ALD Automotive, a prominent global vehicle leasing company with a presence in 43 countries, manages a vast fleet of over 1.7 million vehicles. The dynamics of the automotive industry, marked by trends such as vehicle electrification, emerging mobility disruptors offering alternative leasing solutions, the impact of COVID-19, and supply chain challenges, have triggered significant changes in ALD Automotive’s supply side market. Recognizing the strategic significance of its sourcing function for profitability and competitiveness, ALD Automotive sought to ensure its alignment with current and future needs.
What does Nova Reperta do for ALD Automotive?
Miel Horsten, Group Regional Director at ALD Automotive, engaged Nova Reperta to evaluate and enhance ALD Automotive’s sourcing function.
Key customer questions
How well suited is the current sourcing function?
Are we leveraging the full potential of the sourcing function?
Can we leverage any best practices?
Is the international procurement function fit for the future?
How do we need to develop in the context of the changing market landscape?
In collaboration with Nova Reperta, ALD Automotive undertook journey to align its sourcing function with strategic objectives and future requirements of the market and the leaseplan acquisition. This transformation centered around addressing the following key questions:
How well-suited is the current sourcing function?
Nova Reperta conducted a maturity assessment of ALD Automotive’s sourcing function, encompassing both the central sourcing team and the sourcing teams within ALD’s national affiliates. This assessment phase identified areas for improvement across three critical dimensions: category performance, data and systems, and organization and capabilities. With the insights from the assessment, Nova Reperta provided recommendations on the necessary steps to unlock the sourcing function’s full potential.
Understanding the automotive market dynamics
In a highly dynamic mobility market, ALD Automotive recognized the evolving nature of customer preferences and the changing business models of automotive original equipment manufacturers (OEMs). These changes have significant implications for the mobility value chain and, in particular, vehicle sourcing. The changes in the market were assessed and the impact on ALD procurement were put forward, with some counter measures on how to deal with this volatile market.
First steps launched towards a mature sourcing function
A key recommendation stemming from the maturity assessment was the establishment of a data-driven decision-making and performance monitoring system.
ALD Automotive’s sourcing organization operated in a highly decentralized manner, with local entities defining category strategies and performance metrics to a significant extent. Visibility into performance metrics was limited.
Nova Reperta supported ALD Automotive in implementing the right performance metrics, and introduced performance dialogues with local affiliates, aimed at promoting data-driven category management. These dialogues facilitated the identification of local best practices and their cross-market dissemination to enhance sourcing performance
The primary impact of our approach was to enable the measurement of sourcing performance at both the central and local level. Furthermore, it allowed ALD to measure the impact of its sourcing strategies, and to identify best practices within the markets. This ability to measure performance, identify best practices, share, and implement these best practices across markets are what elevated the overall maturity of ALD’s sourcing function. Ultimately, this resulted in a sourcing function that is more resilient and responsive to pressures from the market and able to enhance it value capture from all leasing activities.
Our not only enabled the measurement of sourcing strategy impacts but also fostered an environment for elevating maturity and performance through the sharing of best practices across markets, ultimately resulting in enhanced value capture.