Archive for the ‘Procurement News’ Category

Ealing Council ahead of the game when it comes to simplifying government procurement

Thursday, December 16th, 2010

Last week John Collington, the Head of Procurement for the Cabinet Office’s Efficiency and Reform Group (ERG) and Chartered Institute of Purchasing and Supply CEO, David Noble, announced they were joining forces to help improve public sector buying. Their aim is to transform how government buys common goods and services through centralised category management, standardisation of specification, and aggregation of spend, to deliver savings from the baseline of £13 billion, in the region of 25 per cent over four years.

This collaboration follows John Collington’s announcement at London’s Efficiency, Reform & Accountability conference on 24 November, where he informed delegates of his plans to address 9 core spending areas, including office supplies, print management, advertising and media, by September 2011.

This is good news for Claritum, given our experience and success in the public sector, and one of our public sector clients, Ealing Council, is excited to be ahead of the game.

Having used Claritum since 2008 Ealing Council has been able to demonstrate the benefits of Claritum for some time, and the Council is now embarking on deployment of additional functionality, after reaching out to Claritum for ideas of how best to deliver additional cost reduction and value for money.

Claritum proposed a complete solution for Ealing encompassing branded templates, user portal interface, internal print management and costing and charging. This was to be added to the existing Claritum deployment which ensures sourcing and procurement meet corporate requirements and deliver best value on every transaction. A combination of matrix and bid costings covers a wide range of media from photography and design to complicated mailings and distributions. An interface to internal council systems provides semi-automated financial transactions.

The bottom line benefits to Ealing will be further cost savings and process efficiencies. Less tangible but increasingly valuable benefits will be derived from strengthening the Ealing brand and improving the effectiveness of communications media.

Ralph Brandhorst, Senior Production Manager for Ealing Council said, ”we estimate the reduction in direct and indirect costs will be many times the costs of the system improvements as well as providing many non cost benefits. It is an area many public sector organisations are looking at”.

The London Borough of Ealing is the largest in west London, third largest of the London boroughs, with 310,000 residents, 13,365 businesses and a budget of £266 million.

Former Home Office group commercial director John Collington became the most senior procurement figure in the UK government on 1 September when took up his current role. His remit is to spearhead a cross-government approach to procurement and its supply chain to make the best use of its combined purchasing power and get better value for money.

Top Tips for a Successful Spend Analysis Project

Thursday, December 2nd, 2010

In our experience of spend analysis projects for complex categories, especially marketing services and print, it can be daunting to know where to start.  Follow these top tips from Claritum for a successful outcome with meaningful and actionable information.

  1. Do something! Don’t assume this category is too complex to get the information you need.
  2. Clearly define your objectives before you embark on your project.  Decide what business decisions you want to make as a result of your spend analysis, and ensure you develop a framework that will give you the information you need.
  3. Gain senior procurement and marketing buy-in early, as you may need a champion to push through change further down the line.
  4. Engage independent category specific and vendor neutral experts, not generalists or those eager to win your contract.
  5. Segment spend groups at both broader and more detailed levels. You will want to be able to roll up and drill down spend detail by carefully identified categories.
  6. Be wary of invisible costs.

Good luck!

For more tips on conducting a successful spend analysis project download the Claritum White Paper: Spend Analysis for Complex Categories at: http://www.claritum.com/info-centre/white-papers

Claritum CEO to speak at CIPFA Performance Improvement Network Event

Friday, October 29th, 2010

Claritum CEO, James Samuels has been invited to speak at the CIPFA Performance Improvement Network Event “Driving Cost Reductions through Better Procurement”

The workshop is designed to give an insight into delivering savings and efficiencies in the current economic climate, and takes place in Leeds on 4th November 2010.

The event will be attended by Heads of Procurement, Finance Officers and Auditors from local authorities in the North of England.

Event organizer, Mohamed Hans (Performance Advisor at CIPFA) invited Claritum to share their practical experience of delivering savings to The London Borough of Ealing, as well as sharing the challenges, solutions and outcomes across their wider public sector client base.

James Samuels said “with such pressure to deliver savings and efficiencies, its good to see more public sector bodies sharing best practice. Our experience in this sector proves that significant, measurable and sustainable savings and efficiencies can be achieved through implementing better procurement

How The London Borough of Ealing are planning significant savings and efficiencies

Tuesday, October 19th, 2010

 The London Borough of Ealing is the largest in west London, third largest of the London boroughs, with 310,000 residents, 13,365 businesses and a budget of £266 million.
With increasing pressure to deliver cost reductions and value for money across the organisation, Ealing are looking at improving processes to drive cost savings and efficiencies. 
Ralph Brandhorst (senior production manager), in the central Marketing & Communications department is working with Claritum to develop systems and processes that will reduce time/costs associated with designing and producing all documents and any marketing and communications media. Within any organization there exists the hidden cost / time executives spend creating documents and ensuring they meet corporate branding guidelines, which could be reduced and used to make a greater contribution to service objectives.
To address this Claritum are proposing a complete solution for Ealing that encompasses branded templates, user portal interface, internal print management and costing and charging. This can be added to the existing Claritum deployment which ensures sourcing and procurement meet corporate requirements and deliver best value on every transaction. A combination of matrix and bid costings covers a wide range of media from photography and design to complicated mailings and distributions. An interface to internal council systems provides semi-automated financial transactions.
The bottom line benefits to Ealing are cost savings and process efficiencies. Less tangible but increasingly valuable benefits will be derived from strengthening the Ealing brand and improving the effectiveness of communications media.
 
Ralph Brandhorst said “We estimate the reduction in direct and indirect costs will be many times the costs of the system improvements as well as providing many non cost benefits. It is an area many public sector organisations are looking at”.
 
Phil Martin, Marketing Manager of Claritum said: “With the pressure on public sector spending we are delighted that Ealing are seeing real tangible efficiencies and savings from using Claritum. Our public sector clients are all reporting similar benefits and provide a best practice template for other local authorities. It is clear that the successes we have seen at our public sector clients provides proof that significant, measurable and sustainable value for money can be achieved from print, marketing and document services. We are seeing an unprecedented level of interest from councils, universities and other non for profits right across the country.”

Sir Philip Green “Government spending up to 80% above market rate on printing”

Tuesday, October 12th, 2010

The government is paying up to 80% above market price on many print jobs adding to a total annual print spend of £104m, according to Sir Philip Green’s review of Whitehall spending.

Green’s report into government efficiency, which was published this week, found that the prices paid by government for commodity purchases are often far from competitive.

He identified the lack of a centralised approach to buying goods and services, which has failed to leverage the buying power of the public sector and resulted in departments paying hugely different prices for the same items.

The capability of print buyers varied greatly across government departments while buying processes were often inconsistent, the report said.

Green added: “There is no reason why Government should not be as efficient as any good business.  Any large organisation would want to use its credit rating and scale to buy efficiently.

One of the  conclusions of this review is “scale”.  Every department has not been used to make Government spending efficient.”

Among his recommendations to the government, Green advocated centralised procurement, the production of accurate spend and consumption data, managing down demand and specifiations, and pricing common items at the same level for all central government departments. This can be achieved through the use of technology such as e-Procurement.

Local authorities such as Ealing Enfield and Greenwich Councils have adopted such technology by implementing Claritum, which has streamlined their sourcing, procurement and invoicing processes, leveraged their in house expertise and optimised communications with external suppliers.

The software-as-a-service solution automates much of the process of specifying, costing, ordering and invoicing marketing print, stationery, documents, reprographics and creative services. The application can be deployed to large number of users from customers and budget holders to expert buyers and suppliers. Management have control over spend limits and controls and have real time management information to monitor performance across the supply chain. Claritum integrates with most leading ERP and financial systems such as SAP, Oracle, JD Edwards and Agresso.

More Pressure on local Governments.

Wednesday, September 22nd, 2010

Chancellor George Osborne is due to deliver his Spending Review on Wednesday 20 October.

The June 2010 Budget said that departmental spending would have to be cut by £50bn a year by 2014/15, compared with 2010/11 levels

These cuts are putting even more  pressure on the public sector and Government Offices to improve efficiencies and drive better value for money procurement than ever before.

A survey from the Chartered Institute of Purchasing and Supply in the UK suggested that as much as 60% of corporate spend is uncontrolled, meaning it does not have proper management approval and it cannot be properly accounted for.

As a consequence, many not-for-profit organisations are adopting Print Spend Management solutions in a bid to take control of expenditure, improve cost-base visibility and ensure that value for money is truly achieved.

By deploying Claritum’s Print Sourcing and Procurement platform, sustainable and measurable value for money can be achieved from a combination of price reductions, process improvements and minimised wastage, avoiding costly and disruptive outsourcing.

A variety of public sector and local government authorities are already using the system

Phil Martin Marketing manager said; “Local Authorities are seeing real tangible efficiencies and savings from using Claritum . It is clear that the successes we have seen at our other public sector clients provides proof that significant, measurable and sustainable value for money can be achieved from print and document services.

Our Local Council Clients are able to do Much more with less resource.

We look forward to the possibility of shared services. This will benefit all local Councils who are using Claritum

Claritum Launch new White Paper

Monday, June 7th, 2010

For most organisations complex indirect spend categories pose an opportunity for significant savings and efficiencies but are often seen as too challenging to address. Professional Services, Travel and Expense; Print and Marketing Procurement can represent substantial spends but require specialist expertise and technology platforms to achieve savings and efficiencies.

However, with cost pressure on most organisations, complex categories need to be considered a higher priority – especially as savings of 17-40% can be achieved.

Claritum have created a White Paper which focuses on one of the largest of these complex categories and is intended to demystify the approach to achieve savings and efficiencies. This is the first of a series of White Papers from Claritum addressing Print and Marketing Services Procurement.

Print and marketing services are surprisingly large spends for most organisations. Dependent on sector, this category can represent between 0.5% and 3% of revenues. According to research, expenditure on printed materials in the US totals US$167billion per annum and Euro243billion in Europe.

Yet much of this spend falls outside the visibility and control of a formal procurement program. According to Aberdeen, 80% of print is manually sourced using phone, fax and email; leading to higher than necessary costs, inefficiencies and errors.

Why? Print is typically difficult to capture and control as requirements are dispersed across the organisation and usually bought by whoever has the need. Marketing may have established long term relationships with suppliers or rely on their agencies to purchase print on their behalf – often at inflated margins. Most businesses and departments use printed materials and responsibility for buying it is often delegated to junior staff with little or no experience or understanding of what they are ordering.

Print can be a complex area of spend where minor variances in specification, date of order, production process or supplier selection having significant impacts on cost.

To download the full white paper FOR FREE please register your details here>>

Buyers show lack of faith in spend data

Friday, May 7th, 2010

Just under one-third of purchasers have a high degree of confidence in the data that measures their spending, according to a report.

In a survey of 150 procurement professionals by procurement technology firm Rosslyn Analytics, only 28 per cent of buyers said they believed their spend data was “complete and accurate”.

In addition, 31 per cent of respondents had a low level of confidence that the information was accurate enough for decision-making purposes. Forty per cent had a medium level of confidence.

“With recent advances in technology including automated data extraction, categorisation and enrichment services, it shocks me that procurement continues to have inadequate spend data,” said Rosslyn Analytics CEO Charles Clark.
“The sooner procurement professionals resolve data quality concerns, the sooner they will be able to focus on the serious business of sustainable cost savings.”

The report also found that 40 per cent of respondents used a third-party provider to gain additional information from available data.

Claritum’s data driven spend analysis program enables our Client’s to gain granular insight into their spend, or monitor performance of a current outsourcing arrangement, in order to achieve significant, measurable and sustainable savings and efficiencies.

Companies told to analyse spend to save money,

Friday, April 30th, 2010

Supply Management: Organisations are missing out on cost savings because of inadequate spend analysis, a report has found.

“Strategic spend visibility: Untapped potential for cost reduction” (sponsored by Rosslyn Analytics), examined the impact of spend visibility and analysis on companies’ returns. It estimated the potential losses from poor practices to be millions of dollars in terms of unrealised cost savings.

It highlighted that companies should adopt a more strategic and organisation-wide approach to spend visibility to not only incorporate transparency of what is bought and from whom, but also identification, tracking, reporting and analysis.

This should not solely be the remit of procurement and supply chain management, the report said, but become practice in other departments including finance, HR, IT, marketing and legal. This would enable companies to catch savings opportunities that might otherwise have been missed.

For example, savings from strategic sourcing could be increased by up to 12 per cent with better spend analysis, according to the report. It could also help get more spend under the control of procurement, potentially from 25 per cent to more than 75 per cent, and result in better control of maverick spending and greater contract compliance.
The report estimates that, on average, 80 per cent of organisations’ spending is with less than 20 per cent of its suppliers. A better understanding of where money goes could lead to consolidation of the supply base, which in turn could generate savings. In addition, improved spend visibility could facilitate better risk analysis by, for example, identifying potential disruptions to the supply chain as a result of being overly dependent on a single source of supply.

Claritum’s data driven spend analysis program enables Their Client’s to gain granular insight into their spend, or monitor performance of a current outsourcing arrangement, in order to achieve significant, measurable and sustainable savings and efficiencies.

Spend Analysis can be provided as a stand alone engagement, but when combined with Claritum’s sourcing and supplier management tools, client’s realise significant, measurable and sustainable savings, without compromising quality or performance.

59% Of US Companies see Cost Savings and Process Efficiencies as their key priority in the procurement of print.

Wednesday, April 28th, 2010

Initial research conducted by Claritum has shown that 59% Of US Companies see Cost Savings and Process Efficiencies as their key priority in the procurement of print.

Claritum (in conjunction with UK Trade and Industry) surveyed over 200 US Companies with a view to better understand their views on the procurement of indirect and complex categories.
The majority of those who responded (87%) spend between $3 and $10million on complex, indirect categories such as print and related services.

73% from the returned sample believe that effective print buying is just as important as any other indirect spend.

When asked about how print is purchased within their organisation, 68% were still using manual processes by either a central procurement function or the individual who has the need, with only 16% using and automated ERP or procurement platform.

The majority of companies indicated that cost saving and reducing the over all indirect spend (32%) as their top priority. Improved efficiency and effectiveness was also important (27%)

41% stated that granular/real-time visibility of indirect spends was “Very Important” where as 29% thought cost saving through competitive bidding was “Very Important”

72% felt cost savings through process automation was “Somewhat Important”

However 62% believed that monitoring buyer and supplier performance was “Medium to less important”

The survey is still available to complete, For Companies still wishing to take part, please follow the link - http://freeonlinesurveys.com/rendersurvey.asp?sid=fnrx31na32o8hf9726068