A prominent player in the UK telecommunications sector, was facing significant cost and performance pressures from their clients. Despite having a strong market position and a solid cash flow, the company was struggling with inconsistent supplier performance, poor procurement governance, and missed opportunities for cost savings. These issues were impacting their profitability, operational efficiency and overall performance. IC Procurement were engaged to undertake a health check of their approach to procurement and the management of their supply chain to see what could be done to improve their situation.
Phase 1: Identify
During the Identify phase, which spanned 5 weeks, IC Procurement conducted a comprehensive analysis of the client’s spend and procurement practices. Key areas of focus included:
Spend Analysis: We conducted a deep dive into the company’s £37 million 3rd party spend, identifying significant inefficiencies and opportunities for savings.
Supplier Performance: Our analysis revealed inconsistent and poor supplier performance, largely due to a lack of formal procurement policies and governance.
Contract Management: The company’s strong cash position was not being leveraged effectively, resulting in missed opportunities for more favourable supplier terms.
Outcome
Our detailed report highlighted potential savings of approximately £2.6 million. Additionally, we identified the need for immediate improvements in procurement governance, policy implementation, and supplier performance management. The report included a strategic plan outlining how the client could achieve these improvements in the short, medium, and long term.
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IC Procurement provided independent Challenge, insight and a pragmatic approach, helping us navigate the complex field of Procurement whilst on a journey to become an Intelligent Client
Head of Organisational Capability, EDF
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