Honda Motor Adopts Oracle Cloud ERP To Automate And Standardize Indirect Purchasing

Oracle Corporation Japan announced that it is helping Honda Motor improve the efficiency of its procurement for operations in Japan with Oracle Fusion Cloud Enterprise Resource Planning (ERP), optimizing the procurement cost of indirect materials.

Honda and its group companies are adopting Oracle Fusion Cloud Procurement, part of Oracle Cloud ERP, to consolidate purchasing of indirect materials for their operations in Japan. Previously, each company managed its own procurement systems and processes.

Standardizing on Oracle’s cloud procurement system enables Honda to adopt the latest best practices, and centrally analyze data for the efficient use of corporate resources. This will enable better planning for future procurement strategies and increase agility to respond to changing external factors and minimize additional costs.

In line with Honda’s 2030 Vision to serve people worldwide with the joy of expanding their life’s potential, Honda is engaging in new business areas while solidifying its existing businesses, which form its foundation. As part of these efforts, Honda has decided to reform its procurement operations for indirect materials in Japan to optimize costs and improve operational efficiency within its group companies.

“By utilizing Oracle Cloud Procurement, we aim to improve the efficiency of our indirect material operations, optimize costs and shift to higher value-added operations,” says Nobuyuki Hattori, General Project Manager, Interdepartmental Projects, Honda Motor Co., Ltd. “We also appreciate that it is a SaaS application that enables us to comprehensively analyze spending of combined data from group companies, is always updated with the latest technology, and can be used in remote and paperless environments. We will continue to promote efforts to optimize our overall procurement operations.”

Honda plans to embrace the standard features of Oracle Cloud Procurement, organized by purchase request, quotation request, price determination, ordering, and payment. In the future, the company will accumulate reasons for selecting suppliers and transaction data in the system to strengthen data-driven analysis for forecasting management and optimal supplier selection. Oracle Fusion Cloud Applications’ Oracle Guided Learning feature will help employees with step-by-step workflows that Honda’s 4,000 indirect materials suppliers and 25,000 employees will follow.

“The automotive industry is rapidly developing new technologies such as next-generation vehicles and the use of renewable energy,” said Toshimitsu Misawa, Member of the Board, Corporate Executive Officer, President, Oracle Corporation Japan. “With Oracle Cloud ERP, Honda Group will benefit from self-updating platform that provides new procurement capabilities every 90 days, giving it the ability to build, innovate, automate, and adapt on-demand. We expect Oracle Cloud Procurement will support the sustainable growth of the Honda Group.”

“The past 18 months has propelled the procurement function to the front lines of business, and supply chain risks have been elevated to a board-level concern,” said Tom Anthony, Vice President, Procurement Product Strategy, Oracle. “Oracle Cloud Procurement will enable Honda Group to simplify supplier management and enforce compliant spending to minimize supply chain risk and streamline indirect purchasing.”