Gary Richardson [email protected]
description
Transcript of Gary Richardson [email protected]
![Page 2: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/2.jpg)
Content of Presentation
• Who am I?• What is Procurement• Few facts…• Sourcing v Buying• What is eProcurement• Procurement is changing - drivers• Case study• 2005 Exercise Results
![Page 3: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/3.jpg)
Who am I?
• Slough
• IDeA– IDeA:marketplace– Zanzibar
• Royal Borough of Windsor and Maidenhead
• South Eastern Centre of Excellence
![Page 4: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/4.jpg)
What do we mean by procurement?
“Procurement” is the process of acquiring goods, works and services, covering both acquisition from third parties and from in-house providers. The process spans the whole cycle from identification of needs, through to the end of a services contract or the end of the useful life of an asset. It involves options appraisal and the critical “make or buy” decision which may result in the provision of services in-house in appropriate circumstances.
National Procurement Strategy for Local Government October 2003
![Page 5: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/5.jpg)
Few Facts…
• Councils spend £25bn (plus housing and capital) each year.
• Savings are there for the taking.
• Commodity spend is typically 30% of councils spend.
• Variation in Price is minimum of + 5%
![Page 6: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/6.jpg)
Few Facts…(2)
• Gershon/Spending Review 2004– 21.5 bn across all government– 6.45bn Local Government
• 50% Cashable
• 50% Non-Cashable
![Page 7: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/7.jpg)
Sourcing v Buying• Sourcing (Contracting)
– Make or Buy– Specification– Evaluation– Negotiation– Implementation– Contact management– PFI – Transfer of risk/Value for Money
![Page 8: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/8.jpg)
Sourcing v Buying• Buying (Shopping)
– Standard commodity items– Delivery– Requisitions– Orders– Delivery address– Standing Orders– EU Regs
![Page 9: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/9.jpg)
So what’s eProcurement?
e-Procurement is a tool to E enable procurement activities, including sourcing, ordering, commissioning, receipting and making payments for the whole spectrum of an authority’s activities.
The prime objective is to e-enable the management of the supply chain that can be achieved by stand alone, shared or integrated software tools.
The Benefits of
e-ProcurementLocal e-Gov - National e-Procurement Project
![Page 10: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/10.jpg)
So what’s eProcurement?
![Page 11: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/11.jpg)
So what’s eProcurement?
Sourcing is the process by which an authority identifies, selects, and manages its suppliers. (e-tendering and e-auctions)
Buying goods and services is the transactional process executed by many members of the authority during the day to day delivery of services. (e-purchasing and procurement cards).
e-Procurement is a collective term for a range of technologies that can be used to automate the internal and external processes associated with sourcing and buying.
![Page 12: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/12.jpg)
Procurement is changing…Drivers For change (1)
1. Every council should have implemented an appropriate e-Procurement solution as part of its Government program by December 2005 (National Procurement Strategy).
2. Every council should be using an appropriate e-Marketplace by the end of December 2006 (National Strategy).
3. To promote the development of e-procurement in the region, in collaboration with the National e-Procurement Project. (Core function of the Centres of Excellence)
![Page 13: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/13.jpg)
Drivers For change (2)
4. Every Council shall have an appropriate e-Procurement solution in place including at the minimum paperless ordering, invoicing and payments” by the end of December 2005 (Priority Outcome).
5. Every Council shall engage in Regional co-operation on e-procurement by the end of March 2006 (Priority Outcome).
6. An optional “stretch target” for high-achieving councils is to have established access to a virtual e-Procurement “Marketplace” (Priority Outcome).
![Page 14: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/14.jpg)
Drivers For change (3)
7. There are Performance Indicators to measure the Percentage of corporate spend through electronic orders, invoices received electronically, corporate spend through electronic sourcing, orders raised electronically and invoices paid electronically. (Local Performance Indicators).
![Page 15: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/15.jpg)
Case study – RBWM • Gershon/SR ‘04
– 6.45bn (national)– 2.09m (RBWM)
• 50% Cashable
• 50% Non-Cashable
![Page 16: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/16.jpg)
Few Facts…
Variation in Price is + 5%
20
21
22
23
24
25
26
27
28
29
30
RBWM[Worst]Best
£25m as average
![Page 17: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/17.jpg)
Few Facts…cont
Variation in Price is + 5%
20
21
22
23
24
25
26
27
28
29
30
RBWM[Worst]Best
£23.75m
![Page 18: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/18.jpg)
Few Facts…cont
Variation in Price is + 5%
20
21
22
23
24
25
26
27
28
29
30
RBWM[Worst]Best
£23.75m
£1.25m Potential; Saving
£25m
![Page 19: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/19.jpg)
Few More Facts…
• Stationary/Computer Consumables - – £287,500 spent
– Average Value = £110
• Spend with 6 suppliers of Stationary/Computer Consumables = £228,851 (over £400k incl Schools)
• Variation in Price on just printer cartridges is 30% - 40% below current costs
![Page 20: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/20.jpg)
What we did!
• Phase 1 is to grab the low fruit
• Where the “Best” are available on Framework agreements we use them.
• How:– Via Agresso/IDeA:marketplace - looks like…
![Page 21: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/21.jpg)
![Page 22: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/22.jpg)
paper
![Page 23: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/23.jpg)
![Page 24: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/24.jpg)
![Page 25: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/25.jpg)
![Page 26: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/26.jpg)
![Page 27: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/27.jpg)
![Page 28: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/28.jpg)
“Product Description”
“Supplier ID”
“Item Code”
“Manufacturer”
“Qty” “Unit Price” “Total Price”
![Page 29: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/29.jpg)
What we had to do?
• We needed to build the link between Agresso and IDeA:marketplace
• It looks like this…..(for illustrative purposes and not to be read on screen)
![Page 30: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/30.jpg)
1a
SupplierOnline Catalogue
Supplier
AuthorisationWorkflow
AuthorisationWorkflow
AccountsPayable
Bank
BACSPayment
Cheque
Remittence
InvoiceManager
PaperInvoices
ImageServer
TIFFImage
InvoiceScanning
XML Invoice
GoodReceipt
DelveryNote
POP
XMLPurchase
Order(eBIS)
Web Req
PunchOut
PostBack
XML Schema
Paper Document
XMLOrder
XMLInvoice(eBis)
IDea Catalogue
IDea Supplier Management and PO processing IDea Invoicing
Supplier
PunchOut
PunchBack
XMLOrder
Fax or email
Order
XML Invoice
Online Invoice
IDeA:marketplace
AGRESSOBusiness World
1 2
3
3a
4
5 6
7
6a
8
9
10
1a
AGRESSO Process
IDeA Process
![Page 31: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/31.jpg)
What are we going to do?
• We needed to build the link between Agresso and IDeA:marketplace
• We now have access to numerous Framework Agreements one of which is the Stationery contract which was our “lowest fruit”
• At first buyers were be able to purchase as existing
BUT
![Page 32: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/32.jpg)
BUT
• We needed to stop people buying without using the Agresso system– Suppliers were told NOT to accept telephone orders
except in an emergency or by special arrangement– Use MI from Agresso to inform managers of maverick
activity
• We needed to stop people buying from “expensive” suppliers
• The next step was to “extract” the efficiency savings
![Page 33: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/33.jpg)
1st Steps (work packages)
• Data analysis• Comparison• Negotiation with supplier• Commodity Champion and Departmental
Representatives• Establish new Supplier• Communications• Roll-out and Training
![Page 34: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/34.jpg)
ALARM National Conference Exercise (2005)• Your organisation uses eProcurement or is
about to – List the risks inherent in this new way of purchasing?
• Give each a rating 1-5 (5 is high) for1. the probability of them occurring
2. the impact on the organisation if they occur
3. what you would recommend to either stop the event occurring or mitigate its effects.
![Page 35: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/35.jpg)
Exercise Results
Risks Prob’ty Impact Action
Staff resistance, not adapting to change
5 5 Training and
Comms
IT System failure/Breakdown
5 5 Back-up systems
Inability to use local supplier
5 5
![Page 36: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/36.jpg)
Exercise Results
Risks Prob’ty Impact Action
Breaches in security (eg. Passwords) Lack of audit trail/fraud
4 4 Password protocols
Discipline procedure
Restricted delivery address
![Page 37: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/37.jpg)
Exercise Results
Risks Prob’ty Impact Action
Human error 4 3 Training and audit
Loss of control 4 5 Build in checks
Impact on local business sustainability
4 5
![Page 38: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/38.jpg)
Exercise Results
Risks Prob’ty Impact Action
Unauthorised purchasing
4 4 Segregation of duties
Different levels of access
Exception reports
![Page 39: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/39.jpg)
Exercise Results
Risks Prob’ty Impact Action
Product not fit for purpose
4 4 ???
Lack of control over suppliers
(Automatic payment)
4 2 Processes Training
Checks
Maverick spend 4 2 ???
![Page 40: Gary Richardson gary.richardson@rbwm.uk](https://reader035.fdocuments.net/reader035/viewer/2022062723/56813e3e550346895da82266/html5/thumbnails/40.jpg)
Thank you…