procurementco

West Moreton Anglican College

Wed, 22 May 2024 03:39:27 GMT

Client

West Moreton Anglican College

Industry

Education

Project

Procurement Review

Engagement Summary

Procurement Co was engaged by West Moreton Anglican College (WestMAC) to identify opportunities for improvement in their purchasing processes including ways to improve governance and internal controls to ensure the ongoing efficiency and affordability of the operational services being provided by the College.

Procurement Co conducted a comprehensive review of WestMAC’s current processes and organised workshops with a range of different stakeholder groups, including 1-on-1 workshops with personnel responsible for corporate governance, such as the Finance Manager, as well as broader workshops with ‘Leaders of Learning’ and the Executive Leadership Team. Procurement Co produced a Recommendations Report which detailed the findings from the spend data analysis, stakeholder engagement, and desktop review. This report also highlighted risks and opportunities in purchasing processes and spend habits. Procurement Co identified there was opportunity to revise WestMAC’s procurement processes to develop a fit-for-purpose policy that was simple to follow but empowered de-centralised purchasing..

Procurement Co delivered a revised purchasing policy with a suite of procurement templates, which included:

Request for Proposal (RFP) template
RFP Returnable Schedules
Statement of Work (SoW) template
Evaluation Spreadsheet
Contract Performance Review template
Contract Extension and Renewal Checklist

Procurement Co also developed a ‘Roll-out and Self-guided Training Slide Pack’ to support the implementation of the revised procurement processes, and templates. The training pack was tailored to ensure that all staff members, regardless of their role or previous experience with procurement, could effectively understand and apply the new policy, processes, and guidelines. Visualisations and step-by-step process workflows offer a clear presentation of roles, responsibilities, and approval touchpoints throughout the different procurement processes. This Training Pack covered the following content:

The purpose of the revised Procurement Policy
A summary of the revised Procurement Policy
Procurement Process Workflows for:
The Purchase Order Process
Capital Expenditure (CAPEX) below $10,000
Capital Expenditure (CAPEX) over $10,000
The Business Case Process
An overview of the newly developed Suite of Procurement Templates
Evaluation Planning Considerations
Modern Slavery Checklist
ICT Purchasing Requirements
Work Health & Safety Purchasing Requirements

Procurement Co conducted a detailed walk-through of the Training Slide Pack to ensure that WestMAC key stakeholders were well informed to deliver the anticipated training sessions to the wider team.

Queensland University of Technology (QUT)

office@procurementco.com.au (Office Procurement) — Tue, 21 May 2024 06:29:33 GMT

Client

University of Technology Queensland (QUT)

Industry

Education

Project

Training Package Procurement for Fraud, Corruption, and Probity

Project Summary

Queensland University of Technology (QUT) recognised the necessity of enhancing the awareness of fraud, corruption, and probity issues among its business stakeholders across various departments and units. To achieve this, a specialised training package was developed, tailored to the needs and context of QUT's diverse business landscape. The training sessions were organised into 2-hour blocks to accommodate the busy schedules of stakeholders.

Project Outcomes

Procurement Co developed a bespoke training solution and co-delivered the training with QUT’s procurement team to various stakeholder groups across the organisation.

Industry and stakeholder specific content crafted to address the unique concerns and challenges faced by business stakeholders across QUT. Case studies and examples were carefully selected to resonate with the diverse roles and responsibilities within the university.
Each training session was designed to be interactive and engaging, encouraging active participation and discussion among stakeholders. Real-life scenarios and practical examples were used to illustrate key concepts and enhance comprehension.
Recognising the time constraints of busy stakeholders, the training sessions were delivered in 2-hour blocks, allowing for focused learning without disrupting daily operations. This format ensured maximum participation and minimised disruption to ongoing activities.
The training package emphasised actionable strategies and practical insights that stakeholders could apply directly to their roles at QUT. By providing tangible solutions and guidance, participants were empowered to identify and address fraud, corruption, and probity issues within their respective departments.
While formal evaluation mechanisms were not implemented, informal feedback channels were utilised to gauge stakeholders' satisfaction and understanding of the training content. This feedback loop allowed for continuous improvement and refinement of future training sessions based on stakeholders' needs and preferences.

In conclusion, the training package developed for QUT provided valuable insights and practical strategies to mitigate fraud, corruption, and probity risks across the university. By delivering tailored sessions in a time-efficient and engaging format, QUT was able to empower its stakeholders to uphold the highest standards of integrity and ethical behaviour in their respective roles.

Origin Energy - Integrated Gas Category Management Case Study

Tue, 05 Sep 2023 06:43:44 GMT

Client:

Origin Energy

Industry:

Oil and Gas

Project:

Integrated Gas Category Management

Project Completed:

May 2016

Engagement Summary:

Origin Energy required the services of a specialised procurement consulting firm to develop category management plans for their Integrated Gas Business Unit.

The objective of the engagement was to support the organisational change from a contract management approach to a category management approach. The category plans were required to outline the current and future strategic position of the organisation regarding each category.

The category management framework and deliverables were required to achieve:

standardisation of approach;
local and international market analysis and information for each category;
procurement activity plan at a sub-category level;
high quality deliverables for ongoing use; and
knowledge transfer to client staff.

Project Outcomes:

Procurement Co development a category management approach aligned with Origin’s key objectives. The category management approach included the following activities:

spend and contract data analysis;
strategic planning with executive team;
consultation and coordination with procurement team and key business stakeholders;
development of a category structure that was able to be applied across all assets and locations (including corporate services); and
development of a suite of category management documents that was easily interpreted and implemented.

The Procurement Co team worked closely with the Origin Supply Chain team to ensure stakeholder buy-in and knowledge sharing was occurring throughout all phases of the project.

As a value adding initiative Procurement Co developed and delivered a category management governance document to provide an overview of the considerations and activities required for ongoing management of the categories.

DJPR - Probity Advisor Victoria Fund Assessment Panel

Tue, 05 Sep 2023 06:35:22 GMT

Client:

Victorian Department of Jobs, Precincts and Regions (DJPR)

Industry:

State Government

Project:

Probity Advisor Victoria Fund Assessment Panel

Project Completed:

19/06/2022 - Current

Engagement Summary:

DJPR required a Probity Advisor advisor to attend Jobs Victoria Fund Assessment Panel meetings for the provision of probity advice and guidance to the Panel. This included:

- Attendance at the Jobs Victoria Fund weekly assessment panel meeting.

- Providing Independent assessment and strategic advice on probity matters identified in the Jobs Victoria Fund panel meetings.

- Advising on probity-related issues to maintain the integrity of the Jobs Victoria Fund, as requested.

Project Outcomes:

Procurement Co successfully delivered the activities required under this engagement, including:

- Review of background material – Procurement Co undertook desktop review of background information to establish a context for preliminary discussions with DJPR

- Provision of senior and experienced probity personnel who are able to actively support the panel and provide probity advice in real-time to support panel discussions and decision making

- Probity review and assurance activities

Victorian Department of Jobs, Precincts and Regions (DJPR)

Tue, 05 Sep 2023 06:26:45 GMT

Client:

Victorian Department of Jobs, Precincts and Regions (DJPR)

Industry:

State Government

Project:

Probity Advisor for the Commonwealth Games Interim Project Management Office

Project Completed:

01/06/2022 - Current

Project Summary:

DJPR required an experienced Probity Advisor to support the procurement process for the engagement of a services provider to support establishment of the Project Management Office for the Victorian Commonwealth Games. The probity advisor was required to oversee the project team’s procurement event to ensure that a supplier is engaged through an open, equitable and transparent process. This includes:

Review, from a probity perspective, of go to market documentation such as the Invitation to Supply (ITS) documentation
Attend meetings, interviews, presentations or negotiations when required, to ensure appropriate meeting protocols and established procedures are followed
Ensuring evaluation is conducted in accordance with the evaluation methodology and the DJPR procurement policy
Advise on compliance with VGPB policy and any other government procurement policies with respect to probity
Delivery of a probity report to the business unit
Resourcing to support this requirement is expected to provide a review and response within 24 hours

Project Outcomes:

Procurement Co successfully delivered the activities required under this engagement, including:

Review of background material – Procurement Co undertook desktop review of background information to establish a context for preliminary discussions with DJPR
Development of a Probity Plan to outline the probity governance for the project
Review of tender documents, Market Engagement Strategy (procurement plan) and evaluation plan
Attend evaluation meetings and any tenderer presentations / meetings to confirm adherence to the evaluation plan and final selection process
Provide ad-hoc probity advice to address any probity concerns as they arose
Review of Evaluation Report / Recommendation Report and develop and provided a Probity Report for the project

Transport for NSW - Probity Advisory Services – Prospect Highway Upgrade

Tue, 05 Sep 2023 06:19:34 GMT

Client:

Transport for NSW

Industry:

Government / Road Infrastructure

Project:

Probity Advisory Services – Prospect Highway Upgrade

Project Completed:

June 2019 - current

Project Summary:

Transport for NSW will upgrade Prospect Highway between Reservoir Road, Prospect and St Martins Crescent, Blacktown. Prospect Highway is a major roadway through western Sydney which connects motorists with the M4 Motorway, the Great Western Highway, Old Windsor Road and the M2 Motorway. Around 35,000 vehicles currently use the Prospect Highway each day, including 5000 heavy vehicles, the scope of the project includes; upgrading of roadway and footpaths, duplications of two bridges over the M4 Motorway and the Great Western Highway along with other significant roadwork changes

Procurement Co was engaged to provide probity advisory services to support EDQ in the delivery of a three-stage procurement process incorporating: an initial Expression of Interest (EOI) stage shortlisted three (3) tenderers for participation in the Request for Tender (RFT) Phase A stage. Two (2) tenderers were down-selected to participate in a further RFT Phase B stage, which is a collaborate phase with RMS and the two (2) tenderers to de-risk the project and select a preferred tenderer.

Project Outcomes:

Due to our extensive experience in providing probity services Procurement Co was able to develop a customised approach for TfNSW, with particular emphasis on undertaking adequate planning to identify probity risk and establish effective mitigations.

Clear probity processes were defined and probity briefings were provided to the project team to ensure probity requirements were understood and breaches were avoided.

Procurement Co undertook the following activities ensuring that all probity issues were mitigated and addressed. The Probity Advisor role included the provision probity planning, strategic probity advice, review of procurement documentation, management of conflict of interest, attendance at tenderer briefings, unsuccessful tenderer debriefs, attendance at all tender evaluation committee meetings and continued support and attendance at joint TfNSW and tenderer Phase B workshops, and final evaluation.

The project was delivered successfully with all probity matters addressed early and mitigated to avoid any impacts on the project.

Economic Development Queensland - Yeerongpilly Green Development Case Study

Tue, 05 Sep 2023 06:09:01 GMT

Client:

Economic Development Queensland

Industry:

Government

Project:

Probity Advisory Services – Yeerongpilly Green Development

Project Completed:

June 2015

Project Summary:

Economic Development Queensland (EDQ) is a unique government agency which combines property development with specialist planning functions to achieve their vision. They are part of the Department of State Development, Tourism and Innovation which has a focus on economic growth through private sector investment and job creation.

Procurement Co was engaged to provide probity advisory services to support EDQ in the delivery of a multi-stage transaction process to engage a suitably experienced and financially viable developer to fund and deliver the project, while achieving the architectural and community benefits sought from the Queensland Government.

Project Outcomes:

Due to our extensive experience in providing probity services Procurement Co was able to develop a customised approach for EDS, with particular emphasis on undertaking adequate planning to identify probity risk and establish effective mitigations.

Clear probity processes were defined and probity briefings provided to the project team to ensure probity requirements were understood and breaches were avoided.

Procurement Co undertook the following activities ensuring that all probity issues were mitigated and addressed:

reviewing and providing probity advice on Expression of Interest (EOI) and Request for Proposal (RFP) documentation;
providing ad-hoc probity advice;
attending evaluation meetings and tender presentations/ meetings to confirm adherence to the evaluation plan and final selection process ;
attending de-briefs for unsuccessful respondents; and
reviewing the final Evaluation Report and developing and providing a final report.

The project was delivered successfully with all probity issues addressed early and mitigated to avoid any impacts on the project.

Economic Development Queensland - Probity Advisory Services Case Study

Tue, 05 Sep 2023 06:02:50 GMT

Client:

Economic Development Queensland

Industry:

Government

Project:

Probity Advisory Services

Project Completed:

June 2018

Project Summary:

P rocurement Co was engaged to provide probity advisory services to support EDQ in the delivery of a multi-stage transaction process for development of a 250-megawatt renewable energy project in Gladstone.

Project Outcomes:

Procurement Co delivered probity advisory services which:

provided guidance which enabled commercial outcomes to be achieved while ensuring that the EDQ transaction process was undertaken in accordance with Queensland Government Procurement Policy and best practice probity principles;
developed high quality probity documentation including, probity plan and probity report;
ensured that probity issues were identified and mitigated before being realised to prevent probity breaches from occurring; and
supported the EDQ team to deliver a commercially focused process and a good project outcome.

Transport for NSW - Probity Advisory Services Case Study

Tue, 05 Sep 2023 05:54:27 GMT

Client:

Transport for NSW

Industry:

Government / Rail Infrastructure

Project:

Probity Advisory Services

Project Completed:

March 2021

Project Summary:

Transport for NSW’s Power Supply Upgrade Program is designed to meet expected power requirements for Sydney's future rail network and new fleet of air-conditioned trains. The program involves upgrades to substations, section huts, overhead wiring, and feeders as well as the construction of new infrastructure across the network. The Scope of the project includes aerial modification, pole replacement and new conductors upgrades to 8.7km of existing 33kv feeder.

Procurement Co were engaged as Probity Advisor to support the two-stage procurement process involving an Expression of Interest (EOI) stage following by shortlisting of tenderers to participate in the Invitation to Tender (ITT) Stage.

Project Outcomes:

Due to our extensive experience in providing probity services we were able to develop a customised approach for TfNSW, with particular emphasis on undertaking adequate probity planning to identify probity risk and establish effective mitigations.

Clear probity processes were defined, and probity briefings provided to the project team to ensure probity requirements were understood and breaches were avoided.

Procurement Co provided probity guidance, advice and oversight to the tender process from the EOI phase through to the ITT evaluation phase and selection of preferred tenderer.

Probity deliverables were produced, including:

Probity Plan
EOI Interim Probity Report
Final Probity Report

The project was delivered successfully, in accordance with NSW Procurement Policy and with all probity matters identified and addressed early and mitigated to avoid any impacts on the project.

Origin Energy - APLNG Directional Drilling

Tue, 05 Sep 2023 05:46:38 GMT

Client:

Origin Energy Asset Services

Industry:

Oil & Gas exploration

Project:

APLNG Directional Drilling

Project Completed:

October 2022

Engagement Summary:

Origin Energy required the services of a specialist procurement consulting firm to conduct a complex end-to-end procurement activity, for the provision of directional drilling services to support gas operations within the Surat & Bowen Basins in Queensland, Australia.

Services Provided:

Procurement Co successfully delivered the activities required under this engagement, including:

- Planning and development - review of background material, co-ordination of kick-off meetings, development of planning materials and tender documentation.

- Tender facilitation - Tender Release, management of clarifications, development and release of all addenda, Tender Closing, submission completeness & compliance checks, facilitating any necessary clarifications.

- Tender evaluation – delivery of pricing, commercial and social procurement evaluations, evaluation consolidation and presentation to the panel, coordination of moderation and clarifications

- Contract Recommendation & Award – facilitation of contract negotiations, development of contract award recommendation document, co-ordination of approvals, management of stakeholder enquiries, arranging for contract execution.

Murray-Darling Basin Authority (MDBA) - Procurement Advisor

Tue, 05 Sep 2023 05:39:11 GMT

Client:

Murray-Darling Basin Authority (MDBA)

Industry:

Federal Government

Project:

Procurement Advisor, engagement of Program Management Office (PMO) contracted services for the Integrated River Modelling Uplift (IRMU) Program

Project Completed:

July 2022

Engagement Summary:

MDBA required procurement advisory services to develop a scope of work and assistance with tender evaluation, contract negotiation, and development of contract documentation. This included:

- Engagement with key MDBA personnel and external legal and probity advisors to the IRMU Project.

- Drafting the technical tender and contract scope of work.

- Providing briefings on intended contract scope of work to Murray-Darling Basin jurisdictions.

- Providing tender evaluation advice to MDBA executives.

- Providing contract negotiation advice and support to MDBA.

- Advising on procurement and contract related issues, as requested.

Services Provided:

Procurement Co successfully delivered the activities required under this engagement, including:

- Review of background project material – Procurement Co undertook a detailed review of the IRMU business case, project documentation and technical hydrological data modelling requirements.

- Drafting a scope of work for PMO services and hydrological data modelling development for inclusion in the PMO Request for Proposal (RFP).

- Drafting the RFP Evaluation Report and providing advice.

- Reviewing and advising on the MDBA contract negotiation plan.

- Developing the contract scope of work and associated commercial contract schedules.

- Participating in contract negotiations between MDBA and the preferred Service Provider.

- Provision of senior and experienced procurement personnel who were able to actively engage MDBA to understand their requirements, develop briefs to support executive decision making, develop contract documents, compliant with the IRMU project schedule.

- Ad hoc probity, contracting and commercial advice.

DJPR - Procurement Advisor

Tue, 05 Sep 2023 05:25:55 GMT

Client:

Victorian Department of Jobs, Precincts and Regions (DJPR)

Industry:

State Government

Project:

Procurement Advisor, engagement of a contracted Service Provider to audit the Jobs Victoria (JV) Grant Program

Project Completed:

June 2022

Engagement Summary:

DJPR required a Procurement Advisor to develop a scope of work for audit services and prepare all the Request for Tender (RFT) documentation. This included:

- Engaging DJPR key stakeholders on the various JV grants and associated risks.

- Drafting the audit scope of work for tender.

- Providing briefings on intended contract scope of work to DJPR executives.

- Drafting RFT documentation for DJPR to release to market.

Services Provided:

Procurement Co successfully delivered the activities required under this engagement, including:

Review of background material – Procurement Co undertook review of DJPR documentation, including JV Grant Program, probity and compliance requirements to establish a context for discussions with DJPR.
Interviewing DJPR key stakeholders on the various JV grants and associated risks.
Preparing a risk assessment of the JV Grant Program.
Drafting a scope of work for audit services for inclusion in the RFT.
Drafting all RFT documentation for DJPR to release to market.
Provision of senior and experienced procurement personnel who were able to actively engage DJPR stakeholders and draft documents in a timely manner.

QRA - Council Procurement Review

Tue, 05 Sep 2023 05:13:13 GMT

Client:

Queensland Reconstruction Authority

Industry:

State Government

Project:

Local Government Disaster Funding Procurement Review

Project Completed:

August 2021

Project Summary:

The Queensland Reconstruction Authority (QRA) manages and coordinates the Government’s restoration of communities and infrastructure reconstruction within disaster affected communities. The QRA’s role focuses on working with state and local government agencies to deliver value for money and accountable expenditure and acquittal of public reconstruction funds. Following a natural disaster event, the QRA also works with disaster-affected local governments to assess and establish the scale of damage and administers funding arrangements for completion of those works.

QRA required the services of a specialist procurement company to review and document procurement strategies implemented by Local Councils in the delivery of DRFA works as part of the Queensland Disaster Funding Program.

Project Outcomes:

Procurement Co successfully completed a procurement review of 10 regional local councils and provided a detailed report to QRA. The review consisted of two phases: a desktop review of procurement documents provided by the local councils, and an onsite visit/online meeting to engage with the local government procurement officers. During the first phase Procurement Co conducted a detailed analysis of individual local government procurement documents. The second phase included a review of how the procurement policies are implemented, and the practical constraints/limitation which may impact upon the use of best procurement practices. This phase was conducted at the local councils’ offices (where possible) to gather an understanding of how procurement is conducted in these regional areas.

The procurement review was successfully completed to the satisfaction of QRA within the specified timeframes.

Uniting Care - Procurement Services

Mon, 04 Sep 2023 13:20:19 GMT

Client:

Uniting Care Queensland

Industry:

Health Care and Community Services

Project:

Development of Procurement Documentation for Fire Protection and HVAC Services

Project Completed:

December 2021

Project Summary:

As a not-for-profit health care and community services organisation, Uniting Care Queensland engaged Procurement Co to develop procurement and tender documentation for the provision of Fire Protection Services and the provision of Heating, Ventilation and Air-Conditioning Services.

The project was required to be delivered within a short duration to meet strict timeframes

Project Outcomes:

Procurement Co provided an experienced team to:

Prepare and facilitate stakeholder workshops in order to inform Uniting Care’s requirements and to discuss current contractor performance
Formulate and develop procurement strategies and approval documentation, and undertake procurement options analysis
Develop an evaluation plan outlining the recommended evaluation criteria, weighting, process and probity obligations
Refine existing organisation requirements to incorporate into tender documents for two packages of work
Develop Request for Proposal documentation, including response schedules

The project was delivered in an eight-week period, with the suite of procurement and approval documentation completed.

Stanwell - Procurement Services

Mon, 04 Sep 2023 13:12:51 GMT

Client:

Stanwell

Industry:

Energy & Mining

Project:

Delivery of the Procurement Framework Project

Project Completed:

December 2021

Project Summary:

Stanwell is a Queensland government owned energy company that owns and operates power stations and mines in Queensland. Procurement Co was engaged to deliver their Procurement Framework Project which included advisory on their current procurement framework, value risk matrix, development of procurement templates and process flow mapping.

Project Outcomes:

Procurement Co provided an experienced team to:

Prepare and facilitate workshops to gauge key stakeholder requirements to assist in developing Stanwell specific procurement templates, process flows, and risk value matrices
Create procurement templates, including procurement strategy, evaluation plan, RFx tender documentation, evaluation report and approval documentation
Develop procurement process workflows in Microsoft Visio along with stakeholder involvement
Brainstorm and workshop risk value matrices incorporating Stanwell specific business risk to assist in shaping decision pathways
Developed user instruction manual to accompany the suite of template documentation
Utilised Zycus procurement software to develop workable RFx and approval documentation that is workable for existing technology being used at Stanwell

Procurement Co was able to deliver suitable template documentation and advisory that adapted to Stanwell’s specific requirements to the satisfaction of key stakeholders.

Cross River Rail - Procurement Policy and Guidelines Case Study

Mon, 04 Sep 2023 12:51:42 GMT

Client:

Cross River Rail Delivery Authority

Industry:

Rail Infrastructure

Project:

Development of Procurement Policy, Guidelines, and Templates

Project Completed:

December 2017

Project Summary:

As a newly formed Statutory Body in April 2017, the Cross River Rail Delivery Authority (the Authority) engaged Procurement Co to develop a commercially focused procurement , policy, guidelines, and templates that were in accordance with the Queensland Procurement Policy.

The project was required to be delivered within a short duration to achieve targets set by the CRRDA Board.

Project Outcomes:

Procurement Co provided and experienced team to:

Undertake extensive stakeholder engagement with the procurement team, internal customers, the Authority’s executive leadership, and associated departments;
Conduct benchmarking against other Queensland Statutory Authorities, Government Owned Corporations, and interstate rail project organisations;
Develop a compliant procurement policy, procedures, guidelines, and templates;
Liaise with the Authority’s Audit and Risk Committee;
Prepare board submission for approval and respond to Board queries;
Deliver procurement training, communications, and broader roll-out of the new policy and procedures to the Authorities organisation.

The project was delivered in a six week period, with the suite of procurement documentation being approved for use by the Authority’s Board.

Cross River Rail - Procurement Director Case Study

Mon, 04 Sep 2023 12:43:13 GMT

Client:

Cross River Rail Delivery Authority

Industry:

Rail Infrastructure

Project:

Procurement Director Secondment

Project Completed:

February 2018

Project Summary:

As a newly formed Statutory Body in April 2017, the Cross River Rail Delivery Authority (the Authority) engaged Procurement Co to support delivery of their key procurement and contract management activities and review the capability of the staffing and ensure the structure and processes were fit for purpose.

Project Outcomes:

Procurement Co provided one of our experienced directors to:

lead the Authority’s procurement team and be accountable for procurement activity;
deliver a range of procurement activities, including strategy development, tender management, negotiation, award, inter-government agreements, and inter-government novation of contracts;
oversee contract management activities, ensuring compliance with the Queensland Procurement Policy;
identify capabilities and team composition required for the delivery of the Authority’s ongoing procurement activities;
undertake a skills gab analysis of existing team;
lead a compliant government recruitment process and onboarding of permanent resources into the procurement team, including procurement manager (A08), senior procurement officer (A07), and procurement officer (A06); and
successful handover and transition out following implementation of the new structure.

Santos - Procurement Services

Mon, 04 Sep 2023 12:20:24 GMT

Client:

Santos GLNG

Industry:

Oil and Gas

Project:

Operational Readiness Procurement Services

Project Completed:

March 2015

Project Summary:

Santos GLNG required specialist procurement expertise to plan, tender, negotiate and implement operational contracts during Santos’ transition from their major upstream facilities and downstream plant construction phase on the $18.5 Billion GLNG projects, to the business’ Upstream and Downstream production phase.

Procurement Co was engaged to deliver end to end procurement program for operational goods and services over a 12-month period. The packages ranged from local goods and services to highly complex multi-currency high value/risk agreements with international vendors.

Procurement Co implemented the solution through an integrated team approach working within Santos’ systems and processes and coordination with Santos’ internal stakeholders and supplier base. Despite the time pressures and complexities of the various contracts, Procurement Co successfully delivered the scope on time, on budget, and with a forecast benefit of 10% total contract spend in negotiated savings to the client.

Project Outcomes:

The delivered outcomes were the development of key procurement documents including:

Stakeholder engagement and management of different areas for the project such as engineering, operations, legal, finance and procurement.
Development of procurement strategies
Development of tender documents, tender evaluation criteria
Conducting tender evaluations.
Negotiations of commercial terms
Development of KPIs
Contract delivery for the construction and maintenance of various plant functions
Sharing of knowledge to the procurement team to ensure ongoing contract management

This project was delivered on time and with the effect of significant cost reductions and sustainable negotiated savings.

What Are The Benefits Of Supplier Tiering?

Mon, 04 Sep 2023 11:51:52 GMT

It's hard to talk about supplier tiering without mentioning the automotive industry, a sector that's no stranger to supply chain innovation.

A single automobile can contain 30,000 parts. Can you imagine handling 30,000 suppliers?

Well, neither could the manufacturers, which is why they came up with a tiering system. By only dealing directly with the most critical suppliers, car makers were able to free up time and resources significantly. But is this practice right for your business?

What exactly is supplier tiering?

Supplier tiering is a concept used by businesses to achieve efficient supplier base management. Suppliers may be tiered differently depending on the size and complexity of the buying company. You might, for example, organise your tiers by size (expenditure), complexity or risk - whatever matters most to your organisation.

Tiering your supply chain is an exercise in sitting down and saying, 'Here's everyone who provides goods or services. What's the best way to organise them?’ The whole point of going through this exercise is to gain an understanding of your supplier profile in order to manage it more effectively. Once an organisation tiers their suppliers, they can begin developing standardised contract management strategies within each tier.

Typically, tier 1 suppliers would be those your organisation categorises as high-value, high risk or critical to operations or the delivery of a given project. Tier 1 suppliers are - for one reason or another - essential to your organisation. From the second tier onwards, suppliers are denoted by less spend, risk or criticality.

When developing a tiering system, understanding business-critical contracts is key. If you fail to weigh the risks of losing or mismanaging such a contract, your operations could suffer considerably. In supplier tiering, spend is not always synonymous with contract importance. There are some very valuable contracts that don't necessarily require close management due to the nature of the goods or services being delivered.

It's evident that tiered supply chains aren't only useful in manufacturing. Any organisation can increase efficiency by analysing their suppliers and formulating strategies to best manage them. To get started, think about the objectives of your organisation or the project goals you're trying to achieve. What are the specific requirements to your success?

The importance of focusing on your most critical suppliers

Without supplier tiering, you risk spending too much time on suppliers that don't support overall business performance.

Tiering ensures that the most business-critical contracts are managed and supported, fostering collaboration, innovation and even improved financial outcomes. It gives businesses a method for understanding where risk or spend is - and where it isn't.

When implemented and used correctly, supplier tiering is a decision-making tool organisations can use to:

Drive internal management costs lower by reducing the number of suppliers an organisation must engage with;
Reduce business risk by allowing the right amount of effort to be placed on critical suppliers;
Enable engagement and negotiation with key suppliers by improving supplier relationships; and
Improve the way resources are deployed by allocating the right amount to key suppliers.

If you haven't examined supplier data recently, start there. Supplier tiering needs to be based on up-to-date analysis or else you risk paying too much attention to contracts that might not be as important as they once were. If your organisation is lacking maturity and doesn't have sufficient data to perform a supplier analysis, hold off. At this point, tiering your suppliers could be haphazard. Undertaking a review of the supply chain systems and processes is likely a better step.

Supplier tiering with Procurement Co

It's important not to rush into supplier tiering. If you do, you risk mismanaging your business-critical suppliers in a big way.

At Procurement Co , we have extensive experience helping organisations improve operations and outcomes by implementing a tiered supply chain. Not only that, we also help come up with actionable points around the standardised contract management strategies used at each tier. We can even handle implementation.

To lean more, reach out to our team today .

Procurement Teams Need To Be Strategic Partners

Mon, 04 Sep 2023 11:42:15 GMT

A procurement team should be identified as a strategic partner in achieving the business's goals. However, too often procurement teams are seen in a negative light by other parts of the business - as mere gatekeepers or roadblocks, with little value to add. This is bad news for the organisation's ability to achieve its goals efficiently and effectively.

Consider an all-too-common example: Imagine there's an engineering team within a business that wants to engage an engineering company. To do so, they need to use procurement to run the tender and evaluation process and put the contract in place for them. The problem comes when this engineering team sees procurement as a hoop to jump through rather than someone that can add value.

In a lot of circumstances, the decision or the strategy has already been made - the engineering team wants to renew a certain supplier's contract, say - and procurement is then engaged at the last moment. But by that point they can't add any value. Had the engineering team engaged procurement at the front end of the process, the procurement team might have been able to:

identify other competitive suppliers in the market, that may be able to provide a better service at a more competitive price, or,
if proceeding with the same supplier, implement a strategic negotiation process to improve the ‘pain points’ of the existing agreement.

The result of all this is the procurement team ends up just having to rubber stamp processes to ensure time frames are achieved, while not necessarily agreeing with or having any control over the procurement decisions being implemented. Understandably, this is frustrating and can lead procurement to become a bit of a roadblock, fighting other teams in the business by forcing compliance through unnecessary procurement forms and onerous administrative burdens. This creates a confrontational relationship between procurement and the business units, with an 'us versus them' dynamic of teams working against one another instead of together towards the common goals of the organisation.

If that sound like the working relationship in your business, something needs to change.

How can procurement teams move towards becoming strategic partners?

Poor historical relationships can make moving towards a strategic partnership a difficult task. Difficult, but not impossible.

It starts with the procurement team understanding their role as a service provider to the business. Procurement needs to show they can add value by being good at the basics and delivering effectively. Engaging the assistance of an outside expert is often a good way to get the ball rolling on this, and to sidestep the issue of a previously negative relationship - the business may well be happier giving the procurement team their projects if they know someone else with proven experience in the specific type of procurement process is involved.

Part of demonstrating value is the procurement team sharing their knowledge of the market they're working in. They know about the commodities, the suppliers, the key players - when they communicate that knowledge to the business, they can add real commercial value by allowing the business teams to make better decisions on who to purchase from, or even whether it's worthwhile consolidating multiple services under one agreement.

Procurement teams should also aim to streamline their processes. Sometimes the policies and guidelines are over complicated, rigid, and not aligned with the value or potential risk of the project. Sure, there are always going to be those high-end projects where every template must be filled and box ticked. But there has to be a common-sense approach to how quickly some of the other procurements can be delivered. A 12-month procurement time frame for a routine contract borders on ridiculous. It's all about striking the balance between complying with your organisation's procurement policy while still being able to react to business needs in an appropriate time frame. When you evolve your procurement policy and purchasing guidelines to reflect the kind of work you deliver, you'll begin looking less like a roadblock to the rest of the business.

To learn more about how we can help move your procurement team towards becoming a strategic partner with the rest of your business, contact the team at Procurement Co today.

Why You Need To Develop Strong Supplier Relationships

Mon, 04 Sep 2023 11:32:52 GMT

Mutually beneficial relationships with suppliers are a measure of success for procurement teams.

When both parties get a lot out of engaging each other, the relationship transforms from being merely transactional to strategic. It's no longer just about getting the lowest price and the minimum technical compliance from a supplier - it's about making your business more valuable to them so they in turn become more valuable to your business.

What are the benefits of strong supplier relationships?

For a start, your communication becomes more honest and collaborative. Understanding each other’s businesses helps drive efficiencies and improvements, as each side is willing to share their thoughts on what's going well, what isn't, what's taking too long, et cetera - all things that wouldn't always be communicated with a supplier but can be in a strong relationship.

Another benefit is the quality and consistency of supply you get. With a good relationship comes the chance to refine and tweak the product or service over time with your feedback. You can also offer the supplier longer-term contracts without the need to tender so often. This way the supplier can have more confidence investing in product innovations or process improvements, because they know they have a steady amount of work lined up in the future.

When the strong relationship is mutually beneficial, you're sometimes afforded a number of competitive advantages: things like better service from the supplier or being offered innovations first, exclusively or at no additional cost. With bad or neutral supplier relationships, it's unlikely a supplier will be so generous; whenever those innovations come up, they're either not offered because it doesn't fit the price the customer is willing to pay or when they are offered, it is at an additional cost.

All in all, the value gained from a strong supplier relationship becomes much greater than what was originally contracted.

How can procurement teams develop good supplier relationships?

The question for procurement teams, then, is "how can we move towards stronger relationships with our suppliers?” The first step is to decide which suppliers are going to be worth it. Strong relationships are valuable, but they take work; for some goods or services, it's just not going to be worth the time and effort as there's not much value that can be added above what's in the contract. Once you've found a supplier, there are a few things you can do to strengthen the relationship.

It starts with having regular meetings. You need to do your due diligence to understand their business. Find out what helps them, what doesn't, the things you ask them to do that are actually quite difficult - for example, producing a report every week might be onerous for them, not particularly valuable for you, and therefore a requirement you could remove from the contract. Regular meetings also give you an opportunity to recognise good performance when it occurs.

A strong relationship also requires a bit of flexibility. If you're pulling out the contract every time something isn't delivered exactly as specified, it's possible you'll be costing yourself more in the long run by hurting your relationship. Instead of always asking for a discount, pay what's fair - it might cost you more than what your targeted saving was, but that supplier may be able to deliver efficiencies back into your business that are economically more valuable, giving you a bigger overall saving.

Finally, you can also offer key suppliers market share or monetary incentives. If you have multiple firms supplying the same product but there's one that stands out - and with whom you'd like to build a stronger relationship - offering a larger percentage, or perhaps all, of your business for that product can be a fitting reward for great service. Likewise with monetary incentives. If there's a supplier that has done a lot of work on their end towards making their offerings more affordable, you can offer them a share of savings.

To learn more about how Procurement Co can help you bring your recruitment to the next level, get in touch with a member of our team today.

Why You Need To Engage The Market Early In The Procurement Process

Mon, 04 Sep 2023 11:24:41 GMT

Engaging the market early in the procurement process is important if you want to maximise its effectiveness. Early engagement allows you to properly align your tender with the offerings and capacity of the market, as well as give suppliers time to prepare and increase the competition and responses for your actual tender.

What does it mean to 'engage the market'?

Unlike the early desktop analysis you should do before developing a procurement strategy, engaging the market involves contacting suppliers directly. Conducting interviews, questionnaires and site visits with suppliers is all part of market engagement. The intention is to learn more about what's available - such as any innovations or efficiencies the supplier can offer - before developing any strategies or tenders. It's an open dialogue with suppliers, a back and forth through which both parties have something to gain.

Market engagement is the next level of analysis above basic industry research, which while important and vital, can only tell you so much. No one really knows the services better than the suppliers themselves. Engagement with them gets you the intel about what local suppliers can provide, how their services are evolving and how they can supply to your specific requirements. Suppliers will also know if there's going to be a shortage of labour in that specific field, or if there's going to be material supply issues; basically, any problems that can have an impact on your procurement goals.

It's important for this engagement to always be done through a fair process - you don't want to give one supplier an advantage or a perceived advantage. Not only is it unfair, it can also damage your reputation with others in the market.

Engagement should be early…

Oftentimes market engagement pays most dividends when it's done early in the process. Doing so gives a full understanding of the market prior to developing a strategy or a tender. It's easy to go too far down the path of thinking you know exactly what you want and how you want it delivered. Yet without a discussion on the market's capabilities, there's a chance you could be going in the wrong direction - for instance, in asking the market for something it can't provide or that's outdated.

Another benefit to early market engagement is that it gives the market advanced knowledge of the opportunity, so they can plan to have capacity to respond to the tender. Too often you can throw something into the market and suppliers are simply too busy to respond, so they have no choice but to let the chance pass them by. Too many suppliers doing this results in a tender response with too few suppliers and, as a consequence, limited competition. Once again, it's important this process is done in accordance with probity - it's not fair for one supplier in a pool of many to get advanced warning while the others don't.

...but only if your strategy calls for it

While the benefits of early engagement are numerous, in some cases it doesn't need to happen until later in the process. Doing all your market analysis and engagement before you create a strategy makes it more informed. But in other circumstances where you need that next level of intelligence, market engagement can become a part of the tender, similar to requesting an expression of interest or running a multi-stage procurement. A supplier providing feedback as part of the formal process can give you just as much information as engaging them earlier via other methods.

What's critical, however, is understanding when to engage the market early or when to delay it to a formal process during the tender. Either way, an early decision needs to be made as to what timing works best for the specific project at hand. Decisions of this kind are something the team at Procurement Co can help your business get right. To learn more, get in touch with a member of our team today.

Transaction Management vs Procurement: Finding The Right Solution

Mon, 04 Sep 2023 11:15:55 GMT

At some point, procurement teams are going to come across a project that doesn't fit neatly into a regular procurement process. Being able to identify when a particular project requires a more bespoke solution, is a necessary lever a procurement team can implement if required.

When is a regular procurement process not the right tool for the job?

When there's a specific project or major delivery, at time it falls more into a transaction process rather than a procurement one. This is because the project requires a more bespoke delivery model than just rolling out the normal procurement process and associated tender templates. Using a standard tender template in these situations is like trying to fit a square peg in a round hole. Procurement teams need to be aware when they're facing a project of this kind.

These kinds of projects that require a Transaction Management approach are usually high value - often in the range of hundreds of millions to billions of dollars. They also have more of a commercial focus. Transaction Management is generally going to be a bespoke process that's aimed at achieving the best commercial outcome. Procurement can sometimes have a greater focus on compliance, but in the cases of major transactions the commercial outcome is much more important than just ticking the procurement compliance boxes.

For major transactions, it is important to remember that it is not a 'business as usual' requirement, but rather a major project that needs a dedicated team to effectively deliver the targeted outcome.

What kinds of transactions require a different solution?

How then, can you recognise when this different approach is called for?

A Transaction Management approach is for high value, complex and usually one-off projects (even though they may have a long operational period after construction). An example would be for large infrastructure projects delivered through an alliance model. This is where the client and you, as the contractor, are partners in making sure the project gets delivered - things like building a tunnel or a toll road. These can be known as a PPP (public-private partnership project), where the contractor or a consortia ends up owning the asset for a period of time after it's built, but it's constructed on behalf of the government who are engaged throughout the whole design and construction phase. Running a normal procurement process isn't going to get the level of detail that's required for a project of this kind. A bespoke, interactive negotiated process, on the other hand, can.

Whatever the specifics of the project are, it's going to be one where the traditional model of releasing a tender out to suppliers using standard processes and templates and expecting a good outcome isn't going to work. A whole project built around a specific and complex requirement requires a different skill set to manage and deliver. However, within the resourcing you currently have, you may not be fully across how to deliver a project of this kind. That's where we can help. At Procurement Co , we've worked with many clients to help them complete large transactions of this kind by putting together a dedicated team or managing the process on their behalf.

To learn more about how we can help you deliver a project of this kind, get in touch with a member of our team today.

Understanding And Utilising Procurement Spend Data

Mon, 04 Sep 2023 11:10:26 GMT

One of the richest sources of information for improving procurement outcomes is spend data. Analysing it can tell you a lot about which suppliers and categories of purchase are most vital to your business, which is necessary because there's a chance they're not what you think they are.

What is procurement spend and why is analysing it necessary?

Procurement spend is all expenditure on the goods and services to help deliver business operations, but not including those costs which cannot be influenced by the procurement team such as: employee costs, company taxes, levies, etc.

Without a thorough understanding of the procurement spend of an organisation, it's difficult to know the most important suppliers and categories. It's about discovering where your money is actually spent rather than assuming this based on historic spend. For example, a company could think its most important service is engineering, but when it looks at the spend profile it discovers most of the expenditure is related to drilling campaigns. From there they can put more of a focus on its drilling strategies and contracts, to ensure they're getting the right companies on board. So to understand what resources are most vital, what's needed to get a project over the line, or whether it's even feasible, the spend profile has to be analysed.

What are the benefits of analysing procurement spend data?

There are many benefits to looking into your spend data.

1. Spending money where it's best spent

Once you understand how you're spending your money, you can work out how to spend it more effectively. For example, say you have a contract in place with a supplier for a certain good, which was subject to a competitive tender process and price negotiations. However, after analysing the spend data, you discover only 60 per cent of the spend is actually going to that supplier, with the rest going to others who you haven't negotiated contracts and pricing. From there, you can work out a process to get all uncontracted spend or leakage either with the contracted supplier as originally intended, or run a new procurement process to formalise agreements with those other suppliers being utilised.

2. Better market research

When you understand your historical spend, you can better plan for future tenders and understand the leverage you have in the market. If you know you spend $10 million a year on a certain good, and you're doing your market research for a new strategy, you can better understand what type of suppliers are able to deliver that level of service and the importance of your contract (or lack thereof) to the industry. As an example, if you're only spending $50,000 a year on a particular service, it would be foolish going out thinking tier one suppliers are going to be fighting over that work.

3. Minimising uncontracted spend

Spending on credit cards or one-off purchase orders as opposed to a contract can present risk, because uncontracted spend doesn't have the same sort of terms and conditions associated with a contract developed for the specific goods or service in mind. As a consequence, if something were to go wrong, it lowers the possibility of achieving a favourable commercial resolution. Analysing the spend data can tell you what proportion of your spend is uncontracted and the value of these goods and services. This analysis can lead to reduction in rogue spend and or identify the need to develop contracts for these goods or services

If you're ready to get the benefits of understanding your spend data, we are the people to speak to. Procurement Co can conduct spend analysis for you, or even set up a structure so you have better visibility of your expenditure as it occurs. To learn more about what we can do for your business, get in touch with us today.

Maximising Procurement Outcomes Through Stakeholder Engagement

Mon, 04 Sep 2023 11:02:00 GMT

The nature of procurement means there are always other parties who have an interest in the business decisions you make. These stakeholders are affected by your procurement activities and decisions, with the selection of a particular supplier having a range of flow-on effects to both the external supply market and also the operations of the internal business unit you're procuring the good or service for. As such, engaging with key stakeholders early and often can help get the best from your procurement efforts.

What is stakeholder engagement?

Stakeholders are those who have a stake in your procurement activities. They can be divided into two camps: internal or external, with internal stakeholders being business units within your organisation and external stakeholders being suppliers or other outside parties that are affected by your procurement decisions. Stakeholder engagement is simply the process of finding out how these parties are affected by your actions and what they want from you. This is clearly going to vary from stakeholder to stakeholder, so it's important to foster the kinds of relationships that allow you to engage with all the relevant groups.

At the end of the day, procurement's function is to serve the internal stakeholders in its organisation. Broadly speaking, procurement can be called a success if its internal stakeholders are satisfied with its performance and the outcomes it is achieving for them. To achieve satisfaction from internal stakeholders, it is critical to first understand the objectives each party has regarding the procurement process and what they will deem success. This is achieved by active and ongoing engagement with key stakeholder groups. The kind of continuous engagement required to stay informed means relationships have to be built. You can start with surveys of customer satisfaction to find out how your internal stakeholders rate your procurement efforts and use that as a platform to address any issues moving forward.

A similar story can be told for external stakeholders. While their fortunes aren't tied as closely to yours, many external stakeholders will nonetheless be vital to your business. On top of self-interest, governments and councils often need to be more cognisant of their external stakeholder's needs too, as their responsibilities to the public and social good are greater than that of purely for-profit businesses.

How does stakeholder engagement improve procurement outcomes?

In a sentence, engaging with your stakeholders improves procurement outcomes because it gives you a better understanding of what those stakeholders want that outcome to look like. Without it, developing a procurement strategy becomes a bit like aiming for a target while wearing a blindfold - you just can't see the target you need to hit.

Without any engagement, your procurement objectives and your key stakeholder's objectives are likely to become misaligned. Therefore it is essential to open up the dialogue between the procurement department and the stakeholder groups it services, as when procurement becomes a strategic partner with their internal stakeholders, they are in a far better position to deliver the outcomes sought by the business unit, rather than ones that are sought on the basis of outdated or incorrect information.

Stakeholder engagement can also improve procurement outcomes by reducing any internal resistance to change. Sometimes there are cases where a supplier needs to change, for example, where there is a better deal available or a proprietary innovation that's been developed - yet the internal teams are unwilling to commit to something new. This kind of scenario can be avoided by engaging stakeholders early, and by building the relationship to the point where they're willing to listen to your arguments for change.

Engaging external stakeholders can also improve procurement outcomes in a number of ways:

You can provide the market with adequate notice regarding upcoming tenders.
The market and the procurement function can share information regarding changes, innovations or opportunities in the various supply markets.
You can better understand their supply capacity.

At Procurement Co , we can help you develop a procurement strategy that best satisfies the interests of your key stakeholders. Our expert team has helped countless clients improve their procurement outcomes and better manage the relationships they have with both internal and external parties. To learn more about how we can help you get the most from your procurement, get in touch today.

Why Your Evaluation Methodologies Must Be Fit For Purpose

Mon, 04 Sep 2023 10:55:23 GMT

"Once the business and procurement are working together with a strong strategic relationship, that's when you start to discover the next level of procurement."

Those are the words of Procurement Co Director Heath Jess . Working towards a strategic partnership was recently discussed by Procurement Co's Co-Director, Ryan Jackson , but what's involved in this 'next level of procurement' Heath speaks of? We sat down with the both of them to find out.

What outcome are you seeking to achieve?

The next level can be thought of like this: in order to get the desired outcome for a procurement process, you need to ensure you're choosing an evaluation method that's fit for purpose.

As Heath explained, "there are sometimes basic procurement templates that are straight down the line and used without considering what's being purchased. No thought is given to, 'what are we actually after here and therefore should we have a different focus for the evaluation method to achieve that outcome?'”

The evaluation method, in other words, needs to take into account the procurement goal or outcome and shape itself around that. Ryan described this process as, "asking the right questions and targeting your evaluation on the attributes that a supplier or a service provider can offer to fix a problem you're trying to solve."

All well and good - but what might this look like in practice? Heath provided an example:

"Every procurement project will potentially have a different focus. It could be 'let's get the lowest priced item that will comply with the technical requirements' - in that case price becomes very important. Other times it could be 'we need this delivered within four months' - the schedule they're tendering then becomes very important and price can take a back seat. And finally, when you're looking for something in a niche market, you're really looking for the expertise of the individuals that are going to do the work - the experience is therefore going to be potentially more important than price or schedule."

"If you just continue to use the cookie cutter method, you can get to the end of the process, and it can tell you to go with supplier A when everyone on the team knows supplier B is better." If this occurs, the culprit is usually a poorly structured evaluation process that hasn't had the outcome in mind as its guiding focus.

The importance of choosing the right evaluation methodology

This focus on keeping your outcome in mind applies to the evaluation methodology you select. As Ryan said, "often procurement's main objective is to get something for the lowest price - but that might not necessarily meet the business's or project's objective of getting something done in a short period of time or getting something done to a level of quality that's not achievable with a low price."

There are a number of different evaluation methodologies you could use, for example:

Lowest cost technically compliant - choosing the product that costs the least but still meets minimum technical requirements.
Value ratio - ranking is based on a combination of weighted technical score and pricing. The advantage with this is you get a compromise between an option that's cost competitive and performs well technically.
Weighted scoring (including price) - evaluation criteria is weighted out of 100%, with each evaluation element provided a weighting depending on its relative importance in achieving the business objectives.

Each of these options has their merits, depending on what the objectives of the procurement are. The key is to make your choice carefully based on the desired outcome, rather than choosing any one 'best' method.

To bring it full circle - these kinds of outcome focused evaluation methodologies are only possible when procurement and the other business units work together in a strategic partnership. To learn more about how Procurement Co and their procurement services can help you get there with your business, get in touch with a member of the team today.

Why Selecting The Right Procurement Strategy Is Vital

Mon, 04 Sep 2023 10:47:58 GMT

Diving into the procurement process without first understanding the market and its drivers is never a good idea. Instead, thinking through your procurement activities to develop a strategy is incredibly important for getting the best result.

We spoke with Procurement Co co-directors Heath Jess and Ryan Jackson to find out why developing a solid procurement strategy is key for any business.

What's involved in a procurement strategy?

Developing a procurement strategy requires researching the market, or as Heath explained, "working out the best way to approach the market for a particular good or service". That's a process which is comprised of many elements, a number of which Heath listed:

"Often, organisations engage the market without knowing what the market capability is."

Is there a known market available for what we're seeking or is it an immature market?
Has the way we've packaged the particular goods or services together potentially precluded us from getting the best outcome - should we incorporate other services we haven't thought of into the tender?
How important are we in the market with respect to expenditure - would tier-one operators be interested in the project based on the expenditure or the complexity?
What's our approach - do we know that it's a limited market so it's best to directly invite suppliers, or is there a large and competitive market so an open tender would be more appropriate?
Are there local suppliers – Small to Medium Enterprises (SMEs), or are we engaging an international market?

All these types of things are considered as part of a procurement strategy - the pieces you need to consider to achieve a successful procurement.

Instead of doing this research, some firms, as Ryan pointed out, use the procurement process itself to find this information, which often gets them a poor result.

"Sometimes organisations engage the market without knowing what its capability is and they use the tender process as a way to do their market testing at the same time. This isn't always good, as they can get painted into a corner with having to engage providers that might not be able to deliver parts of the service directly. This can lead to higher costs from having to subcontract parts of the service, or it can bring about quality issues."

What can go wrong if you don't develop a procurement strategy?

There's a lot that goes into a procurement strategy - but what can happen if you don't have one?

For a start, you could get few or even no responses to your tender. If you haven't done your research, you might find no-one can actually fulfil your request as outlined. And sometimes, as Heath explained, you might only get sub-optimal responses.

"If you're not fully across developing your strategy, and haven't done your research on the products out there, new technologies, or the way services are delivered, you might miss something and not get the best result possible from what the market could potentially do."

There's also a chance that a poorly developed tender document might cause suppliers to price their response higher than they otherwise would have.

"If you look like you don't know what you're doing and there's a lot of vagueness in the tender, the provider can sometimes add some risk pricing into their response. If they're not exactly sure what you're asking for, adding an extra margin into their quote can cover their bases in case they misinterpreted the requirement."

How should procurement and project teams work to develop a strategy together?

The best procurement strategies are the result of project teams and procurement working together in a strategic partnership, but this requires early engagement from both sides.

"If it's a project team seeking to deliver something the procurement team is not across, it's on the project team to engage procurement early so they can provide input on that strategy - and vice versa; if the procurement team are aware that a contract is running out in the next twelve months, they need to be proactive in telling the business that it's going to occur and suggest some potential strategies for re-contracting or the next tender."

To learn more about how Procurement Co and how their procurement services can improve your business, get in touch with a member of the team today.

Should My Business Outsource Its Procurement?

Mon, 04 Sep 2023 10:29:21 GMT

Backed by many years of procurement experience in the public and private sector, Procurement Co co-director Heath Jess has seen many businesses come around to the idea of outsourced procurement .

According to Heath, however, there's still a long way to go.

" Procurement is still viewed as a service that businesses need to deliver themselves. Ten years ago, it was the same for HR, IT, finance. But while certain elements of the purchasing function do need to remain in-house, procurement and contract management can be outsourced."

"I don't believe outsourcing of a procurement function is a good idea for all organisations. There are many high performing procurement teams that other companies should aspire to build for their own organisation; however, building a high performing and sustainable in-house procurement team is very difficult. Therefore, companies should also be open to outsourcing the service where there is a poor performing procurement function or the function is not yet developed."

So, what's keeping businesses from making this shift and what are the benefits of freeing up your internal teams to focus on core competencies? We sat down with Heath to find out.

The Procurement Co outsourced procurement model

How is an outsourced procurement model different to what your business is likely already doing?

According to Heath, "Where we differentiate is that we can match the specific skill set and industry experience with the requirement of the project."

Businesses usually seek outsourced procurement services "for major projects, where there's a high risk if it's not delivered properly," explains Heath. "That can be everything from delivery of a major construction project to management of a high-risk contract to ensure adequate implementation and management of external parties."

That's because when you hire professional procurement consultants, you have access to their massive wealth of professional experience and human resources. They'll know exactly how to deliver your project based on the firm's collective expertise and proven procurement methodologies.

This illustrates one of the benefits of moving to outsourced procurement - you don't need to make the shift all at once.

"Our work usually starts on an individual project level, delivering one major project and that eventually leads to others," says Heath. "Unless you haven't formed a procurement team already, it can be difficult to flip the switch to an outsourced model, so generally businesses will seek assistance for particular programs or contracts and shift over slowly, growing from there based on performance. They can also pilot outsourced procurement on a critical project or initiative, to see whether their organisation would benefit from an outsourced model."

What are the benefits of outsourcing your procurement function?

In recent years, Heath has seen a greater willingness to move towards an outsourced procurement model.

"While businesses used to accept delays from the procurement function as business as usual, there's now a much stronger focus on performance. Businesses are now more willing to change the norm and say, 'Okay, it isn't working - how can we fix or change this? What are the options available?' and outsourcing is becoming much more viable."

Start-ups and new companies are also more likely to outsource their procurement.

As Heath explains, "These businesses are purely focused on their core service and that's what they focus their resource profiles on."

It's not just start ups who should think this way - anywhere overall business performance is impacted, outsourcing should be considered. Heath describes three key benefits of letting a company like Procurement Co handle your procurement needs:

1. Higher standards

As with all services, your business' procurement needs to be delivered at a high level. When you outsource, you can meet that requirement by setting Key Performance Indicators (KPIs) for the service and hold the provider accountable - something that can be difficult to do to an internal function.

2. Lower cost

It's easier to manage the cost of an outsourced model because you're able to ramp up the service during peaked periods and down when procurement activity is closed out.

3. Different delivery models

By working with experienced professionals, you'll be able to utilise different procurement strategies and models, all in order to find the most efficient, cost-effective option. Outsourced procurement can be much more nimble, especially because of the ability to match skill sets with a particular project.

Thinking about outsourcing any aspect of your procurement services? Reach out to the team at Procurement Co today to find out how we can help.

4 Reasons Why Probity Is Critical In Procurement

Mon, 04 Sep 2023 10:18:42 GMT

Operating fairly and with integrity when running a tender is vital for businesses that want to succeed. Probity is not something that can be ignored, as it directly impacts the viability of each tender process, as well as the reputation of your business in the wider industry.

Here are four reasons probity is of the utmost importance in procurement .

1. It protects you from legal and financial risk

With an unfair tender process comes the potential for legal and financial risk. For Government procurement in particular, probity requires that all parties have a fair opportunity at being awarded contracts. If there is evidence that one supplier has been favoured for reasons unrelated to the evaluation criteria, there's potential for legal action to be taken against the awarding party.

Running a fair tender in accordance with probity ensures that risks of this kind are minimised as much as possible. Working with the team at Procurement Co provides you with a source of independent oversight - giving you peace of mind that you're running your tenders in accordance with market expectations.

2. It promotes and supports a healthy and competitive marketplace

Not only does working in accordance with probity promote good outcomes for your business, it also helps support industry. When an industry is free from corruption and all suppliers are on equal footing in a tender process, it makes a big difference to the industry. If suppliers trust that they have an equal chance of being awarded contracts, they'll be more willing to put a higher level of effort into their tender responses. Whereas suppliers that don't believe they have a chance based on the fairness of the tender process and the tendering company, may choose to either not tender, build a risk premium into their pricing or participate in unethical activities to increase their chance of success.

When the industry is healthy, it improves the quality and number of tender responses through greater competition. When suppliers know they will be awarded a contract on merit, they're going to work harder to lower their prices and provide new innovations.

3. It builds trust with industry

The best supplier relationships are the ones where both parties get something out of it beyond just an everyday commercial engagement. A relationship that becomes strategic instead of merely transactional opens a line of communication between client and supplier that otherwise wouldn't exist. Each side becomes willing to share more information about what they think is going well. What may need to change and where they think improvements to efficiency could be made.

The benefits these kinds of supplier relationships bring are worth pursuing. But to bring such a relationship about, suppliers need to be able to trust you, and this requires running your tender processes in a fair and principled way. If you show a supplier you're the kind of business that doesn't operate with integrity, they may be reluctant to build a strategic relationship with you. Reputational damage is hard to repair, so it's best to avoid it in the first place.

4. It's the right thing to do

Integrity in business shouldn't just be something you pursue because it benefits you in the long run. Operating fair and ethical tenders is important simply because it's the right thing to do. The commercial benefits that come hand-in-hand with having a reputation for honest conduct are simply an added bonus.

At Procurement Co , we work together with our clients to make sure their procurement activities are held to the highest standards of probity. To learn more about what we can offer your business, get in touch with a member of our team today.

The Benefits Of Doing Market Research Before Developing A Procurement Strategy

Mon, 04 Sep 2023 10:11:17 GMT

Before you can develop an effective procurement strategy or tender, it's important you understand the state of the market you're about to enter. Without this knowledge, the chances of not achieving the desired outcome, and instead just wasting time and money are greatly increased.

We spoke with Procurement Co Directors, Heath Jess and Ryan Jackson , to find out more about the importance of market research for procurement.

What does market research entail and why is it vital?

As Heath explained, it's about gaining ''a better understanding of what's available in the market prior to actually developing your procurement strategy and/or tender''. This understanding can come from a variety of places:

Internet research on suppliers and their capabilities.
Reaching out to similar organisations to see what they do to source a particular good or service.
Industry research on specialist platforms such as IBISWorld to understand who the major players are, the services they offer and how the good or service is evolving with new technologies.

Undertaking this market research brings a host of benefits. Principally, it ensures that your procurement strategy as a whole aligns with the capabilities of the market; there's no point building a strategy around something the market can't actually deliver. Once you know what the market can do, Ryan explained, you can then tailor your procurement approach to achieve the best outcome.

''Market research helps you decide whether the solution you're looking for is best outsourced to the market, delivered internally or a combination of both. You can't really know which option is best until you've done your due diligence on what the supply capabilities of both the market and your own firm are,'' Ryan said.

Market research also provides a chance to consider alternative solutions, new innovations or opportunities for collaboration, if some parts of the market are ahead of the others. Heath provided an apt example: "New technology is changing so fast, so you don't want what you're procuring to be redundant within a year - there may be opportunities to future-proof that service by finding new and innovative suppliers, but you have to do your research first to find them.''

Finally, market research also provides the opportunity to find out the likely costs of the goods and services you're seeking, so you can determine whether a tender can be delivered within allocated budgets.

As important as it is, doing market research takes time and specialised knowledge. One of the services Procurement Co provides is doing this research for you.

What can happen if you don't do your research?

Ryan explained a number of negative consequences not doing the necessary market research can bring.

''If you run a tender without understanding the market, you can end up with an unexpected or unsuccessful outcome, resulting in wasted time and money.''

There's also potential for damage to your reputation ''if the tender's aborted because the strategy wasn't properly thought through, or you don't have adequate budget to procure the services tendered, it may reduce the markets likelihood of tendering for future work you release.''

Finally, as Heath pointed out, a lack of research can bring about lost opportunity costs: "You potentially miss out on a better service or improved pricing if you just roll over a similar strategy from last time you tendered to the same suppliers. For all you know, there could be ten new suppliers out there who do a better job at a better price or can offer you something your current supplier doesn't. But unless you do the research and understand how the market has changed since last time you tendered, those opportunities will be lost.

To learn more about how the team at Procurement Co can help with your market research, get in touch with a member of the team today.

How To Measure Your Procurement Team's Performance

Mon, 04 Sep 2023 10:02:16 GMT

To get the best from a business unit, you always need to be measuring its performance. Whether it's sales, marketing or product development, using Key Performance Indicators (KPIs) to track how a business unit is performing gives you the information needed to make improvements where necessary. The same is true for your procurement team.

We spoke with Heath Jess and Ryan Jackson , co-directors of Procurement Co , to find out exactly how this can be accomplished.

Performance metrics must be tailored to the organisation

How procurement performance is measured is always going to vary from organisation to organisation. As Heath explained, ''It has to align with the most critical elements the business needs its procurement team to deliver. So there's no cookie cutter approach to measuring performance, because you could roll out the same measurements to all organisations but there will be only a few that matter for each. What's important is going to depend on what the organisation does and what they're procuring."

So while there's no one KPI for procurement teams that will suit every organisation, there are a number of commonly used metrics, such as:

Negotiated savings.
Time taken to conduct a procurement process.
Customer satisfaction.
ROI of procurement savings vs procurement team cost.

Balancing short- and long-term measurement

Whatever the metrics you choose, it's important they align with the strategic objectives of the business and are updated if and when those objectives change. Just having one rolling KPI that never changes can be difficult for employees to focus on, and subsequently much easier to ignore. Instead, Ryan explained, "there's an opportunity to hone a procurement team's focus and give them a three-month KPI that aligns to a sprint or campaign, or a business objective. It can be targeted to achieve outcomes over a short period of time."

That said, it's still important to have longer term KPIs as well. Heath noted that ''they can help the procurement team understand their own performance, so when the business asks them how long a tender will take, they know from their metrics it'll take them, say, three months and they can stand by that.'' Finding the balance between shorter-term targeted metrics and longer-term general performance tracking is therefore key.

Engaging suppliers directly allows you to tailor a tender to your market.

Increasing the returns to procurement

All this performance measurement isn't worth conducting if it not reviewed and reported. Procurement is a service provider to an organisation, so it's important to ensure the procurement function is providing a service which meets or exceeds business requirements. Establishing measures and targets ensures performance can be tracked and reviewed in a clear and transparent manner.

Ryan explained the importance of taking a service-provider view of procurement within a business.

''Procurement functions are generally an overhead to the organisation, or a business support cost to a business unit. As such, its important from an overall profitability perspective that organisation's understand the performance of their procurement teams, to ensure that the level of service being supplied to the business is efficient and of high quality."

A high-quality procurement service is one that provides a good return on investment. A study from the Chartered Institute of Procurement and Supply (CIPS) found top Australian procurement teams delivered a 7x return on investment to their firms. Procurement Co has been able to double this, bringing their clients a 14x return on investment.

To learn more about Procurement Co and how they can work with you to get more from your procurement team, get in touch today.

5 Tips For Running A Successful Tender

Mon, 04 Sep 2023 09:54:08 GMT

The process of putting together a successful tender involves a lot of moving parts. With each stage having a big impact on the next, there's a lot to get right from the very beginning.

Here are 5 tips for running a successful tender.

1. Do your market research

The first thing to do in any tender process is make sure you've done your due diligence in researching the market. You can't develop a fit-for-market tender if you have no idea what it's capable of. Who are the biggest suppliers? What are their offerings? What kind of prices can you expect to pay? These are the kinds of questions that can be answered by researching your market.

This early research should be a mixture of straightforward internet searches, talking to firms in your industry about their suppliers and looking on specialist platforms like IBISWorld.

2. Engage the market, early

As useful as the above desktop research is, it can't match the knowledge of the market that the suppliers themselves have. By engaging with the market in a transparent manner, you'll be able to identify the capability of the market, potential innovations to the goods or services, or potential challenges the market might be facing as a whole.

Interaction with the prospective market, ensuring probity requirements are adhered to, usually delivers a better outcome. These interactions provide greater understanding to both parties of the requirements and provides suppliers with advanced notice of the upcoming tender so they can resource appropriately.

Engaging suppliers directly allows you to tailor a tender to your market.

3. Select the right procurement strategy

What should you include in the tender? What tier suppliers should you target? Should you approach a limited number of suppliers directly or launch the tender publicly because there's a lot of competition? The procurement strategy should be customised to the specific goods and services to be tendered and should not just be a duplication of what has occurred historically.

These are the kinds of things you need to think about as part of a procurement strategy and potentially address in the early market interactions in items 1 and 2 above. The market research and sounding you conduct as part of the strategy development allows for a more comprehensive procurement strategy that aligns with the market capabilities.

4. Make your tender work for suppliers, not against them

When you put a tender into the market, it's important to remember the time and effort suppliers have to invest into responding. They are usually very busy servicing other organisations, so always be sure to set realistic timeframes for a tender's duration.

Ensure the tender response requirements are in accordance with the value of the contract to the market and that the information being requested is actually required for evaluations. Too often the tender template utilised is not tailored to the process and suppliers are requested to provide information that is irrelevant to the particular good or service tendered.

Outlining response expectations and/or page limits on each criterion also enables suppliers to focus on the important elements of the tender in forming their response.

5. Choose a relevant evaluation strategy

It's critical that you adopt a strategy for evaluating the tender responses that is relevant to your business objectives and the outcome you wish to get from the process. Consider the elements that are most critical and provide these with a greater weighting in the evaluation scoring. Too often a business criticises or challenges the outcome of an evaluation process without properly detailing the required outcome and contributing to the development of the evaluation criteria and weightings

Be realistic regarding evaluation and award timings too. The tendering company will program their workload and resourcing to account for when the contracted services are required. If award is then delayed by a lengthy period, it should come as no surprise that elements of their tender response have been impacted by this delay i.e., available resources, etc.

To learn more about how Procurement Co can help you run a successful tender, get in touch with a member of the team today.

Electronic Signatures in Procurement

Mon, 04 Sep 2023 09:20:31 GMT

“Information that is born digitally should be managed digitally” – QLD Government – myth-buster on signatures.

If you have engaged in the procurement process , it is likely you have encountered some sort of formal approval requirement. Whether it is via email, software or a physical (wet) signature.

Whilst the use of e-signatures has been contemplated by legislation as far back as 1999 via the Electronic Transactions Act 1999 (Cth), the recent epidemic has brought the use of e-signatures back into the forefront of legal, parliamentary, and general business discussion.

With COVID’s impact on how we do business in Australia, this “new normal” as described by the Australian Government – Department of Health, has led to significant changes in how we work with one another. As we become more mobile, simply walking to an approver’s office, discussing the procurement requirement, and obtaining a signature may not be as easy as it once was for everyone.

With many people being swamped with emails, and certain software’s cost and training barriers for newer or smaller businesses, electronic signature platforms such as DocuSign are finding a market here in Australia as well as the international market.

The Queensland Government has shown support for the use of e-signatures. This can be seen through a plethora of notices, articles and even legislation. Examples of this are:

Office of the Chief Advisor – Procurement Advisory Notice 13/2020 For buyers – Use of electronic signatures and witnessing documents;
RTA’s Announcement that they will accept digital signatures on RTA forms (March 2021);
Queensland Government – Implement and use digital signatures (May 2021);
Queensland Government – Procuring During and Emergency (July 2021); and
COVID-19 Emergency Response Act 2020 (Expired Dec 2020).

Benefits

Whilst the Queensland Government has made their opinion on the use of e-signatures clear, there are plenty of operational and commercial benefits that private entities, who do not deal with Government Procurement, can take advantage of by making the change, these include:

Reduced labour and materials costs from printing, faxing and physical filing;
Better utilisation of employee time;
Quicker turn around for procurement processes via a collaborative approach to document review and approval, which mitigates project delays due to procurement activities;
Improved storage practices enabling ease of access to key documents when required;
Easier and cheaper than implementing a purchasing software to manage approvals, with very little training required;
Increased security due to digital footprints and version control; and
Reduction in operator error and improperly executed documents, by clearly identifying where to sign, whilst also limiting where certain approvers from being able to sign where they shouldn’t.

Things to keep in mind

The jury is still out when it comes to the execution of deeds and certain agreements via electronic signature. Different states have taken different approaches to the legality of this process with some even implementing temporary legislation to further promote e-signatures during the pandemic. Unfortunately, the temporary legislation in Queensland has expired.

The good news for advocates for innovation and efficiency is that the Federal Government has put together the Deregulation Taskforce with an aim to (amongst other items) expand the range of documents that can be validly signed electronically, with an aim to finalising the legislation for this phase by the end of 2021. A paperless future could be around the corner.

Please note all content provided here is for informational purposes only and should not be interpreted as legal advice. As the legality of electronic signatures for certain documents differ depending on the state or the expiry date of certain legislation, you should seek counsel for your own circumstances.

Procurement Co Are Here to Help

Need some help or advice? Contact Procurement Co today and one of our expert consultants will get you on the right direction.

Small to Medium Enterprise Specialising in Procurement Services

Mon, 04 Sep 2023 09:16:57 GMT

Recently Procurement Co were acknowledged by Queensland Government for our contribution to supporting Queensland Government procurement, and jobs creation in Queensland for 2020/2021.

Small to medium enterprise specialising in procurement services | Department of Energy and Public Works (epw.qld.gov.au)

We're also happy to announce that since this article was written, we continue to grow our team and have hired one more procurement graduate, and 4 more procurement consultants, all Queenslanders.

procurementco

West Moreton Anglican College

Queensland University of Technology (QUT)

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University of Technology Queensland (QUT)

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Education

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Origin Energy - Integrated Gas Category Management Case Study

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DJPR - Probity Advisor Victoria Fund Assessment Panel

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Victorian Department of Jobs, Precincts and Regions (DJPR)

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Transport for NSW - Probity Advisory Services – Prospect Highway Upgrade

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Economic Development Queensland - Yeerongpilly Green Development Case Study

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Origin Energy - APLNG Directional Drilling

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DJPR - Procurement Advisor

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QRA - Council Procurement Review

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The importance of focusing on your most critical suppliers