Experts on Digital Transformation - Oleksandr Vodotyka

„Don’t Shut Yourself Away in an Ivory Tower“

Mr. Vodotyka, you’ve been a driving force behind the digital transformation of Coca-Cola Hellenic’s procurement processes. How did this come about?

Our CPO and the leadership team, who brought me to the company, gave the go-ahead for restructuring procurement in 2015. Companywide, we’d set ourselves the goal of optimizing the costs, working more closely with our stakeholders, and making our supply chain agile and secure. We wanted to establish consistent standards. It was clear to us that we could only achieve these strategic ambitions in conjunction with optimized and digitalized procurement.

Your functional transformation has started as far back as six years ago; how far have you already come with the program?

Every transformation has a concrete starting point, but it never really ends. Our program had three phases. The first phase was all about achieving transparency for all our spend areas. We also made the strategic decision that procurement would take responsibility for every Euro that leaves the company. Before that, traditionally, different departments were responsible for negotiating and reviewing agreements with suppliers as part of their regular operations. It was also important to define the specific requirements, to find new ways of working together, and to use them to achieve a new service level within the organization.

What did the second and third phases focus on?

The second phase was probably the most challenging one. We had to completely redefine our operating model in procurement; it was all about more streamlined processes, a customized organizational structure and, of course, implementing new technologies. In some cases, we first had to utilize better those procurement tools, which were already in place but were not used to the full potential for our transformation (like e-sourcing and e-auction portal). In the third phase, that’s where we’re now, our focus is on accelerating the function for the business even further. We want to continue to automate our processes end-to-end. An important milestone of this ambition is our decision to roll out the corporate source-to-pay integrated suit for upstream and downstream procurement across all countries during the upcoming years.

We also redefine the ways how we approach and automate the tale spend at the company, where we provide integrated solutions to our internal customers for easier order management through internal and external catalogs and marketplaces. This leads to new and exciting experiences for internal customers and provide procurement with more space for strategic initiatives and continuous improvements with our suppliers.

The coronavirus crisis has put many companies to the test. How robust has Coca-Cola Hellenic’s procurement proved to be in the midst of its transformation?

The pandemic appeared to be a crash test for our improvement journey. In many areas, we could see that we were already in good shape, but in some, there was room for improvement. We were able to maintain production in Austria throughout the entire crisis, for example, thanks to our earlier implemented contingency and business continuity measures together with the functional partners. The COVID-19 situation also suggested that in some areas we had to make decisions faster. For example, the lockdown back in April last year helped us move to e-signature internally and with external partners as one of the critical means to continue our operations.

What’s been the biggest challenge so far in the transformation?

I’ve learned that you can’t just shut yourself away in your ivory tower to draw up a plan on your own. You might have developed the best strategy and have good analysis at hand, but if you don’t coordinate with other departments, you’ll never achieve the desired excellence.

From the start, we had to convince all our stakeholders that we needed to change our ways of working and that a professionally organized procurement function could become a source of greater longer-term value. We were organizing multiple cross-disciplinary workshops together for all areas of the company spend (both direct and indirect spend). We wanted to bring together all our talents to look for the best common solutions around costs, services, and the speed of execution. It was crucial to support our departments’ functional expertise with the structured data analysis and modelling to help us discuss and agree on business cases for the benefiting departments. We followed a detailed project plan, with shared responsibilities and defined timelines. For more complex initiatives, we also allowed us to pilot them on a smaller scale before expanding to full functionality and scope.

What role did your procurement team have?

Our procurement team probably played one of the most crucial roles. Especially at the beginning, we positioned ourselves as a piloting laboratory, where we tried new approaches, best practices, methods, and tools. That was made possible by the large number of committed and enthusiastic colleagues we had who wanted to join and drive the pilot projects. It was also important to work closely with everyone during implementation and to build on their skills and awareness. They’re now even prouder that procurement is completely tailored to our company’s needs. They now feel they’re really driving value creation and are tracking it through the available tools, and they’ve also contributed to building new organizational capabilities and improving our engagement with internal customers.

You have invested a lot of energy in the transformation over the last few years. Was it worth it?

Yes, without a doubt. We are now completely clear about the strategic, tactical, and operational roles that procurement plays for the company. We’ve managed to standardize our processes across departments, and now, for example, in every business unit, we use the same procedure to place and manage orders. New ways of working and source-to-pay processes supported by modern technologies provide greater opportunities for our international talent development across multiple locations. For example, our new procurement support lead in Austria, who’s responsible for the effective system processes, compliance, and analytics, has started her career at our procurement service center in Bulgaria. I am hopeful we will witness even more examples like this in the future as a part of our functional excellence journey!

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