GM Holden saved $2.3M in the first twelve months, with ongoing direct cost savings and efficiencies being realized through use of an integrated IT system for supplier audit management and overall supply chain pipeline visibility.

BACKGROUND

Under parent company General Motors Corporation in the United States, GM Holden in Australia specialises in the manufacture and distribution of motor vehicles, engines, components and parts both to the domestic & export markets, together with local initiatives towards innovation such as safety, in-car IT systems and alternative propulsion systems.

With production of over 150,000 vehicles, GM Holden possesses 18% of the Australian market as a leader in passenger vehicles, light commercial, sports utility and high performance special vehicles through to luxury brands, together with an additional 60,000 vehicle and 200,000 engine exports into Asia Pacific, Middle East, North America and Europe.

BUSINESS CHALLENGE

Independent supplier invoice audit, validation and centralised management and control to deliver cost savings, optimisation and pipeline reporting

In an environment of tough competition and cost pressure, increasing product volumes and use of over 50 different suppliers for import and export activities, GM Holden struggled with its limited systems and internal resources to manage multiple forms of manual invoicing and supporting documentation. With over 4000 transaction lines a month and an expenditure of over $70 million, the task of checking and validating its supplier charges against purchase orders, contractual agreements and related accounts payable functions, meant that a solution was required by an independent party to assist GM Holden’s global purchasing body.

With information on its supply chain pipeline activity fragmented across multiple supplier manual paperwork, use of over 100 different codes and methods of charging, this company needed the ability to accurately measure its pipeline costs, control its purchasing activity and realize potential for significant optimization and efficiency gains, through centralised reporting, analysis and data management.

SOLUTION

Infoactiv’s Loginet system for processing, validation and data management of all logistics supplier activity, and access to Infoactiv’s expertise within its Data Centre Team

Armed with the task of outsourcing the management of its supplier invoicing and related data and reporting processes, the company sought an independent provider, with a much desired arms length relationship to all its current purchasing and logistics activity. Partnering with an innovative company, whose investment in its customers and commitment to delivering results, was a major factor in ensuring the company met its objectives in the shortest timeframe possible. With agreement by both parties to launch into a new area and conduct an initial pilot program, whilst continually driving process and cost efficiencies and commitment to elevate the standards of the industry, a successful alliance was created with a measurable return on investment.

Infoactiv is an award-winning Multi-Party Logistics company (MPL) that provides customer-focused, quality logistics management and IT systems solutions, enabling customers to concentrate on their core business activities with greater ease and confidence.

“We communicated to our customer’s supplier network that a change was required in its traditional invoicing and documentation processes and management approach. This enabled us to initially focus on any low hanging fruit that could deliver the savings we believed existed, simply by introducing a centralised, controlled system” says Helen Jarman, Managing Director, Infoactiv Group.

“We then applied our own expertise, reporting systems, modeling and audit principles throughout the network to realise further savings in detention and storage, taxation, shipment routing and so on, all in the first quarter”. Enhanced automation and further process and cost efficiencies are now in focus.

“We are there not only for our customers’ benefit, we are also there to very much assist with the suppliers’ ability to provide the customer with information and to speed up processes, ensuring supplier payments are accurate and timely”.

The Loginet system houses all International and Domestic customer pricing including a myriad of additional fees and surcharges, rate agreements, zone information, asset and inventory detail, purchase order data and other logistics activity, to enable both the Data Centre and the Logistics Helpdesk to conduct various supply chain programs for customers. This system, together with our real time exception management tools and breadth of services, make Infoactiv an integral partner to any customers’ logistics strategy.

BENEFITS

Direct cost savings and strengthened relationships with suppliers to deliver greater customer satisfaction

One of the key benefits realised was significant cost savings through a controlled and fully audited system. Of equal importance was the benefits achieved through centralisation and visibility, an ability to measure, analyse, benchmark and negotiate logistics services, effectively tightening up processes both internally and externally for the future.

As a supporter of innovation and competition with a desire for independent relationship, GM Holden didn’t have to sacrifice its ability to take advantage of market offerings in order to achieve consolidation and centralisation of its activities.

“Infoactiv is now a trusted partner providing valuable services to a market dominant and respected automotive company. From the start of the relationship through to where it exists today, we have been responsive, flexible and most of all proactive in our dealings with GM Holden to ensure costs of our service are kept in check as volumes increase, and more importantly that the net value and net gains realised by the customer remain significant and easily measured, month after month”.

THE FUTURE

Infoactiv’s model has already been leveraged across other divisions and business units, and is flexible enough to extend across both the company’s International and Domestic logistics environment, for total supply chain pipeline visibility and cost control. The ongoing requirement is the continued supplier logistics audit processes, B2B links and automation with the Top 5 suppliers and majority of volume, together with focus on proactive initiatives to continually deliver efficiencies and improve GM Holden’s internal and external relationships and customer satisfaction.

Infoactiv’s commitment to delivering customer satisfaction, measurable return on investment and more and more value-added services and technology, means this partnership is successful long term, ensuring capabilities and solutions continually align with the customer’s strategic and business needs.

For more information on Infoactiv’s products and services, please email info@infoactiv.com.au

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