10 July 2021
Topics in this article
  • Media & Entertainment
  • Transformation

Working with one of the world’s largest entertainment businesses operating in over 40 countries globally across two core lines of business; music publishing and music recording, to balance creative and commercial outcomes.

Challenge

Historically, the business had a top-line, sales-focused culture and had enjoyed strong growth. However, with the rise of digital transformation and piracy, traditional revenue models began to come under pressure. Further, the growth of streaming, the explosion of social media, and the resurgence of vinyl and live performances had utterly transformed the commercial dynamics of the sector.

The CFO recognized that the organization was highly creative but not highly commercial. In search of creativity, distinct business units and labels took distinct approaches. At times, this was the right thing to do; however, at other times, the organization was simply duplicating processes, decreasing buying power and increasing costs for little or no benefit. 

The organizational ethos valued creativity and feared that a commercial approach would restrict innovation and growth. The CFO wanted to support the creative process by implementing commercial support for faster and more cost-effective decision-making. A traditional, process-led procurement approach would likely fail, so the CFO contacted Proxima for support. 

Approach

We have been delivering services to this business for over a decade. The engagement started with an initial assessment to understand the organization’s culture and what this meant for the potential opportunity and approach. 

We installed a global CPO and a sourcing and category management team to begin the transformation process. Initially, we worked closely with finance on back office processes and costs, looking into how to reduce operational expenditure and drive a better customer experience. This meant transforming the supply base and leveraging some of Proxima’s in-house technology to manage sourcing, spend and contracts.

We created a procurement function to be a commercial partner to the organization, assisting stakeholders by making the right thing easy to do. This involved building teams throughout the relationship to deal with different strategic and commercial challenges such as Source to Pay, Supply Chain, Bespoke Print, IT and AP Helpdesk, Assisted Buying, Vendor Management, International Opportunity Assessments, and expanded service delivery in North America.

RESULTS

Our relationship has flexed over time to reflect changes in the market and evolving client needs. There have been many $millions of savings achieved. Moreover, we have been successful in creating a more commercial culture;

  • Reducing the overall cost base, which is now held to market levels or below
  • Changing attitudes toward cost management across the organization
  • Transforming the supply chain
  • Supporting the physical to-digital transformation trend
  • Innovating e-procurement and process solutions supporting stakeholders
  • Implementing sustainable practices.

To discover more about how our team of expert procurement consultants can help your business thrive, get in touch.

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