Transforming how Microsoft connects with its 58,000 suppliers

Jun 3, 2021   |  

Anyone procuring goods or services for Microsoft needs to do their homework. Not only must you make sure the supplier can provide what you need at a reasonable price, but you must make sure they meet certain standards and security compliance as well as needing their email or phone number. Tracking down all that information is where supplier information management comes in.

From cafeteria food and office chairs to professional services, marketing or hardware, Microsoft works with more than 58,000 different suppliers. Until recently, finding the relevant information needed to make an informed choice required searching through at least 10 different databases or tools.

Whether or not that information would be current and accurate was another question. Updates made in one database may not make it another. Only 65 percent of Microsoft’s regular suppliers had valid contact information on file.

“There was no holistic data store where we could say, ‘here is a 360-degree view of a supplier,’” says Naveen Kumar Nooka, a senior program manager on Microsoft’s Procurement team.

Gathering the pieces to form that view is typically a four or five day process. The solution was often to create a support ticket with the Accounts Payable or Procurement teams—and there were a lot of them.

These pain points weren’t only felt internally at Microsoft.

Suppliers had a difficult time as well providing the needed information to partner with Microsoft. They had to visit 14 separate tools owned by various teams to enter different types of data, such as basic profile information as well as their rate cards, compliance documentation, and sourcing information. And if they had questions, there was no centralized place to get help.

Shah smiles in a headshot photo with a white background.
Suchit Shah listened to the pain points expressed by Microsoft suppliers to improve the experience of providing supplier information to Microsoft. (Photo by Suchit Shah)

“We heard from the suppliers telling us that it’s difficult to do business with Microsoft because you have so many tools,” says Suchit Shah, a senior procurement operations manager for Microsoft. If they wanted to update any information, suppliers had to contact their business manager, and that person would then enter the updates manually on an ad-hoc basis.

“The result of that was that suppliers were missing compliance deadlines and missing critical data that they had to provide to us,” Shah says. “That’s disruptive to the business, because if they’re not compliant we have to block them, and they can’t provide services to Microsoft.”

The Procurement team within Microsoft Digital, the organization that powers, protects, and transforms Microsoft, envisioned a way to solve the company’s issues with supplier information management.

Not only aiming to reduce the overall risk by ensuring trusted and accurate data, the Procurement team sought to improve the experience for their users on both sides of the business relationship while reducing the costs associated with the manual and disconnected processes.

[Learn more about how Microsoft secures its supply chain with risk-based assessments. Find out how Microsoft designed a modern service architecture for its procurement and payment processes.]

Somebody stood up

Microsoft Consulting Services is highly dependent on supplier information.

As senior business program manager overseeing master data within Microsoft’s Services business unit, it’s important for Andreas Hart to have accurate information on subcontractors.

The biggest win of the project was that somebody stood up and said, “I’ll be that central reference point for everyone.”

– Andreas Hart, senior business program manager, Microsoft Services

Hart partnered with the Procurement team to help integrate supplier data APIs into what would become a single source of truth for supplier information. Hart says the most critical aspect of creating a solution was identifying that source and then convincing all the stakeholders involved that it would be reliable.

“I think the biggest win of the project was that somebody stood up and said, ‘I’ll be that central reference point for everyone,’” Hart says. “Naveen and the Procurement engineering team volunteered to be the backbone, and then the consuming team saying, ‘we want to create a dependency as well.’ That trust on the dependency has to be established.”

With the supplier data backbone established and centralized, the Consulting Services team removed the internal replication of supplier compliance status from its contract management system and agreed to consume the supplier details from the newly established master source.

For Microsoft suppliers, a single portal called SupplierWeb was created to replace the 14 existing tools. Designed as a self-service portal, suppliers can log in and easily manage and update their own data, view their transactions, and get help through a digital assistant. Implementing data governance rules and best practices within SupplierWeb ensures that only valid data flows in.

Since its initial rollout in January 2020, roughly a third of Microsoft’s suppliers are now onboarded into the new system. The remaining suppliers are expected to be onboarded in a year, when data quality is tracking to improve from 65 percent to 90 percent.

For internal users at Microsoft needing to find a supplier, a new ProcureWeb portal provided the sought-after 360-degree view with all the necessary and validated information together in one place. In addition to basic information, ProcureWeb also offers “surround data”—augmented data-like awards, skills, fact sheets, and special recognitions that help complete the picture.

We’ve built a seamless user interface on Microsoft technologies that is available to both suppliers as well as internal users.

– Naveen Kumar Nooka, senior program manager, Microsoft Procurement

The robust ProcureWeb database has another popular new feature: intelligent search insights that can help internal users find a supplier based on specific criteria, such as areas of expertise, level of experience, or even a supplier’s diversity rating, which is helpful as Microsoft works to diversify its supplier base to include more minority-owned businesses. The search function has logged more than 870,000 unique searches since July.

Built on Microsoft Azure, both portals use micro front-end architecture, with a single service layer powering both systems with consistency. Data is stored in Azure Cosmos DB, Microsoft’s multi-model database service, and seamlessly connects to SAP on the back end.

“We’ve built a seamless user interface on Microsoft technologies that is available to both suppliers as well as internal users,” Nooka says. “We build once and make it available in multiple places, ensuring that there is the right level of authorization. That’s the whole suite of solutions we’ve built to make life easier for both suppliers and internal users.”

Tackling bigger questions

Microsoft isn’t alone in needing a robust solution for supplier information management that operates at enterprise scale. Designing one with solid data integrity, enhanced capabilities, and a smooth user experience was an opportunity to build something unique.

“If we look at the industry today, there are a lot of large enterprises who do business with a number of suppliers,” Nooka says. “Most of them have their own portals where they collect supplier information. So, we’re trying to be as innovative as possible in this space, optimizing the data we collect from suppliers, while generating all the insights for an internal user to ensure a seamless experience.”

A year and a half into the project, the Procurement team is now looking to improve other aspects of the supplier lifecycle.

The supplier vetting process is up for an overhaul next, aiming to eliminate duplicative work that happens when the same supplier is onboarded multiple times by different teams who all have their own processes.

Collecting data at the right points in time and completing the vetting process before a supplier is entered into the system will also ensure that only suppliers that meet Microsoft standards and requirements go through the whole onboarding process.

“It’s going to help faster onboarding,” Shah says. “It’s a massive transformation for both sides, and it’s a multi-year journey.”

Rosalia Snyder, group procurement operations manager for Microsoft Procurement, says that as risks in managing suppliers have evolved, it’s increasingly critical to have agile solutions for supplier information management.

“Whether it be supporting company commitments around diversity or sustainability or adding mandatory statutory requirements, how do we ensure we have accurate supplier data to quickly adapt when we need to?” Snyder says.

It starts with better tools, but that’s just the beginning.

“We are breaking down silos, taking a lead across the enterprise to define how suppliers should do business with us, while creating the ecosystem to do it in,” Snyder says. “This has been part of our digital transformation journey at Microsoft.”

Learn more about how Microsoft secures its supply chain with risk-based assessments.

Find out how Microsoft designed a modern service architecture for its procurement and payment processes.

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