Vodafone Reduces Supplier Disputes by 80% With Full Lifecycle CLM
As a leading global telecoms service provider, Vodafone Group serves over half a billion people in 40 countries and collaborates with 200,000+ suppliers to ensure timely service delivery that meets the needs of both retail and enterprise customers worldwide.
Company Overview
Vodafone Group is a network of companies that provides mobile, fixed, and IoT products and services around the world. Vodafone Procurement Company (VPC) is part of the Vodafone Group and leads purchasing and supplier management for Vodafone in 21 countries. It also has a vast network of partners, giving them reach in another 50-plus countries worldwide. VPC manages about 70% of Vodafone’s global spend, while Vodafone Global Enterprise (VGE) – another Vodafone Group entity – primarily manages sell-side relationships with large enterprise customers
Challenge
Given the breadth of its business, the Vodafone Procurement Company (VPC) struggled to gain complete visibility into and control over 30,000+ supplier contracts stored across siloed IT systems. Contract authoring was largely manual, and contract data access was limited across multiple roles, resulting in limited understanding of each other’s commitments and subsequent efficiency gaps:
- Category managers had to fill in five different spreadsheets with the same information and go through at least 45 approval loops to generate a simple contract.
- Stakeholders relied on outdated legacy tools and processes to retrieve, search, understand, and derive meaningful insight from agreement terms.
- Contract managers had to manually compare digital copies of contracts with invoices.
This heavy reliance on manually executing contracts led to up to 10% contract value leakage pushing Vodafone Group to find a new CLM solution that could:
- Drive contract performance across the Vodafone Procurement Company (VPC) as well as the Vodafone Global Enterprise (VGE).
- Provide a connected contracting environment where VPC and VGE could better collaborate across functions.
“We were creating huge contracts that had multibillion-dollar commitments over a number of years… the ability to understand whether those contracts were leaking any value throughout the lifecycle was crucial. That’s why we thought post-signature in managing the lifecycle of contracts [has] significant value.”
Solution
VPC’s legacy SAP CLM system was no longer serving the growing needs of the group.
So, Sirion digitized and migrated VPC’s existing 30,000+ supplier contracts to a centralized repository. The entire supplier community was then onboarded to the Sirion platform, which quickly became a plug-and-play solution for VGE to digitize contracts for their top 50 enterprise customers.
With the power of Sirion’s AI and machine learning, VPC was able to:
- Configure custom workflows to automate approval frameworks
- Extract both buy- and sell-side contract data and unify them through a shared ledger
- Easily access and leverage pre-approved clause and template libraries for self-service contracting
- Automate content drafting of contracts in 70+ languages
- Monitor service levels (SLs) and obligation data to validate invoices
- Access visual dashboards and supplier performance reports in one place across VPC stakeholders
“Sirion allows us to bring contracts to life, to collaborate, and to review where we have potential risk.”
Impact
Ultimately, prescriptive authoring and automation helped streamline the contract creation processes for increased efficiency across all Vodafone Group entities. This lead to:
- Increased contract creation speed – Sirion’s configurable workflow engine allowed VPC to create progressively stronger contracts at a much faster pace and reduce manual effort by 60%.
- Greater procurement spend visibility – With a single source of data in place, VPC had greater transparency into spend, which improved auditability and reduced supplier disputes.
- Decreased value leakage – Service levels and obligations were extracted from contracts using Sirion’s AI capabilities, enabling VPC to track supplier performance and reducing disputes by 80%. They then used that data to validate invoices and preempt negative impact on revenue.
- Customer transparency – Automated obligation tracking and alerts helped VPC communicate better with its customers on expectations and deliveries.
- 360° visibility into customer-supplier dependencies – Sirion streamlined and converged VCP’s supplier and customer contract management to enable a seamless and effective contracting experience covering both the buy- and sell-side.
- Consistency and improved collaboration – All applicable functions within VCP had instant access to contract libraries, approved clauses, and historical contract data which allowed teams to work smarter and ensured congruence among contract types.
“We procure to ensure that we deliver best possible services or products to our customers, and having that full oversight will only be possible if we start digitizing and using the contracts to connect all the dots.”
Additional Resources
4 Challenges Facing Buyer-Supplier Relationships and How to Solve Them
4 Benefits of Supplier Management Automation Post-Signature
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