Modernise Procurement: building an in-house intake solution at Personio

Brajan Gatys works at Personio as Procurement Manager and built the entire procurement stack from scratch with a complete no-code approach.
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Our CEO Pauline had the chance to interview him with the final goal of sharing his expertise and experience on how to make a procurement team successful thanks to pragmatism, automations and a frictionless experience for internal requesters.
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Brajan started his career at Trivago as an IT Procurement manager wanting to find a job mixing IT and Business. Then he moved to Personio 2 years ago with his leader to start the procurement team there!

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State of procurement at Personio 2 years ago with nothing in place.

When Brajan joined Personio, the procurement process was quite unorganized. He had to figure out the landscape: what resources did they have, how did employees make purchases, what were the major deals - in order to define how he could implement changes early on.

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There were several problems initially, such as contracts being scattered all over the place. Typically, joining a procurement function often means finding a system and processes already in place that you need to learn and follow. At Personio, they had to build everything from scratch.

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Typically, when you join a procurement function, you find a system and processes already in place that you need to learn and follow. However, we had to build everything from scratch.

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Over the past two years, Personio's procurement team has made significant progress. One of their major accomplishments was building out the entire procurement system. There was an existing procurement solution, but they decided to customize it building an in-house tool to better fit their operational needs.

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The procurement team now covers various areas and they have established a comprehensive freelancer process. Surprisingly, according to Brajan they faced no resistance in internal marketing; everyone was eager to work with them from the start.

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Creating trust and proving value of procurement function.

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A simple tip on the approach Personio procurement team took is that they make the experience easier, positioning themselves as enablers and not blockers for internal users doing purchases. Procurement teams want final users to spend time excelling in their expertise fields like marketing, engineering, HR or product but not managing purchases.

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The aim is to create a full service procurement: vendor enrollment, legal check (contract, compliance), finance check (budget, payment). The procurement team takes care of everything so that internal users handle the bare minimum and get a seamless experience: not painful nor complex. Indeed they don’t care about some terms in the contract or the compliance or budget check; they just want to start working as soon as possible with an agency, a tool or a provider.

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Once people realize “ok, it’s very easy to work with you, I can focus on my own topics” it’s a win for the procurement team.

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If the process is bad and it is difficult to reach out to you, people won’t use your process or fill your tickets or forms in the right way. An obvious red flag is a heavy documentation (written pages or tutorials) meaning the procurement process is too complex for your final users.

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How to deal with a large volume of requests with a small team using automation?

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Personio procurement team is doing a lot of automations to tackle the challenge of numerous requests to handle with only 3 full time employees and they estimate they would need 4 more people without their automations.

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They tried to automate all recurring tasks and what we could called “monkey work” ones: creating a PO, creating a vendor, onboarding a vendor, sending out a NDA, saving a contract, … People are here only to control and check compliance and quality with simple steps.

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For example for their freelancers process: internal users can make a request from Jira, then procurement team looks at it and automatically reach out to the freelancer if there are missing information, then it automatically drafts the contract and sends it. Data is all stored in one place to ensure compliance and the process is just a 2 to 3 clicks for procurement, 2 clicks for legal and all good!

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4 first steps Personio went through while building an in-house procurement system.

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1. Focus on procurement vendors benchmark

They did a lot of benchmark with several vendors back in 2022 to assess if vendors would fit their needs and solve their pains. Nevertheless they didn’t find a fit because:

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• Tools were quite old schools and not enough advanced: they didn’t do a lot of things and had a lot of limitations according to Personio. They also feared that if they need a special feature, customer support would try to push in into the roadmap but they would never hear back from them.
• Other big modern tools were just “intake” so not creating a lot of value for the Procurement team.
• Back then, none of the new modern procurement solutions like Payflows existed

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So, the Personio Procurement team decided to build an in-house solution to meet their procurement operations needs.

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2. Focus on orchestration layer and intake

The goal was to have very specific processes tied to Personio ways of working and existing tools.

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‍That’s why they assessed existing tools that internal users already knew to avoid onboarding and training them. Their tool Jira, Google Drive, DocuSign and all existing tools to make connections between them, create automations and leverage tools where people work and spend their days. The team focused on breaking Silos that were created by several tools and on avoiding double work when people have to write updates in 2 tools with the same information.

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‍Adoption is then super higher as users know their tools or Jira. On the front end, internal users are familiar to the system and in the back end, procurement team relies on ClickUp, no-code integrations, connections and automations to ensure there is no additional work for them and flows are also smooth on their side.

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3. Focus on recurring requests like freelancers management

Personio works with several freelancers and regularly onboard new ones so the goal was to make this process as smooth as possible: simple, fast. Procurement team wanted to make life easier for requesters and for freelancers to ensure a fast onboarding and a freelancer ready to work in minute.

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4. Focus on automations for contract renewal

Another focus at the beginning was to tackle contract renewal process and avoid challenging a provider 1 month before the end of the contract as it is too late to negotiate or to benchmark and choose other solutions.

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The idea is to get in the middle of the contract so for example after 6 months for a 12-month contract, an automated notice arrives in Slack to get NPS of the tool or of the supplier to check how things are going and anticipate a change in the contract. They tried to make it appealing with funny gif too!

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3 ideas to maximise adoption of procurement processes within a company.

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1. Engage with internal users

• Create a trustful relationship showing you will be an enabler and not a blocker
• Ensure they identify you as their point of contact
• Be reliable to unlock them or answer their questions
• Send reminders with short and nice messages

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2. Make things really easy and simple for internal users

• Mention how long some actions would take (2min, 5min)
• Actions and process should be simple by design: no explanation documentations or videos because people don’t bother reading it or watching it and creating tutorials mean you already failed in the simplicity of your process
• Be pragmatic and take existing inputs if the quality is good enough: if internal users has an existing description or a document, take it and don’t ask for another format
• Be in charge of the vendors relationship: don’t ask internal stakeholders to do thing procurement team can do like data processing and service agreement checks with the vendor
• Update internal stakeholders on your progress: it can be visual in the interface for the status of their request and also short messages like “I just ask your vendor about their data processing to get a green light for compliance topics”

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3. Be ruthless

• Your time as procurement team is precious
• If there is no ticket, procurement team doesn’t work with you

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Next challenge at Personio in 2024: having a full financial data cycle.

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2 mains challenges that Personio Procurement Team is facing and would need to address soon:

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• Integrate even more their systems into other financial systems: financial planning, ERP, …
• Be more analytical and action-driven: go beyond reporting and measuring 20 regular KPIs. There is a clear goal to perform advanced analyses so that they can work on concrete actions to improve those KPIs

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Our next mission is to achieve a complete financial data cycle by linking procurement and accounting data.

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A key value also for Procurement functions is generating clean and connected data to ERP for accounting purposes in order to manage and link invoices, vendors credit, pre-payments, final payments, etc.

Finance teams definitely need a link for example between Intakes and Purchase Orders. It can be thanks to tools, or a commun database but having siloed data will add manual work in the end and teams need to be careful about this.

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AI is a must-have in 2024: how can procurement functions leverage it?

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The obvious and first usage is for efficiency or productivity: write emails, descriptions, Jira tickets and these use cases are for all functions in a company. Same for data check: enabling your to get insights and quick analyses of raw data when you send them to an AI tool.

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For an advanced usage of AI within procurement team, here are 2 use cases:

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• contract reviews: pre-read and check, detect certain clauses, set custom clauses. The goal here is to speed up the contract review process and manual tasks
• purchase order and ERP updates: to manage differences between an order you made and the final delivery you get because your supplier didn’t have the right number of supply or prices changed a bit. So updates are automated and not manual. This example is more for Manufacturing companies

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Procure-to-Pay tools: key values and features that procurement teams need.

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Brajan is convinced procurement teams need a best of breed approach. And here are some “must-have” wishes to bring value and consider a tool over a in-house system:

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• lots of integrations: with ERP but also with contract management tools, ticketing tools, and all the other tools procurement teams deal with because of other stakeholders
• great API: to customize things and get access to raw data
• internal workflow: to customize flows based on company processes and operations
• very good UI, UX: for the procurement manager but also for the requesters as adoption is key and you need low-effort actions and not read long documentations
• low-code features like customizable forms: to be highly adapted to internal context

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The orchestration layer seems particularly central for Brajan to ensure a smooth and seamless flow of request from intake to contract to Purchase Order (PO) to Invoice to Payment. Here are some examples of Personio needs:

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• intake request with Jira
• contract review with Ironcloud
• PO pushed to Netsuite or Workday
• self-service functions for NDAs

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Different tips to start a procurement organization from scratch.

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1. Keep it simple

• Think about people over process and don't overcomplicate
• Keep orchestration at the center of your operational model

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2. Know your stakeholders

• Know who are your stakeholders, be good friends with them to build to a strong relationship
• See them 1st and avoid sending them a first Jira ticket or reminder message as your 1st interaction

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3. Improve your biggest contracts as soon as possible

• Find the biggest vendor contracts over your entire company tooling stack
• Improve these contracts as soon as possible to have quick value creation on savings

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4. Learn how to operate tools and make them evolve

• To be able to change things within the tool without relying on Tech or IT
• To develop small automations on your own and increase your operational efficiency

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5. Track your process efficiency with simple KPIs

• Monitor time from request to vendors fully onboarded ; you can break down by sub-steps:
  • Time from request to contract signed
  • Time from contract signed to onboarding completed
  • Time to fully onboard a new freelancer
• Check how much effort it requires for stakeholders:
  • Number of clicks to reach a goal
  • Time to perform specific actions‍
• Minimize bottlenecks or even remove them:
  • Number of times you expect stakeholders to do things or review a document

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To view all the short clips featured in this article and the entire interview with Brajan, please check out the full YouTube playlist just here.

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To speak with a Payflows experts and understand how Payflows solution can help your Procurement team to save money, ensure adoption, gain time and reduce risks, book a demo here!

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