AVL List GmbH

The Challenge:

VAST SUPPLIER NETWORK COMPLICATES PURCHASING DECISIONS AND ENSURING UP-TO-DATE INFORMATION

Efficiently managing relationships with thousands of suppliers and internal employees around the world is no small feat but it’s mission-critical for modern enterprises that want to mitigate risk and remain competitive. Supplier management at AVL’s scale is further complicated by the sheer volume of documents and data required for audits, regulatory compliance and the verification of ESG criteria. 

“We wanted to have QAD SRM as a single point of contact and a single point of truth for our suppliers. It means we are sharing information with our suppliers but on the other hand, we want suppliers to provide their  documents and information. Transparency and collaboration is important,” explains AVL.

Although AVL initially implemented QAD SRM to gain visibility into its global purchasing process and increase buying power, leadership quickly realized the solution’s seamless integration with SAP and bidirectional interface could streamline supplier onboarding and organize critical data in a centralized location.

AVL implemented QAD Supplier Data Management, Sourcing and Collaboration, and now having had QAD SRM in place for 13 years, continues to discover new ways to improve its processes and address emerging risks. As cybersecurity, ESG, compliance topics and supply chain integrity became growing concerns, AVL looked to QAD SRM for support.

The Solution:

AVL SCALES QAD SRM TO BUILD RESILIENCE AGAINST EMERGING SUPPLY CHAIN AND PURCHASING RISKS

With QAD SRM at its side, AVL has brought 11,000 suppliers from the Americas, Europe and Asia-Pacific regions into a shared portal that pushes and pulls data into SAP in real time. Internal and external users can share documents with ease and everyone at AVL from purchasing and quality to information technology (IT) and project management has a cohesive view of the company’s global supplier network. 

“QAD SRM is available for all our suppliers and affiliates worldwide and supported centrally from Graz,” says AVL. “Global availability is a big advantage in supporting better decisions. Another is that the QAD SRM portal is web-based and therefore everybody can have access.”

AVL is leveraging the robust nature of QAD SRM to address its various challenges. The company is using Supplier Data Management to organize supplier and SAP information, manage documents, information security management system (ISMS) and streamline new supplier onboarding, while Collaboration supports change notifications and measures supplier performance, including poor supplier ratings.  

The team relies on Sourcing to manage its sourcing interface, quotation documentation, requests for information (RFI) and requests for quotes (RFQ). The solution provides supplier performance monitoring with serial and ad-hoc ratings along with risk ratings. 

AVL is in the process of implementing new material group structures, activities triggered by supplier ratings, audit processes, supplier scorecards and questionnaires that will support ESG and compliance requirements. These new strategies, combined with existing ones, will address the increasing market and customer requirements that AVL confronts.

The Benefits:

UNIFIED SUPPLIER ECOSYSTEM DRIVES GROWTH AND FURTHERS ESG INITIATIVES AT AVL

AVL has found QAD SRM to be a versatile solution that can be adapted to support different business goals, whether that means using supplier ratings as a risk mitigation tool or simplifying RFIs to secure supplier buy-in on ESG topics. 

As the ESG-focused regulatory landscape continues to evolve, many companies are realizing the importance of keeping a pulse on supplier activities. According to the "2023 Corporate Global Trade Survey Report" from the Thomson Reuters Institute, 88% of businesses collect supplier ESG data at least once a year to comply with local laws, ensure alignment with corporate values and preserve reputational risk, among other reasons. 

“As Warren Buffett once said, ‘Risk comes from not knowing what you are doing,’ and we extended that for what our suppliers are doing,” states AVL.

Gathering external ESG data can be extremely intricate and time-consuming, especially for large organizations like AVL that work with thousands of suppliers. “We are supporting ESG and compliance requirements, as well as those driven by AVL, in our purchasing organizations with QAD SRM. We will connect with tools like EcoVadis, and there surely will be more to come,” explains AVL. 

“We are also asking ourselves questions like, ‘How do we ensure supplier acceptance?’” says AVL. For AVL, this meant overhauling its RFQ process with efficiency in mind. It reduced the number of fields it was asking suppliers to complete, by an average of 45% and now only seeks absolutely relevant information, resulting in a process that’s more effective and efficient for both parties. Flexibility and scalability are key necessities in AVL’s business and supported by QAD.

“We have 13 years of experience with QAD SRM and we are lucky every day to have this tool,” states AVL.