Cathay Pacific Case Analysis
e-Procurement at Cathay Pacific Airways: e-Business Valuation Group 7/ B2B Kunal Kumar PGP/16/204 AnkitVermaPGP/16/185 Chandan Bharambe PGP/16/078 StutiAnand PGP/16/231 Supriya S M PGP/16/234
1. What are the benefits of the e-procurement systems for the Airlines Purchasing Department? Quantifiable benefits: Reduction in the purchase price Increased spend through CxeBuy Reduction in inventory cost Reduction in transaction cost Reduction in order cycle time Improvement in order accuracy Time saved in procurement activity Time available for carrying out value-adding activities Sourcing cost reduction
Non-Quantifiable Benefits: Real-time availability of standard and ad hoc purchasing intelligence reports that were not previously available The ease with which users can access new suppliers Improved supplier data and price visibility More product information in a more accessible format Personalised information to meet individual/departmental requirements Centrally negotiated prices from preferred suppliers
2. Mention the concerns of key managers in Cathay Pacific regarding the e-procurement system implementation? Finding a suitable inventory management system for CxeBuy as the earlier EMPACS and the new Ultramain systems were both very complex External systems integration with the e marketplaces Redeploying of the staff involved in the APD to other startegic roles Finding suppliers who could be let go without affecting the entire rollout process Building a database like spend and supplier prefernce data, sales and inventory data Obtaining a buy in from all the spend departments for the new sytsems
3. What kind of financial metrics can be used to quantity the benefits? Reduction in the purchase price Throughimproved supplier performance greater purchasing power and reduced off-contract spending Increased spend through CxeBuy Reduction in inventory cost:Through efficient order processing and better forecasts the
1. What are the benefits of the e-procurement systems for the Airlines Purchasing Department? Quantifiable benefits: Reduction in the purchase price Increased spend through CxeBuy Reduction in inventory cost Reduction in transaction cost Reduction in order cycle time Improvement in order accuracy Time saved in procurement activity Time available for carrying out value-adding activities Sourcing cost reduction
Non-Quantifiable Benefits: Real-time availability of standard and ad hoc purchasing intelligence reports that were not previously available The ease with which users can access new suppliers Improved supplier data and price visibility More product information in a more accessible format Personalised information to meet individual/departmental requirements Centrally negotiated prices from preferred suppliers
2. Mention the concerns of key managers in Cathay Pacific regarding the e-procurement system implementation? Finding a suitable inventory management system for CxeBuy as the earlier EMPACS and the new Ultramain systems were both very complex External systems integration with the e marketplaces Redeploying of the staff involved in the APD to other startegic roles Finding suppliers who could be let go without affecting the entire rollout process Building a database like spend and supplier prefernce data, sales and inventory data Obtaining a buy in from all the spend departments for the new sytsems
3. What kind of financial metrics can be used to quantity the benefits? Reduction in the purchase price Throughimproved supplier performance greater purchasing power and reduced off-contract spending Increased spend through CxeBuy Reduction in inventory cost:Through efficient order processing and better forecasts the