Flint Group and SAP Ariba; A transformation success story
Created by the union of XSYS Print Solutions and Flink Ink Corporation in 2005, is one of the world’s largest suppliers to the printing industry. Working with SAP Ariba solutions, the Fling Group has centralised and digitalised the procurement of its indirect materials and services, resulting in increased efficiencies, reduced costs and better spend management.
The Flint Group replaced its manual procure-to-pay processes with SAP Ariba solutions cloud-based platform. With a single unified solution, the company was able to standardise its purchasing process across the enterprise, increasing transparency and simplifying the buying, invoicing and accounting process for both internal employees and external vendors.
“We have vastly improved our employees’ buying experience and process efficiency with our shift to the cloud and implementation of the SAP Ariba solutions,” said Arno de Groot, vice president, Procurement Packaging, Flint Group. “What’s more, with a complete unified procurement system, we have greater visibility into spend, enabling more informed buying decisions and a positive effect on our bottom line.”
Operating in over 130 centres across six continents, to ensure optimum customer service, the Flint Group works with an intricate network of suppliers, which previously had made for a complex and time-consuming procurement process. A lack of transparency on spend and data inconsistencies further complicated matters, resulting in an incomplete view on costs and hindering the ability to make well-informed procurement decisions.
Leveraging SAP Ariba solutions, the Fling Group has been successful in:
- Reducing maverick spend by empowering employees by providing an intuitive user experience to make guided buying decisions.
- Improving compliance, accounting accuracy and the accounts payable process by attaching a purchase order to almost every invoice.
- Reducing its vendor base and instituting a preferred supplier program to help maximise rebates and incentives while improving the supplier experience.
- Avoiding duplicate or unnecessary purchases by increasing visibility of current stock
IHS Markit/CIPS: UK Manufacturing PMI near-record high
UK manufacturing trends
For the UK manufacturing sector, growth of output and new orders were both reported by IHS Markit and CIPS as among the best seen over the past seven years, which in turn has led to a strong increase in employment. Despite this, the sector continues to face supply chain delays and input shortages, which resulted in increased purchasing costs and record selling price inflation.
UK Manufacturing IHS Markit/CIPS Purchasing Managers’ Index® (PMI®)
Seasonally adjusted, IHS Markit/CIPS Purchasing Managers’ Index® (PMI®) rose to 60.9 in April, which was an increase compared to March (58.9) and above the estimated 60.7 for April.
Increasing for the eleventh consecutive month, the latest readings are the highest since July 1994 (61.0). The output growth for April has been attributed to the loosening of lockdown restrictions, improving demands and a rise in backlogged work.
“The manufacturing sector was flooded with optimism in April as the PMI rose to its highest level since July 1994, bolstered by strong levels of new orders and the end of lockdown restrictions opened the gates to business. It was primarily the home market that fuelled this upsurge in activity though more work from the US, Europe and China demonstrated there were also improvements in the global economy. This boom largely benefited corporates as output growth at small-scale producers continued to lag behind,” said Duncan Brock, Group Director at the Chartered Institute of Procurement & Supply.
In addition to expanding production, total new orders rose for its third consecutive month, which was attributed to a revival of domestic market conditions, stronger client confidence, parts of the economy reopening and improving global market conditions.
While new exports rose in April, the rate was reported as weaker in comparison to new orders. “Companies reported improved new work intakes from several trading partners, including mainland Europe, the US, China and South-East Asia. Large-sized manufacturers saw a substantial expansion in new export order intakes, compared to only a marginal rise at small-sized firms,” said IHS Markit/CIPS.
UK Manufacturing’s outlook
Remaining positive at the start of the second quarter, 66% of companies forecast that output will be higher in a year's time, which is attributed to expectations for less disruption related to COVID-19 and Brexit, economic recovery, improved client confidence and new product launches.
“Further loosening of COVID-19 restrictions at home and abroad led to another marked growth spurt at UK factories. The headline PMI rose to a near 27-year high, as output and new orders expanded at increased rates. The outlook for the sector is also increasingly positive, with two-thirds of manufacturers expecting output to be higher in one year’s time. Export growth remains relatively subdued, however, as small manufacturers struggle to export,” said Rob Dobson, Director at IHS Markit.
Adding to comments from IHS Markit and CIPS, , Managing Director of Freight and Logistics at Accenture Global said: “While today’s figures are positive overall, the worsening supply situation is still a concern, with rates of both input costs and selling price inflation running far above anything previously seen. Shipping delays and material shortages are driving huge backlogs of uncompleted work and the surge in manufacturing orders is leading to many firms struggling to boost operating capacity to keep up with demand. With business expectations becoming even more optimistic as the economy rebounds, the big question will be whether firms will be able to cope with the surging inflows of new orders.
“As ongoing supply chain issues are still at large, companies with wide international footprints should look to reassess their logistics strategies by running supply chain stress tests and simulations in order to respond quickly to upswings and variability in demand. A flexible and resilient supply chain will be a key way for businesses to remain both competitive and stable as we emerge from the pandemic”