For factory supplies, UTC workers hit the mall
Susan Avery -- Purchasing, 6/15/2006 2:00:00 AM
An online shopping mall that makes it easy for employees to place orders with suppliers for MRO items and other indirect goods and services is helping to improve productivity at United Technologies Corp. (UTC) in Hartford, Conn.
"That is the most important benefit of the mall," says Dana C. Loucks, UTC Mall project manager. The UTC mall, which contains supplier "storefronts", went live on July 1, 2005, and, while traffic was light at first, by April, the site was receiving nearly 3,000 hits from employees in one week.
"The UTC Mall provides an effective 'one-stop shopping' experience for our employees and fits into our sourcing strategy by making it easy to find corporate supplier agreements, the first step to improving compliance to using those deals," says Susan Spence, director of general procurement. Loucks reports to Spence.
The UTC mall, in a nutshell, is a link to suppliers' websites with whom UTC category managers have negotiated agreements. Unique to the mall is the fact that users only need one user ID and password to gain access to the sites of some 20 suppliers of such goods and services as factory supplies, factory services, chemical management services, office supplies and travel services. The mall also provides users with links to employee discounts on such items as personal computers and pre-owned automobiles and tickets to museums, concerts and other arts events available through the company's corporate communications department. Availability of these latter items on the site help drive traffic to the mall.
Loucks, who has 32 years of experience at UTC, and other purchasing professionals on UTC's general procurement team in Farmington, Conn., first conceived of the idea for the mall, or one-stop shopping, in 2003. Then, their thinking was that creating a mall or kiosk-type shopping environment online might help UTC employees who need to remember user IDs and passwords for a host of sites—to place reservations for travel services, order MRO and office supplies and complete expense reports—sometimes in the span of one day.
As anyone who frequents online shopping sites knows, tracking several user IDs and passwords can be a challenge.
The group did some benchmarking and found that purchasing professionals at other companies were using mall-type shopping environments, but they weren't exactly what UTC had in mind. General procurement at UTC is responsible for a $4 billion annual spend on nonproduction goods and services.
In 2004, the general procurement group formed a cross-divisional team of UTC employees who understand buying habits of the company's workers. From its findings, the director of IT created a concept of a mall which the team quickly determined would be viable—and valuable—to UTC.
Next, the procurement group created a requirements team to determine the mall's design and its functionality. IT worked with a third-party provider to write coding for the mall to meet the requirements. The mall was ready to pilot by the first quarter of 2005. After a few tweaks, the UTC web council, made up of the company's web managers, gave the mall its okay, providing it with a link which went live with four UTC divisions on July 1, 2005.
As designed, users of the UTC mall need only a single user ID and password to log onto the site. The mall, which is configurable by business unit, contains stores representing suppliers of indirect goods and services with whom UTC general procurement has negotiated agreements. It also contains a link to the company's e-procurement platform for items not generally available from the stores. Users can also find employee discounts and deals and content related to suppliers with a storefront, such as a list of contacts within general procurement and information on contracts the company has with the suppliers. The businesses also may use the site to exchange best practices related to purchasing.
A supplier with a storefront in the mall simply provides UTC with a stable link to its site. UTC category managers responsible for agreements with the suppliers are owners of content in the store. The category managers are members along with other UTC employees of the mall governance team.
While Loucks and the team communicated information and training on use of the mall to employees, traffic was light in the first few months. This was partly because the link did not have a prominent place on the intranet, says Loucks, who went back to the users for additional feedback on their thoughts on the mall.
As a result of the research, the team is enhancing the site. For one, they are creating a guest mall so that users can view its content without having to actually log onto the site. (Users still have to log on to make purchases, however.) Another adds a UTC mall icon to users' desktops. A third makes it easier for users to navigate around the site.
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