Optimising Procurement

Processes

E World 2016

Context

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£270m  spend  p.a.    approx  1000  contracts  

300  branches  and  5000  staff  

£20bn    loans  

               William

s  and  Glyn  

£1.8bn  spend.      2000  contracts  

In@luence  over  £1bn  cash  

20m  policies  

Large  Start  Ups    

               Direct  Line  Group  

What Are We Doing – Keeping The Headlines Simple

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Complying  to  internal  and  external  regulation  /  

legislation  

Optimising  Value  

Selecting  the  right  Suppliers  

Managing  In  Contract  Performance  

Managing  Fraud  Risk  

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End to End Sourcing and Contract Management Approach

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Data  Gather  &  Analyse   Iden1fy  Opportuni1es  

Define  Selec1on  Approach  

Conduct  Supplier  Selec1on  

Finalise  Supplier  Selec1on   Governance   Implementa1on   Supplier  &  Contract  

Management  Iden1fy  &  Tier  Requirements    

Supplier  Deployment  

Third  Party  Management  Policy  and  Category  Strategies    

Mandatory  Document  

Core  RFP  using  Esourcing  pla;orm  

Mandatory  Documents  

Sourcing  Plan  

Mandatory  Documents  

Supplier  Selec<on  /  Due  Diligence  Output  

Mandatory  Documents  

1.  Contract  Checklist    2.  Business  Case  3.  Contract  

   

Mandatory  Ac1vity  **  

Tier  Services  

** = only when applicable

Mandatory  Ac1vity    

Carry  out  1st  LOD  Assurance    Ac<vity  

Mandatory  Documents  

Contract  Control;  Sheet  

Governance  Select  Supply  Base  Define  Sourcing  Plan  Define  Business  Need  

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Sourcing / Purchasing Approach

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Financial  Governance  Ensure  Compliance  

Contract  Checklist  and  Legal  Agreement  •  A  signed  contract  appropriate  to  the  services.  

•  Documentation  of  any  signi@icant  variations  from  the  standard  terms  and  conditions  

Selection  Outcomes  The  selection  outcomes  must  be  agreed  and  documented  

Due  Diligence  /  Risk  Assessment  Technical,  commercial  and  @inancial  

Sourcing  Plan  Document  the  selection  approach  in  advance  

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Supplier Tiering

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Customers:  relationships  of  trust  

A  @irm  must  take  reasonable  care  to  \ensure  the  suitability  of  its  advice  and  discretionary  decisions  for  any  customer  who  is  entitled  to  rely  upon  its  judgment.

     

MATERIAL  OUTSOURCE    

Failure  of  the  services  casts  doubt  upon  compliance  to  FCA  principles  

and  threshold  conditions        

CUSTOMER  CRITICAL    

Failure  has  signi@icant  direct  and  immediate  impact  on  the  customer  experience  &  /  or  supplier  represents  

us  directly  

INFORMATION  SECURITY    

Supplier  handles  our  secret    information,  con@idential  customer  information  or  accesses  our  sites  /  

systems  unaccompanied  

OFFSHORE  

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OFFSHORE    

   Suppliers  operations  based                                                                      outside  UK  or  Europe  

 

Contract Management Approach

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Clearly  de@ine  a  Contract  Management  Approach  and  an  associated  RACI  

Contract Start Contract Performance Contract End

•  Understand  the  contract  and  its  obligations  

•  Con@irm  activities  (mandatory  and  judgement  based)  to  be  carried  out  and  frequency  

•  Manage  Risks  and  Issues  

•  Performance  Reviews  

•  Ongoing  Due  Diligence  

•  Purchase  to  Pay  processes  and  monitoring  

•  Contingency  Plans  

•  Exit  Plans  

•  Supplier  Business  Continuity  

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Key Tips and Lessons

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Iterative  Testing  Approach  

Specialist  Contract  Managers  /  Operating  Model  Debate  

Optimal  approach  requires  judgement  requires  strong  performers  

Collaborate,  Train  and  Integrate  

What  About  The  E  ?  

eWorld 2016