Tuesday, June 16, 2015

Ariba’s digital handshake helps Caesars up the ante on supply chain diversity

The next BriefingsDirect business trends interview focuses on Caesars Entertainment Corp. and how they're transforming supplier discovery and improving their supplier diversity through collaboration across cloud-based services and open business networks.

Learn from Caesars' best practices on how they expand diversity across their supply chain and how that’s been accomplished using Ariba Discovery. We’ll hear first-hand how one supplier, M & R Distribution Services, has benefited from such supplier visibility on the business network.

Listen to the podcast. Find it on iTunes. Get the mobile app for iOS or Android. Read a full transcript or download a copy. 

For the inside story on improved supply chain visibility and access, please join our guests, Jessica Rosman, Director of Supplier Diversity and Sustainability at Caesars Entertainment based in Las Vegas, and Quentin McCorvey, Sr., President and COO of M&R Distribution Services, based in Cleveland. The discussion is moderated by me, Dana Gardner, Principal Analyst at Interarbor Solutions.

Here are some excerpts:

Gardner: What are some of the more difficult aspects of finding the right supplier for the right job under the right circumstances?

Rosman: Oftentimes, our portfolio managers look into their natural networks of suppliers we’ve already used or suppliers who have contacted us, but that can be limiting. Having a wider network or using the Discovery tool on Ariba has allowed us to open up to millions of different suppliers that we haven’t met before and who we might want to do business with us.

Additionally, we do numerous outreach events into the communities in which we operate, so we can find top suppliers and include them in our supply chain.

Gardner: What sort of supplier requirements are there, and has that been changing over the years? Is there a moving target for this?

Rosman: For Caesars, it really depends on the category or commodity that we're searching for. Certain commodities may require larger supply chains or more integrated processes than others. But for all of our suppliers, we're looking for quality, service, and price. That may also include requirements around insurance, delivery time, or other needs to meet those three areas.

Gardner: People are familiar with the Caesars’ name, but your organization includes a lot more. Tell us about the breadth and scope of your company.

Rosman: Caesars Entertainment is the largest globally diversified casino network. We're also the home of Horseshoe, Harrah’s, Total Rewards, Paris, Rio, and obviously, the most famous, Caesars Palace in Las Vegas.

Gardner: Quentin, tell us a little bit about M&R and why getting the visibility from folks like Caesars has been a good thing for you?

McCorvey: M&R Distribution Services, my company, was established in 2008 by my partner Joe Reccord and myself. I came out of banking and had experience and a background of 12 years in banking. My partner has been in the distribution business for over 20 years as a market leader in a regional distribution company. We're primarily focused on distributing products such as disposable gloves. Most maintenance, repair, and operations (MRO) product lines are in our portfolio, as well as personal protective equipment and trash liners.

You asked how this has been important for us or how Caesars’ relationship has been important for us. It has been very important, because, as Jessica said, we found each other through some of their outreach events that they have in the community.

It was through a National Minority Supplier Development Council. My company is a nationally certified minority business. With this networking event and through a matchmaking event, I found someone on Jessica’s team, Bridget Carter, and learned a little bit more about Caesars and the opportunities that happened within Caesars. Then, through further connections, we had some opportunities that led to a strong relationship.

Gardner: What is it about making these connections between buyer and seller that’s easier today? What’s changed in the past several years?

It's about relationships

Rosman: Technology has changed, but some things haven’t changed. At the end of the day, business is about relationships. To start that relationship, there are new ways that we can meet different businesses by doing outreach and having the Ariba Discovery tool, where we can team up buyers and sellers through using Naics codes, UnPsc codes, or other types of codes. Using those, we can find those who want to sell and those who want to buy.

But part of it is the same as it has always been, which is about having that face-to-face connection, knowing that there is a potential relationship and feeling comfortable that that business will deliver on the quality, the service, and the need for the internal customer that there always has been.

Gardner: As to your title, Supplier Diversity and Sustainability, how important is that? How did that come about and what are your goals?

Rosman: Caesars Entertainment has a code of commitment. Our code of commitment is our code that says that we have a responsibility to the community, to the environment, to our customers, and to our employees to be the best that we can be. Under that code of commitment and in line with it is our Supplier Diversity Program. Our Supplier Diversity Program sits within our sourcing office, but also has a dotted line into the Diversity Department overall.

We are in unique areas across the country. When we do outreach within the community, in part it’s because in order for our businesses to grow, it’s important that we find community and local business partners that can meet the 24-hour, seven-days-a-week business that we have.

It’s different than other business types that have a delivery on Monday and don’t need it again until next week. That outreach has allowed us to find small, medium-size, and large businesses that are minority-owned, women-owned, veteran-owned, and other diverse businesses that can meet those needs.

Gardner: Quentin, tell me a bit about how long you’ve been working with Caesars? Is this strictly in Ohio with some of their properties there? Is it expanded across the company? Have you got a beachhead that’s then expanded? What’s the nature of the business you have?
While I didn’t win that opportunity, what I did win was the entrée into a relationship with Caesars.

McCorvey: We initially got engaged with Caesars, as I mentioned, through an outreach program, and through that, an opportunity came up for me to bid on a project with Caesars. Because I had bid on that project, I had to get connected to the Ariba Network. While I didn’t win that opportunity, what I did win was the entrée into a relationship with Caesars. Jessica talked about how a relationship is important, and for minority business, clearly, it’s really about relationship development.

As a minority-owned company, I'm not looking for handout. I'm looking for handshake, an opportunity to earn the business of a customer. I have to prove myself in being able to produce tier 1 pricing capacity and helping in solving pains within the supply chain network. Even with not getting this opportunity, I continued having conversations with Caesars and continued to develop the relationship.

Caesars has a mentoring program, which I was involved in and had the pleasure to become a part of. Through that mentoring program, I was able to sit down with Caesars and discuss certain goals that I wanted to accomplish, not only with my business personally, but also with the business opportunity with Caesars.

Some of those things included meeting the category managers in the categories where I was supplying into the organization and really understanding how to grow my key performance indicators (KPIs), not only directly, but also with Caesars and some of the other opportunities that are there.

Mentoring program

Through this mentoring program, we began to work on the relationship. I began to meet other people within the supply chain more regionally, as well as the national folks -- from Jessica and her team to up and down and across the Caesars organization. That’s been a very important process for me.

That's how we started out. I've gotten, and I'm going to get, opportunities through the mentoring program to start serving the company regionally. There are casinos in Ohio. My primary markets are servicing the Ohio casinos. Then, moving out of the region is a goal, ultimately growing into being a national supplier with all 52 properties within Caesars casinos.

Gardner: How important have Ariba Discovery and the Ariba Network been for you? How did you get on it? Was it easy? And where else have you been able to extend this visibility?
I actually won a couple of opportunities through the system and through the Ariba Network.

McCorvey: I got into the Ariba Network accidentally on purpose. On purpose because I had an opportunity to bid on a national contract with Caesars. When I had that opportunity, I got an invite from the buyer to sign up into Ariba. So I had to put my profile in there in order to bid on the opportunity that was available to me.

I did that, and it was a quick turnaround on the bid. I spent all of my time trying to figure out how to get through this, how to get my profile updated, and how to get the bid engaged.

I didn’t really know that much about the network and how connected the matches were to opportunities. I started seeing alerts and I started seeing, direct opportunities that really connected with my business. Through that, I said let me investigate a little bit further. And when I did, I began to look at some other opportunities. I actually won a couple of opportunities through the system and through the Ariba Network.

When I say "accidentally and on purpose," I guess it was fortuitous that we had this opportunity to bid. Even though it wasn't a win directly with that opportunity, it was a win for me and my company.

Gardner: Jessica, how about from the buyer side at Caesars, using the network, having the data, the insights, and the visibility. Has that added more value to your process? Obviously, you’ve got a certain specialization, but is there a more general value that you're seeing over time?

Rosman: We've used Ariba Network for a quite a while now. We started off with request for proposal (RFP) or the sourcing phase or module. We extended to the contracting phase or module and then we eventually went to the procure-to-pay.

We've seen a plethora of Ariba services, each one adding and building upon prior Ariba services that we had used. In all of those areas, it’s beneficial, because the lessons learned from a past RFP are archived and you can go back in and find RFPs that were used in the past.

When we're mentoring suppliers, especially within our Supplier Diversity Program, talking to minority or women suppliers, it helps us to know what some of the contract managers might be asking, or a little bit more about the categories. We don't pull the entire RFP. We don’t share all of those pieces, but unique items that might be applicable to future questionnaires. That goes all the way through to the procure to pay (P2P). It keeps it easy in one place and it archives the data for us.

Real standardization

Gardner: It sounds like you have a real standardization about how you are going about these things. Is that fair to say?

Rosman: Yes, I believe it is. Our sourcing team has evolved throughout this process to a category-driven leadership approach, and Ariba has been an integral part of that.

Gardner: Any thoughts or recommendations with 20/20 hindsight now for other organizations that are looking for specific requirements in the suppliers that they're targeting?

Rosman: As we continue to grow, Ariba also continues to grow in this area of supplier diversity. Using Ariba Discovery has also helped us when we're trying to find minority women or vendors in unique industries.

An example of that is also in Ohio. We were looking to find a women-owned or minority-owned company in that region that sells carbon dioxide. We put it into Ariba Discovery assuming that we wouldn’t find anybody that we hadn’t already met through our outreach events.
When you're looking for hard-to-reach vendors and looking for that opportunity and connection, it just takes it one step further.

We had done very extensive outreach events in the community and talked to more than 300 local vendors and yet we still were able to do find some. When you're looking for hard-to-reach vendors and looking for that opportunity and connection, it just takes it one step further.

Gardner: Quentin, I imagine that, as a business owner, you're curious about what new business opportunities are available. Has the visibility within the Ariba environment, seeing what alerts come across, seeing what the bids are about, led you to pursue other business opportunities and lines of business within your company? Has it helped you grow?

McCorvey: It has definitely helped us to grow. When I initially looked at the Ariba Network, I saw it as a procurement platform. But for me it's actually more of a supply chain accelerator, and I say that because as with any good business what's important is deal flow, how you get projects and opportunities in the pipeline.

Ariba has been a minimal level of inputs with a maximum level of outputs. So as a company and as a smaller growing company, you’re constantly looking at ways to grow opportunities, to grow market share. Do you invest $20,000, $30,000, $40,000 in a B2B website? Do you engage in Google Analytics? Do you put sales executives in other parts of the country to begin to grow?

Those are all the decisions you have to make every day with a limited amount of resources, because you really want to put that into growing your company. Ariba has has been able to do that. I don't necessarily have to have a larger sales team or some of the other things out there. I can begin to look at opportunities where I can grow my company in other markets. I can service those markets. It also gives me access to other Fortune 100 and 200 companies that I don't necessarily have the access to, to begin to look at.

A lot of ideas

What's important for me is to get a lot of ideas. Jessica talked a little bit about the archived RFPs. But really mining through those archived RFPs, I can see what companies are looking for, what their RFPs have been about, when are their sales cycles coming up again, when can I begin to look at those opportunities and target those opportunities, who are the purchasing and procurement managers that’s managing those lines.

That’s tough data to find. It’s tough to be able to find out who, for example, is procuring resins for a company. You can Google over their website, you can search for it, and you can’t find it, but you will never find that opportunity. It really, really closes down the sales cycle loop for me and gives me maximum value.

Gardner: Well, we're here at Ariba LIVE, and there's lots of news being made. We're hearing about integrated services for travel and expenses. We’re seeing more emphasis on the user experience, end-to-end processes that would end up in a mobile environment or any number of environments.

What's of interest to you? Where do you see yourselves taking advantage of some of these new technological and process innovations?

Rosman: One of the areas that's most interesting is learning about how to implement Ariba within your internal team and externally. We've done a great job of it within Supplier Diversity Program, but how do we roll that out further amongst our entire supply chain? The takeaway is how can we train internally and train externally to find results using Ariba?
It's worth spending some time really understanding how Ariba works and what are the components there within the system.

Gardner: Quentin, any thoughts about what’s of interest to you and then perhaps words of advice you could give other companies that are trying to improve their business using a business network?

McCorvey: Jessica hit on it again. Technology is really driving the market. My partner, who has been in the business for 25 years, often tells a story about how when he first started out. He left home every day with a pocket full of quarters and a pager. That day is gone. This is not your father's Oldsmobile. We really had to begin to leverage technology in a different way.

As a distributor, I'm looking at, and have been typically looking at, the sales side. How can I look at opportunities here? But what’s also been important for me to see and really learn is that I can look at it on the buy side. How can I not only find other manufacturing partners to begin to drive more cost out of my supply chain and even be more competitive in my business and my business environment.

Relative to advice for other customers, other people or other suppliers who are using the network, it's worth spending some time really understanding how Ariba works and what are the components there within the system. Ariba has some very knowledgeable account executives who work directly with you. You need to spend some time with your account executive to make sure that you update your profile to the point where you can get maximum amount of exposures to the maximum amount of hits.

To reiterate what I said before, it’s important to not only look at to the opportunities that are available to you, but closed opportunities, and see where you can begin to look at opportunities, and see if there are other business ideas or business partnerships that you can develop through the Ariba Network.

Listen to the podcast. Find it on iTunes. Get the mobile app for iOS or Android. Read a full transcript or download a copy. Sponsor: Ariba, an SAP company.

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