The organization faced significant operational and strategic challenges in managing procurement planning across their global footprint:

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Process inefficiencies and fragmentation:

• Each region managed annual operating plans and monthly latest estimate forecasts through different manual processes heavily reliant on Excel, resulting in labor-intensive and inconsistent ways of working

• Fragmented planning led to occasional discrepancies between different versions of the truth, with no centralized workflow to track changes

• Manual processes made it extremely difficult to perform quick forex and scenario modeling, with tasks that should take minutes requiring days of effort

• Limited ability to adapt swiftly to dynamic market conditions such as commodity price fluctuations, macroeconomic fluctuations or supply chain disruptions (e.g. shipping delays

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Data and system integration challenges:

• The business has no centra procurement l data lake, with each region operating icould notERP system that could not be easily linked to provide key data

• Disconnected systems prevented global visibility into what was happening locally within regions and driving costs and spend variance

• Managing procurement across 64 plants and 23,000 materials without unified systems created significant coordination overhead

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Organizational complexity:

• Two key markets drive approximately 80% of procurement spend and have different ways of working

• Misalignment between what the global team expected to see versus what regions were actually reporting due to lack of prpcess alignment

• Three different stakeholder groups (procurement, finance, and IT) with different priorities and perspectives made decision-making challenging

• Cost Management and Visibility:

• Procurement teams struggled to manage cost fluctuations driven by multiple drivers such as commodity indexes (for example significant cocoa price increases), freight expenses, interest rates, and other cost drivers

• Limited ability to negotiate effectively with suppliers or evaluate supplier performance without comprehensive visibility

• Difficulty forecasting, budgeting, and managing risks to avoid disruptions

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Keyrus partnered with the client to implement a Materials management model designed to standardize, digitalize, and streamline procurement and finance annual operating plan and forecasting processes. The implementation strategy focused on delivering global financial consolidation in Phase 1 while preparing for deeper regional procurement integration in Phase 2.

Throughout implementation, Keyrus created high-level architectural diagrams showing business process workflows, outputs, transactional data sources, and building blocks to align stakeholders and guide development.

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1.Sophisticated Cost Modeling Framework

Keyrus developed four distinct cost modeling archetypes to accommodate the diverse procurement planning needs across different material categories:

Flat Price Model: For materials with limited visibility into cost components, providing a single price without a breakdown of commodity, freight, or logistics inputs

Escalation Model: Primarily used for packaging materials during budget planning cycles, this model takes a base price (such as last purchase price or prior year average) and applies escalation factors including:

• Country-specific inflation rates

• Foreign exchange fluctuations

• Commodity index changes

• Logistics cost adjustments

• Quarterly escalation percentages with first-half and second-half applicability

Cost Plus Model: The most complex archetype for ingredients, calculating price from multiple absolute cost drivers organized into clusters:

• Commodity impacts linked to global indexes (cocoa, sugar, wheat, etc.)

• Export duties and tariffs

• Freight and logistics expenses

• Interest rates and financing costs

• Conversion factors and byproduct returns

• Each cluster can be grouped and calculated cumulatively, with configurable drivers  

BOM (Bill of Materials) Cost Model: Recipe-based costing directly linked to material-plant combinations, including:

• Commodity drivers with inclusion rate percentages

• Waste percentages and direct labor/energy conversion

• Packaging costs and margins

• Tariffs applied at both commodity and final item levels

• Commodity balancing adjustments for manual overrides

The beauty of this framework is that cost models serve as reusable vessels—once created and configured with cost drivers, teams simply update prices and rates monthly without restructuring models, and multiple material-plant combinations can link to the same cost model for automated cost calculation.

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2. Global Financial Consolidation and Reporting Bridge

Recognizing that global and regional procurement teams and finance teams can lack strong connections, Keyrus built a comprehensive reporting bridge that:

• Aggregates procurement data across all 14 regions into unified global financial reporting

• Provides dynamic waterfall analysis connecting base versions to current versions, showing volume mix variance, market variance, transactional FX impacts, productivity, and translational effects

• Enables seamless currency switching between local country currencies and global GBP reporting for alignment during cross-regional discussions

• Delivers drill-down visibility from consolidated category levels to individual material-plant combination details

• Tracks variance drivers at granular levels (UC level - unique plant/material combinations) and summarizes to plant and category reporting levels

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3. Flexible Price Management and Data Architecture

The solution accommodates diverse pricing approaches:

• Cost driver prices can be updated at country, plant, or specific material-plant override levels with automatic hierarchy management

• Commodity index data loaded from external files with blending rates for hedged versus non-hedged positions

• Master data management for logistics impacts by country and category, FX dependencies, and category ownership (centralized, central-led, or local)

• Planning source flexibility for base prices with manual override capabilities

• Lag rules for averaging commodity prices across multiple periods

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4. Phased Implementation and Change Management

Phase 1 focused on delivering core functionality with global financial visibility:

• Piloted initially in key Western European markets to gain insights and validate approach

• Deployed to approximately 70 users across regions in live environment

• Three-month post-go-live support period functioning as extended support for socialsation with regional teams

• Addressed core process differences discovered during scoping, UAT and  live usage

Phase 1.5 addresses regional process variations:

• Enhancing and updating solution to accommodate key differences in regional processes discovered during hyper care

• Aligning regional processes to central design or modifying central design for validated local requirements

Phase 2 will focus on:

• Business process mapping and alignment of regional procurement processes

• Automated data integration from multiple ERP systems (potentially through data lake or direct interfaces for key regions)

• Deeper local procurement team involvement and workflow optimization