Transcript GPS PPT presentation template

GOVERNMENT PROCUREMENT
SERVICE
SERVICE OVERVIEW
The Past
• Buying Solutions was an Executive Agency of the
Office of Government Commerce (OGC)
• A national Professional Buying Organisation (PBO)
for UK public sector services.
• Remit was to maximise value for money and
savings through framework agreements
• Spend through Buying Solutions - £7bn pa
• NHS spend through Buying Solutions- £2bn pa
Strategic Review
• “If you always do what you’ve always done, you’ll always get
what you’ve always got!!”
Background
• Review – internal and external
• There is a recognised need to implement centralised
systems and deliver greater quantifiable savings from
centralised procurement effort.
• Increasing spend under central management <£2.5Bn to
>£10bn and delivering the consequent savings
• Leverage total expenditure to benefit whole public purse
• Tighter control and better demand management have led to
savings of approx £1.5Bn in 2010/11
Key Recommendations
Centralised Procurement:
1. Creation of Government Procurement - procurement for common goods
and services to be mandated and centralised in central government
2. Formalised agreements between Cabinet Office and Depts
3. Accountability – Ministers, Perm Secs and Commercial Directors to be
held accountable for channelling spend through GPS
4. Rename & transform Buying Solutions to Government Procurement
Service to:
• Deliver expert sourcing, contract, category & data management
• Implement & operate the Govt procurement spend data warehouse
• Provide mechanism to fund GPS and help Dept’s to invest in
improving capability of procurement staff
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Government Procurement Service
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•
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Executive Agency of Cabinet Office, retain trading fund status and supplier funding model
Lead executive will be a MD
A procurement service provider for the whole public sector
Management of £9.7bn public sector procurement spend 2011-12
Operating Board will have a customer representative
Managing Director
NED [3 x
independent; 2 x
CD]
Director of HR
•
•
Director of
Resources
Director of Sourcing
& Category
Management
Director of Customer
Service
Reduced headcount & accommodation
Continue to operate in the following categories: energy, fleet, travel, office solutions,
professional services, property/FM and ICT
Operational Priorities
•
People: Development and continuous improvement of high quality
professional teams at every level in the organisation
•
Operational and financial efficiency
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Effectively and commercially managing public sector spend. Delivering
in-year cashable savings and ongoing service level improvements
•
Full eEnablement of our operations
•
Becoming customer centric and delivering what our customers, need,
want and value most
Vision Statement:
“To be valued as the integral delivery partner of Government Procurement, working
with customers and suppliers to reduce public sector spending, improve value for
money and deliver savings efficiently and effectively.”
Mission
Reform Government Procurement through centralisation of common goods and
services spend, to fund improvements in technology, processes and Government
wide procurement resources to better manage total spend, in support of
Departmental SR cost reduction targets.
To Deliver:
“Savings for the Nation”
Making government work better
Savings for the Nation
Scope
Nine centralised categories:
• Energy
• Fleet
• ICT
• Learning & Development
• Media & Advertising
• Office Solutions
• Print
• Professional Services
• Travel
A centralised strategy for Property is now also being developed.
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Savings for the Nation
Key Facts
•
£7.6bn of public sector procurement spend in 2010-11.
•
1,350 suppliers including many SMEs.
•
14,500 customers across 1,400 organisations.
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4,500 contracts.
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Over 80 EU-compliant framework agreements.
•
272 staff across two sites – Liverpool and Norwich.
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Savings for the Nation
Targets
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£15bn of public sector spend under active management.
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Deliver savings within a minimum range of 5-8%.
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Reorganise and restructure to improve operational efficiency:
- reduce staff from 435 (budget FY 10/11) to 272.
- reduce non-operational staff to 15% of total headcount.
•
Reduce operating costs by 30%. From £97K (budget FY 10/11) to £70k
per FTE by FY 12/13.
•
30% reduction in procurement cycle times.
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Overview
High Level Operational & Functional Delivery
ACTIVITIES
PROCUREMENT
SERVICES


Category Development

Sourcing

Business Performance
Management
Market &
Supplier
Analysis
Demand
Management
EU Compliant
Procurements
E-auctions
Supplier
Relationship
Management
Spend
Monitoring
Capture
Requirements
Governance
Spot Buying
Project
Management
Savings
Generation
Contract
Management
Innovation in
Procurement
&
Technology
Contract
T&Cs
Development
Customer
Support
Supplier
Audit
Price
Benchmarking
Implement
Policy
through
Procurement
Customer & Stakeholder Engagement
eEnablement
Ready Access
to Best Prices
via Catalogues
Prompt
Payment
Contract
Compliance
Data
Management
& Reporting
Support
Transparency
Policy
Service Offerings
Category Development
Activity
What we do
Capture requirements
 Engage with stakeholders to understand current and future
demand/requirements within in each category
Market & Supplier Analysis
Governance
Manage Demand
 Capture market intelligence from a variety of external & internal sources
and use this to create category expertise and source plans.
 Assess the ability of the market to meet requirements and fulfil demand.
 Develop category strategies with short, medium and long term
objectives.
 Obtain approval and support from PEB and ePEB.
 Influence and impact demand through the implementation of policy and
associated procedure
 Work with stakeholders to identify alternative products/solutions.
Innovation in Procurement
& Technologies
 Review and evaluate alternative mechanisms for sourcing and delivering
solutions.
 Encourage and/or lead the adoption of innovative products as
appropriate
Implement Policy through
Procurement
 Ensure that all aspects of Government policy are taken into account
during the development of category strategies, including level of SME
involvement, sustainability, ethical sourcing and support for
apprenticeships
 Monitor the outcomes.
Service Offerings
Sourcing
Activity
What we do
EU compliant
procurements
 Ensure that the specification meets the requirements of the stakeholders
as identified in the category strategy and source plan
 Ensure that PQQ, ITT and evaluation criteria are clear and allow suppliers
to differentiate themselves from their competitors
 Ensure that all procurements are conducted with probity and
transparency
Project Management
 Ensure that each procurement is professionally project managed and
delivered on time.
 Manage resources effectively including ensuring that external evaluators
are properly briefed.
e-Auctions
 Run e-auctions where the market conditions are appropriate during the
OJEU process and/or a further competition stage.
 Manage customer engagement to gain commitment, rationalising
requirements where possible to obtain best possible prices.
Contract T&Cs
Development
Customer Service &
Support including spot
buying
 Develop standard terms & conditions for each category and subcategory that provide clarity and protection.
 Engage with suppliers through trade bodies such as Intellect to ensure
that T&Cs are not excessively onerous and lead to higher prices.
 Provide customers with access to great deals through e-catalogues.
 Provide sourcing advice to customers and/or source on their behalf
(running further competitions, e-auctions etc.)
Service Offerings
Business Performance Management
Activity
What we do
Supplier Relationship Management
 Monitor and rate supplier performance against agreed metrics.
 Work with suppliers to identify areas for improvement and to
develop improvement plans.
 Work with suppliers to identify process/contract changes that will
deliver savings for the public purse.
Spend Monitoring
 Monitor customer actual spend against transition plans, identifying
contract leakage and establishing why it has occurred.
 Work with customers to resolve any issues/problems.
Savings generation & price
benchmarking
 Develop savings methodologies for each category or sub-category
and gain HMT approval.
 Ensure that data is captured to support these methodologies.
 Calculate the savings generated and monitor against targets.
 Ensure that centralised deals remain competitive by benchmarking
against the market.
Contract Management & supplier
audit
 Ensure that suppliers are meeting their contract commitments,
including how they manage their supply chain (e.g. promptly pay
their sub-contractors, source ethically)
 Negotiate/manage contract changes including improvements in
price where there is provision in the contract to do so.
Service Offerings
eEnablement
Activity
What we do
Ready access to best prices
via catalogues
 Ensure that centralised deals are easily accessible through the
Government eMarketplace (GeM)
 Assist customers with transition/implementation
Contract compliance
 Manage the catalogue content & customer permissions to ensure
that users only have access to the centralised deals. In
accordance with Departments’ transition plans.
Prompt Payment
 Enable the prompt payment of invoices by ensuring that there is
integration with customers’ ERP systems.
Data management & Reporting
 Capture all transactions through GeM and monitor to ensure that
customers are achieving optimum VFM.
Support transparency policy
 Ensure that all opportunities and contract awards (over the
agreed thresholds) are published as required by the transparency
policy/
 Work with suppliers to remove any clauses in contracts that
would prevent transparency.
Financial Model
Key principles:

Government Procurement Service is a not-for-profit executive
agency of the Cabinet Office with trading fund status.

It does not receive any central funding.

It recovers it costs by collecting a small commission from
suppliers based on the value of transactions through its
contracting arrangements. The average is currently 0.5% with
the intention to move to a maximum of 0.5%.
What it means for NHS Customers
 Committed to Health – dedicated relationship managers
 Opportunity to aggregate & benefit from the leverage of the whole
public purse
 Access to best value deals through e-catalogues
 Department of Health represented on Extended Procurement
Executive Board
 Building Customer Board across the NHS
 More transparency
 Access to MI on spend and savings
 Continue to work with DH on QIPP
 Simpler average Supplier Commission model
 Access to NHS specific frameworks in addition to general portfolio
 NHS specific best practice roadshows
Savings for the Nation
A practical example – office supplies
‘As was’ Model
Model ‘Now’
5
Single
Departments represented
83% of CG spend in Office
Supplies
contracting
authority
5
suppliers accounted for
99% of total CG business
6
separate contracting
vehicles
144 individual CG contracts
15,000 individual product items
2,600,000 data lines over 18 months
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Drivers for change:
1. Aggregation
2. Efficiency
3. Environment
4. Resources
2
Suppliers
Volume bound
contract
1
product price for
Government
3,500
individual product
items
Delivering real, cashable saving in
region of 12-29%
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Benefits
•
Greater aggregation and commitment leads to improved
public sector leverage with suppliers and better prices.
•
Simple & quick access to best value deals through
Government Procurement Portal (website) and e-catalogues
on the Government eMarketplace (GeM).
•
Greater transparency and visibility of procurement activities
and prices achieved.
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Greater efficiency and removal of duplication.
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Consolidated, Government wide view on spend and savings.
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Investment in procurement capability across Government.
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Greater sharing of knowledge and category expertise.
Summary
Before
After
• Frameworks & MoUs
• frameworks, MoUs, & central
contracts
• Perceived “let & forget”
• transparent, formal contract, supplier,
data and customer management
• Commission
• reinvest to improve capability and
supporting technology
• Processes
•new improved LEAN processes
e-enablement tools
• Communications
• e-Zines for Health
• MI/Spend/Savings
• Improved MI. Benchmarking data/
approved methodologies
• Customer Service Desk
•Customer centric team – 22 staff with
dedicated Health team
Need help?
Customer Service Desk
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Dedicated team – 0345 410 2222
– Lines open between 8.30 – 17.30
– Head of Customer Service Health – Joan Murray
– [email protected]
Second Line support
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Category specialists available to take your call
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Provide detailed advice on using a framework