Quadrem helps Phelps Dodge track spending
For large mining companies, tracking how and where money is spent is a necessary but labourious task in fiscal management. Recently, Phelps Dodge enlisted the help of Quadrem to develop an effective strategy for centralizing indirect spending across its eight North American sites.
“In process-intensive industries like mining, a significant category of spending consists of high-volume/low-dollar value transactions,” states Jens G. Brown, sourcing process leader, global supply chain management for Phelps Dodge.
To complete the task effectively, it is important to standardize pricing. In addition, there must be increased visibility into the processes and costs in several purchasing areas where consumption detail isn’t always available or where order validation is difficult to perform. This creates a problem where there is a trade-off between visibility and workload.
To cope with the trade-off, Phelps Dodge implemented Quadrem’s hosted buying application across all North American sites, and has Quadrem-hosted e-catalogue content. Quadrem also worked with the company and its preferred supplier of fasteners, Copper State Bolt and Nut, to develop an automated bin-stock vendor-managed inventory process that delivers detailed consumption visibility and tracking. (Although Copper State is the preferred provider, it was unable to take advantage of this status because of Phelps Dodge’s decentralized procurement practices.) By combining the hosted buying application, e-catalogue and third-party automation tools, Quadrem and Phelps Dodge have built a mechanism to manage vendor-managed ‘bin-stock’.
As a result, Quadrem’s e-Business solutions have enabled Phelps Dodge to gain control over direct charge, bin-stock and purchasing card procurement processes across multiple sites, resulting in a reduced total supply chain cost. In addition, there is increased visibility and a standardized process in the operation, which is repeatable for all bin-stock spending.
“Within six months, Quadrem’s solutions have enabled us to win 30% more business within one of our largest accounts,” says Brian Cates, CIO with Copper State. Copper State also received exposure to new business opportunities among non-fastener categories, which led to a 15% increase in that business segment.
For more information visit www.quadrem.com.