Equinor case study

– Arne Johan Larsen is a Lead Analyst at Equinor. Here he shares his story about how process improvement saves the company huge amounts. It all started as a pilot project together with Eye-share related to improving the purchasing process in Equinor, and collaboration between the purchasing organization and suppliers. 

We wanted to set a standard in the market and be a pioneering company, says Larsen. The result of this exciting project is that Equinor now has a fully automated process for sending and receiving orders, even though not all suppliers are ready for this. The solution is being rolled out to more than 6,000 suppliers in Norway, Europe and hopefully also the USA in due course, says Larsen.

Challenge

Time-consuming handling of orders with different suppliers with different solutionsEquinor is a large purchasing organization and for our buyers it is very demanding to deal with many different ways of sending orders to suppliers. When we also add the manual follow-up afterwards, the process requires a lot of time and resources in Equinor, says Larsen. The starting point for the improvement was also the phasing out of a proprietary solution, which was both outdated in technology and very expensive to operate. Equinor also has a clear strategy of being at the forefront of digitization and creating value through new digital tools. We seize the opportunities that technology gives us. A fully automated purchasing process simplifies not only the orders, but also the entire invoicing process, says Larsen.

Solution

Electronic orders are sent and received at EHF. Deviations are handled in the eye-share Portal
The solution is ingenious and is based on the standard EHF – Advanced Order Processing. TietoEVRY access point is used for sending and receiving all orders, while eye-share Portal takes care of all suppliers who can not receive and send in this format. Equinor can thus handle all its orders electronically, using the EHF Advanced Order * format which is handled through the access point. eye-share Portal is used by suppliers who do not have the opportunity to receive and process purchase orders or EHF orders in their own system and this happens all by itself. eye-share Portal notifies suppliers when they have orders for processing, these are answered, goods and services are delivered, and you can also send invoices directly to the orders from the system. Suppliers get a user-friendly interface through the eye-share Portal. Equinor sends and receives everything directly in its own system. When Equinor has the correct order information, this is matched directly to the invoices, which in turn are connected to the ERP system SAP. We do not overcomplicate anything and in all its simplicity, the solution works best, says Larsen.

Gain

Equinor saves valuable working time through automated purchasing!
The project has highlighted a great potential in time and process optimization. Larsen mentions examples where the use of time is reduced by approx. 1 hour per order, and when it comes to over 160,000 orders per year, this represents a significant saving. In addition, the solution offers great advantages in relation to the quality of the invoices, which we have estimated amounts to several hours of savings per invoice. Through automation, invoices will be reconciled to orders, Equinor will pay the suppliers on time, and there will be much less need for follow-up along the way. Overall, this solution provides a significant reduction in time spent, both for us as a purchasing organization and for the suppliers, a “win-win” situation for both parties.

A solution for everyone
There is a great potential for other companies to use the eye-share Portal. No one else has previously developed a similar solution. The project was not intended as tailoring, but as a contribution to increased collaboration between customers and suppliers. Now we have taken the lead and set a standard for the market, and here we have a “Proof of concept” solution that can definitely create value for many other companies as well.

The exciting way forward
The solution is currently being rolled out to over 6,000 suppliers of Equinor in Norway. The next step in the process is to get the solution out to Europe, and eventually also the United States. We continue the work with further development of the product, related to the expansion of functionality that we have not used. We also want to expand the solution for more demanding change requests from suppliers over time, says Larsen.

The collaboration between Equinor and Eye-share
Equinor chose Eye-share as a partner based on the company’s flexibility and ability to deliver quickly. From the very first meeting, we also matched well on both competence and communication. We are very pleased with the collaboration with Eye-share, which has delivered a solution that both delivers and excites, Larsen concludes in Equinor.