Retail Merchandiser - March/April 2016 - 21


MONDELEZ INTERNATIONAL

Sweetening Supply
Snack maker Mondelez International is unifying its procurement process to improve
its margins and increase investment in growth. BY TIM O'CONNOR
There was a time in Mark Dady's career when he wanted
to switch to sales so he could see the impact he was making
on weekly and quarterly revenue statements.
But sticking with procurement turned out
to be the right choice
for the chief procurement officer of snack
food giant Mondelēz
International. In
Mark Dady, senior
less than two years,
vice president and
Dady has overseen
chief procurement
officer
the transformation of
www.mondelez
procurement into a
international.com
Deerfield, Ill.
unified operation that
visibly impacts the
company's growth and bottom line.
Mondelēz formed in October 2012
after Kraft Foods split off its snack
brands into a new company to encourage growth. For the past three years,
Dady says Mondelēz has been flexing its
independence to discover what it is and
is not capable of. "We are committed to
being the global snacking powerhouse,"
he adds. "Our dream is to create delicious moments of joy."
Although it is a relatively new
company, the separation from
Kraft left Mondelēz with a
collection of beloved, leading
global brands such as Oreo,
Cadbury, Ritz and Trident.
The company is the No. 1
chocolates and biscuits company
and the No. 2 gum maker in the
world, according to Dady. Mondelēz
offers a variety of products in five major
categories: biscuits, chocolate, gum and
candy, beverages and cheese and grocery.

Redefining Procurement
As Mondelēz refined its organizational
structure, the company looked to adjust
its procurement strategy to become one
of the foundations of its transformation.
Mondelēz International's leadership believed the company had good growth potential, but realized its margins were not
competitive with rivals such as Hershey,
Nestlè and Mars. Improving its margins
would enable the company to develop a
virtuous cycle of investing in growth and
expanding margins further. "We were very
deliberate in focusing first on getting our
margins to a particular point," Dady says.
To achieve that goal, Mondelēz decided its procurement operation would
own and source 100 percent of its $20

billion spend on everything from cocoa
and packaging to insurance, consultants
and sponsorships. "There was an appetite to leverage scale," Dady explains.
Mondelēz regards procurement as a
discipline in its own right, not just as
a function of the finance department.
"We want to be the best procurement
function out there," he adds. "In many
ways, there's no excuse not to deliver on
that ambition." Many of Dady's peers
at other companies can spend their
entire careers trying to get a seat at the
table with business owners and budget
managers, but Mondelēz has embraced procurement as a vital part of its
strategy. "With our model and with the
foundational building block of procurement owning and managing 100 percent
[of spend], the challenge wasn't getting
a seat at the table, but to jump on the
table and dance a jig," Dady says.
Since taking over as chief procurement officer in July 2014, Dady
has reorganized the division.
About 90 percent of the
company's 1,000 procurement employees

March/April 2016

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Contents
Retail Merchandiser - March/April 2016 - Cover1
Retail Merchandiser - March/April 2016 - Cover2
Retail Merchandiser - March/April 2016 - 1
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Retail Merchandiser - March/April 2016 - Contents
Retail Merchandiser - March/April 2016 - 4
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