In a Time of Environmental Disruption, DSM ‘Does Something Meaningful’
“Doing
Something
Meaningful.”
The
term
is
instilled
in
employees
at
Dutch
health,
nutrition,
and
bioscience
company
Royal
DSM
N.V.
“Doing
Something
Meaningful.”
The
term
is
instilled
in
employees
at
Dutch
health,
nutrition,
and
bioscience
company
Royal
DSM
N.V.
(DSM),
a Heerlen-based
organization
committed
to
improving
global
health
by
setting
ambitious
environmental,
social,
and
governance
(ESG)
targets.
It’s
a
lofty
ambition
in
a
volatile
era
in
which
global
businesses
are
impacted
by
ongoing
inflation
and
restrained
economic
growth.
Supply
chain
issues
that
first
surfaced
during
the
pandemic
have
now
been
aggravated
by
the
Ukrainian
and
other
geopolitical
conflicts,
not
to
mention
erratic
weather
events–creating
distractions
for
companies
on
the
path
to
addressing
decarbonization
and
sustainability
factors.
Given
this
climate,
by
the
dawn
of
the
decade,
DSM
was
forced
to
reckon
with
the
fact
that
its
old
procurement
system
was
no
longer
sufficient.
In
2021,
for
example,
highly
fragmented
processes
and
systems
were
still
being
used
for
indirect
procurement.
With
much
of
the
burden
placed
on
buyers,
category
managers,
procurement
project
managers,
and
procurement
professionals,
the
substandard
purchase-to-pay
process
meant
potential
pay
delays,
among
other
risks.
It
was
time
for
DSM
begin
a
new
chapter
by
digitizing
its
procurement
function,
connecting
partners,
suppliers,
and
other
experts
across
business
units
and
international
borders.
According
to
Andries
Feikema,
DSM’s
Global
Director
Procurement
Digitalization
&
Transformation,
the
company’s
objective
was
to
“put
a
clear
governance
structure
in
place
to
drive
success.”
Value
beyond
cash
Established
by
the
Dutch
government
to
excavate
coal
in
1902,
DSM
has
evolved
into
a
purpose-led
science
company
specializing
in
solutions
for
human
and
animal
health,
as
well
as
nutrition.
The
latest
phase
in
that
progress
was
the
creation
of
DSM’s
buy.SMART
program
to
digitize
and
automate
procurement
transactions.
In
its
quest
to
achieve
“value
beyond
cost
savings,”
DSM
collaborated
with
EcoVadis,
a
company
providing
evidence-based
business
sustainability
ratings
for
organizations
wishing
to
monitor
and
improve
their
own
sustainability
performance,
as
well
as
that
of
their
trading
associates.
Participating
partner
McCoy
&
Partners,
a
Dutch
SAP
consulting
firm
known
for
its
solutions
market
leadership,
helped
bring
about
the
project’s
realization
while
supporting
change
management.
“In
such
a
complex
environment
with
the
challenges
we
faced
such
as
COVID-19,
our
team
(kept)
things
simple,
pragmatic,
and
realistic,”
said
McCoy
&
Partners
Delivery
Director
Martijn
de
Coninck.
Another
participating
partner,
Deloitte,
chosen
to
oversee
the
transformation
and
project
management
office,
already
had
deep
ties
to
SAP,
the
world’s
leading
enterprise
resource
planning
(ERP)
software
vendor.
Because
of
this
and
other
factors,
the
SAP
Business
Network
was
used
to
digitize
transactions
and
develop
enhanced
supply
chains.
The
Business
Network’s
tasks
would
be
integrated
with
a
source-to-contract
process
utilizing
SAP
Ariba
solutions.
Another
strategic
choice
was
using
Brazil
and
France
as
the
pilot
market
for
the
global
design.
“We
made
the
decision
to
lead
the
procurement
transformation
in
the
regions
with
the
most
complex
tax
system
for
the
Plant
Maintenance
design,”
Feikema
said.
“This
approach
helped
make
the
rest
of
the
global
rollout
that
much
easier.”
‘Like
getting
a
driver’s
license’
A
global,
multi-lingual
team
of
270
champions
was
organized
to
help
users
improve
adoption
and
assist
them
in
everything
from
supplier
enablement
to
sourcing
support
to
contract
operationalization.
In
the
end,
the
time-consuming
manual
activities
of
the
past
were
eliminated,
minimizing
human
error,
while
indirect
procurement
operations
were
transformed
into
a
standardized,
automated,
source-to-pay
process
spanning
85
sites
across
20
countries.
The
alliance
with
EcoVadis
ensured
that
trading
partners
met
the
specific
sustainability
criteria
to
qualify
as
suppliers.
Under
the
new
system,
DSM
can
boast
of
greater
spend
compliance,
improved
catalog
maintenance,
automated
e-sourcing
events,
and
more
touchless
transactions.
Through
the
dynamic
exchange
of
electronic
business
documents,
5,529
suppliers
were
enabled
and
2,088
were
onboarded
between
June
2021
and
December
2022.
During
that
period,
200,000+
purchase
orders
(POs)
were
sent,
while
DSM’s
99%over
the
Ariba
Network
on-time
payment
rate
was
consistently
maintained.
For
reshaping
its
procurement
model,
DSM
received
the
distinction
as
a
finalist
at
the
2023
SAP
Innovation
Awards,
an
annual
event
highlighting
organizations
using
SAP
products
to
make
a
difference.
In
fact,
you
can
get
the
details
behind
their
amazing
accomplishment
in
their
Innovation
Awards
pitch
deck.
Capitalizing
on
its
recent
accomplishments,
DSM
has
now
begun
the
transformation
drive
toward
direct
procurement.
“For
us,
digitalizing
our
procurement
operations
was
like
getting
a
driver’s
license,”
said
Feikema.
“It’s
just
the
beginning
of
our
journey
and
it
certainly
doesn’t
stop
after
deployment.”
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