part of a broader digital strategy at BT Sourced that’s focused on implementing tools that address employees’ specific challenges – and, in terms of procurement, that means allowing people to do their jobs more effectively and efficiently, rather than relying on Excel spreadsheets and big-name enterprise applications. Pourrat explains:
Most procurement professionals use one-size-fits-all suites to please their boss and for compliance purposes, rather than to really do the work their business needs. They're running everything relating to procurement outside the suite and then, to please their boss, they are going back and putting everything into the system.
When it came to implementing Globality, Pourrat asked his team to search the market for a solution that they thought would solve their business challenges. That’s a big break from the normal approach, where a top-down decision to invest in technology rests with the CPO and the tool is then imposed on the procurement team. Giving his staff the power to make the decision has produced big dividends, according to Pourrat:
I made a commitment that I wouldn’t challenge their choice. The idea is to try fast, learn fast and move on. It's a way more powerful approach because people will look for tools that are really enabling them to solve the issue they're facing. And that's something that is very different to the usual process.
Pourrat contrasts the “millions of pounds” and years of work that can be spent implementing software from a big-name software provider to the ease of bringing in the Globality solution. Instead of investing in integration specialists, training courses and change management processes, his team selected the platform and implemented it quicky. Even though he says BT is a complex organization, it took less than six months to bed in Globality’s tools:
We want our people to have a consumer-grade user interface, which means you reduce the level of training. None of us have to take any training for the apps that we have on our phones – and the idea here is exactly the same. If there's a user interface that makes sense, my team will have to spend less time being trained – and that's a big win for me.
Embracing fresh opportunities
As well as being quick and easy to implement, Pourrat says Globality has produced a range of benefits for BT. The insight the tool provides is helping his team to collaborate with senior stakeholders across the organization. While Globality was selected by the procurement team, it’s also been adopted by users across other areas of business and finance. Pourrat explains:
If it's easy to use, then you can promote the tool to your stakeholders. They can then have access and start to play with it. That never happened with the big suites because you needed comprehensive training.
The ability for the rest of the organization to self-serve means the procurement team can get on with other value-adding tasks. They can leave line-of-business users to processes smaller transactions or step in and negotiate if they see from the tool’s in-built analytics that there’s potentially better deals to be had, he adds:
We've got a better view, it’s more detailed and we can deep dive into all the analytics. We can create a strategy in advance instead of being reactive and always being in a rush. The tool is already preparing future strategies by giving us all the analytics that we need.
Pourrat estimates the Globality has produced “double-digit” cost savings of at least 10% when compared with his team’s old suite-based way of working. He says the Globality solution is part of a new plug-and-play approach to applications at BT Sourced, where – after continuing to hone his organisation’s orchestration layer – it will be possible to add spot solutions to deal with fresh business challenges quickly and easily:
We've already got 11 digital platforms beyond Globality. And what we want is an orchestration layer where we move to a best-of-breed approach. That’s a very different approach to what's happened in the procurement space for the past 20 years, where people have relied on monolithic applications.
For other business leaders who are thinking about using AI-based solutions such as Globality, Pourrat says it’s crucial to look for the right moment to test and move forwards:
A lot of my peers have put their money into these big monolithic suites, even though they can see the value of digital technology. What I'd tell them is to find the opportunity where you believe that there's a way for you to implement new technology.