SA Water Procurementspb.sa.gov.au/sites/default/files/Richard East - 'SA Water... · SA Water...
Transcript of SA Water Procurementspb.sa.gov.au/sites/default/files/Richard East - 'SA Water... · SA Water...
SA Water Procurement State Procurement Board Forum 28 May 2015 Richard East – Senior Manager Procurement
Thursday, 28 May 2015
SA Water Procurement….Topics
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• Structure • Strategic Alignment • Key Facts • Our Journey • Capability and Culture • Key Initiatives and Priorities • Key Strategies and Tools • Successes • Recap
Structure
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Operational, Goods,
Services & Equipt
Capital Works & Services
Corporate Services
Systems & Governance
Energy Strategy &
Service FM & Fleet
Category Management
Procurement Regulation Finance IS
Business Services
Procurement
• More than just “Procurement” • Part of “Business Services” • Driving role in business performance
Strategic Alignment
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Corporate Vision &
Strategic Goals
Business Group
GM's Group Business Plan
Business Unit
Action Plan
Employee
PD & PADP
Strategic Alignment
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Key Facts
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• Moved to “category” structure in April 2014 • 35 FTE positions across 6 teams • Rolling $500m p.a. spend • 80% of spend with 50 suppliers (3000 suppliers) • 3 category teams covering 7 “master categories” –
• Capital Works & Capital Services • Operational Goods, Services & Equipment • Indirect Services & IS
• 7 Category plans with savings targets (total $7m target 14/15; forecast $17m)
Key Facts
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Facilities and Fleet Management…..
65 Regional & Outer Metro Sites
(All sites freehold)
Total Occupants – 550
FM Service Supplier
Brookfield Global Integrated
Solutions
Current Contract
5 years commenced January 2011
8
9
250 Victoria
Square
Adelaide Metro Sites
250 Victoria Square (leased)
11 Waymouth Street (leased)
16a Ashwin Parade, Torrensville
(leased)
Bolivar AWQC (Freehold)
Total Occupants - 1061
FM Service Supplier
DTZ (UGL Services Pty Ltd)
Current Contract
5 years commenced February 2011
11 Waymouth St
10
Heavy Fleet Truck & trailer assets – 173 Minor plant assets – 543 Total assets - 716 Heavy Fleet Service Supplier: Vehtec Pty Ltd
Light Fleet Passenger & Light Commercial assets – 495 Light Fleet Service Supplier Fleet SA - Leaseplan Australia
Energy @ SA Water
SA Water is one of Australia’s & SA’s biggest energy users Energy is one of SA Water’s highest operating costs
Electricity use is our single largest source of CO2 emissions
Renewable energy producer & user What else are we doing about energy?
Key Facts
Energy Portfolio Management (EPM)
Prior to 1 July 2013 we procured electricity via standard retail contracts
We now pay the wholesale (spot) market price
Price risk is managed by: 1. Electricity load management 2. Electricity self–generation 3. Progressive forward contracting
Energy Management
Energy Recovery Energy Generation
Energy Efficiency
Our Journey…..Procurement Transformation
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Category Management
Transactional
Strategic and Commercially Focused
Our Journey……Key Enablers
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Organisation and Structure Focused team with clearly defined responsibility, authority and accountability for Procurement activity
Procurement Processes Best-in-class measurement, approvals, conditioning, negotiation, risk management processes
People The right people in the right positions, empowered and motivated by accountability
Learning / Skills Procurement team using transparent price methodologies, use of P2P and educated key stakeholders. Upskilling customers’ commercial acumen
Category Management A structure process that embeds the involvement of key stakeholders in the development of comprehensive sourcing strategies
Technology Appropriate spend analysis, e-sourcing, e-procurement and e-SRM approaches for sourcing and procurement
Capability
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• Strong focus on developing our own people • High degree of self-sufficiency and empowerment • Mixture of experienced professionals and less experienced • Moving from a transactional/traditional function to
strategic/commercial approach • Building a capability framework for required skill sets • MCIPS development supported plus “in job” experience • Position descriptions aligned and standardised for rotation • Diverse skill set across the team
• Procurement (MCIPS, long-term and short-term experience) • Energy Strategy & Service (accountancy, engineering, market knowledge) • Governance, Policy and Procedure (process efficiency, lean, audit etc) • Systems and Analytics (systems, accountancy, database creation – management
and interrogation) • Facilities & Fleet Management (engineering, technical)
Team Culture
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• A “one-team” ethos • “Requisite Organisation” principles and tools • Guiding behaviours developed by team with open recognition • Sense of achievement and pride in being part of successful team • Building the “Bank of Trust” • Feedback and learning • Flexibility, rotation and resilience • Development and retention strategy (“Procurement Brand”) • High expectations matched with high empowerment and encouragement • A key part of Business Services: aligned plans and behaviours
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Culture…….Procurement Team Behaviours
Culture “The Teamwork Pyramid”
19 Acknowledgment: Patrick Lencioni, The Five Dysfunctions of a Team
RESULTS
ACCOUNTABILITY
COMMITMENT
HEALTHY CONFLICT
TRUST
VULNERABILITY COMPETENT, COHERENT LEADERSHIP
Key Initiatives & Priorities – 15/16
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Category Management • Demand management and visibility • Supplier performance measurement • Intelligent contracting models
• Incentivised Target Cost Contracts • Early Contractor Involvement • Framework Agreements
• Sustainable benefit delivery • Product standardisation • Mix of work - BAU & strategic
eCatalogue • User experience
• “Shopping basket” • Online shopping
• Contract leakage • Efficient processes • Aligned to contracts
Risk Based Procurement • Accredited Officers and Business Unit
Delegates • Customer empowerment • Audit controls • Targeted solutions and training • Reduction in low value transactions in
Procurement
People • 15/16 Business plan refresh • 2020 Business plan and “line of sight” • Behaviours and recognition • Development and retention strategy • Capability framework • Commercial acumen • “Essential business partners” • Systems and analytics • Stakeholder management and planning
Key Strategies and Tools
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Incentivised Target Cost Contracting
Early Contractor Involvement (ECI)
Energy Price Management (EPM)
Programme Delivery
Kit Framework Agreements
Supplier Performance Management
Work Allocation for Good
Performance
Project Framework Agreements
Collaborative Planning
with Customers
Benefits Methodology and Capture
Risk, Opportunity
and Innovation
Capture
Agile and Flexible Working
Successes
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Exceeding 14/15
Benefits Target by
12.5% YTD All Recent
Vacancies Filled Via Internal Promotions
Playing Integral Role in Other SAW
Transformation Initiatives
Incentivised Contracting is Changing Contractor Behaviours
Programme of Framework Agreement Opportunities Agreed
Playing Pivotal Role in Reducing SAW Energy
Costs
Procurement Team Collaborated to Develop
Team Behaviours
Customers Coming to
Procurement for Help
Using Category Management Intelligence to inform
Procurement Strategies
Upskilling SAW Internal Customers’
Commercial Acumen
Dashboard Reporting for Customers
SA Water Procurement….Recap
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• Structure • Strategic Alignment • Key Facts • Our Journey • Capability and Culture • Key Initiatives & Priorities • Key Strategies and Tools • Successes
…bedding in new structure and skills
…aligning plans to SAW priorities …diverse team and functions …focusing on commerciality …developing our people….behaviours
…high expectations…much to do …intelligence and collaboration
…great progress….transformation continues