Business Intelligence Best Practices - BI-BestPractices.com

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2007 Best Practices Award Winner: DaimlerChrysler AG
In a similar fashion, GPSIS is an SRM—Supplier Relationship Management—system that provides a basis for managing the company’s relationship to its suppliers.

Category: Enterprise Business Intelligence (EBI)

DaimlerChrysler (DCX) is a global automotive manufacturer formed by the merger of Daimler-Benz and Chrysler Corporation. Procurement at DCX is part of an organization called Global Procurement and Supply (GP&S), and is extremely important to DCX because approximately $100 billion is spent annually on parts and services. Cutting these costs by even a small percentage generates large benefits.

After the merger, operational systems for creating purchase orders and paying suppliers could not be commonized quickly, so it was decided to build a DW for combining the procurement summary data. The result is the Global Procurement & Supply Information System (GPSIS), which has grown far beyond the original vision.

Business Impact

GPSIS aids in global negotiation, thereby facilitating achievement of lower costs and higher quality of purchased parts and services.  The annual corporate goal for reducing purchased part costs exceeds $1 billion, and GPSIS is key to meeting that goal as it is already credited with helping create savings of millions of dollars.

 Maturity

GPSIS began as a globally available DW with structured Web-based reporting and has evolved into a fully functional BI platform with strategic planning applications.

The original concept was merely to understand how much business we did with each supplier. This provides leverage for negotiating lower prices based on the full global value of business (VOB) across commodity groups.

We then needed a way to consider the other aspects of TCO (Total Cost of Ownership), since choosing a supplier is more than finding the lowest price. It was decided to use the GPSIS DW as a foundation for Balanced Scorecards, to track supplier performance globally.

The next steps for the system are to support both Daimler and Chrysler corporations as they proceed down their separate ways.  Management at both companies has expressed a strong desire to retain GPSIS functionality for their respective global purchasing operations. 

Innovation

CRM applications are all about providing a basis for managing a company’s relationship to its customers. In a similar fashion, GPSIS is an SRM—Supplier Relationship Management—system that provides a basis for managing the company’s relationship to its suppliers.