NPD’s focus on procurement has boosted its efficiency and savings.
By Alan Dorich
NPD Group Inc. not only is invested in its own success, but also the success of its customers. “[We] spend a lot of time focusing on our clients, making sure we are delivering for them by providing data and analytics that helps our clients operate more effectively and generate more revenue,” Executive Director of Procurement Tony Brita says.
Based in Port Washington, N.Y., NPD has 13 offices in the United States, and 12 more across Canada, Europe, Asia and Australia. The company collects market data on what people buy every day in their lives like clothing, food and electronics. He notes that there are multiple ways that NPD accumulates this information, including directly from retailers and distributors as well as from consumers through the web and mobile apps.
Afterward, the company analyzes and aggregates the information and sells the data to manufacturers. That helps them “run their businesses more effectively in terms of what products they want to sell to their consumers,” Brita says.
On the Journey
Brita joined NPD one year ago, with more than 13 years of experience in procurement. “I’ve worked across multiple industries,” he says, adding that this included working as a consultant for Accenture. “The skills within procurement are fairly transferable across industries.”
But procurement is a relatively new function for NPD, which started focusing on it three years ago. When Brita joined the company, “They were just getting started on their procurement journey,” he recalls.
Brita’s work has included implementing foundational pieces such as a procurement policy and growing the department’s network by developing relationships with stakeholders across the organization. That way, “Our stakeholders understand the value Procurement brings to the table and helps the company operate more effectively at the end of the day,” he says.
One area Brita focused on was NPD’s travel program. The company’s salespeople are out on the road quite often, “so our travel spend is substantial,” he says. Brita decided to transform the entire program, which included adding a new expense management solution.
Previously, employees had to manually submit paper receipts for travel and entertainment expenses. “That was a bit of an arduous process,” he admits.
“Managing travel and entertainment expenses has become more efficient,” Brita says, adding that the company implemented Expensify, a system that allows users to take pictures of receipts on their phone and submit them for reimbursement.
“The entire workflow approval process is automated, from the end user to the final step in the process in accounts payable,” he says, noting that Expensify has earned a positive reception at NPD. “Since we rolled out Expensify, it has been well received.”
Brita also manages the ongoing implementation of the procurement module in NetSuite, NPD’s ERP system. “We’re trying to kill two birds with one stone by introducing this procurement module throughout the organization,” he says.
The rollout, he explains, will do more than give NPD a procurement system. “As we provide training to end users, it gives us the opportunity to explain what procurement does and what role we play to drive value,” Brita says.
NPD recently began to take steps to adopt more formal relationship management measures with key suppliers.
NPD has implemented quarterly business reviews with a number of key suppliers to make sure service levels are being met and identify any issues they are having.
The sessions also allow NPD to learn about innovation initiatives the suppliers have in their pipeline that may benefit the company. “We’re doing the same thing for suppliers as well, by giving them insight to where our business is headed, so they can develop solutions that would help us,” he says.
Right on Track
NPD has benefited from these changes. The procurement system “has significantly increased our visibility into what people are buying across the organization,” he describes.
The company also exceeded its savings target for 2017 by a healthy margin. “As a result, they raised our target for this year,” he says, noting that NPD is on track to meet its goal for 2018.
Brita and his team have encountered challenges during this process, but NPD’s size has made them easier to navigate. “One of the nice things about working in a smaller company is the number of people you have to interact and engage with is less than it would be at a much larger company,” he explains.
“There are not a lot of layers we have to go through to get a decision on something related to procurement,” he says, noting that the company has an entrepreneurial spirit. “People at NPD are always looking for ways to make things better, more efficient and cost effective.”
NPD will continue looking for efficiencies while maintaining control and oversight, Brita says. The company also plans to expand its business with its current customer base by “developing new methodologies and analytic solutions that help its clients address challenges and identify opportunities as consumer tastes and the retail environment continue to evolve.”