bp is one of the largest and oldest oil and gas companies in the world; headquartered today in London, England. As an integrated energy business with operations in Europe, North and South America, Australia, Asia and Africa, bp serves customers world-wide. bp’s global products and services are namely providing heat, light and mobility to customers all over the world, with a purpose of reimagining energy for people and the planet. By 2050, bp has set out to be a net zero company all while continuing their enormous operations worldwide.
bp’s enormous scale of operations produces an incredibly complex system. The company’s supply chain spans the globe, incorporating functions as varied as drilling for oil, to constructing wind turbines, to operating retail storefronts. In this environment, the procurement team needs to manage spend ranging from billion-dollar specialist equipment to the receipt rolls in cash registers. Over the last 18 months, bp lost 25% of the organization. However, they still needed to produce the same quantity and quality of work, resulting in a massive gap.
“Sourcing and contract negotiations can be quite a manual process,” says Nicholas Wright, Director, Digital and Innovation at bp who is responsible for the way in which bp approaches the market in the digital and innovation space. “It requires careful attention at every step of the process—from capturing and sending the requirements out to suppliers to have them bid on particular requirements or scope, to the selection of a final vendor and the activities required to on-board them. It's an incredibly time- and resource-intensive process.”
bp’s legacy procurement systems and inefficiencies within their manual sourcing processes were resulting in frustration among teams and stakeholders. Bp turned to digital innovation as an opportunity to combat not only their manual processes, but also bridge the gap with their 25% reduction in workforce.
bp not only wanted to free up resources to concentrate on value-added procurement activity, they also wanted to ensure they were making the best use of the digital tools available within the marketplace. To do this, bp wanted to be able to both automate as much of the process as possible, as well as monitor and analyze their procurement data at a granular level.
For bp, the introduction of Fairmarkit allowed them to “complete those requirements without the people there. And for us that has been massive to unlocking the efficiency targets that were achieved through the platform and also the reduction in cycle,” says Nicholas Wright. By working with Fairmarkit to automate processes, bp’s procurement team was able to deliver the same scope automatically that was previously done manually.
Alongside the implementation of Fairmarkit, bp’s main objectives were to make their RFx processes more efficient, reduce their cycle time and save money. Wright says that “Fairmarkit has allowed us to do the same amount of work but with less people and what we’ve been able to do is repurpose those people onto more high-value tasks as opposed to transactional day-to-day activities.”
In the last 18 months alone, bp has put $1.2B of spend through Fairmarkit. Wright’s focus on automating manual and low-value transactions has resulted in bp actively sourcing $100M via automated processes, requiring zero human intervention.
“Before Fairmarkit we had a very manual sourcing process and it took time and what that caused was frustration with our stakeholders. What Fairmarkit has allowed us to do is complete those requirements without the people there. And for us that has been massive to unlocking the efficiency targets that were achieved through the platform and also the reduction in cycle. So for example, we have taken our cycle time down by about half and what that means in real terms is our stakeholders get their work and their product and services about 50% quicker,” says Wright.
Beyond achieving Wright’s identified goals of meeting efficiency targets, reducing cycle time, and cutting costs, bp is incredibly committed to using Fairmarkit’s data and intelligence for their DEI initiatives (Diversity, Equity, and Inclusion).
“The data that Fairmarkit has provided is really the key to the tool. We have never had data like it. DEI is really important to us in bp and it’s something we’re really passionate about within procurement. What we’ve been able to do is work with our category management organization using that data to figure out where we need to bring more diverse suppliers into the mix,” says Wright.
Fairmarkit’s integration with bp has served another benefit. “It has pushed the boundaries,” Wright says. “At bp, it was one of our first significant digital platforms, and it is disrupting the way that we work within procurement; it’s actually made people stand up and realize that we can do things differently. As a team and a company, we’re inspired to go out and look for the next Fairmarkit, whatever that may be, and be more aware and open to disrupting other manual processes.”
Fairmarkit gave SDI the data and visibility necessary to deliver the most value to their customers