Genting Malaysia Berhad realises procurement savings with ‘systems-thinking’ strategy, powered by cloud-based SAP Ariba suite

Shortened approval process by 80%, with procurement team members now assuming ‘higher value’ and strategic roles

KUALA LUMPUR: For leading integrated resort operator Genting Malaysia Berhad (GENM), the recent year-long implementation of SAP Ariba on the cloud, which was completed in May 2021, was part of the procurement division’s digital transformation programme. The transformation was driven by the need to remove redundancies and inefficiencies caused by multiple systems, processes, and policies.

Being the visionary group that it is, GENM embarked on a strategic ‘systems-thinking’ approach to look at cross-functional relationships within and beyond the four walls of the group. This is based on the premise that procurement and supply chain practitioners can lead the way in developing new business models, embracing innovative technologies, and increasing employee engagement through a systems-thinking approach.

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Darrel Lim , Assistant Vice President of Procurement, Genting Malaysia Berhad said that, with SAP Ariba, GENM is now able to “upskill our employees within the supply chain to provide value-added services.”

“Our business strategy was based on our digital transformation initiative to digitise the manual work that we were doing, before turning to a system to do the work for us instead.”

He said this during a panel discussion at the SAP SAPPHIRENOW event called ‘Fit for the Future: Procurement’s Digital Evolution’.

While the digital transformation was already in the pipeline, Darrel was assigned to lead the implementation of the Ariba project within a fortnight of him joining GENM. “I received consistent input from our stakeholders whereby they would like to see more value-added services, as well as participation from our procurement team, along with any possible reduction in turnaround time to complete our entire procurement process.”

“Of course, this included warehousing, receiving, material requirements planning, and finance.”

At the time, Darrel also discussed with his team the challenges they faced with their existing systems. The team then noted the ‘handshakes’ of various processes, before concluding that manual preparation of documents and approvals were slowing down productivity.

“Things like tender write-ups meant circulations to obtain approvals, report preparation and preparing data to export it into another module of another system so that the workflow continues,” recalled Darrel. “Since some of our Ariba on premise modules were not integrated or talking to each other, my team had to spend so much time overseeing these manual activities.”

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As an existing SAP customer, GENM made the decision to move from its current on-premise solution to the cloud-based SAP Ariba suite. The suite comprises SAP Ariba Sourcing, SAP Ariba Supplier Info, Performance Management, SAP Signature Management by DocuSign, SAP Ariba Contract Management, and SAP Ariba Commerce Automation. 

Enormous benefits with the SAP cloud based Ariba suite

The benefits were enormous: The SAP cloud based Ariba suite helped to resolve IT audit issues, retire other satellite solutions to a single platform, and provided GENM with transparent processes to manage all types, sizes, and volumes of procurements.

Aside from financial cost savings, Darrel also highlighted a significant improvement in the approval process time for tender write-ups.

“Our headquarters, where 80% of our team works, is based in Kuala Lumpur while majority of our end-users reside in different states. In order for us to get sign offs, it would require a number of couriers for the physical document which takes up a lot of time.”

Because of this, Darrel’s team was averaging close to 36 days to get all the necessary approvals.

With the SAP cloud based Ariba suite, the time taken for the approval process was reduced by 80%.

“By relying on the system to manage that activity for us, and using e-signatures, we are now able to record a seven-day average turnaround time to get all the necessary approvals,” he said.

Other benefits included prevention of loss of documents and full-time equivalent employee (FTE) savings for his team to manage and follow-up on approvals. With all the FTE time savings realised, Darrel’s team was able to reassign five of his team members into new sections to assume ‘higher value’ and more strategic roles for the company.

“We set up a Vendor Management team comprising of 3 FTEs and their new roles are to improve our vendor engagement activities and identify potential business partners that can assist in positioning our business ahead of our competitors.”

“We also set up a Strategic Sourcing Team comprising of 2 FTEs who are assistant managers and they are tasked to focus on our critical contract engagements, bringing in greater value be it in a technical or commercial perspective.”

Meanwhile, SAP Malaysia managing director Hong Kok Cheong cites GENM as an example of its over 16,000 customers and partners worldwide that use the SAP Cloud Platform to build application extensions and seamlessly integrate landscapes.

At SAPPHIRE NOW, the company had announced the SAP Business Network, an innovative new solution that reimagines how businesses collaborate with their network of trading partners and will empower companies to unify all the points of interaction and integration across that network to move faster and smarter than ever before.

“A unified network based on a ‘cloud-first’ strategy enables all trading partners to leverage combined intelligence to apply learning from past experiences to future decisions, ultimately driving success across the board,” said Hong.

“Because when a network reaches across functions, across industries, across the world, companies have the power to reshape how business gets done, including collaborating to solve some of today’s biggest social, economic, and environmental issues,” concluded Hong.

About Genting Malaysia Berhad

Genting Malaysia Berhad (GENM) is one of the leading leisure and hospitality corporations in the world. Listed on Bursa Malaysia, GENM owns and operates major resort properties including Resorts World Genting (RWG) in Malaysia, Resorts World Casino New York City and Resorts World Catskills (which is 49%-owned via an associate company) in the United States (US), Resorts World Bimini in the Bahamas, Resorts World Birmingham and over 30 casinos in the United Kingdom (UK) and Crockfords Cairo in Egypt.

With about 10,500 rooms across seven distinct hotels, RWG is Malaysia’s premier integrated resort destination. The resort also features wide-ranging leisure and entertainment facilities, including gaming, theme park and amusement attractions, dining and retail outlets, as well as international shows and business convention facilities. Genting Highlands Premium Outlets (a joint venture between Genting Plantations Berhad and Simon Property Group) at the mid-hill further complements the various attractions at RWG. Additionally, the Genting SkyWorlds outdoor theme park will add to RWG’s extensive entertainment offerings upon completion.

GENM is a member of the Genting Group, one of Asia’s leading and best-managed multinational companies. The Genting Group is led by Tan Sri Lim Kok Thay, a visionary entrepreneur who has successfully established the Resorts World brand as a leader in the leisure and hospitality sector in Malaysia, Singapore, the Philippines, the US, the Bahamas and the UK. Tan Sri Lim Kok Thay also has significant investments in other industries globally including oil palm plantations, property development, power generation, oil and gas, cruise and biotechnology. For more information, visit http://www.gentingmalaysia.com.

For more information, press only:
Darryn Lim, darryn.lim@sap.com
Mike Ang, mike.ang@alconsulting.asia