ExxonMobil
Optimizing business processes for the future of energy.
Overview
The need for energy is universal. That's why ExxonMobil is pioneering new research and pursuing new technologies to reduce emissions while creating more efficient fuels and lubricants. ExxonMobil is committed to responsibly meeting the world's energy needs. In this spirit of innovation, ExxonMobil’s procurement organization is continuously looking for ways to drive business value by making buying faster and more cost effective and ensuring the best user experience for internal clients.
A leading energy company requires innovative procurement
ExxonMobil’s procurement organization is global, serving 80,000 internal users in more than 40 countries on six continents. In 2018, ExxonMobil spent more than $25 billion in capital and exploration expenditures. That same year, payments were made to more than 100,000 suppliers of goods and services worldwide. At this scale, the company’s procurement teams continually look for new opportunities to decrease cost, reduce cycle time, and enhance user experience.
Nassim Kefi, Procurement Advisor at ExxonMobil, sees himself and his colleagues as being at the forefront of an innovation pipeline, one filled with both short- and long-term opportunities. In his view, it’s critical that he and his team look beyond the horizon to ensure their pipeline is full of opportunities to streamline operations and that they proactively identify and find solutions to potential barriers. That’s what brought them to consider e-commerce solutions and choose Amazon Business to help accelerate their procurement digital transformation.
Like many enterprise customers, ExxonMobil started their Amazon Business journey buying office supplies. They quickly expanded to other commodities, such as industrial supplies and maintenance, repair and operations (MRO), which represent significant spend for an energy company.
“At our scale, every percentage point counts. When you save thousands of dollars on each transaction, considering the sheer size of our procurement organization and our purchasing activities, it adds up fast," said Kefi. “And that’s why we’re aggressively rolling out e-commerce solutions such as Amazon Business in North America, Europe, and beyond, because of this buying channel’s superior value proposition.”
Beyond business selection and prices, Kefi and his team take advantage of Amazon Business Prime features such as Guided Buying to help users select company-endorsed products, and Spend Visibility to gain visibility and control of company-wide spending.
Additionally, they’re able to easily find and buy from suppliers with diversity certifications on Amazon Business. “Working with diverse suppliers creates new perspectives, ideas and practices that help grow our business. In 2018, we spent more than $2.2 billion with diverse suppliers and small businesses just in the United States—an increase of more than 15 percent from 2017," said Kefi. “Additionally, instead of deliveries spread out throughout hours, days, and weeks, we get them delivered across all of our locations on a dedicated Amazon Day that we selected based on our shipping preferences,” said Kefi. “Free delivery through Business Prime is also a major advantage. Otherwise, an average package costs roughly $7.50 to deliver via postal services. Multiply that by the many thousands of monthly deliveries in the US alone, and that gives you an idea of the shipping cost savings with free Amazon delivery.”
“At our scale, every percentage point counts. When you save thousands of dollars on each transaction, considering the sheer size of our procurement organization and our purchasing activities, it adds up fast. That’s why we’re aggressively rolling out e-commerce solutions such as Amazon Business in North America, Europe, and beyond, because of this buying channel’s superior value proposition.”
— Nassim Kefi, Procurement Advisor, ExxonMobil
Leveraging Amazon Business for digital transformation
The move to digital is no longer a question of if, but when, for procurement leaders like Kefi. According to a recent study, the majority of procurement leaders are already in varying stages of digital transformation. Some 84 percent of procurement executives are in the midst of sourcing solutions, and 50 percent consider their transformation either nearly or totally complete.1
“When I first started in procurement more than ten years ago, we were using the same systems dating from the 1980s. We still relied on paper, and the process of purchasing wasn’t as efficient as it is today,” said Kefi. “But if your organization is serious about delivering superior value to customers, you have to be leaders in digital transformation and you have to be ahead of the curve. Amazon Business is an integral piece of this transformation.”
For ExxonMobil, the transformation includes integrating Amazon Business into their e-procurement system, Smart by GEP (known internally to ExxonMobil as "BuySmart"), one of more than 110 e-procurement systems Amazon Business integrates with. This integration, known as punchout, gives users a seamless experience between their existing e-procurement system and the Amazon Business store.
ExxonMobil saw a significant increase in Amazon Business usage in a short span of time through both purchasing cards and through the e-procurement system. The number of users increased from zero to many thousands in mere months. According to Kefi, users naturally gravitated towards Amazon Business as a purchasing channel because of their familiarity with the Amazon experience in their personal lives.
“We didn’t have to push too hard for adoption within the company—the growth was organic," Kefi explained. “For our users, there was no change in what they were used to, as a lot of the work was being done in the background. We didn’t compromise our approval system, didn’t reinvent the wheel, or drastically change any of our existing systems. Instead, we seamlessly integrated Amazon Business with our purchase-to-pay ecosystem to order what we need in a scalable way.”
"If your organization is serious about delivering superior value to customers, you have to be leaders in digital transformation and you have to be ahead of the curve. Amazon Business is an integral piece of this transformation.”
— Nassim Kefi, Procurement Advisor, ExxonMobil
Guest post: How ExxonMobil’s procurement team was prepared for business continuity
Digital implementations such as cloud storage and purchasing automation not only improve global operations, they prepare us for unexpected disruptions.
