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Procurement Innovation Andrew Croston Fujitsu Services UK+I.

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Presentation on theme: "Procurement Innovation Andrew Croston Fujitsu Services UK+I."— Presentation transcript:

1 Procurement Innovation Andrew Croston Fujitsu Services UK+I

2 A Neapolitan Procurement Talk 1 Version Jan2011 FUJITSU CONFIDENTIAL

3 2 Agenda  Infrastructure Programme Delivery Assurance/Risk Management Brand New Supply Chain Creating Opportunity  Central Government Procurement Procurement Transformation Lean e-Sourcing  Global Technology Company Supply Engagement Global Alignment R2P

4 3 Version Jan2011 FUJITSU CONFIDENTIAL  Big Budget and Challenges  No procurement team  No established supply chain  No policy, procedures, processes or systems  Innovation  Delivery assurance: CLM  NEC3 Contract Schedule  Swift adoption of proven e-Tools Challenges of Procuring London 2012

5 AquaticsCentre SwimmingPool BricklayingSubcontractor Brick Merchant Distribution Company Brick Manufacturer Quarry Olympic Park Tier 1 Tier 2 Tier 7 Tier 3 Tier 4 Tier 5 Tier 6 Typical Supply Chain 5,000 contracts leading to 75,000 subcontract opportunities Payment Terms Regional Reporting Compliance Over 150,000 suppliers currently registered 250 buying organisations placing contract opportunities Opportunity Portal

6 People Process Technology % Temps Outdated Practices Paper Based Processes Performance MS Outlook Tenders Electronic Daily Reactive Fire Fighting Long term Interims Tender Event Schedule eTendering eEvaluation eAuction Paperless Office Permanent Staff Focused 45% Temps CIPS Gold Sustainable Policy Sustainability Embedded £20M/PM £25M/PM <15% Temps £30M/PM Opportunity Portal Procurement Strategy World Class - Hackett CIPS Gold Network Procurement & Contracts Division (PCD) Transformation Map Lean Processes

7 Efficiency from within Defra ORACLE e-Tendering e-Auctions e-Evaluation e-Contract Management Requisition to Payment

8 Operating Model Options Five operating options identified and considered for a consolidated procurement and commercial function across the Network, each option has its own relative merits, these are outlined below. Common Features and Benefits (present in each option) - Single Network Commercial Director across the Procurement/Commercial profession - Lower operating costs - Common processes and procedures - Reduced number of procurement functions - Reduce Headcount Option 2 1 Centre Option 5 Delivery Unit Option 3 Outsource Option 4 Hybrid Option 1 2 Centres

9 2 - Procurement Centre Model KEWMMOAH Core EA KEWMMOAHCoreRPA Network Commercial Director Existing Client Organisations ICT Relationship Management London CentreBristol Centre Centralisation of Common Commodities to ERG Common: People Processes Technologies EA DPTs Relationship Management Network CIO’sEA Distributed Existing Client Organisations EA Organisations currently provided with a procurement shared service from London Organisations currently being adopted into the London shared service Option 1 2 Centres

10 Supplier Assurance Programme CSR Portal CSR Portal Annual Review Site Visits (100% pa) Site Visits (100% pa) Quarterly Review CSR Portal CSR Portal CSR Portal CSR Portal Premier Suppliers (Top 50 >£2M PA) Preferred Suppliers (Top 150 >£500K PA) All Approved Suppliers (c1600 > £5K PA) Organisation Assurance Level Environmental Credentials Health and Safety Labour Anti-Bribery & Corruption Industry Accreditations SME status Scope F2F Meeting (#) per annum Relationship Management Performance Measurement Scorecards Extract Relationship Value 4 F2F Meetings per annum 1 Supplier Premises Promote Innovation Extract Relationship value Joint opportunities to … ++ + A Framework for Supply Chain: Visibility, Compliance and Governance Site Visits (5% pa) Site Visits (1% sample pa) Site Visits (1% sample pa) + +

11 UK+I Supplier Chain 10 Version Jan2011 FUJITSU CONFIDENTIAL LIVE Fujitsu UK+I Suppliers Tail Rump Premier Preferred 100 Why does this Dinosaur exist? - Decentralised procurement - CFS/SLS Purchase 2 Pay processes - Poor governance - Poor use of P-Cards Question Marks? 250 Up to 15 New Suppliers Added each Month! (6,000 historical, many remain on database) Chop off the tail?

12 11 Version Jan2011 FUJITSU CONFIDENTIAL

13 Challenges of Procuring the Games 12 Version Jan2011 FUJITSU CONFIDENTIAL  Big Budget and Challenges  No procurement team  No established supply chain  No policy, procedures, processes or systems  Green field Operation  Build a strong team 3 to 120  Pragmatic and workable procedures  Adopt proven e-Tools and mandate


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