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More Than 80% Time Savings in Supplier Evaluation Through Process Automation
Oculus Optikgeräte GmbH
🏗️ Industry: Medical technology
🗺 Headquarters: Wetzlar (Hesse, Germany)
🧍 Employees: ~ 550
💶 Revenue ~ $110 million per year
💶 Procurement volume ~ $25 - 30 million per year
Oculus Optikgeräte develops first-class ophthalmological instruments used for diagnosing eye diseases and vision problems. The product range extends from classic optical lenses to highly complex devices that can examine the cornea or the interior of the eye for pathologies. Additionally, Oculus offers supportive optical aids for corneal surgeons, for example. Over the past three years, Oculus has recorded impressive growth in both revenue and headcount, with double-digit percentage increases.
"What I've always experienced in the past: you don't have a central tool for your supplier information where you can actually retrieve and evaluate it. The information is always somewhere behind some network drive. But I can't select, compare, or analyze there - and that's exactly the problem that Tacto solves." - Sven Weber, Head of Operations, Oculus Optikgeräte
Initial Situation and Challenges
Oculus's impressive growth in recent years did not come without challenges. On the path from a small mid-sized company to a larger mid-sized enterprise, Oculus had to fundamentally adapt its organizational structure, particularly in procurement, and streamline its processes.
Procurement processes at Oculus were largely managed manually and operationally, which meant that no resources were available for non-operational tasks. Only what needed to be ordered was ordered, and there was barely any time to adequately track delivery dates. As a result, procurement at Oculus was constantly in so-called "firefighting" mode.
A key problem was the lack of transparency and decentralized data management. Assigning materials to commodity groups and suppliers within those commodity groups was indeed a strategic guideline, but was hardly feasible given the data situation at Oculus at the time. Reports and analyses were spread across three different systems (ERP system, Excel, and Felios) and preparing them was difficult and time-consuming.
Added to this were the challenges in supplier management at Oculus. Standard queries such as supplier self-assessments (SSAs), supplier long-term declarations (LTDs), or mandatory supplier disclosures were handled manually and required a high level of manual effort.
Furthermore, in medical technology, patient safety is the top priority. Specifically, this means that suppliers from whom even individual safety-relevant components are sourced must be particularly thoroughly evaluated, regardless of the size of their revenue share. Since Oculus sources a large number of safety-relevant parts from various suppliers, a comprehensive evaluation of a large number of suppliers was required. This supplier evaluation represented an enormous manual workload for Oculus. In addition to the limited capacities that only allowed for an annual evaluation and merely represented a snapshot, the procurement department required more than three months to conduct the evaluation of over 170 suppliers. All "soft facts" regarding the suppliers had to be manually assigned and evaluated.
In this context, Sven Weber looked for a tool that would first ensure visibility and transparency of the data situation to pursue a dedicated commodity group strategy, and secondly automate supplier management and supplier evaluation to free up important capacities for strategic projects and efficiently ensure safety across all parts.
3 Needs That Oculus Wanted to Fulfill
Management, retrieval, and analysis of all supplier knowledge in one tool at the push of a button
Efficient, continuous, and detailed supplier evaluation to ensure 100% patient safety
Preparation for continuous company growth with lean procurement processes
Tacto as THE Solution
Sven Weber's goal was to manage all supplier management and the derivation of commodity group strategies through a single tool. Here, Tacto was particularly convincing with its "one face to the supplier" approach.
Oculus started with the implementation of Tacto's Analytics module to be able to transparently retrieve all supplier data at the push of a button. This was the first step to even being in a position to develop a comprehensive procurement strategy. Furthermore, all queries that need to be conducted, such as SSAs, LTDs, and other queries from Oculus, can be processed automatically through Tacto and evaluated at the push of a button.
"Through the implementation of the supplier management system, we not only have transparency about which suppliers we order which parts from and in what quantities, but we also have information regarding the capabilities and certifications of these suppliers – and all of that in a single tool."
It was then a logical step for Sven Weber and Oculus's procurement department to focus on automating supplier evaluation with Tacto. Many of the data points captured by Tacto through queries are so-called "soft facts" that are used in supplier evaluation to determine whether suppliers are a good fit for Oculus. At the same time, "hard facts" such as on-time delivery, quantity accuracy, and quality compliance can be extracted from the Analytics module and integrated into the supplier evaluation. With Tacto, Oculus is able to continuously evaluate its suppliers at any desired time at the push of a button. This also results in high response speed regarding quality non-compliance for safety-relevant parts. The efficiency improvement in supplier evaluation through Tacto compared to the previous manual and time-bound process amounts to more than 80%. Additionally, this leads to significant cost savings in the five-figure range for Oculus.
"With Tacto, we have all supplier knowledge in one tool and can retrieve it at any time at the push of a button, from various perspectives. What I've always experienced in the past: you don't have a central tool for the supplier information you always collect where you can actually retrieve and evaluate it. The information is always somewhere behind some network drive. But I can't select, compare, or analyze there - and that's exactly the problem that Tacto solves."
Success with Tacto: Commodity Group "Populated Circuit Boards - PCBAs"
One of the largest commodity groups in terms of volume at Oculus is populated circuit boards (PCBAs). This was also the first commodity group that Oculus focused on after implementing Tacto. Through Tacto, Oculus was able to determine how much spend was allocated to which supplier and how many suppliers were represented in this commodity group.
Through the Analytics module, it was discovered that one supplier with an extremely high volume posed an increased risk for potential delivery failures, particularly regarding capacity. To counteract this risk, Oculus developed a strategy in which two suppliers were retained and two were replaced by providers with better performance.
By using SSAs, Oculus was able to create a shortlist of potential new suppliers, and ultimately Oculus added three new suppliers. These insights and actions would not have become apparent so quickly without Tacto.
Outlook with Tacto
The collaboration with Tacto was perceived by Oculus as very straightforward. The implementation was very simple and pragmatic across all steps. Additionally, the regular check-in meetings, especially at the beginning of the collaboration, were very helpful to find and fix all errors and clean up the data foundation. The focus is always on problem-solving.
In 2024, Oculus will begin using and implementing Tacto's Supply Chain Due Diligence Act (LkSG) module. While Oculus is not directly affected by the scope of the LkSG, it has already received customer requirements from directly affected customers and wants to prepare for future European-level legislation. Sven Weber sees Tacto as a long-term partner for procurement. Sven Weber sees particular joint potential in the area of savings measurement.
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Many thanks to Sven Weber and the entire team at Oculus Optikgeräte for our partnership-based and trustworthy collaboration.
Through partners and customers like you, it is possible to further develop our product in close exchange and close to day-to-day operations, as well as to discuss the topics that concern industrial mid-market procurement in joint webinars.
Learn how Oculus Optikgeräte was able to achieve more than 80% time savings in supplier evaluation with the help of Tacto.
