First ERP, SCM, CRM, and Then Comes the Money

When CEO A. Maurice “Maury” Myers and Senior Vice President of IT Tom Smith arrived at Waste Management in November 1999, they knew they wanted to transform the strategy of the company from one focused on acquisition and rollouts to one centered on operational excellence. In order to inculcate discipline and accountability throughout the company, the turnaround team outlined four initiatives early on for the ailing company. Here’s how they’re progressing as of the middle of 2001.

ERP Myers and Smith plan to launch PeopleSoft financial, HR and customer information systems companywide. More than 400 of Waste Management’s districts were up and running on the PeopleSoft financial systems as of July 2001, and the company plans to convert all 1,500 districts by the end of the year.

Supply Chain Myers and Smith are attempting to leverage Waste Management’s size and its $4 billion annual procurement budget (everything from trucks to paper clips to travel services) by consolidating purchases, paring down suppliers and taking all procurement online. The company expects procurement savings of $75 million by the end of 2001 and eventually $400 million annually after a few years.

CRM The goal is to make Waste Management a true “service machine” by creating enterprisewide rules and standards for customer relations. Three service machine program pilots were running in June 2001, from which the company will build a blueprint for the companywide rollout later in 2001. Each business unit will then have a template for customer setup, on-time service requirements and customer-handling protocols.

Overall Market Strategy The plan is to adjust pricing based on location and competition, and maintain the focus on the strongest core North American business units, leveraging locations in which the company owns collection, transfer station and disposal businesses in order to make the company more profitable. Waste Management has already sold its overseas assets and has raised some landfill prices. The company expects $75 million in benefits from this initiative in the second half of 2001.