Project background
Client: Aggregate Industries
Aggregate Industries is an international construction and building materials company with leading regional market positions in the UK and the US and is a member of the Holcim Group.
The company’s operations extend throughout the UK and into Northern Europe and across seven regions of the United States. Aggregate Industries produces a range of aggregates, ready-mixed concrete, asphalt and pre-cast concrete and the company employs over 12,000 people working from over 650 locations.
Aggregate Industries handles many hundreds of thousands of transactions per year with their supply chain, which represents a significant demand on resources for processing. The company has approximately 17000 customer accounts to manage and trade with and these include some of the largest construction industry firms, contracting companies and construction materials suppliers such as builders’ merchants.
Within Aggregate Industries’ business, the majority of purchase to pay processes were handled manually, requiring high levels of human intervention and labour intensive activities to take an order through to payment.
Of the Aggregate Industries' purchase to pay processes that were automated, these were handled by multiple e-trading software applications which required specialist skills and IT resource to administer, update and manage over time.
Project goals
The business goals set by Aggregate Industries were:
- Streamline business processes
- Centralise applications and processes onto a single platform
- Standardise electronic trading whilst remaining flexible to customer/supplier needs
- Reduce transactional costs.
Selected application
Causeway Tradex was the chosen electronic trading application.
Tradex integrates with Aggregate Industries’ back office systems which are Oracle, One World and PRMS – Computer Associates (Legacy).Tokopen (Infonic) is used by Aggregate Industries for document management and storing copies of all of the invoices which are received.
Implementation
The implementation of Tradex in Aggregate Industries was intended to replace all existing electronic trading infrastructure within the company. At the same time, Aggregate Industries also embarked on the implementation of a new ERP solution from Oracle (called Oracle One World) which was also replacing legacy systems within the business.
The project sought to automate the exchange of data and the way in which documents are processed within the business. The intention was to manage these by using workflow and business rules within each application to reduce human intervention.
The implementation followed the standard project methodology:
- Documentation
- GAP Analysis
- Specification of the project
- Deployment of new functionality
- User acceptance testing
- Customer and supplier testing
- Go-live
- Monitoring
- Improvement.
Business benefits
The Tradex solution was implemented effectively and within an agreed timescale. Aggregate Industries has seen immediate benefits in the following areas:
- Improved customer service and satisfaction: Aggregate Industries has now reduced its debtor days as transactions are quicker and much more visible to all users. This has meant an improved cash flow position. Aggregate Industries has also reduced the need to put clients ‘on hold’ because the purchase to pay process is quicker. There is less risk of data errors leading to a higher percentage of matching rates – again avoiding manual intervention, which could slow the process down. 40 of the company’s key customers now trade electronically with Aggregate Industries.
- Operational efficiencies and time savings: Aggregate Industries has improved the resource efficiency of its electronic trading. Aggregate Industries has grown significantly over the past 18 months with the purchase of Foster Yeoman and other businesses. The purchase of Foster Yeoman itself increased invoice volumes by 15%. However, with the Tradex implementation the company’s back office teams have remained at a similar size even though the number of documents exchanged has increased significantly.
- Reduced costs: Aggregate Industries has reduced transaction processing costs by 95%. Aggregate Industries is now saving approximately £3 in costs for every transaction that is processed via Tradex.
Final client comment
The project has been a complete success from start to finish undoubtedly due to the help and support of Causeway Technologies, our electronic trading platform and services provider. Using the Causeway electronic trading platform (Tradex) not only meets our current customer and supplier needs but given the flexibility of the solution allows us the ability to meet the needs of both customers and suppliers in the future, regardless of size and technical ability/capability.
The original aim of this IT Project was to improve the way in which we trade with our customers. By trading electronically we are now able to provide a much better customer experience.
In addition, we were also looking to improve our own internal supply chain processes by receiving invoices electronically and by auto matching the invoice against the purchase order and proof of delivery. This has given us a fully automated and transparent process from end to end all via the Tradex Hub.
