Revitalizing procurement for greater efficiency

Each business sector faces its own unique challenges when it comes to purchasing. Some heavily rely on direct components, while others have higher levels of indirect spend because of large numbers of employees or multiple office locations.

Purchasing laptops, furniture and even consumables such as ink or stationery can add up, so it’s important to ensure these spend categories are managed effectively. Often, though, procurement teams are overstretched and can find it difficult to allocate dedicated employees to actively manage these low-value-but-high-volume spend categories.

Increasingly, every organization also may have its own specific supplier requirements, making it essential that items are sourced from reputable organizations that conform to certain standards and wider business priorities.

Amazon Business’ 2025 State of Procurement Survey finds that 99% of organizations report having specific social responsible purchasing (SRP) goals, with the majority of decision-makers (63%) and senior leaders (61%) stating that their organization’s SRP goals and priorities have increased in the past year. Procurement’s role is increasingly tied to these broader objectives, with a particular emphasis on working with certified sellers.

The energy sector is one example of a sector that faces all these challenges, with different organizations focusing on parts of a process ranging from the extraction of raw materials from the ground to powering or heating homes.

ExxonMobil 

ExxonMobil is a global oil and gas producer with more than 80,000 customers across 40 countries, spanning six continents. After spending more than $25 billion on capital and exploration opportunities across 100,000 suppliers in one year alone, its procurement team sought to introduce a digital process to better streamline operations.

ExxonMobil originally partnered with Amazon Business for office supplies, a partnership it soon extended to other categories, including industrial supplies and maintenance, repair and operations. These categories represent significant spend, but often involve large numbers of transactions where items are required at short notice.

“At our scale, every percentage point counts,” said Nassim Kefi, Procurement Advisor at ExxonMobil. “When you save thousands of dollars on each transaction, considering the sheer size of our procurement organization and our purchasing activities, it adds up fast.”

“Additionally, instead of deliveries spread out throughout hours, days and weeks, we get them delivered across all of our locations on a dedicated Amazon Day that we selected based on our shipping preferences,” said Kefi. “Free delivery through Business Prime is also a major advantage.”

The transformation also included integrating Amazon Business into Exxon Mobil’s e-procurement system, Smart by GEP, which gave users a seamless experience between their existing e-procurement system and the Amazon Business store.

This led to a sharp increase in the number of users, who now enjoy the same experience they are familiar with in their personal lives. “We didn’t have to push too hard for adoption within the company,” said Kefi. “The growth was organic. For our users, there was no change in what they were used to, as a lot of the work was being done in the background."

ExxonMobil also leverages  features such as Guided Buying (a paid feature), which helps direct users to company-endorsed suppliers and products. “Working with diverse suppliers creates new perspectives, ideas and practices that help grow our business,” said Kefi.

Using Business Prime’s Spend Visibility virtualization tool has also helped the procurement team gain insight into what is being spent and with which suppliers, providing valuable insight that can help to achieve further economies of scale.

“We didn’t compromise our approval system, didn’t reinvent the wheel or drastically change any of our existing systems. Instead, we seamlessly integrated Amazon Business with our purchase-to-pay ecosystem to order what we need in a scalable way,” added Kefi.

Centrica 

Centrica supplies energy and other services to more than 9 million people in the UK and Ireland, through brands such as British Gas. It employs 23,000 people worldwide and has offices in the UK, Ireland and North America.

The organization has significant tail spend and recognized a need to implement a more structured approach to procurement. A number of acquisitions over the years meant the existing processes were cumbersome and varied across different business units and locations.

The procurement team wanted to implement a new system that would allow it to capture all purchasing activity in a digital environment to meet the needs of stakeholders and accommodate business growth.

The starting point was to create a centralized platform that linked the buying environment to its existing source-to-pay (S2P) system. Peter Sowrey, Chief Procurement Officer at Centrica, said this: “Embedding Amazon Business into our Ariba buying environment allows for e-invoicing which enables Centrica to have an end-to-end transaction model. We work with partners such as Amazon Business to help us transform into a digitally enabled procurement function.”

Centrica now has around 2,600 internal customers using the system and saw an 800% increase in traffic in the first month alone. By integrating Amazon Business, Centrica has been able to cut down on maverick buying, where people purchase items from unauthorized vendors without approval, and instead directs them to a wider range of approved products on Amazon.

“Amazon Business helps our colleagues and stakeholders find what they need fast, allowing them to focus time and effort on their role, not complex processes and policies,” says Vincent Gautheron, Head of Services Portfolio at Centrica. The proportion of purchase orders going through the centralized platform has increased to 77%, beating the initial target of 65%.

The introduction of Amazon Business has also helped raise the profile of the procurement team, allowing it to deliver greater value to the wider business. “Technology is allowing procurement to rebrand and re-establish itself by focusing on strategic value creation, innovation, sustainability and even wider organizational strategy,” said Alexei Burns, who is responsible for strategy, planning and performance in Centrica’s procurement team.

Amazon Business complements Centrica’s overarching strategy of releasing capacity on the ‘tail’ spend and moving away from the more transaction purchasing of goods not for resale (GNFR) and focusing on unlocking value with their key partners and suppliers which, ultimately, increase procurement’s strategic importance to the business.

The next steps in the journey with Amazon Business are to increase adoption and to expand it in new areas where it can drive value. Developing the usage of AI/ML technologies will help Centrica drive increased cost and efficiency savings through its reshaped procurement function.

Originally published on USA Today.