PROACTIS Resources

CB Richard Ellis

Fortune 500 real estate services firm adopts procurement & invoice processing system
CB Richard Ellis

CB Richard Ellis Group, Inc, (CBRE) a fortune 500 and S&P 500 company headquartered in Los Angeles is the world's largest commercial real estate services firm. The company has over 30,000 employees and serves real estate owners, investors and occupiers through more than 300 offices worldwide.

CBRE's UK Property and Asset Management service provides owners with lease management, accounting, risk management, facilities management, and procurement services for commercial properties including shopping centres, office buildings, and industrial estates. Operating out of 12 UK offices with approximately 460 employees, the team manages 1,300 properties and delivers service to 12,000 tenants. They demand and collect rent and service charges of more than £1.3 billion each year. In terms of procurement, they have an annual spend approaching £200 million, with over 2,000 suppliers and over 100,000 invoices a year.


When property owners contract with CBRE to manage their assets, they expect the CBRE team to leverage property management expertise and local knowledge to operate their investments to maximise long-term value and reduce exposure to risk and financial shortfalls. Among other things, that demands close control of expenditure for services such as cleaning, maintenance, security, landscaping, and all activities required to keep a property in top condition and ready for sale. It also requires careful management of a wide range of suppliers, as well as proper, and prompt, payment of utility and tax bills, and other invoices. Both the owners and the tenants who are in receipt of and pay for the services expect clear, accurate and timely accounting for all operating expenses.

That's a tall order when CBRE is responsible for full service charge management at over 850 properties. This level of service can only be provided using well-conceived and consistent management processes, such as the way in which goods and services are procured and supplier payments are handled.

The Property and Asset Management executive team recognised that a comprehensive organisation-wide procurement and invoice processing system was needed. The system to be designed to effectively support the growing scope of the business and to provide great customer service. They also knew that such a system would put them ahead of the competition in terms of the value they could offer clients, and so it was made a top priority.


CBRE wanted a procurement solution they could put in place quickly, but also a solution that had the framework to become a true spend control system for all of their properties. "We wanted a system that would be a significant value-add to our clients and our tenants," says Matthew Burnham, CBRE's Property & Asset Management Chief Operating Officer. "As such it needed to help us be more efficient in procurement while at the same time enabling us to accurately record and control expenditure across over 850 separate entities. The system needed to ensure that we had control and visibility of not just what we are spending but also what we are planning to spend, thereby significantly improving financial control."

CBRE actually met PROACTIS when they acquired the software company that CBRE had initially selected. But when the CBRE team saw the PROACTIS solution, it was clear that it would meet their needs quite well and the decision to adopt the system was an easy one. The fact that PROACTIS was available as a hosted solution made it even more attractive. That meant the CBRE team could focus all their attention on deployment and use of the system, and let the PROACTIS team handle day-to-day technical operations.


As hoped, CBRE implemented PROACTIS very quickly, achieving full deployment across all properties in just nine months. The system is now in use by over 350 employees ranging from central office personnel to on site operations people. Frequent users also include regional facility managers responsible for multiple properties who are often working on the road using laptop computers with mobile Internet access. The system is integrated with four different financial systems to support CBRE and various property owners.

Using PROACTIS workflow and authorisation rules, most purchases are made directly by the authorised employees. If the purchase exceeds a specified value, risks an over-budget situation, or is otherwise outside the norm, it is automatically routed to a manager for further approval.

"The PROACTIS system has been very well-received," says Lee Tanner, CBRE National Procurement Manager. "Once people got accustomed to using the computer for purchases, they got comfortable with it pretty quickly. They generally sing its praises today."

Tanner adds: "Some of the people who appreciate the system the most are the site managers who are responsible for the budget of their facility. I understand that - having been a site manager in the past, I would have given anything to have the budget control and visibility they have now with PROACTIS."

Invoice processing is another area where the system is helping to streamline things. Many expenses are necessarily based on invoices alone - for instance phone, utility, and tax bills. CBRE is already using PROACTIS with large suppliers like the phone company and internal CBRE charges, and is about to implement electronic invoices with utility providers. Soon, about 40% of all invoices will be received electronically. That plus the use of purchase order matching and workflow to verify service delivery by the originator, has greatly reduced paper based processing and enabled the AP department significantly increase control of the payment process.

PROACTIS is helping with strategic procurement issues as well. "We now have visibility of exactly what we're doing with our suppliers - what we're buying, how much we're spending, delivery performance, etc. That's enabling us to proactively identify and resolve issues, and to work towards obtaining even better value with our contracts," says Tanner.

Burnham summarises by saying: "It was no small feat to establish a single procurement system that enables us to manage 850 different properties as separate entities. But in doing so, we now have one of the best spend control system in our business. We believe PROACTIS gives us the perfect platform to ensure that we are at the forefront of delivering both value from procurement and control of expenditure management."
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