When Purdue University began the herculean task of changing and improving all of its purchasing practices across all of its campuses, it didn’t hire high-priced business consultants to help smooth the transition. Instead, it enlisted the help of Krannert students.
|Krannert interns (from left) Jay Gatson, Meghan Stepanek, Andrea
Pedroza and Austin Crane are now specialists in purchasing practices.
“We weren’t going to go out and spend a million dollars on additional business consulting to support our transformation,” says Philip O’Keeffe, director of procurement services. “Somehow, internally, we were going to be able to execute this transformation and do our jobs without incurring those consulting fees.”
At the suggestion of Jim Almond, senior vice president and assistant treasurer, they decided to employ four Krannert students in an internship program to assist in the process. “We jumped on that idea right away. That could be a very effective augmentation of resources for us and a huge learning opportunity for them,” O’Keeffe says.
After employing the students full-time over the summer, and now 20 hours per week during the school year, Procurement Services is happy, to say the least, with the experiment. “It has been a remarkable experience. This is the way it should be done. You rarely get the opportunity when you are so close, literally down the street from a business school of this quality, to find ways to have this mutual win-win situation.”
The new procurement system
The scope of the change for Purdue is somewhat hard to grasp. The University planned to transform all of its practices for procurement not only at the West Lafayette campus, but the regional campuses as well. Strategies, policies, business practices and procedures, organizational skillsets and cross-functional teaming, information for decision-making and tools would all change, including exchanging paper forms for an online, e-commerce system.
“Over a three-year period we are going from a relatively immature level in all of those areas to what is targeted to be top 10 percent in our industry, reflected in a process that delivers excellent service, millions of dollars of savings and costs avoidances, exceptional efficiency and highly effective management of procurement risks. We’re going through a huge transformational change in all aspects of procurement at the same time,” O’Keeffe explains. “We have one year completed.”
Purdue decided to invest in Ariba as its e-commerce solution for procurement. “I was developing a strategic plan to cover this transformation over a three-year period, that’s a pretty intensive 100-page document. One of the students, Andrea Pedroza, helped me directly with that, with the environmental scan component. To have a student helping me do that was great.”
Getting suppliers on board
As Purdue transforms its practices, the new system also requires suppliers to change the way they do business with Purdue. “You order electronically, you get approvals electronically, you send the order out electronically to the supplier. You receive it and are invoiced electronically. Everything is electronically reconciled. Almost everything we do today is on a manual invoice, and the ordering processes are inefficient,” O’Keeffe explains.
There is some amount of guidance and training needed for suppliers to understand the new process. “You tell it to them and you sell it to them, but then you have to make it happen. Almost all suppliers must establish a presence in the electronic supplier network – they must be enabled on the Ariba Supplier Network in the Cloud. We gave a couple of the interns the opportunity to really take the leadership to make that happen,” O’Keeffe says.
Jay Gatson, a senior majoring in accounting and management, is one of the students on the supplier enablement team. “Working through the process of a major change within the University, seeing first-hand a changing organization, is incredibly rewarding,” Jay says.
It’s been rewarding for Purdue as well. O’Keeffe shares, “An Ariba executive said he hasn’t seen any organization, corporate or any other industry, make so much progress so quickly with the Supplier Enablement. We’re way ahead of schedule engaging the supply base. It’s hugely important, it’s foundational to the success, and they’ve done a brilliant job with that.”
From procurement to payment
Austin Crane, a junior majoring in economics, has taken the lead in certain aspects of the technical implementation of the Ariba procure to pay (P2P) system. “I have written over 50 test scripts to test the functionality of Purdue Specific customizations,” Austin says. “I also held multiple testing sessions ranging from 5-25 testers. I kept track of which test scripts passed or failed, kept track of testing issues, updated scripts, and communicated issues to the Ariba Team so they could fix them.”
Austin also wrote exercises used in “Training the Trainer” sessions and attended the sessions to make sure end-users were comfortable with the program. “Austin has become a subject matter expert in procure to pay. He is one of the key people the organization now looks to for knowledge and expertise. He’s just another phenomenal resource,” O’Keeffe says.
Austin appreciates the opportunity to get real-world experience, as well as the professional work environment he experienced in Procurement Services. “They don’t really treat us like interns. We don’t fetch coffee or make copies. We all contribute in real ways, we attend meetings and share ideas,” he says.
“This experience has given me a lot more concrete things to talk about in interviews and at career fairs,” Austin adds. “Last year at the career fair, I felt like I didn’t know what to talk to employers about. Then at the fall career fair, I felt like I had a never-ending list of things I could discuss with recruiters. I know that I have good applicable career experience and it is easy to communicate with recruiters how I can be a valuable asset to their team.”
Andrea Pedroza, a senior graduating in December with a dual major in accounting and management, also acquired valuable skills. “I have performed a range of operational tasks including direct support of the strategic sourcing groups, cost savings/avoidance analysis and auditing travel expense reports. I also helped create documents and presentations about the Procurement Transformation Process. Because of the experience I have gained as an intern, I am confident in what I can contribute to future employers and am grateful for everything that Purdue has taught me both academically and professionally.”
For Meghan Stepanek, the most rewarding part of the internship has been learning about strategic sourcing. “I have discovered the importance of cost efficiency, having a positive relationship with vendors and the presence of competition in the market place. I have been able to apply knowledge from my academic course,” says Meghan, who will graduate in May with accounting and management degrees. “Purdue has given me a very well-rounded education to take to my future employers.”
Vote of confidence
How confident is O’Keeffe in what his interns have to offer? “I’ve only two years in higher education. I spent all my time in a corporate environment and in business consulting,” he says. “I would recommend all four of our interns to all of my former corporate employers, and they’d be fighting for them. But they have lots more to contribute over the coming semesters to our transformation.”