Saving Millions In The Long Run

• Supply Management, (2013). ‘Procurement overhaul at John Lewis saves £90 million’. Online < http://sm.redactive.co.uk/news/2013/procurement-overhaul-at-john-lewis-saves-90-million/>

Even though this article is over a year old it provides significant evidence to how changing your procurement process can produce savings for the years to come.

The article describes how John Lewis Partnership (JLP) has produced savings of more than £90 million since it launched an overhaul on indirect procurement three years ago.

Their Procurement Planning & Support Manager found that with a £1.4billion indirect procurement spend, there was a need to have processes and people in place to manage it effectively.

How did he rebuild their procurement and save millions?

By setting up a CENTRALISED procurement department.

Our previous post, ‘Let Contract Management Take Centre Stage’  touched upon some of benefits of having centralised contract management systems. A system which can help manage the lack of control by helping you gain the whole scope of data in regards to purchasing goods and services.

John Lewis Partnership needed to centralise their procurement department to be able to take care of spend across four divisions. By centralising the department they have been able to become more commercial and tougher in its dealings. Previously they had separate departments which were dealing and processing independently and impromptu.

A centralised procurement department and system provides rich intelligence and value. Centralised systems that can manage all your procurement data and activities can identify ways to improve value, by getting robust contracts in place and provide a better tool for risk management.

JLP found the project’s key challenge was around changing the culture of the organisation (we all know change is not initially accepted).

We understand that change to procurement practices is a scary concept (especially in large companies) as there can be years of data back tracking which could flag even more issues. However as a software company we make the crossover simple and easy.

We currently provide contract management systems to a number of clients; to make the process of change easier we create and tailor the system to the requirements of the organisation. We take the manual processes and turn them into a cognitive system which can be accessed with secure logins and provide a central working platform for all departments. Our software makes day to day tasks more efficient and cost effective, while keeping you compliant.

A centralised team combined with an efficient centralised system can give you one version of the truth, ensure nothing gets missed in your process and help you save millions for the future.

Are you looking restore your procurement practices? Do you want to save millions in years to come?

Start your procurement overhaul search for 2015… Take a look at our Procurement & Contracts Management System, Accord.