arcblue consulting @pmmsgroup it’s time for procurement chris newman director arcblue consulting...
TRANSCRIPT
![Page 1: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/1.jpg)
ArcBlue Consulting www.arcblue.com.au @PMMSgroup
It’s Time for Procurement
Chris NewmanDirector ArcBlue [email protected] 318 384
![Page 2: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/2.jpg)
The Global Procurement Network
© ArcBlue Consulting 2
QLD State Government• Contract Management Assessment and
training program • Social Procurement Development
VIC State Government• Training Programs• Review and Certification
Programs
VIC Local Government• LEAP Spend Analysis and Procurement Development• Contract Management Guidelines and Development• Training• Social Procurement Programs
NZ Government • Agency
assessment• Spend Analysis
NSW State Government• Accreditation process with 7
Departments• Procurement Project delivery• Capability Model Development
State Government
Local Government
SA Local Government• Roadmap Program• Regional Opportunity
Analysis Programs
Procurement Capability Assessment / Development
Federal Government• Contract Management
Training Federal Government
Queensland Local Government• Local Buy Training• Spend Analysis Pilot• Gold Coast Contract
Management Training and Capability Development
WA Local Government• Procurement and Contract
Management training • Procurement Handbook
Development• Spend Analysis
SA State Government• Savings Programs• New Royal Adelaide
Hospital Procurment
NSW Local Government• Procurement Development Program
across 30+ councils • Procurement Leadership Program• Regional Development Programs• Social Procurement Guidelines
Our public sector experience
![Page 3: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/3.jpg)
The Global Procurement Network
© ArcBlue Consulting 3
Contents
Implications of rate-cappingWhy procurement - what is the data
telling us?How can strategic procurement be
part of the solution?
![Page 4: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/4.jpg)
The Global Procurement Network
© ArcBlue Consulting 4
Implications of rate-capping
A burning platform for the next stage of professionalisation or
A handbrake on sector capacity and development
Opportunities for innovationWhat does it mean for regional and
sector collaboration
![Page 5: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/5.jpg)
The Global Procurement Network
© ArcBlue Consulting 5
Operating in a commercial world
Delivering and Demonstrating savings, value and productivity improvements
Data-based decision-makingTaking a structured approachBuilding the right skills and capacityBalancing commercial and
community
![Page 6: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/6.jpg)
The Global Procurement Network
© ArcBlue Consulting 6
Procurement Trends and Insights
MAV LEAP Program
![Page 7: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/7.jpg)
The Global Procurement Network
© ArcBlue Consulting 7
LEAP Background A continuous improvement program designed to
assist councils, regions and the sector to:
– Achieve sustainable savings and value for money– Support local and regional economic development
Identify and pursue shared services opportunities– Improve probity management and compliance– Improve organisational and sector capability
23 councils currently participating in LEAP Data insights are based on first 15 councils
![Page 8: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/8.jpg)
The Global Procurement Network
© ArcBlue Consulting 8
>24,600 Active suppliers in single
year
$1,300 million
spent across 15 metropolitan councils in FY15
~467,000Individual transactions (invoices) processed
LEAP Program Statistics
45 – 65% of total council spend
![Page 9: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/9.jpg)
The Global Procurement Network
© ArcBlue Consulting 9
17% - 37%of spend in the local (Council) area.
40% - 60%of Councils spend is with top 20 suppliers
Spend
quarter 4opex and capex spend spikes in key categories
suggesting rushed end of budget cycle spend.
~$52,000average spend per supplier, predominantly below
tender threshold
![Page 10: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/10.jpg)
The Global Procurement Network
© ArcBlue Consulting 10
350,000 75%
of transactions <$1,000 value
Efficiency
$2,875average value per
transaction
$25 million
spent processing
transactions with value of <$1,000
28% of all suppliers
were used only once during the financial
year, ~7,000 single use suppliers
Up to $73 Per transaction cost
of traditional PO process
![Page 11: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/11.jpg)
The Global Procurement Network
© ArcBlue Consulting 11
Low-value Procurement White Paper
![Page 12: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/12.jpg)
The Global Procurement Network
© ArcBlue Consulting 12
Low-value Procurement White Paper
![Page 13: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/13.jpg)
The Global Procurement Network
© ArcBlue Consulting 13
Capability and Maturity
![Page 14: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/14.jpg)
The Global Procurement Network
© ArcBlue Consulting 14
Procurement in Local Government
State
Local
![Page 15: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/15.jpg)
The Global Procurement Network
© ArcBlue Consulting 15
Case Study: Barossa Regional Procurement Development ProgramObjectives & Process
Program Objectives: Make sustainable savings & create efficiencies Stimulate economic development Improve probity and reduce risk Build staff and organisational capability in procurement Strengthen regional collaboration
Joint Council Kick-off
Data Collectio
n
Individual
Council Worksho
ps
Detailed Joint
Spend Analysis
Opportunity
Analysis Worksho
p
Regional Roadma
p Develop-ment and
Validation
Final Roadma
p Worksho
p
Progress Reviews
and Support
![Page 16: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/16.jpg)
The Global Procurement Network
© ArcBlue Consulting 16
Barossa Regional Procurement Program
16
Regional Collaborative Procurement Program – Start May 2014
Regional Governance MOU in place – October 2014 Regional Resource engaged – February 2015 Collaborative Projects
• Standardisation of process and documents • Development of regional procurement website
Agreed priority regional contracts delivered since February:• Regional Building Maintenance/ Trade Services Panel • Audit Services• Road Re-Seal Program• Stationery• Line Marking
Savings to date $800,000 – Target $2.5m/ year (5%) Increased regional spend and internal efficiencies
![Page 17: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/17.jpg)
The Global Procurement Network
© ArcBlue Consulting 17
![Page 18: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/18.jpg)
The Global Procurement Network
© ArcBlue Consulting 18
Barossa Region – Next Steps
18
Expanding model to shared services investigations Correlating spend data against service, output and
demographic data Using opportunity analysis to structure and
prioritise opportunities
![Page 19: ArcBlue Consulting @PMMSgroup It’s Time for Procurement Chris Newman Director ArcBlue Consulting Chris.newman@arcblue.com.au 0412 318](https://reader035.vdocuments.us/reader035/viewer/2022062805/5697c0021a28abf838cc35f1/html5/thumbnails/19.jpg)
The Global Procurement Network
© ArcBlue Consulting 19
Strategic Procurement
Procurement represents our most tangible area to deliver and demonstrate savings:• External and internal efficiencies• Continuing to move from administrative to strategic
Structured programs• Targets and measurement• Commercial focus• Building capability – council, region, sector• Demonstrating ‘value’ while maintaining our
commitment to community