GCP Applied Technologies is focused on building a solid procurement team of experts who remain flexible as the market changes.
By Janice Hoppe-Spiers, Senior Editor at Knighthouse Media
GCP Applied Technologies was formed when in 2016 the business was separated from W.R. Grace to become an independent company specializing in construction products. The company’s products include concrete and cement additives, building materials and technologies that ensure specified quality and enhance business productivity.
“We are now focused 100 percent on the construction industry, expanding through acquisitions in our segment and continuing to invest in construction technology,” Director of Global Procurement and Sourcing Tatiana Alfaro says.
With more than 50 years of industry experience and decades of success in creating new product categories and markets, GCP partners with the world’s most successful architects, producers, builders and contractors to provide solutions for their construction products. The company has customers in more than 100 countries and 57 manufacturing locations.
“Our global presence ensures that customers receive high performance products that deliver layers of value and superior solutions,” the company says.
For example, GCP’s Verifi® in-transit concrete management system uses sensors installed on ready-mix trucks to produce real-time monitoring of data showing concrete properties while in transit. The company in December acquired Montreal-based Contek Shilstone, a technology company that has a prominent position in quality control software used in the ready-mix concrete industry, to complement and enhance Verifi®.
“This is one of our key initiatives to do acquisitions that will add to our portfolio and continue to ensure our technology position in the marketplace,” Alfaro explains. “GCP’s goal is to be the leading provider of construction technology, including data management systems and finding innovative ways to add-value to the industry.”
GCP’s data management approach sets the company apart in the construction industry, Alfaro says. “If you think about social media companies, they use data collected to tailor products and content to you,” she explains. “We want to bring that concept to the construction industry where we manage quality and performance through technology increasing customer productivity.”
One of the major changes GCP made after splitting off from W.R. Grace was to take advantage of the company’s new focus, which encouraged its staff to work across-functions and less in silos. “As GCP, we are a much smaller company with $1.1 billion in revenue and need to be nimble. We don’t work in silos and have implemented changes to ensure we are working together with other departments.”
GCP encourages teamwork because it wants to ensure the most number of people are reached in the company and information is shared. “We need to be quick, nimble and flexible,” Alfaro says. “That has been a big cultural change because now we are telling our people is ok to bring in someone from a different department to a supplier negotiation, if they believe this will add value to the negotiation.”
GCP is investing in data management systems internally to ensure its procurement team has the right tools to achieve the task. It is also focused on training to ensure the team is made up of experts in the market to communicate effectively and drive the internal decisions to increase profitability.
“As a company we are investing in technology for our process,” Alfaro notes. “We have only been a standalone company for two years and are building the business case for implementing software management for logistics, vendor portals and other supply chain processes. This will allow us to eliminate many non-value added activities done by the team.”
Alfaro oversees GCP’s global procurement team of 40 people around the world and says communication is extremely important. “There are different cultures and you have to understand how to communicate properly by making an effort to learn and understand the best way to approach people,” she explains. “I like to give my team the opportunity to take the lead and maybe make mistakes, but learn from those and develop their potential.”
GCP is developing a strategy in terms of where it wants to be from a procure-to-pay standpoint. “Being a start-up in a way, we have a longstanding brand that has recognition in the market, but we are developing our own processes within the company,” Alfaro says. “We want to develop a clear vision and definition of what we want to do and implement processes that are faster, use more technology and reduce the number of human touches we have with a vendor.”
The company is in the process of developing a procure-to-pay strategy that allows it to remain flexible and fast. Technology will play a significant role in this strategy as GCP continues to acquire more companies and create efficiencies internally. Having the right procure-to-pay process in place will allow it to realize synergies and integrate new companies faster and more efficiently. “I would like to highlight how great it has been to be a part of a company that’s introducing technology into the construction industry, known for being a traditional field, and trying to balance the challenges we face,” Alfaro notes.
GCP will continue to focus on developing a procurement team made up of experts in the field who are flexible to changes in the market and work in conjunction with all the business units. Because of the trade and political uncertainty of today, GCP embeds its procurement team in the market so they have a thorough understanding of the implications if there are changes in trade patterns or supply and demand balances, for example.
“We are a global company that takes advantage of global supply to ensure the most cost-effective products while ensuring quality and balancing supply chain risk. A position needed to serve a demanding customer base looking for cost effective products with the highest technical performance that GCP is known for,” Alfaro says. “This procurement strategy is sensitive to changes in trade patterns, so having contingency plans in place and keeping those up to date is key in our business. It’s a balancing act between having plans in place but not spending too much time dedicated to situations that will not materialize; knowing how to segregate those is a challenge.”
Alfaro says she is proud of the procurement team she has assembled today. The team members are experts in their field and are focused on best sourcing and business practices. “They are not just buying materials, they know the impact on the bottom line that their decisions make,” she adds. “We have people on almost every continent to ensure we are balancing cost-effective supply with a local source, avoiding disruptions and naturally hedging against exchange rate disruptions as much as we can. We understand the impact of a decision.”
Moving forward, GCP plans to continue developing global strategies and investing in the tools its procurement team needs to drive their materials expertise and increase productivity.