Citi embraces digital solutions to automate procurement operations
How the global bank created an automated, hands-free procurement process with Amazon Business.
Citi is a leading global financial services company, serving 200 million customers in more than 160 countries and jurisdictions. It provides consumers, businesses, governments, and institutions with a broad range of financial products and services, including consumer banking and credit, corporate investment banking, securities, and wealth management. Citi’s Resource Management Organization (RMO) is its global supply chain organization with Source to Pay (S2P) responsibility for the end-to-end supplier lifecycle process. Citi worked with Amazon Business to adopt a digital solution for automating, standardizing, and simplifying the purchasing process across a complex ecosystem where internal stakeholders and suppliers transact in numerous commodities.
Citi’s mission is to enable growth and economic progress around the world. To achieve this, Citi strives to create the best outcomes for its clients and customers with financial ingenuity that leads to solutions that are simple, creative and responsible. These expectations are carried forward in global supply chain management as Citi’s RMO organization works to improve daily operations and drive value in partnership with Citi’s business units, including the Institutional Client Group (ICG), the Global Consumer Bank (GCB), Citi’s Enterprise Operations & Technology (EO&T) and the Global Functions.
In prior years, Citi’s RMO organization focused on coverage and standardization deploying a single enterprise resource planning software solution (ERP) across 94 countries. This was a foundational investment to ensure safety and soundness across the supply chain. In 2016, the next step in the evolution focused on digitizing and automating manual processes, which enhanced the user experience, streamlined procurement processes, and strengthened the risk and control framework associated with a supply chain.
The goal is to support the business by enhancing Citi’s internal purchasing experience with an augmented digital model, while also providing suppliers with an easily operated environment. The RMO focused on agile development, eliminating manual touchpoints, and considering all the risk mitigation factors of working in a highly regulated financial institution with varying laws across geographies.
Citi’s RMO organization’s number one challenge is global standardization amongst the complexities of international business especially across so many countries. Differences in currency, taxation law, cross-border data privacy and access, and regulations tied to processing payments vary when managing suppliers across geographies. Every one of these variables ultimately results in manual touchpoints, increased number of systems, and points of potential vulnerability.
In the past, RMO invested time vetting suppliers and creating catalogs, which became outdated quickly and weren’t user-friendly—often driving internal stakeholders to purchase outside of the catalogs to get items quickly. It was also expensive to conduct sourcing events, onboard and transact with suppliers. Once items were purchased, they needed to be manually expensed to the appropriate cost center, presenting budget management and accounting challenges.
“Users wanted a simplified experience. Working with Amazon Business, Citi commenced on a journey to fully automate each transaction, so that each purchase is coded to the proper cost center, payment is processed, and extra steps are reduced.”
— Guillermo Bambach, Global RMO Source to Contract Process Owner, Citi
Enter Amazon Business. Citi has been working with Amazon Business since 2017 to consolidate suppliers into a familiar shopping environment, improving the experience for buyers. Initially, Citi’s RMO organization leveraged a centralized Buying Desk team who could order supplies on Amazon Business on behalf of internal stakeholders. Purchases were made on a company Purchase Order or purchasing card, and expensed back through the internal system, using third party expense software. This gave visibility to Citi’s RMO team into areas of spend they may not have previously managed, while making it easier for the business. However, while this made the front-end purchase easy, there was still more work to do to improve the user and supplier experience, as well as the purchase to pay and reconciliation process.
“Users wanted a simplified experience,” said Guillermo Bambach, Global RMO Source to Contract Process Owner at Citi. “Working with Amazon Business, Citi commenced on a journey to fully automate each transaction, so that each purchase is coded to the proper cost center, payment is processed, and extra steps are reduced.”
Citi’s vision was to create automated end-to-end processes to increase global efficiency, first by selecting Amazon Business for purchasing in the United States and Canada, followed by pilots in the United Kingdom and Germany. Citi then enabled a punchout integration from its ERP to Amazon Business, which allowed it to purchase from the Amazon Business store from within existing systems, consolidating thousands of suppliers into one place. The result was greater operational efficiencies and streamlining of Citi’s purchasing operations.
Next, Citi worked with Amazon Business to set Guided Buying policies using United Nations Standard Products and Services Codes (UNSPSC) —the industry standard for codes on goods and services. This allowed Citi to set restrictions on what employees could purchase through the store without manual approval review, while classifying purchases in alignment with accounting systems. Citi enabled access to Amazon Business as a preferred source for goods and services for all its United States internal stakeholders. With these integrations in place, Citi then turned its focus to building a fully automated approval, payment and reconciliation process.
Today, internal stakeholders find what they need in the Amazon Business store and ship it directly to where it is needed. For each transaction, a one-time virtual card number is generated electronically and securely by Citi’s industry leading Card platform with no user involvement. If it is within the approved purchase amount threshold, the transaction is complete, instantly paid and reconciled, saving time for users that can be reinvested in more strategic efforts. The only additional step is automatically routing to an additional approver if the purchase amount falls above an established threshold.
Then, level 3 credit card data for each transaction is electronically provided to Citi’s accounting system giving them the highest level of line-item detail for each transaction. Amazon Business then provides similar level 3 information for purchases with the added visibility. This data flows back to the Citi ERP from Amazon Business, via the Citi Card platform.
“The end-to-end transaction is now completely automated with no manual processing – ordering, invoicing, and expensing is fully automated with no manual intervention,” said Bambach. “The detailed purchasing data obtained from Amazon purchases enables Citi to continuously enrich the program for our stakeholders and suppliers alike. Citi is actively working on a program to encourage existing suppliers to join Amazon Business, bringing benefits to themselves and Citi. Suppliers benefit from the automated infrastructure, exposure to potential new customers and simplification of their supply chain.”
With the new automation and data supplied for every transaction, Citi’s RMO team is also building intelligence capabilities to identify trends to create predictions and find opportunities for cost savings. As internal customers shop in Amazon Business, real-time data directs them to suppliers that offer the best price, saving money for the organization.
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