7% additional Savings
Additional savings on previously untouched tail spend
"We believe this can fundamentally change how operational procurement is handled in the future."
Marcello Pala
Head of Process Excellence & Governance, Covestro
The Company
If you have driven a car, sat in an office chair or looked through a pair of eyeglasses today, you have touched Covestro. The company makes the polycarbonates, polyurethanes and coating raw materials behind headlights, mattresses, insulation and wind turbine blades. Covestro generates $15B in annual sales with around 17,000 employees and 48 production sites worldwide.
Procurement is split across three regional organizations, EMEA, North America and APAC, each with its own processes and buying policies.
The Challenge
Marcello Pala runs Process Excellence & Governance for Covestro's procurement. His problem was not that people didn't want to buy correctly. It was that buying correctly required knowing too much.
Hundrets of catalogs and millions of items sat behind different entry points. Some requesters worked in SAP Ariba, others created their requests in SAP. Covestro's three regional procurement organizations, EMEA, North America and APAC, each had their own rules for which channel to use and which supplier was preferred. As Pala puts it, the old way required people "to understand the underlying procurement landscape" before they could buy. Most didn't, so they picked whatever channel they knew, and the request came back for correction.
Every request that went wrong landed on a buyer. In the tactical buying shared service center, the team responsible for tail-spend requisitions spent its days checking and chasing. Negotiating those orders was out of the question. There was no time, so the spend went through untouched.
With Lio
Covestro didn't buy a new procurement tool. Covestro sees Lio "as an important strategic component of our procurement transformation and as much more than just another procurement tool. It provides an intelligent layer between our requisitioners, procurement processes and backend systems."
That layer went live in Covestro's largest market within a few months. From there it rolled out region by region.
For the requester, none of that is visible. They type what they need. Lio searches the catalogs, applies the buying policy of their region, picks the compliant channel and the preferred supplier, and builds the request. "One of the biggest strengths is the user experience," Pala says. "Lio provides requisitioners with a single, intuitive entry point and guides them through the purchasing process."
Nobody was forced to use Lio but had a User Adoption of 90%.
Ariba stayed available too and any employee could keep buying the way they always had. Within months, over 90% of users had moved to Lio on their own.
Time to deploy more Agents
Once requests came through one door, Covestro could put agents behind it. The PR Review Agent reads every requisition. Missing cost center, wrong supplier, no quote attached: instead of a buyer catching it by hand, the agent finds what is missing and writes to the requester itself. Buyers see only the exceptions that need a decision.
Order Confirmation Agents run for indirect and direct material.
For direct material the bar is different. A laptop arriving a day late is an inconvenience. A raw material arriving a day late is a production problem. At Covestro, the agent reads the confirmed delivery time out of unstructured supplier documents and compares it against what SAP expects, so deviations surface before they reach the plant.
And in the tactical buying shared service center, the team that never had time to haggle now runs its negotiations with the Lio Negotiation Agent. Small orders that used to go through unnegotiated get negotiated, at scale, in whatever language the supplier speaks. The result: 7% additional savings on spend that had never been touched before.
This is the part Pala calls orchestration. "Lio allows us to combine guided buying, catalog search, procurement validation, approval routing and increasingly automated processing within one solution. This is particularly valuable in a complex global procurement environment such as Covestro's."
From operational buying to strategic sourcing
In Q1 2026, a second team at Covestro opened a second workstream with Lio: strategic procurement, direct materials, as a co-development partnership. A Central Sourcing Hub. The problem it solves sits before the tender. Covestro's strategic buyers run tenders across several specialized platforms, each good at one thing. Covestro didn't want to replace them. They wanted the work around them to stop being manual: collecting specifications from the business, analyzing spend and volumes, preparing the documents and Excel templates a tender needs. With Lio, the business uploads its requirements, the buyer adds theirs, and Lio builds the tender project, runs the spend analysis and generates the full package the tendering platforms need.
Results
Strategic Partnership
"Another major positive aspect is the collaboration with the Lio team. They are very responsive, pragmatic and open to jointly developing solutions based on our requirements. The speed at which feedback can be translated into improvements is something we particularly appreciate."
Where this goes, he is equally clear. "For Covestro, the real value is not only in improving the requisitioner experience but also in using AI to automate and orchestrate procurement processes end-to-end. We believe this can fundamentally change how operational procurement is handled in the future."
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CPO, Bilfinger
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