By Andrew Hobbs
DEVELOPING a relationship with suppliers helped Caltex chief procurement officer (CPO) Johanne Rossi and her team contribute $175 million in bottom line value to the company in 2015.
Speaking with Oil & Gas Australia, Ms Rossi said she had joined Caltex at a time of change for the company, when the company was reinventing itself and trying to find ways to do things smarter.
“What I tried to do is transform the procurement function towards being more focused on people and relationships – improving the relationship we had with the rest of the business within Caltex but also the relationship with the external world,” she said.
This meant moving away from the company’s previous process of putting procurement requests out to tender, instead improving communications with existing company suppliers.
“We know more or less what price we should be paying for products and services… so we select the suppliers who are best aligned to Caltex and we have a discussion with them on how they can bring more value,” she said.
“So instead of spending $400,000 on a tender for about six months, let’s talk for three months about how we can add value together. I think it’s time better used.”
In doing this, Ms Rossi said she and her team had made an effort to reduce its number of suppliers, from the current level of 3,000 – which she said was too many to communicate with effectively.
That said, the Caltex team was also on the lookout for new suppliers – with Ms Rossi recently creating the role of procurement innovation manager within her team, focusing largely on new digital innovations.
“We’re getting so much value out of it that we’ve changed the title recently and its going to be fully dedicated to that,” she said, citing start-up incubators such as Fishburners as a great source of innovative thinking.
“They share openly their ideas without being scared it will be used by someone else and that’s a principle I try to install in my team and our suppliers,” Ms Rossi said.
“No one can steal this idea from you – because you’ve worked on it and added to it so much that it really too late for the guys who want use your idea.”
For her work, Ms Rossi was named CPO of the year at the CPO Forum Gala awards in May, hosted by consultancy The Faculty.
Caltex chief executive Julian Segal said the company was able to leverage supplier relationships to drive mutual value and deliver it a real competitive advantage.
“Johanne has managed quite an amazing transformation at Caltex, changing the mindset both internally and externally of procurement from just about buying the cheapest staplers, to delivering on our company-wide strategy and creating value in partnership with our suppliers who are now regarded as key business partners,” he said.
“As an Australian company, with no international operations outside of our trading hub in Singapore, these relationships are extremely important to our success.”