Oldcastle Materials Group

Current State Analysis & Recommendation for Future State

Oldcastle Materials is the leading vertically integrated supplier of aggregates, asphalt, ready mix concrete and paving services in the United States. Operations are carried out from over 1200 locations nationwide with more than 25,000 employees in 21 states.

Oldcastle has always had a clear philosophy for promoting business autonomy within a strict framework of financial performance.  Taken together Oldcastle has a very significant purchasing spend when aggregated across all businesses, it was clear from detailed analysis of the annual accounts that this spend wasn’t being leveraged to its maximum value. 

It was also clear that there was no common procurement process, that the purchase to pay process was not enabling the efficient fulfilment of supply against planned production or maintenance. The process did not manage the timely and efficient purchase of goods or services to enable Oldcastle to meet its requirements.

We were was asked to review the procurement processes for materials and services and make recommendations on improvements

The aim of the diagnostic review was to establish how the existing systems and processes supported the management of purchasing and supply. It also needed to consider the elimination of ‘noise’ in the management of many manual, resource intensive processes.

The review of current processes highlighted that emphasis on SOX compliance had spawned a series of additional processes alongside the normal purchase to pay process. In essence, the burden of compliance and control was causing internal friction in burden of effort and duplication, and external friction with suppliers. It was almost impossible to pay suppliers on time. A review of existing systems, and planned improvements identified that a new approach to the automation of the Purchase to Pay process was required.

ADR recommended a software selection process that was approved by Oldcastle, and which will deliver significant process improvements as follows:

• A single process and system for managing the purchases of goods and services
• Supports procurement of stock and (in the longer term) inventory management
• Approvals, Receipt Management and Accruals
• Invoice management; distribution, approval and reconciliation
• An end to end automated process that includes electronic order, receipt and invoice management with suppliers. This will use either EDI, XML, and email transaction management