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The SIG Webinar will begin shortly.
Once the webinar begins, the sound will come from your computer
speakers.
In the meantime, please take a look at the upcoming SIG networking events listed on the right side of your screen
and plan to join us if you are in one of these cities this fall.
NETWORKING EVENTS
GLOBAL SUMMITSMar 10-12 2015 – Amelia Island
SYMPOSIUMS
March 25 – Minneapolis, MN
REGIONAL ROUNDTABLES
Feb 4 – Seattle, WA
For more information and to register for all SIG events:
www.sig.org
Become a SIG Champion and earn points in the process by…
•Attending an event
•Dialing into a webinar•Speaking at a Summit
•Submitting content to our blog or SRC
•Referring a new member•And more
For more information and to register for all SIG events:
www.sig.org
RECENT POSTINGS
The SIG Career Network is
bursting with opportunities.
New jobs are posted daily by some of the best known global
companies in the world for those seeking careers in sourcing,
outsourcing, procurement and related functions.
For more information go to: www.sig/career-center.org
NEW to the Career Network!
• Honda North America – posted Dec. 10
• Category Leader
• Agrium, Inc. – posted Dec. 8
• Category Manager, IT and Telecom
• Pacific Electric & Gas – posted Dec. 3
• Expert Category Lead
• Zions Bancorp. – posted Dec. 2:
• Information Technology Analyst
• Senior Information Technology Analyst
• GAP Inc. – posted Dec. 1:
• Sourcing Manager – Outsourcing
• Sourcing Manager – GAPTech Software
• Warner Bros. – posted Nov. 25:
• Sourcing Manager - Marketing
• LogicSource – posted Nov 19:
• Vice President, Sourcing – Facilities
• Vice President, Sourcing – Technology
• Vice President, Sourcing – Logistics
• Vice President, Sourcing – Travel
bit.ly/SIGLinkedIn @SIGinsights bit.ly/SIGfacebookbit.ly/SIGYouTube
Join the discussion in SIG’s Peer2Peer Resource program too!
Stay connected with other SIG members through various social media channels
SOCIAL MEDIA
bit.ly/SIGBlog
New Topic Each Week2:00 pm Eastern
(11:00 am Pacific)
Upcoming Free SIG Webinars:
January 15, 2015A Case Study:How Effective Risk Management Drives Global Supply Chain OptimizationPresented by Hiperos
January 22, 2015Solution Deep DivePresented by Zycus
January 27, 2015Thought LeadershipPresented by DTZ Register at www.sig.org
For more information and to register for all SIG events:
www.sig.org
Upcoming Town Hall Teleconference:
January 7th
Supplier Management/Governance
Presented by:
John Fafian
Director – Head of Strategy & Sourcing
PricewaterhouseCoopers LLP
SIG Town Hall Teleconferences
bring a small group of buy-side ONLY attendees together for a facilitated
discussion on top-of-mind issues in an open-mic, private conversation. Town Hall Teleconferences are NOT recorded.
Calendar of Town Hall
Teleconferences
Taking place at 1:00 pm Eastern on
the following dates:
January 7 July 8
February 11 August 12
April 8 September 9
May 13 October 14
June 10 November 11
For more information and to register for all SIG events:
www.sig.org
SIG Symposiums and Regional Roundtables provide education and local networking for members and invited non-member corporate users
Symposiums 2015:
Minneapolis – March 25
Toronto, Canada – May 20Columbus – Sep 16
New York– Oct 15
San Francisco Bay Area – Nov 13
Regional Roundtables 2015:
Seattle – Feb 4
Hartford – Feb 25Sydney AU – April 15
Chicago – April 29
Houston – May 6
For more information and to register for all SIG events:
www.sig.org
A SIG Global Summit is…
• Non-commercialized
• Almost 70% buy-side
• Global brands
• 3 days of networking
• Executive Roundtables
• Multiple keynote sessions
• Nearly 50 breakout sessions
69% at director level or above, of which 43% are VP/C-level
www.sig.org/summits.php
Capital Program Management:Objective Prioritization and Strategic Sourcing Alignment
SIG Presentation
December 11, 2014
10
Today’s presenters
Ron Bye is a Vice President and the Capital
Planning Product Lead at JLL. Ron’s experience
includes virtually every facet of the commercial
building industry with over 40 years experience.
Currently, Ron oversees capital project planning
services to vet scope, budget, and perform
business case analysis for Clients across the US.
Mr. Bye and his team have developed an
algorithmic approach to project prioritization.
Samantha Mehal is a Vice President and Strategic
Sourcing Manager, where she leads the supply
chain and procurement group for Project and
Development Services within JLL. She has over 15
years experience and expertise in developing and
implementing a sustainable preferred supplier
programs that deliver proven savings (250M+ in
2014) and other efficiencies.
11
• Seldom
• Occasionally (25%)
• Often (50%)
• Regularly (75%)
• Almost always
How often do your
projects encounter
sourcing issues,
require redesign,
or spec changes
to meet budget
once you go out to bid?
Polling Question??
12
Capital projects canceled, placed
on hold, or deferred in one year
Budget variance discovered —
submitted vs. verified by CPM
What’s the risk? A case for Capital Program Management.
30% >25%
13
More than half of executives in a
recent study expect future capital
projects to exceed budgets
20 percent anticipating
overruns in the double digits
What’s the risk? A case for Capital Program Management.
15
Capital Budget and Planning
Danger: Shrinking capital
budgets mean greater
importance for prioritization
With less money, you need to plan more
17
How it works
Expose reality of project
scope and budgets
through
detailed review of
projects
Identify
alternate
approaches to
solve facility needs
Identify
unjustified
projects
Apply
market knowledge
to propose
solutions
Deep dive analyses
to identify full
project scope
Examine
maintenance
needs vs.
replacement costs
Identify obsolete
facilities based on
operational costs,
condition and
design/usage
18
The end result
• Well-planned and justified projects
– Easier to construct/manage
– Reduced PjM requirements
– Avoid budget issues
– Shorten project duration
• Integration increases efficiency for all
• Facilities get what they need, when they
need it
Proper planning prevents poor performance
19
Summing it up…
Cost
Risk
Surprise
Inefficiency
Unspent cap budget
Pet projects
Better decisions
Predictable plan
Strategic sourcing
Priorities addressed first
CRE value to C-suite
Optimized timing of spend
20
Capital Projects
Why Strategic Sourcing?
• Complexity
• Tight budgets
• Material and labor availability
• Supply chain fluctuation
• Regional trends
• Critical supplier relationships
On average 90% of capital budgets are outsourced
21
Transactional
Price dominance
Constant negotiation
Short term thinking
Isolated
One time decision
Win-lose result
What sourcing is: What sourcing is not:
Trending
Strategic
Total cost of ownership
Shared resources
Long term vision
Collaborative
Continuous process
Win-win partnerships
22
Integration
Expanding procurement’s influence
• Portfolio Planning
• Business Unit Collaboration
• Design
• Project Execution
• Supplier Relationship Management
• Facility Management
• Analytics
True integration between capital project management team and sourcing team
24
• Savings
• Mitigation of risk
• The best quality and supplier
performance
• All of the above
What is the most
important benefit to you
realized from sourcing
strategically?
Polling Question??
25
A different point of view
• Warranties
• Priority in production
• Sustainability
• Maintenance
• Demand
Scope of SS extends beyond transaction. We should be considering the Total Cost of Ownership
• Innovation
• Technology
• Operations
• Delivery
• Performance
Examples of TCO, price
plus:
26
Objectives of Strategic Sourcing
Reduce cost while
maintaining or
improving quality
Technology
solution
Specialized
skillsets
Leverage entire
portfolio
Manage Risk
Identify improvement
opportunities
Deploy category
management
Optimize supply
base
Drive innovation Develop supplier
metrics that align with
corporate strategy
27
WHY focus on sourcing?• Gain confidence in decision making through
innovative strategies
• Align purchasing decisions with academic analysis to achieve best total cost of ownership
• Develop healthy and sustainable supplier partnerships
• Enhance control and transparency to gain superior terms for capital purchases
• Use benchmark data and other information to better plan for future capital budgets
Companies that excel in
delivering capital projects can
be financially rewarded
Connecting the dots with capital PM team and sourcing
Success requires the team to focus on the management and execution of the
sourcing function
28
The end result
• Key factor in increasing the odds that
projects exceed quality expectations is
sourcing.
• Profitability in capital projects is directly
dependent on how a firm sources for
those projects.
• Firms that employ strategic sourcing are
15-25% more profitable over those firms
NOT sourcing on capital projects.
Companies that excel in
delivering capital projects AND
sourcing will be financially
rewarded
2,500project managers1.1 billion
sq ft facilities
under management
Serving the world’s
LEADING
COMPANIES
JLL’s Corporate Solutions business today
26Kemployees globally
4,000transaction specialists
415 researchers
29
550consulting and
workplace strategists1,300LEED accredited
professionals
84,800leases managed
$30 billionspend controlled
for JLL clients
billionin revenue
$1.3
420+client accounts