Market Forces - Executive Talks | KPMG | BE

Market Forces: New Challenges, New Changes

Market Forces: New Challenges, New Changes

Responding to changes caused by technology and market conditions.


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Excerpts from Detlef Schultz:

Procurement organizations must continually adapt to new and changing developments in the market

If you take technology changes into consideration and the impact of those technology changes on the procurement activities, I think they are enormous.  First of all, I think in Vodafone, as a procurement organization, constantly have to adapt to change.  So you don’t buy a base station anymore, you basically buy the deployment of base stations with the associated services and field maintenance afterwards, as an example.  Now if you think about the technology revolutions and developments in the market out there, think about machine to machine. In that degree, the role of procurement changes dramatically, because here we do not buy any services or any boxes or anything you can touch and deploy, you basically buy commitments.  You buy commitments to our customers, or you support Vodafone making commitments to our customers.  Or think about content.  Yeah, if you buy content, content becomes more and more important for us.  So if you buy content, the question is not, do I get the content for 3% less in price?  The question is, do I get the right agreement in place which enables me to deploy the content everywhere where I want it?  Do I have the revenue share agreement in place?  These things are entirely different and were absolutely unheard of ten years ago.

Emerging markets present significant collaboration opportunities

Vodafone does currently roughly 65 to 70% of its business in Europe, 30% in the emerging markets.  So a typical challenge is cost.  You might appreciate that the cost in India is lower than the cost in Germany or the UK, so if we dare talk about professional services, for instance, there is a price there between the two prices, and people wonder why isn’t it possible to get the same price in Europe?  So this clearly is a challenge.  Secondly, I believe we have yet to do more when it comes to the question of, do I source enough in emerging markets?  And I firmly believe that there is more to gain by collaborating much closer with them.

Entrepreneurial spirit is essential when driving the company to change

I believe if you want to create a company like this, you need entrepreneurial spirit across the entire team, and you only can be successful if the people believe in your vision.  You only can be successful if people follow your vision and then, with their full enthusiasm, heart, and spirit, help you driving the company into a certain direction, and I’m very thankful to have a team which is doing exactly that.

About Detlef Schultz, Vodafone

Detlef joined Vodafone in March 2003 to lead the Global Supply Chain team. His responsibilities include strategic and operational leadership of Vodafone’s Supply Chain Management across the globe in the areas of Technology and commercial Services. Detlef also leads the Luxembourg-based Vodafone Procurement Company, which is the strategic purchasing centre for the Group and now serves third parties.

Prior to Vodafone, Detlef spent more than 6 years in California with the world’s largest semi-conductor equipment manufacturer, Applied Materials where he held various Supply Chain, Planning and Operations Management responsibilities. Before moving to the US, Detlef was a Member of the Board of Management for Babcock-BSH AG in Germany where he led the area of Supply Chain Management and financial controlling. Detlef also worked for Siemens for ten years, more latterly as Purchasing Director based in Bocholt and Kamp-Lintfort, Germany.

He started his Supply Chain career with Siemens in 1985 in the area of Materials Management in Germany, Korea and Singapore.

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