Elm - Brochure 2021

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Changing the game of procurement Project partners


Changing the game of procurement Ahmed A. Alblaly, Director, Procurement and Contract of Elm, looks to answer the question; what kind of function does procurement need to be for Elm?

Written by

Dale Benton

Produced by

Heykel Ouni

E l m: C han g i n g th e game of p rocurement


3


W

hat does procurement

Procurement and Contract. “Companies

maturity mean? We often

used to deal with procurement as a

hear it spoken of as we

tool to record purchasing and do some

navigate the procurement transforma-

saving. In recent years we realised that

tion discourse, but how do we define

we need to change the model and the

maturity? Is it through benchmarking

role of procurement. A lot of compa-

against other procurement functions?

nies faced declines on their revenues

Is it through our own strategic defini-

impacting their profitability and so a

tions based on our own KPIs and goals

procurement function based on strategic

as decided through a collaborative effort

sourcing agreements and following the

from the entire c-suite? It’s a key ques-

broader strategic roadmap of the busi-

tion for any procurement practitioner

ness and truly partnering with the busi-

and most certainly forms a core compo-

ness is key to improving that profitability

nent of Elm Company’s procurement

and adding true value.”

transformation journey. Elm Company, the leading provider of innovative secure services and solutions to both public and private sectors in Saudi Arabia, is currently undergoing a significant transformation of procurement. While the journey is ongoing, it has already allowed the company to implement faster processes, enable greater agility and create a culture that unlocks true innovation and creativity across the entire organisation. As a provider of e-services, customised IT solutions, governmental support services and consultations, agility and speed are crucial to the business and procurement is the key to that. “The game has changed,” explains Ahmed A. Alblaly, Director, E l m: C han g i n g th e game of p rocurement

By its very nature, Elm is a truly digital company which provides digital solutions and digital services to its customers.


Technical procurement makes up around 70% of procurement activity as a spend and so the transformation looks to enable agility, higher quality and better costs for both its government contracts and the private sector. In order to achieve any form of change and growth, it’s crucial that you start at the very beginning and ensure you have the information you need in order to put the right foot forward in that first step. Alblaly spent a lot of time with the organisation identifying what they felt were pain points in the procurement process. This took the form of workshops with senior management, wider business units and external vendors and suppliers.

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E l m: C han g i n g th e game of p rocurement


“ There was also a key conversation as to what kind of function that we needed procurement to be for Elm? Is it just to support the business or to be a hub for our clients (as outsourced services)?” — Ahm e d A . Al b la ly D i re c to r, P ro cu rement a nd C o nt ract of Elm

Doing so allowed Alblaly to obtain a holistic understanding of the business and not focus solely on procurement for procurement’s sake. “This can be broken down into three stages; Understanding the Corporate vision and goals, identifying the pain points and gaps and setting up a procurement strategy that is aligned with the corporate strategy and addressing the gaps and issues.,” he says. “There was also a key conversation as to what kind of function that we needed procurement to be for Elm? Is it just to support the business or to be a hub for our clients (as outsourced services)? With a strategy and roadmap laid out before him, Alblaly began this transformation journey. Like many, one of the first steps was to look for and achieve quick wins as to build momentum. A pain point for Elm, prior to this journey, was cycle time. In the fast moving worlds of both public and private sector, speed with quality is everything and so Alblaly looked to improve the cycle time that would see 7


Rayz’s

Collaborative Synergetic Partnership with Elm The evolution of procurement is the topic that defines the current strategic roadmaps of many organizations. It is no secret that agility, technology and speed are crucial components of any modern successful procurement function, but why? For Rayz, strategic partner to Elm throughout its significant procurement transformation, agility, speed and efficiency are the cornerstones of its value proposition. “Procurement can often fall victim to slow RFP processes and in some cases they come in beyond a certain deadline,” explains Yazeed AlGhuraibi, Co-Founder and Acting-CEO at Rayz Co.. “So that's why the agility, speed, and the efficiency from the procurement department needs to be aligned with the project owner that’s requesting the scope for their department.”

To achieve this, organizations such as Elm look to strike key strategic relationships with partners they can truly rely on. In times of great change, these reliable partners are key to business continuity thanks to the existing successful relationship in place. Elm’s transformation journey since 2015 has seen the company utilizing technology to improve and streamline the procurement process, and Rayz has been heavily involved in this journey. Leading players in the Saudi market have driven a shift in vendor management that has pushed the procurement needle further forward. Technology, such as innovative new ERP and procurement systems, have been adopted and are widely used by private companies and the government alike.


“These electronic portals are improving the relationship between the entity and the vendor in a very transparent manner,” he says. “This goes a long way in driving maturity and will be the baseline from here and moving forward.” Through technology and transparent communication, Rayz’s strategic relationship with Elm has grown considerably. Elm has invited Rayz on a number of occasions to be fully integrated into projects at every stage of the cycle. “If they have a challenging matter and need to think about how to utilize their budget in a well-planned efficient systematic way, Elm turns to Rayz for consultation and guidance,” says AlGhuraibi. “With Elm, we work in a collaborative and synergetic manner on how to organize our procurement cycle, examining how we can organize receiving RFP’s other than those from project owners, this in turn is a continuously growing and achieving process.” Procurement has been and will continue evolving, as organizations and their transformations are a

continuous journey. For Elm, and in turn Rayz, the future is a journey, where the partnership evolves further through better pricing, better quality of service, and further transparency and efficiency. “Rayz will continue to be a dynamically reliable and strong partner for Elm,” says AlGhuraibi “Our relationship will continue to be a win-win for both ends, where we continue to leverage each other’s expertise and resources to reach shared successful accomplishments together.”

Yazeed AlGhuraibi

Co-Founder and Acting-CEO at Rayz Co.


all of the completion of all of the tender-

customers and our internal business in

ing and sourcing process end to end. Not

an area where they expressed a key pain

only that, but to do so with greater visibil-

point,” says Alblaly. “What we’ve managed

ity of the process while satisfying internal

to do is remove that pain and make it a far

and external customers. This quick win

more enjoyable journey. Our customers

opened the doorway to a midterm goal

can see and feel the value that procure-

of overall improvement to the contract-

ment is providing. In fact, many of our

ing and operating model of procurement

clients outsource their procurement or

while initiating new types of purchase

sourcing to Elm as a result of this.”

orders (POs) in order to better serve the needs of procurement at Elm. “We were trying to please our E l m: C han g i n g th e game of p rocurement

Alblaly is a firm believer that buy-in, or sponsorship, form the internal and external customers is the key cornerstone of


that when discussing some issues related to the improvement and proposals in procurement, the first people supporting us were people who are dealing with us on a daily basis,” he says. “Sometimes a change is sensitive, difficult and outside of our comfort zones. We give more authority to the business and with that comes more liability. But this isn’t a case of being left alone to deal with that. The processes and model allows them to be connected to the organisation through procurement. It’s truly collaborative” Transformations can often be dominated by talk of process, new operating models and even new technologies being put in place. But those transformation stories forget what makes the procurement function truly tick; the people. All of the greatest technologies any transformation and so these “small

and new ways of working are nothing

wins’’ go a long way in showing them that

without the people in place to realise

procurement is working with them, not

the true potential. So what is Elm doing

against them. Procurement has histori-

to ensure that it is bringing the people

cally gained a reputation as a policer of

along with it in this journey, and not leav-

spending, which we know not to be true,

ing them behind?

and so Alblaly is working with procure-

Alblaly speaks of the way in which Elm

ment to facilitate a new understanding of

really cares about its resources and its

procurement. Procurement, and all of its

employees from top to bottom and he

processes, are here to add value, not to

considers them a key asset to success

control requests or demand. Empowered

- something that Alblaly truly values in

by their trust and understanding, we found

times of great change. “When we started 11


E l m: C han g i n g th e game of p rocurement


“ What we’ve managed to do is remove that pain and make it a far more enjoyable journey. Our customers can see and feel the value that procurement is providing. In fact, many of our clients outsource their procurement or sourcing to Elm as a result of this.” — A h m e d A . Albla ly D i recto r, P ro curement and Contra ct of E l m

this huge change in procurement we

it puts the organisation in a fantastic posi-

had to keep all of the employees around

tion to continue to move forward.”

us, and those of our external clients and

Transformation and change is a jour-

vendors, right here with us in the same

ney and it is a constantly evolving one at

boat. I think one of the challenges we

that. While there are timelines embed-

faced was the fear of having more

ded within the overall roadmap, Alblaly

process; changing to another or a newer, more controlled, operating model,” he says. “These are the fears

is quick to highlight that you cannot look at it as simply as moving from point A to point B in a set amount of time. There are far too many intricacies and complexi-

that we had from

ties inside (and outside) of the procure-

our employees, not

ment ecosystem for that to be possi-

just procurement. Through

ble. Unfortunately, 2020 saw one of the

an awareness programme, we reached all

biggest external challenges faced by Elm

of the employees with clear messages of

and many others procurement functions

why we are changing, how we are chang-

the world over: the COVID19 pandemic.

ing and what value we (and they) will gain

The disruption from the pandemic is still

from such changes. Today, we are in a

being felt to this day, but we have seen

very good position with a mature level

over the last 12 months how procurement

of acceptance and buy-in of our change

has helped many overcome and mitigate

journey both internally and externally and

some of these challenges, so what has 13


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Elm’s own procurement journey done for the business in this regard? “We are far more mature as a procurement function than we were three or four years ago. And we have reached a very acceptable level of maturity and satisfaction for what we’ve done,” he says. “But I am a big believer in improvement. We have to improve every time. We are welcoming and hunting for more opportunities and more challenges for better improvement. When Elon Musk, CEO of Tesla, participated and decided to invest in the spaceship business, he came up with a solution for SpaceX with a cost that was $300 million cheaper than the standard Space Shuttle. The improvement can never end. There is a space to improve things. With the pandemic, changes happened and we had to deal with them. We had to change our methodology and improve our services, because everything changed so rapidly. Unbelievable things happened last year and we needed to work with

checks for all internal and external activities. Like many, Elm found itself looking at spend as either a

these changes and get the best results

cost centre or profit centre, determining

out of these dilemmas.”

which spend it had to keep to maintain its

Cast your mind back to early 2020 and

corporate activities. This can be, and was,

nobody could anticipate that the world

a difficult process of having to consider

would face such a challenge. The role of

which spend Elm needed to adapt, which

procurement for Elm was very important

projects it could spend more and invest

in order to maintain the spend in each

in, and which projects it would have to

organisation, to keep the cash flow and

slow, or even, stop the spend. It’s here

to participate in major analysis and health

where the work Elm has achieved as part

E l m: C han g i n g th e game of p rocurement


of its transformation journey allowed it to get through what could have been, and indeed was, a difficult time. “These things cannot be decided very

feel the true value

easily unless you have a collaborative

of what Elm is as a busi-

effort from all of the areas of the busi-

ness, not just as procurement.

ness,” he says. “Because of our process

Being seen as a driver of activities

and our model, we were able to work with

that brought real value for people within

our vendors and clients in order to iden-

Saudi Arabia and sometimes outside,

tify and outline the best way forward for

during the pandemic, shows that what we

all involved.In many ways, it opened the

do as a business and how we do it goes

door for more opportunities. We played a

far beyond improving our bottom line or

key role in the distribution of the COVID19

focusing on cash flow.”

vaccination project and were central play-

As a procurement function, partner-

ers in mass testing projects across the

ships and the supplier relationship model

Kingdom. These are projects that we can

can be the ultimate deciding factor when 17


it comes to success and successful outcomes. For Elm, the strategic relationships it had in place with its strategic partners long before the pandemic were a testament to the value it placed in those partners. As the pandemic hit and attention turned towards unique challenges with a varying degree of complexity, Alblaly knew that he and Elm could depend on these partners to go above and beyond in order to deliver. “We worked together with the Saudi Ministry of Health and our partners to prepare, for example, the vaccination centers across Saudi Arabia. This required a 24 hours workdah from all the resources in this project, including the procurement, in order to maintain the needs and the demands of these centres,” he says. “When the call went out for these centers to be built, there were a matter of days to build it, to prepare it, to hire people and to provide the supply chain necessary in order to run these vaccination and test centres,” he explains. “I’m incredibly proud that, together with our customers and partners, we could achieve this. All these activities were done with alignment and partnership with our partners in a very short time in a very tough environment. This alignment, and the success, would not have been possible without the work we have been doing E l m: C han g i n g th e game of p rocurement

“ I am a big believer in improvement. We have to improve every time. We are welcoming and hunting for more opportunities and more challenges for better improvement.” — A h med A . A lblaly D i re c to r, P ro c ure m e nt an d C o ntrac t of E l m


externally in a world where face to face engagement has been limited. So what does the future hold for Elm and how has the last 12 months shaped and reshaped its procurement roadmap? “With the pandemic, everything changed and so what we are targeting overall in the end is to reap the benefits of these changes. We are adopting now, for example, remote working as an option for the business (and maybe permanently in the future as a way of work), which is now made possible thanks to the changes we’ve made this last year,” he says. “There’s also the digitisation angle, which is something that was on the radar prior to the pandemic, but has of course accelerated during it. to foster and maintain those strategic

So, we’re trying to increase the level of

relationships. What we achieved now, will

the digital communication and processes

act as a catalyst for future successes.”

with our vendors and clients.

As Elm, and the world, navigates its

“But I guess the main goal from all

way out of this pandemic and into the

of this is agility and flexibility. We see

new normal it can do so with a manner

that we can improve and adjust our

of confidence in its own abilities. The

operating model to quickly react and

procurement journey has, perhaps, faced

adopt any changes in the future. As I

its biggest test, and so the future looks

mentioned before, there’s always room

to be one of hope for the business as it

to improve and to challenge your think-

continues its procurement transforma-

ing. That’s the key to realising new

tion. Key lessons have been learned from

opportunities for both procurement and

the pandemic around data and the role

for the wider business.”

it plays in risk management and compliance, remote working conditions and how we communicate both internally and 19



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