procurement development in anchor trust; its journey, development & future (may 2015)

Value Adding Procurement at Anchor

Supporting the 2015 to 2020 Business Plan

Anchor Business Plan – 2015 to 2020

Business Objectives

•Best Customer Service•Best Place to Work•Best Run Company•Offer Anchor Services to More Older People

“Improve customer satisfaction across all services…….”“Ensuring value for money in all procurement decisions” “A culture of continuous improvement and innovation”

Anchor Business Plan – 2015 to 2020

Financials

•Growth Plans•Acquisitions•Increasing EBITDA•Cost Management

• Operating costs as proportion of t/o reducing (5%)• Support costs as proportion of t/o reducing (24%)

Procurement supporting cost management deliveryProcurement supporting M&A activity

Annual Expenditure

Category Sub Cat I&E Capital SC Total

Property 37 £32m £36m £4m £72.0m

Corporate Services 37 £19m £20.7m £0.3m £40.0m

IT / Telecoms 4 £14.5m £0m £2.5m £17.0m

Facilities Management 35 £9.3m £1.1m £3.9m £14.3m

Catering and Cleaning 29 £4.3m £0m £5.9m £10.2m

Utilities 6 £8m £1m £12.5 £21.5m

Total £87.1m £58.8m £29.1m £175m

The Challenges Were Clear

Tender not Procurement

Expertise

Business and Customer Alignment

Limited

Demonstration of Value for Money

Required

In isolation of the Organisational

Challenges

Access to required Goods and Services

Difficult

Blocking not Enabling

The Procurement Cornerstones

Resource Management

Leadership, Strategy and Policy

PerformanceMeasurement

& Management

OrganisationSpecific

Procurement Processes

Stakeholder Engagement

Organisation Specific

OrganisationSpecific

Charitable Organisation

Public Sector

Competitive Market

Customer Led

Property Asset BaseProcurement will respond

to the organisation’s specific requirements

Enabling our Customers

StakeholderEngagement

Business Partnering

Aligned Objectives

Category Groups

Easier Buying

Procurement will meet the needs of our

customersCommunication

A Tangible Improvement in Service

Performance Measurement

& Management

Signed Off Cost Savings

Supplier Performance

Benchmarking

Customer Satisfaction

Operational Standards

Procurement will deliver measurable

improvements in cost and quality

Supporting Delivery of Business Priorities

Leadership, Strategy and Policy

Across all of Anchor

Vision, Culture, Values

National, Regional, Local

Legal, Risk, Continuity

Innovation, Environment,Diversity

Procurement will provide commercial leadership

Consistent and Focused on Delivery

ProcurementProcesses

Category Management

Purchase to Pay

Information Sources

Simple Procedures

ConsistencyProcurement will be

efficient and consistent

The Right People…………

Resource Management

Culture and Values

Technical Development

Business Competencies

Coaching, Mentoring

Succession PlanningProcurement will have the right people on the

bus

Organisation Specific

Category Management in Brief (1)

Mobilisation SourcingBaselining

• Stakeholder Identification & Analysis

• Stakeholder Mapping• Communications and

Engagement Plan • Initial Risk Assessment

Undertaken• Stage Gate Approval

• Spend & Historical Analysis

• Current Procurement Practices

• Category Segmentation• Supplier Preferencing• Existing Contracts• Baseline Calculation,

Prices and Volume• Stage Gate Approval

• Competitor Analysis• Best Practice Analysis• Whole Life Costing

(TCO)• Business Needs

Analysis • Cost Benefit Analysis• Specification Challenge

and Confirmation• Stage Gate Approval

Category Management in Brief (2)

Supplier Selection ContinuousImprovement

Implementation

• Supply Market Analysis and Definition

• Market Conditioning• Value and Type of

Contract• Negotiation Plan, • Actual Savings

Calculation• Supplier Management• Stage Gate Approval

• Supplier Relationship Management Approach

• Performance Monitoring and Reporting

• Supplier performance Reviews

• Cost Improvement/• Benchmarking • Learning’s & Feedback

• Implementation Team• Risk Assessment &

Contingency Plan• Core Implementation

Accountabilities with KPI’s

• Implementation Plan / Targets

• Stage Gate Approval

E Procurement – Purchase to Pay

Ordering

Catalogue

PO Flipping

Invoice Scanning

Amazon experienceSingle ordering processReduced support costs

Maverick expenditure reducedImproved data qualityImproved control (PO)

Electronic invoicing and PO matchingReduced manual input / errors

Electronic invoicing and order matchingReduced support costs

Improving financial accruals

Procurement Value 2014/15

Procurement Target - £3m

•In Year Delivery £4.04m• I&E £1.65m• Service Charge £1.64m• Capital £0.75m

Customer Satisfaction

Rented Performance

Leasehold Performance

Procurement Value 2015 onwards

2015/16 2016/17 2017/18

I&E £4m £3m £1.5m

Service Charge £1m £1m £0.5m

Capital £6m £5m £3m

Total £11m £9m £5m

Cumulative £11m £20m £25m

The Structure - April 2015

Category Mgr Corporate Serv / IT

Pam Booth

Category Mgr Property

Charlotte Baker

Category Mgr Catering & Cleaning

Sean Wheatley

Category Mgr Facilities ManVictoria Wells

Category Mgr Property

Drew Robertson

Procurement Services Mgr

Grace Pearson

Category Mgr Utilities

Mike Williams

Head of Procurement and Purchasing

John Wallace

Category AssistantsAlex Holdsworth, Paul Stanford, Lendy Ho,

Kristina Fielding, Laura Stell

Energy Mgr TeamRobert Bradley, Richard Enyori

Commercial TeamDan Mountain, Jane Stephenson, Nick

Patton, Simon Rowe

Procurement ServicesAmber O’Sullivan, Sam Harrison, Debs Berry,

Carole McCarten, Leanne Ridley, Jo

Tolley

In Summary

Recruit ProcurementLeaders withRight Values

Get Influence at Board Level

Create MeaningfulRelationships with

Suppliers

OrganisationSpecific

Embrace ProcurementTechnology

Go Beyond a “Policing” Role

Value Adding Procurement at Anchor

Supporting the 2015 to 2020 Business Plan