An emerging technology company experiencing rapid growth and preparing for future facility expansion.
Challenge
The client was experiencing rapid growth, combined with an upcoming facility expansion that was expected to drive significant increases in spend and add complexity to spend management. Operating in a pre-ERP environment, they lacked a structured framework for analyzing and managing a supplier base. The client required a fast, data-driven assessment to uncover savings opportunities, improve transactional efficiency, and create a high-level implementation plan that could be executed in the near-term.
Strategic Objectives
Waypost was engaged to conduct a comprehensive review of the client’s spending profile and procurement process with the goal of identifying cost savings, transactional efficiencies, and supplier management improvements. The project aimed to quantify potential savings as both a percentage and dollar amount of current spend, develop a savings roadmap by category, and create an actionable implementation plan tailored to high-priority suppliers.
Approach
The engagement began with supplier and spend categorization. Waypost developed a 14-category scheme based on the client’s spend profile, mapping the top 80% of supplier spend into these categories. Next, a detailed spend and transaction analysis was conducted using the client’s most recent 12 months of accounts payable data. This analysis produced a scatter plot mapping suppliers by both spend level and invoice volume, which visually identified clusters with high potential for savings and efficiency improvements—particularly suppliers with high spend and high transaction volume, or low spend with high transaction volume.
From this analysis, Waypost identified strategic opportunities and developed a roadmap that specified savings percentages by category, along with targeted strategies and tactics. An implementation plan was then created, focusing on high-impact categories and suppliers. This plan detailed steps for achieving projected savings and improving efficiency over a six- to 12-month period. Throughout the process, key client stakeholders were engaged to provide input and ensure alignment with organizational priorities.
- Key elements of the approach included:
- Supplier segmentation and spend categorization
- Transaction analysis to pinpoint high-potential opportunities
- Development of a category-specific savings strategy
- Stakeholder engagement for roadmap validation
Deliverables
The final deliverables included a spend categorization framework to enable structured supplier management, a visual analysis to prioritize improvement areas, a category-specific savings roadmap, and a six- to 12-month implementation plan. The plan targeted $1 million or more in savings and a 25 percent reduction in transaction volume, with a focus on high-impact categories and suppliers for rapid value delivery.
Conclusion
This project provided the client with a clear, data-driven strategy for improving procurement efficiency and achieving significant cost savings. By transitioning from a transaction-focused to a more balanced strategic-tactical procurement model, the client gained forward visibility, a structured framework for supplier management, and a practical playbook for value creation.