Transcript EADS The step beyond

EADS
Procurement Talent Management
Maria Granero
EADS Defence & Security
Head of Procurement Projects, Spend Map & Reporting
Archamps, 07/12/07
EADS at a Glance: A Global Leader
Commercial Aircraft
No. 1
Helicopters
No. 1
Commercial Launch Vehicles
No. 1
Missile Systems
No. 2
Satellites
No. 3
Military Transport
No. 3
Military Air Systems
No. 4
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EADS Management Structure
Finance
Strategy &
Marketing
Chief Technical
Officer
EADS North
America
Human
Resources
Operational
Performance
Hans-Peter Ring
Marwan Lahoud
Jean J. Botti
Ralph D. Crosby Jr.
Jussi Itävuori
Fabrice Brégier
Rüdiger Grube
Chairman of the Board of Directors
Louis Gallois
Chief Executive Officer
Airbus
Military
Transport
Aircraft
Defence &
Security
EADS Astrium
Eurocopter
Tom Enders (CEO)
Fabrice Brégier (COO)
Carlos Suárez
Stefan Zoller
François Auque
Lutz Bertling
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EADS Revenues by Divisions
as of March 07
Revenues in million €
By Division
Airbus
2006
2005
25.190
22.179
Military Transport
Aircraft
Eurocopter
2.200
763
3.803
3.211
Astrium
3.212
2.698
Defence & Security
5.864
5.636
-2.092
1.257
-1.436
1.155
39.434
34.206
Headquarters Consolidation
Other Businesses*
Total EADS
*ATR, EADS EFW, EADS Socata, EADS Sogerma Services
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EADS Procurement
Organisation
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EADS PDB
Procurement Directors Board
Airbus
Military Air
Systems
ATR
Defence &
Security
Defence &
Communication
Systems
EFW
Eurocopter
Defence
Electronics
Socata
Astrium
MBDA
Sogerma
Military
Transport Aircraft
Test & Services
HQs Procurement
& Services
EADS Business Units
EADS Divisions
CPO Council
Chief Procurement Officers
EADS Procurement Talent Management
Process
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1) Definition of profiles
Definition of profiles at Procurement
functions according to job descriptions
2) Skills assessment
Skills assessment as part of annual skills
assessment or employee job review
3) Identification of gaps
Compare results of annual skills
assessment to defined profiles
4) Corrective initiatives
Definition of training programmes and
selected corrective initiatives
5) Monitor effectiveness
Regular review of the effectiveness of
training programmes and initiatives
EADS Procurement Talent Management
Process
1) Definition of profiles
2) Skills assessment
3) Identification of gaps
4) Corrective initiatives
5) Monitor effectiveness
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Definition of profiles at Procurement
functions according to job descriptions
1) Definition of profiles
Definition of profiles according to job descriptions
EADS Procurement population in 2006 was 2.400 employees.
Strategic Sourcing
Procurement
Purchasing
Director
1)
Head of
department
2)
3)
Senior Manager
4)
5)
6)
7)
8)
10)
11)
Manager
Staff
Support functions
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9)
12)
EADS
Corporate
Sourcing
Focus
EADS
Divisions
&
Business
Units
Focus
1) Definition of profiles
Relation between General Management and Professional Skills
Procurement Director
Head of Department
Senior Manager
100 %
Management
Skills
0%
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Professional
Skills
Management
Skills
Professional
Skills
Management
Skills
Professional
Skills
EADS Procurement Talent Management
Process
1) Definition of profiles
2) Skills assessment
3) Identification of gaps
4) Corrective initiatives
5) Monitor effectiveness
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Skills assessment as part of annual skills
assessment or employee job review
2) Skills assessment
Required Management Skills Profile
Head of Department / Strategic Sourcing
General Management
1) Strategy / Business Development
2) Supply chain management
3) Finance
4) Sales / Marketing
5) Quality Management
Leadership
1) People leadership
2) Customer focus
3) Relationship Management
4) Cross cultural skills / languages
5) Entrepreneurship
Operations
1) Project Management
2) Engineering / Product knowledge
3) Change Management
4) Market knowledge
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Basic
Working
Fully
Leading
Edge Operational Knowledge Appreciation
Basic
Working
Fully
Leading
Edge Operational Knowledge Appreciation
Management
Skills
2/3
Basic
Working
Fully
Leading
Edge Operational Knowledge Appreciation
2) Skills asessment
Required Procurement Skills Profile
Head of Department / Strategic Sourcing
Procurement Skills
Leading
Fully
Working
Basic
Edge Operational Knowledge Appreciation
1) Supply market intelligence and analysis
Considering: - Identify potential suppliers assessing industrial capabilities & financials,
- Analyse market trends and build cost models for commodities.
2) Sourcing strategies development
Considering: - Develop sourcing strategies for commodities.
3) Procurement policy definition
Considering: - Identify risk and opportunity elements,
- Define adequate contractual terms and conditions.
4) Supplier selection
Considering: - Identify, compare & select suppliers to maximise business value added,
- Assess total cost of ownership and key cost drivers.
5) Supplier contractual relationship management
Considering: - Negotiate and implement contractual frameworks with suppliers,
- Assess risks elements and select appropiate terms and conditions.
6) Supplier performance management
Considering: - Implement supplier evaluation and development processes,
- Work out short term recovery plans and set development targets.
7) Supplier's innovation and technology implementation
Considering: - Ensure early supplier integration,
- Propose new technical solutions available in the market.
8) Optimise supply chain performance
Considering: - Identify business supplier innovation & support standarisation initiatives.
9) Sourcing processes optimisation
Considering: - Set up procurement processes and implement e-procurement tools.
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Professional
Skills
1/3
EADS Procurement Talent Management
Process
1) Definition of profiles
2) Skills assessment
3) Identification of gaps
4) Corrective initiatives
5) Monitor effectiveness
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Compare results of annual skills
assessment to defined profiles
3) Identification of gaps
Current Management Skills Profiles in Procurement
Executive Results
Senior Managers Results
100
100
80
80
60
60
40
40
20
20
0
0
Results
orientation
Leading
edge
People
leadership
Diversity
management
Customer
focus
Results
orientation
Leading
edge
People
leadership
Diversity
management
Customer
focus
Conclusions:
• Strengths: Results orientation, Expertise and Customer orientation
• Development needs:
- Senior Managers: Diversity management and People leadership
- Executives: People leadership
• Analysis shows very few Executive potentials for Procurement functions:
Succession Planning in procurement function is an issue!
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EADS Procurement Talent Management
Process
1) Definition of profiles
2) Skills assessment
3) Identification of gaps
4) Corrective initiatives
5) Monitor effectiveness
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Definition of training programmes and
selected corrective initiatives
4) Corrective initiatives
Managers - Procurement Managers Development Programme
• Objective
Prepare procurement managers with potential for future sourcing challenges:
- Improve the capacity to understand and implement strategic sourcing issues,
- Increase awareness of state-of-art sourcing methods & tools,
- Develop and promote exchange of best practices accross Business Units.
• Target population (180 participants ~7% of total procurement population)
- EADS Managers with potential or recently nominated Senior Managers (25
participants per edition),
- Participants from EADS top suppliers (5 participants per edition).
• Frequency
- Yearly (10 training days) with currently closing 6th edition of programme.
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4) Corrective initiatives
Managers - Procurement Managers Development Programme
• Content
- Sourcing strategy: commodity strategy, future trends, global sourcing,
- Sourcing tools: Supplier evaluation, eSourcing, sourcing risk management,
- Sourcing practices: legal aspects in procurement, TCO, KPIs,
- Visits to EADS procurement departments & external companies presentations.
• Best practice projects
- Participants work in groups in selected best practice projects,
- Final presentation of results and recommendations to EADS CPO Council.
• Organisation
- Organised together with EADS Corporate Business Academy,
- Participants nominated and selected by Procurement Directors & BUs HR.
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4) Corrective initiatives
Lead Buyers - Support: Training & Collaborative tool
• Professional training
Yearly training with the objective to support EADS Lead Buyers in the areas of:
- Commodity strategies,
- Supplier risk assessment,
- Global sourcing.
• Personal training
Yearly training with the objective to support EADS Lead Buyers in the areas of:
- Change management,
- Project management,
- Virtual and remote team management.
• Collaborative tool
- Introduction of a collaborative tool (based in eRoom technology) to support
Procurement Synergy Groups.
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4) Corrective initiatives
Senior Managers - Procurement for Procurement
• Objective
Scope of responsibilities has grown. To meet future challenges, it is required:
- Change Management,
- Excellence in Leadership & People Management,
- Intercultural Competencies.
• Target population (28 participants)
- Senior Managers reporting to Procurement Directors,
- High Performers with potential for promotion,
- Selected and nominated by Procurement Directors and Business Units HR.
• Frequency
- 1 time programme in 2005 to closed the skills gap,
- Following years integrated into Corporate Business Academy programmes.
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4) Corrective initiatives
Executives & Senior Managers - Procurement job rotation
• Objective
Enhance mobility within EADS Group, functions and locations through the
exchange of information regarding: open positions, potential candidates and
preparation of succession plans.
• Target population
Executives & Senior Managers below Procurement Director level.
• Frequency
- 1 Round yearly for Executives,
- 2 Rounds yearly for Senior Managers.
- Organised from 2005 to 2006.
• Organisation
- EADS Management Development and EADS Corporate Sourcing.
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EADS Procurement Talent Management
Process
1) Definition of profiles
2) Skills assessment
3) Identification of gaps
4) Corrective initiatives
5) Monitor effectiveness
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Regular review of the effectiveness of
training programmes and initiatives
5) Monitor effectiveness
Procurement Managers Development Programme
2002-2005 PMDP Participants Survey Results
How much did the PMDP supported you to …?
My understanding of the strategic
sourcing challenges facing EADS
My ability to think more globally about
my business
0
20%
6%
22%
6%
30%
16%
No Extent
A Little Extent
Some Extent
A Great Extent
A Very Great Extent
50%
My understanding of sourcing best
practices and experience across BUs
15%
0
5%
No Extent
A Little Extent
Some Extent
A Great Extent
A Very Great Extent
50%
PMDP was valuable to me personally
0 5%
25%
25%
25%
55%
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No Extent
A Little Extent
Some Extent
A Great Extent
A Very Great Extent
55%
No Extent
A Little Extent
Some Extent
A Great Extent
A Very Great Extent
5) Monitor effectiveness
Procurement Managers Development Programme
2002-2005 PMDP Participants Survey Results
Your Management Level before
beginning PMDP
40%
Your Management Level today
40%
40%
55%
5%
20%
Manager
Manager
Senior Manager
Senior Manager
Other
Other
Conclusions:
Programme supported the career development of participants:
- To develop strategic understanding of sourcing challenges,
- To think globally about EADS businesses,
- To exchange practices with other Business Units.
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5) Monitor effectiveness
EADS Key Performance Indicators
Dimension
KPI
Definition
VALUE
Savings target achievement
US$ Sourcing
Payment Terms
EADS Frame Contract Coverage
Commodity Strategy Coverage
RFX-Automation
Order Automation
Sourcing Volume controlled by Proc’t
Supplier Evaluation Coverage
Supply Base Performance
Supply Base Profile
Global Sourcing
Training
 Savings generated by Procurement projects/ Spend Baseline
PROCESS
SUPPLY BASE
MANAGEMENT
HUMAN
RESOURCES
 US$ Sourcing/ Total Sourcing
 (Payables (in €)/Cost of Sales (€/year)) * 365
 Vol. PO covered by valid EADS frame contracts /Total vol. PO
 Sourcing vol covered by material group strategy/Total sourcing vol.
 Number of e-Rfx
 Number of manual PO/ Total number of PO line
 Total value of invoices paid via PO/Total value of invoice paid
 Vol. of suppliers covered by supplier evaluations /Vol. of suppliers
 Sum supplier performance ratings/Best possible performance
 Aggregated sourcing volume/Number of suppliers
 Sourcing volume in defined countries
 Sum training days conducted in period/Nr of all members of within
procurement organization at defined date (e.g. year end)
Mobility
Potential Ratio in Procurement
 Nr of employees in procurt with experience in other functions or
country /Nr of all members within procurement organization at
defined date (e.g. year end)
 Quantity of potentials in procurt/Total quantity of procurt
employees
INT CUSTOMER Customer Satisfaction
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 Survey
Conclusions
• Support the development of the procurement function from
operational to more strategic role and activities,
• Update procurement employees toolbox to ensure continuous
cost reduction and demand management achievements,
• Adapt to supply market changes
(e.g. global sourcing, e-procurement),
• Address every procurement community according to their
different needs,
• Involve the supply base, in order to address together the
challenges related to procurement
Increased attractiveness of the procurement function
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