The chain is only as strong as its links
Development projects are complex and rely on a large ecosystem of up to 200 suppliers and subcontractors. If just one fails it can have a knock-on effect delaying the project and potentially causing reputational damage for Lendlease and its client.
Up until recently, understanding the financial health of every supplier has been a complex and time-consuming business and with data often months out of date its reliability was questionable.
Accurate data fully integrated
The challenge was not just about obtaining accurate financial data. It was also about integrating it in one place, and creating a single view or dashboard that was easy to use - not just for the procurement team, but the wider community of accountants and commercial managers within the organisation. The existing approach had been time-consuming and was very much a box ticking exercise with data that was not as meaningful and actionable as it needed to be.
What Lendlease wanted to do was build a single Supply Chain Information Portal, SCIP, which integrated multiple information sources including due diligence financial data.
“It’s probably one of the quickest turnarounds that we’ve had from an existing supplier to a new one. Normally these things can take a very long time to move.”
Fast, Fit-for-Purpose and Financially Competitive – The Winning Factors
From the outset, FullCircl provided a more flexible, ‘can do’ relationship. Other providers wanted Lendlease to use their dashboard, but FullCircl were happy to adapt theirs to the way Lendlease wanted to have the data displayed. The API was a key part of this, but there was also the willingness of the FullCircl team to provide a format which could be combined with other datasets.
These factors resulted in one of the quickest turnarounds from an existing supplier the procurement team had experienced, without the need to find extra budget to implement the system.
Accessible and All in One Place
Lendlease had been using a number of suppliers for different sources of information but knew they weren’t realising the full potential of what was available in the market. As you would expect with procurement specialists, the commercial terms were high on their evaluation criteria. Equally important was the API and the technical know-how and flexibility of the provider. The selection criteria very quickly narrowed down the list to their incumbent supplier and FullCircl.
“Commercial managers love it because it saves them time. But for procurement, it ensures they’re using the system, they’re following the correct procedure, they’ve got the right information at the right time to make the decision, and then we capture the information of who has currently bid on our projects. That then feeds back into our potential exposure in the future. Whereas previously we’d have 40 projects ongoing, but we wouldn’t necessarily know who was bidding on which project.” Andy Fulterer, Head of Supply Chain, Europe
Many Suppliers. One Unified System
FullCircl data now confirms the supplier company registration and other core details for accurate and rapid cross-checking with other data. This includes ratios, credit risks and other financial analysis which help the team rapidly assess the financial stability of a supplier. The integration with SCIP brings together 6 or 7 previously separated information feeds from a database of more than 1,600 suppliers and sub-contractors. Being able to integrate systems such as Oracle Purchase to Pay is another huge benefit enabling an instant view of current spend, turnover data and other key financial measures. One specific message that keeps coming through from users right across the company is the usability of the system thanks to the intuitive interface.
Beyond the Construction Supply Chain
“Our previous supplier evaluation was a very standalone, tick-a-box exercise that was taking time and that potentially wasn’t adding as much value as we would have liked.”
New technology – New opportunities
SCIP gained instant uptake by the Lendlease procurement team. Thanks to FullCircl’s API and flexible approach, integration was fast and the benefits were quickly realised. The initial business case identified savings of 3-4 man days per project, but in practice these were doubled. It was also rapidly adopted by Commercial Managers handling bids for future projects, enabling procurement to see what new projects current contractors were bidding on, meaning they could use this insight as leverage during negotiations for future business.
Right Information. Right Time. Right Supplier
Portal information, enriched by FullCircl financial data which is continuously being updated, gives a clear, current picture of the supply chain ecosystem’s financial health. More than supplier profiles in isolation, it shows which companies are bidding on Lendlease projects, their relative exposures, and the degree of potential risk each one poses.
New Directions and New Possibilities, Enabled By FullCircl
The new approach to supplier data brings consistent best practice as well as improved information. This is valuable in many key areas, including anti-money laundering (AML) and know your customer (KYC) compliance, as the company develops direct sales to retail property investors.
Bidding Farewell to ‘Best Guess’ Decisions
Lendlease is already building on SCIP’s core functionality. One application is ‘Bid List’. This splits the complex construction process into ‘packages’, ranging from work needed before laying foundations through to final fit-out. On a substantial project, there could be as many as 40 packages, with up to 5 potential suppliers bidding on each. The total due diligence task could therefore involve as many as 200 different companies.
From 3 weeks to 60 Minutes
The new system helped produce a due diligence report that previously took three working weeks in just one hour. The time saved is spectacular. And each report now stays current, without needing manual updates: “Say a month later an up-to-date version of that bid list is needed, we don’t have to put all 200 companies in again and re-do all those checks. Now, all we do is hit refresh. That pulls the information live from FullCircl, and the other sources, and it’s updated in seconds. You can’t understand how beneficial that is for the company”.
More Data, More Information, More Accurate Decisions – In Less Time
Managers can track suppliers’ financial profiles at a glance with up-to-date data. The final decision in a selection process that may have started a year ago, is based on the most current information, not based on information that is 6 months – or even 6 weeks – old.
“FullCircl is a key part of the whole process. Without you, it wouldn’t work. In terms of understanding what we require, you are streets ahead.”
Andy Fulterer, Head of Supply Chain, Europe