$1 Billion Semiconductor Manufacturer: Semiconductor company conducts more cost-efficient procurement with ICG Commerce expertise and services

Situation:

Faced with an urgent need for cost reductions, a $1B semiconductor manufacturer wanted to achieve continuous procurement cost savings of 5-10% while establishing world-class procurement processes. The company was also using highly manual purchasing methods, and was looking to centralize, streamline and speed those processes, as well.

Solution:

To generate savings from the start, ICG Commerce sourcing professionals helped the semiconductor company's procurement group implement and use eRFIs, eRFQs and other e-sourcing tools to get the best total cost value for both direct and indirect goods. Negotiations were tailored across multiple categories, and ICG Commerce category experts also assisted company staff in conducting software audits, seat-license right-sizing and maintenance contract alignment.

For greater purchasing speed and efficiency, ICG Commerce implemented electronic Vendor Managed Inventory (eVMI) bin stocking programs that ensure adequate supply and minimize production outages.

Results:

Procurement processes implemented with ICG Commerce expertise and tools have netted over $1M in total savings for the semiconductor manufacturer. In particular, the company realized 22% savings in a Small Parcel program, 16.3% savings on Oracle software, and 10.9% savings through eVMI for MRO.