Empowerment in Purchasing

ABM Industries began in 1909 as a window cleaning business on San Francisco’s Fillmore Street and has expanded into a leader in facility solutions, with over 100,000 employees serving over 20,000 clients, generating $8 billion in annual revenue. Today, the company delivers comprehensive capabilities and solutions in janitorial, electrical & lighting, energy solutions, facilities engineering, HVAC & mechanical, EV infrastructure, parking, and more, working in office buildings, schools, hospitals, data centers, airports, manufacturing plants, and beyond. Its customers span industries from aviation, commercial real estate, education, healthcare, retail, distribution, technology, and sports.

Not surprisingly, that combination of scale coupled with a broad, diverse footprint presents a significant challenge for those charged with procurement. “We’re in every corner of the United States,” along with multiple international locations, says Stefanie Bensmiller, director of procurement, indirect, at ABM. “This, combined with our large client base, adds a level of complexity to our supply chain.”

Bensmiller’s team supports the procurement of goods and services internal to the organization for all corporate functions, including consulting and IT services, computer equipment and peripherals, software, office supplies, and more. “We buy whatever goods and services are needed to service the client. Sometimes that means an item we’ve never purchased before. The variety is vast,” she says. Moreover, ABM has to meet its own diversity and sustainability goals while also addressing the needs of its clients, which frequently means needing to purchase items quickly and creatively in order to provide excellent tailored services.

Extending visibility

“We’re in an evolving state right now, trying to wrap our arms around multiple initiatives like centralizing procurement, growing our diversity spend, and building an ESG program from the ground up, which are big objectives,” Bensmiller says. This requires greater visibility into what’s being purchased and why, without sacrificing the flexibility and agility required for our operations to provide the highest levels of service. To help reach those goals, ABM began working with Amazon Business in 2018—and continues to expand that relationship today.

“Flexibility, variety, and delivery: These are three things Amazon Business is extremely successful at,” she says. “They have one of the largest distribution networks of any partner we have. My teams in the field don’t have the benefit of waiting a week for a product to arrive if they need it immediately to service a client. Amazon Business Prime shipping gives us the flexibility to get things quickly, including the flexibility to ship to someone’s home if they’re working remotely. Traditional procurement has challenges around delivering to home addresses.”

That flexibility doesn’t come at the expense of controls.

Bensmiller says the filtering capabilities of Amazon Business have helped ABM gain a much greater understanding of its purchasing practices, especially as they relate to tail spend, without sacrificing the autonomy critical for the business to function effectively at a local level. “Based on our needs, we determined we wanted reporting with a regional perspective,” Bensmiller says. Using Spend Visibility, a paid feature available through Amazon Business Prime, ABM “set up groups to reflect that. We can run reports against specific industries and their regions. We can report against individual commodities or their attributes. I can run a report of spend that looks just at peripherals, such as how many headsets, docking stations, or keyboards I ordered, and so on. And we can use that data to make better, more strategic decisions.”

The sorting and categorization features of reporting in Amazon Business also allow operations and area managers to gain valuable insights into how their spend compares to similar business units, whether by function, region, or other relevant points of comparison.

Aligning purchasing with values

Bensmiller says the tools of Amazon Business are also elevating ABM’s ability to align purchasing with stated goals around supplier diversity and environmental concerns in ways that don’t inhibit capacity to serve customers effectively.

“We’ve always had a diverse supplier profile, albeit one that grew more organically than today as we advance our strategic supplier diversity program,” Bensmiller says. “Our supply base needs to reflect ABM’s culture as well as the diverse landscape of the clients we serve, and it’s top of mind when we’re making strategic sourcing decisions.” The tools of Amazon Business allow ABM to elevate suppliers with diversity and sustainability in mind, so those in the field can make purchasing decisions in line with strategic goals. Over the past five years, ABM has grown its supplier diversity spend by 145%.

“I can choose Supplier A over Supplier B and still get a competitive price advantage because of the competitive nature of the marketplace that exists within Amazon Business,” she notes.

Taken as a whole, Bensmiller believes the architecture and tool set of Amazon Business ultimately allows ABM to be more client-centric on a daily basis.

“I don’t want our operations managers, corporate staff, and management team members worrying about procurement. That’s not their job. If they have to spend time shopping around for what they need, there’s a risk we might not serve the client to the level we want to,” she says. “My job is to get our team what they need when they need it by making the process fast, easy, and quick so they can provide industry-leading service to our clients.

Originally published on Wall Street Journal, click here to view.