Driving Procurement Transformation with Source to Pay Program

QLD Transport and Main Roads (TMR) award-winning Procurement Transformation

Published: 03/September/2023

Reading time: 7 mins

Key Takeaways

⇨ TMR’s new digital procurement system reduced 66 processes to 30 and increased on-time payments from 81% to 91%.

⇨ Partnership with SAP introduced an innovative Guided Buying platform and a collaborative Supplier Network for diverse Queensland suppliers.

⇨ The project's success led to TMR winning the 'Best Run SAP Network and Spend Management' award at the 2023 SAP Best Run Awards.

Register for Mastering SAP this November, to hear firsthand insights from Paul Hesford (Deputy CFO, QLD TMR), and dive deep into TMR’s procurement revolution. Secure your spot now and align yourself with the best in digital procurement!

Queensland Transport and Main Roads (TMR) has embarked on a Public Sector leading Procurement Transformation, digitising and reducing processes, providing simple guided user experiences, driving efficiencies to accommodate increasingly growing capital programs (including the Brisbane Olympics/Paralympics in 2032).

Challenge

Transport and Main Roads (TMR) spends in excess of $8 Billion per annum on procured goods and services, making TMR the largest procurement agency in Queensland Government. This equates to 77% of the total TMR capital and operating budget, and equal to spending about $30 Million per working day.

TMR was at a point where investment in enterprise procurement technology and processes, could allow the TMR business to take a significant step up the maturity curve for procurement process improvement and digitisation.

A specific procurement challenge was the complexity of TMR’s current processes for procuring that takes 66 discrete process steps, including multiple ‘off-system’ endorsements and approvals including emailing, printing, signing, scanning and walking documents around the TMR organisation. Another TMR challenge was an estimated 5.3 million documents manually handled across the Source to Pay process annually.

Additionally, TMR’s suppliers had challenges with procurement administration burdens with the manual nature of the invoicing and payment process resulting in sometimes receiving payments late.

In April 2021, TMR took on the challenge to deliver a digital Source to Pay system.

Solution

Queensland Transport and Main Roads and SAP entered into an 11-year agreement for the following Source to Pay procurement systems to provide:
• A contemporary and easy to use Guided Buying platform integrated to SAP ECC.
• An electronic and collaborative Supplier Network for Queensland SME’s, Indigenous, diverse and large suppliers.
• An integrated Contingent and SOW system to manage labour-hire.
• Significant Change Management and Training Programme utilising Enable Now.

The Source to Pay Procurement systems was rolled out several commodities in 2 Waves to manage the Change impact to the Business consisting of:
• Purchasing Personal Protective Equipment (PPE)
• Major and Minor Equipment Hire (Dry Hire)
• Unplanned Facilities Maintenance
• Accounts Payable
• End to End Delivery of a Legal Services Panel
• Workshop & Roadwork Consumables
• Supply and Delivery of Road Signs, Posts and Fittings.

Underpinned by SAP ERP system, TMR implemented the following SAP Procurement modules:
• SAP Ariba Guided Buying and Supplier Management, SAP Business Network, SAP Fieldglass and SAP Enable Now

Impact

Through a very focused business led and change management program, TMR’s Source to Pay project is on track to deliver the following:

• For Queensland Government:

  • TMR will extend its position as a Government leader, attracting talent and business innovation showing the way for other agencies.
  • TMR system can be leveraged across the rest of QLD Government agencies.
  • Enabler for Government priorities including its commitment to improve on-time payments for small business.

• For TMR:

  • Digitising and reducing processes, providing simple guided user experiences, driving efficiencies to accommodate increasingly growing capital program (including the Brisbane Olympics/Paralympics in 2032).
  • Strengthening the collaborative partnership between TMR and SAP.

• For TMR Suppliers:

  • Alignment to QLD Procurement Policies such as local community benefits, indigenous and small to medium businesses support allowing more ethically, environmentally and socially responsible suppliers.
  • Enabling suppliers better and simpler ways to electronically collaborate with TMR improving on-time payment performance and reducing the administrative burden for Suppliers.

Productivity

  • Reduced 66 discrete process steps to 30 for Professional Services
  • Reduced processing costs for 37,000 Expense Vouchers
  • % Increase in on time payment: On time payments in Ariba 91% vs
    Legacy Systems 81% (FEB-23 YTD)
  • Reduction in costs: currently around $25,000 per quarter, expected to increase to $5 million per annum with full roll-out plus productivity benefits.

Change Approach

  • 1462 impacted users supported through Wave 1 and 1811 through Wave 2
  • 376 Suppliers enabled as part of Wave 1 and Wave 2
  • 250+ strong change network engaged over 17 forums with an average attendance of 87 staff
  • 27 Roadshows to the business with 807 staff attending
  • 1002 End users attended 118 in-person training and 552 online courses
  • 78+ people involved in UAT, 126 Super Users across all areas of TMR.

Volume

  • Over $600k of Spend managed in first month
  • Over $50 million spend to date
  • Forecasted spend of $150 million by end of year through live commodities
  • $1 billion expected through existing and new commodities for FY23/24
  • 2914 Purchase orders created and 6861 invoices submitted.

Testimonials

As a leading procuring agency for the Queensland State Government, the Source to Pay program will enable TMR to transform our payment processes and provide significant benefits for our people through reduced workload and our suppliers through improved payment times. But more importantly it will be a critical enabler for TMR to successfully deliver a significant infrastructure program leading up the Brisbane 2032. –Nick Shaw, CFO, TMR

“As an Approver (and someone who is not too great with IT), I found approving the Labour Hire purchase requisition for our Brisbane Ops team was really straight forward. I received an Action email and pressed a link that took me directly to Ariba for review and consideration. Pretty intuitive which is great.” – TMR end user

“Work anytime, any place.” – TMR Source to Pay Project Mantra

“Source to Pay will deliver the procurement and payment technology to allow the TMR procurement and finance community to deliver better value for Queensland.” – TMR Business Case Excerpt

“Source to Pay’s priority for this project is to deliver the change in partnership with the TMR Business, to ensure you feel informed, supported and enabled in your Roles.” – Paul Hesford, Deputy CFO, TMR

Partner Information

Price Waterhouse Coopers (PwC) – Significant Change Management Partner

  • Role PwC played in the Source 2 Pay Project:

PwC were identified as a true partner of choice to manage the change for the large-scale system implementation based on their existing, trusted relationship with TMR, and a history of successful ICT implementations working with SAP in the Queensland market. PwC provided the change management services, working collaboratively to define the change levers, plans and activities to drive engagement and adoption for the workforce and supplier community. Through working closely with the client and SAP project team, PwC’s change approach facilitated a smooth go-live for Wave 1 and Wave 2.

“TMR’s focus on the Change Management challenge for the Source to Pay project was key to its success. The commitment from the Leadership team to keep people front and centre throughout the project influenced how the change was managed and, more importantly, how it was received.”

EY– Training Services as part of Change Program:

  • Role EY played in the Source 2 Pay Project Wave 2:

The Department of Transport and Main Roads (TMR) engaged EY for Wave 2 of the Source 2 Pay program. EY developed all the strategic and design documents to support the Source 2 Pay Wave 2 Training rollout. The team supported the successful enablement and uptake of SAP Ariba & Fieldglass by introducing, developing and deploying high-quality SAP Enable Now learning content for all impacted TMR end users, as well running successful Train the Trainer and coordinating End User Training programs. To ensure adoption of the new ways of working and a culture of continuous learning for TMR, EY also trained TMR staff to continue to develop and update content in SAP Enable Now and to administer the system.

“Key to the success of the Source 2 Pay Project is the ability of the TMR end users to adopt to the new ways of working. Close integration across all project teams and workstreams enabled the development of training and support materials that focused on system use with business process context. TMR’s choice of SAP Enable Now for the development of the training and support content and linkage of that material using SAP Companion to the production environments, means that End Users have an interactive Learning Asset that can be used for go-live training as well as performance support. Loading these ‘SCORM’ compliant materials to the TMR LMS also provides TMR with a sustainable learning asset that can be used in BAU for new users and those changing roles. An outcome for TMR well beyond the life of the program.” – Lisa Smith, Partner, People Advisory Services, Ernst & Young, Australia

Atturra (previously Cubic Consulting) – Training Services as part of Change Programme

  • Role Attura played in the Source 2 Pay Project Wave 1:

As SAP’s Training and Enablement partner on the TMR Source 2 Pay Project for Wave 1, Atturra Change & Adoption developed all the strategic and design documents to support the Source 2 Pay Training rollout. Our team supported the successful enablement and uptake of SAP Ariba by introducing, developing and deploying high-quality SAP Enable Now learning content for all impacted TMR end users, as well running successful Train the Trainer and End User Training programs. To ensure adoption of the new ways of working and a culture of continuous learning for TMR, our team also trained TMR staff to continue to develop and update content in SAP Enable Now and administer the system.

“Atturra Change & Adoption worked seamlessly and collaboratively with the SAP team, TMR’s change management partner, the TMR Source 2 Pay project team and business stakeholders to create high quality learning materials and deliver exceptional Train the Trainer and End User Training programs.”

Want to explore the award-winning transformation story that clinched the ‘Best Run SAP Network and Spend Management’ at the 2023 SAP Best Run Awards? Register for Mastering SAP this November, to hear firsthand insights from Paul Hesford, and dive deep into TMR’s procurement revolution. Secure your spot now and align yourself with the best in digital procurement!

The full SAP Best Run 2023 entry can be found here.

More Resources

See All Related Content