Services
procurement transformation
Procurement has been a grossly underestimated function, mostly regarded as an admin discipline subservient to the core disciplines of the organisation. Lately, leading organisations have embraced procurement as a key lever of value addition which can be instrumental in improving bottom line financial performance. Revolutionary management concepts, impact of new technologies and cutting edge digital technologies have highlighted the importance of procurement as strategic to business. From merely a requisition processing function to spend management powerhouse; modern procurement has evolved to constantly innovate sourcing strategies, inventing new ways of looking at internal demand, relationship management and discovering new methods of approaching the marketplace. In short, Procurement has transformed from tactical to strategic delivery.
Peter Kraljic, Harvard Business Review 1983
“Purchasing must become supply management.”
A unique opportunity exists as most organisation still carry on business in the traditional way and are intensely focused on day to day activity. Value creation through procurement still remains an unfulfilled dream. The challenge is to transform the Procurement function to deliver value that is fully aligned to business strategy and can be transparently measured and tracked in bottom line financial performance of the organisation.
Consequently a new set of expectations has emerged in terms of capability, processes and value delivery. A unique opportunity exists as most organisation still carry on business in the traditional way and are intensely focused on day to day activity. Value creation through procurement still remains an unfulfilled dream. The challenge is to transform the Procurement function to deliver value that is fully aligned to business strategy and can be transparently measured and tracked in bottom line financial performance of the organisation.
- Reduce exposure to risks across the entire supply chain(s)
- Enroll leadership to buy in to Procurement value proposition
- Identify the relevant and objective performance metrics
- Increase category coverage under Procurement
- Propose areas of strategic spend management
- Devise effective and fit for purpose governance and assurance mechanism
- Propose right organisational structure for Procurement function and team
- Understand if the ERP is utilised optimally (if applicable)
- Assess capability; recommend ways to enhance capability
- Improve supplier relationship processes to obtain and sustain value delivery
SERVICES
Services
We will help your Procurement team organise in a manner to deliver industry leading performance. Our Transformation Advisory will provide the tools to enable you to move from tactical to strategic delivery. This complete 360 degree program is aimed at delivering the following objectives in three distinct phases of diagnostics, recommendations and implementation:
Costmap’s proprietary diagnostic process seeks valuable input from key stakeholders right from clients’ leadership to major functional heads. A series of interviews are held and recorded to capture this valuable feedback. Views on current performance and future expectations form a key input to the report. Diagnostics process is not completed without a comprehensive assessment of Procurement process, spend data, team structure and capability. The collated data is then bench-marked to industry leading practices. The aim is to deliver an as-Is understanding of organisation’s Procurement function and set it up for future. In summary the Diagnostics exercise will cover the following areas of Procurement practice:
- Existing process
- Delegation of authorities
- Demand management
- PSCM governance process
- PSCM market strategy
- Approach to market
- Contract terms and conditions
- Contract administration
- Payment and claims administration
- Ethical conduct
- Organisational capability and competencies
- Documentation and record keeping
- Compliance with clients’ head office and regulators
- Legal compliance
- Guidance on PSCM Filing and Documentation system
- Electronic systems (if any)
Putting to use decades of experience and proprietary benchmark data, our Procurement transformation experts then compare clients’ existing Procurement operations against industry best practices, along with companies of similar profiles. Our Procurement Transformation advisers deliver a clear and comprehensive Report detailing the strengths and weaknesses of clients’ existing Procurement practices within its Strategic Sourcing and Procurement department, along with recommendations for achieving better operating efficiency, enhancing human capital management, and reducing costs. The gaps identified in the Diagnostic process will be documented in the report and delivered to the client along with the recommendations to resolve the gaps.
Client will be expected to implement key recommendations (if not all) by devising a priority-based scheme; allocating required resources and any other support that may be required in the regard. Costmap is always available to guide the implementation process after deliberating the details. Should the client wish, Costmap can deliver the implementation phase of Procurement Transformation also.
