Procurement and Supply Chain Professionals

Tuesday, 8 June 2010

World Cup Footie Deal....

In a last minute deal ahead of the World Cup opening game on 11 June, the South African government has stockpiled a 30,000 ton spot market purchase from Russian oil firm Lukoil.

South Africa has also struck a deal with Eskom to guarantee uninterrupted supply of electricity to key World Cup installations.

The new stadia will not place any additional stress on the national power grid because generators are their primary power source, but Eskom is set to provide back up.

These measures come at the end of a long procurement initiative for the World Cup in South Africa. A transport upgrade costing R19 billion ($2.4 billion) has seen the construction of new roads and resurfacing of existing routes, along with the provision of 418 new trains and 970 buses, over and above the 1,100 buses and 800 midi-bus taxis already in operation.

State-of-the-art military information and communications technology has been procured to help manage security arrangements.

Once the World Cup is over the technology will be used in day-to-day crime fighting, authorities say. The system includes mobile command centres able to receive live video feed from manned and unmanned aircraft, as well as helicopters and fixed surveillance cameras.

The procurement effort has extended to the health service, with a major upgrade to the National Health Operations centre linking the nine provinces for real-time monitoring and co-ordination of the health plan roll out. Dispensing machines for basic medication purchases have been placed at the stadia and pharmacies will be open 24 hours.

Hundreds of trained volunteers and professional health personnel will also be on standby on the major routes. Measures have been put in place to monitor ports of entry for health-related problems and vaccines have been procured to deal with disease outbreaks, including flu vaccines.

Tuesday, 25 May 2010

Procurement Reform

Procurement professionals need to be at the heart of public sector savings, while senior management should take procurement more seriously, according to a senior figure at the Confederation of British Industry (CBI).

Following the formation of the UK coalition government, the CBI called for re-engineering of public services to help reduce the £163 billion public sector deficit, including reform of procurement.

Speaking to SM, Susan Anderson, director of public service at the CBI, said procurement professionals should “be centre stage” during this transformation.

She claimed that senior managers, in earlier efforts to save on public procurement, had failed to take full responsibility for driving through business change necessary to capture the benefits of initiatives such as shared services and joint buying.

“It’s about culture: a senior manager does not get Brownie points for seeing through procurement, and that goes to the ministerial level. They get recognition for new initiatives. The responsibility [for change in procurement] has to lie with the senior management team. Procurement professionals sometimes say ‘we do not get a look in’, although they sometimes get
the blame. We have got to take them seriously.”

Some shared service initiatives had failed because once they achieved critical mass, and had a full team in place, additional public bodies were put off joining because they realised they would not be able to transfer staff. “They get cold feet because they do not want to make 
staff redundant, but [avoiding redundancies] 
is a luxury we cannot afford,” Anderson said.

However, she said to be effective in reducing public spending, professional procurement skills should be retained where possible. “Although no areas of public spending should be sacrosanct, procurement people should be centre stage.”

The CBI also re-enforced the claim it made in October’s pre-budget submission that improving public sector purchasing and reducing duplication in the process could save the public purse £13.5 billion by 2015-16.

Spelling out its priorities for the government in the document Time for Action: Reforming Public Services and Balancing the Budget, the CBI said savings could be achieved by re-shaping public service provision, including using the private and third-sector to deliver efficiencies.

Tuesday, 18 May 2010

Nestle draws up responsible sourcing

Nestlé is introducing procurement guidelines to ensure its palm tree oil supply comes from sustainable sources.

The Swiss confectioner, which came under fire from environmental action group Greenpeace after a report claimed some of the oil it purchased was from unsustainable sources, has now teamed up with the Forest Trust to produce a set of responsible sourcing guidelines.

These guidelines, which were announced this week and will be enforced immediately, look at Nestlé’s procurement process and provide technical support to suppliers that do not meet the requirements. Guidelines include protecting high conservation value forest areas and peatlands, and ensuring farms and plantations used for sourcing palm oil comply with local laws and regulations.

In a statement Nestlé said: “By setting critical requirements for its procurement process and checking compliance with its supplier code, Nestlé wants to ensure that its products have no deforestation footprint.”

Nestlé recently dropped Indonesian firm Sinar Mas as a palm oil supplier after claims by Greenpeace that identified Sinar Mas as guilty of deforestation in its production of palm oil.

In a statement in March, Nestlé UK said it does not buy palm oil from the Sinar Mas Group for any of its products, including Kit Kat, but does purchase it from a company called Cargill and had sought assurances from them about their supply chain.

Nestlé aims to have 18 per cent of its palm oil purchases in 2010 coming from sustainable sources, working to reach 50 per cent by the end of 2011. The company has already committed to purchasing all of its palm oil from ethical sources by 2015.

Pat Venditti, head of Greenpeace’s forest campaign, said: “Nestlé’s move sends a clear message to Sinar Mas and to the rest of the palm oil and paper industries that rainforest destruction is not acceptable in the global marketplace. They need to clean up their act and move to implement a moratorium on rainforest destruction and full peatland protection.”

In a policy statement released by Sinar Mas earlier this year and at its AGM the company said it was committed to the principles of the Roundtable on Sustainable Palm Oil and to a halt to clearing in forests and peatlands.

Monday, 10 May 2010

Supply chain and carbon management......

Leading businesses will increasingly refuse to purchase from suppliers who fail to manage their carbon emissions, according to a survey.

The annual Carbon Disclosure Project (CDP) Supply Chain Report, produced by management consultants AT Kearney, found that only 6 per cent of major organisations currently deselect suppliers for failing to manage carbon emissions. However, 56 per cent have committed to do so in the future.

The survey of CPD supply chain members, which include Dell, BAE Systems, Cadbury, Sony, IBM, Unilever and PepsiCo, found that 89 per cent had an established strategy to engage with suppliers on carbon-related issues.

Meanwhile, 90 per cent of these companies have an emissions or energy reduction plan in place.

But while a significant proportion of carbon emissions are typically found in the supply chain, only 20 per cent of these companies report figures for their own supply chain emissions.

Of the 710 suppliers who disclose carbon emissions to their customers through the CDP programme, 60 per cent have appointed a board member responsible for climate change. Fifty-six per cent have a carbon reduction plan in place and 38 per cent have committed to a clear target, according to the report.

Tuesday, 27 April 2010

Disney & Procurement

Purchasing professionals who focus on the end product will be considered part of the creative process and therefore be more effective, a senior film industry executive told the Institute for Supply Management conference in California yesterday.

Steven Miller, senior vice-president of strategic sourcing and procurement at the Walt Disney Company, was making a presentation on strategic sourcing for the entertainment supply chain.

“Creative folks need to not view you as a different part of Disney or a different part of the team – you’re part of their team – singularly focused on their success and showing as much passion for their creativity as they show.

“Alice in Wonderland was a gift to us: a phenomenally big movie, the cast was great and the box office sales far exceeded what we expected and that will translate to DVD sales. That’s what it’s about – the creative content more than cost savings or sourcing initiatives.”

Miller gave an overview of Disney’s multiple supply chains. These support a set of five business areas including theme parks, movies, television and consumer products, with commodity categories spanning everything from costumes to call centres.

Strategic sourcing was introduced in 1999, a move Miller admits was “maybe 15 years behind some industries”. The sourcing department was expected to save $300 million (£195 million) a year within five years. By 2008 it achieved $1 billion (£650 million) cumulative annual savings.

Approximately 300 people work in purchasing and the company has about 70,000 “high-level active suppliers”, with the top 200 accounting for about 23 per cent of spend.

The future for Disney – and therefore the focus of the sourcing teams – is more investment in theme parks (it is hoping to build a Shanghai resort), fit-outs of its stores and film franchises. Meanwhile, purchasing is also working on increasing sustainable procurement and anti-piracy innovations

Monday, 19 April 2010

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Fantastic insight into social media...

Wednesday, 7 April 2010

National Trust to Create Vacancies

The National Trust is recruiting 11 regional buyers as part of a broader move to put procurement at the forefront of its ‘going local’ strategy. 

The charity protects and makes public more than 350 historic houses, gardens and ancient monuments in England, Wales and Northern Ireland. The new purchasing posts reflect its goals for the next decade, which include getting closer to local communities and suppliers and putting properties and natural environments “back at the centre of community life to encourage a sense of belonging, local pride and identity”. 

So far the Trust has shifted power from the centre to the properties, such as historic sites and stately homes, including control of budget. It will now advocate local procurement and recruitment policies to connect its properties more closely to local communities.

Regional procurement managers will be appointed to cover Yorkshire, the North East, North West, South West, South, and South East of England, East Anglia, the West and East Midlands. They also cover Northern Ireland and Wales.

Responsibilities will include developing effective relationships with stakeholders in the region, developing strong, sustainable working relationships with suppliers and putting in place sustainable contracts and, where appropriate, supporting local producers and supply chains. 

The National Trust could not provide any more detail but the advertisement states: “We’re moving from direct buying and looking for real leaders to empower others to reach their potential.

“In short, by identifying efficiencies in line with our sustainability ethos and local agenda, you’ll be helping ensure we can put more into protecting our dramatic coastline, beautiful countryside and historic buildings and make sure they remain accessible to all.”

Tuesday, 6 April 2010

Manufacturing registers strong and encouraging growth

The UK manufacturing industry remained buoyant last month, reaching its highest level of expansion in almost 16 years.

According to the latest CIPS/Markit Manufacturing Purchasing Managers’ Index – where a figure above 50 represents growth – total activity in the sector registered 57.2 in March. This was up from the previous month’s figure of 56.5.

Output for March rose for the 10th month in a row, with the index coming in at 61.9 – a stronger performance than February’s figure of 59.8. The rate of increase reached its highest since July 1994 and was the second fastest in the survey’s 18-year history.

New orders increased for the ninth consecutive month, expanding at only a slightly slower pace than in January, when growth was at a six-year high. Employment levels fell in March as a result of cost-cutting initiatives, redundancies and workforce restructuring.

CIPS chief executive David Noble said the drop in employment was mainly confined to larger firms and signalled attempts to cut operating costs rather than “dampened demand”.

Commenting on the overall results, he said: “To see such a fast-paced recovery in the manufacturing sector is hugely encouraging. Strong growth in the intermediate goods sector should filter through to consumer and investment goods producers in the coming months, boding well for the sustainability of the upturn.”

Further coverage of PMI reports is available here.

Tuesday, 30 March 2010

BSKYB expects £200M!! in damages

BSkyB expects damages of nearly £200 million following its lengthy court battle with EDS over whether the IT services firm was completely truthful in its attempt to win a contract.

The satellite television operator had originally sued for £709 million in damages, claiming EDS had made a “deliberate, cynical and dishonest” sales pitch to win a £48 million deal to provide a new customer relationship management system – a contract that was terminated after two years.

Sky began its legal action against EDS (now known as HP Enterprise Services following a takeover by computing firm HP) in August 2004.

In his judgment Mr Justice Ramsey, who has taken 18 months to deliver his verdict, ruled in favour of the broadcaster, saying it would have chosen PricewaterhouseCoopers – a rival bidder for the contract – if EDS had not misrepresented its ability to deliver the project.

The judge said EDS had not carried out the “proper analysis” of time needed to complete implementation of the system they claimed to have, nor were there “reasonable grounds” – as they indicated – to believe they could deliver the system as promised. Mr Justice Ramsey said an EDS employee made the assertion “dishonestly” and “knew it to be false”.

But he ruled EDS had not lied about the level of resources necessary and how much it would cost to complete the project.

He also said EDS had “failed to exercise reasonable skill and care or conform to good industry practice”, with no effective programme management and a failure to provide the necessary technical and managerial resources. Because of this the judge awarded damages to Sky for breach of contract.

HP responded to the decision in a statement: “This is a legacy issue, dating back to the EDS business in 2000, which HP inherited when it acquired EDS in 2008. We are pleased the court dismissed the majority of the allegations made. While we accept that the contract was problematic, HP strongly maintains EDS did nothing to deceive BSkyB. HP will be seeking permission to appeal.”

The court will determine the level of costs and damages at a later date. Lawyers predict the case will lead to greater scrutiny of tender proposals and submissions by buyers and suppliers

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Friday, 26 March 2010

Jobs in Procurement on the up!!!

Recruitment market on the up

The UK purchasing jobs market is set to gain buoyancy over the coming months as permanent posts open up across the country, recruiters have reported.

A market update by procurement recruitment consultancy Edbury Daley out this week said permanent vacancies have been rising steadily since the end of 2009.

Other recruiters agreed and said this is the result of both general optimism in the UK economy and greater confidence among candidates, who are now more willing to move jobs. Richard Silk, account director at procurement consultancy CIPS GPA, said that up to 50 per cent of candidates are reporting that conditions are looking better for jobseekers.

But while the permanent job market is improving, demand for interims has slowed, according to Jonathan Ross, director of specialist recruitment firm Butler Ross. “This is possibly as a result of companies looking to strengthen their core procurement capabilities for the long term,” he told SM.

Edbury Daley director Andrew Daley agreed there had been a shift in focus. He said: “Cutting procurement staff during the recession is very short-sighted, but now people are starting to look forward again.”

It is a turnaround from the situation just a few months ago when recruiters reported problems appointing the right talent, despite the market being flooded with candidates.

Wednesday, 24 March 2010

Mcdonalds .........

UK scammers posing as McDonald’s buyers have stolen up to £2 million of goods.

A statement by Greater Manchester Police said the con artists pretended to be staff from the fast-food giant and purchased electrical goods from high-profile suppliers.

The items, including laptops, computers and televisions, were ordered with credit periods of between 30 and 90 days and delivered to addresses in Manchester, but never paid for. It is thought the fraudsters are now using the same scheme to obtain food, wines and spirits.

Detective inspector Neal Colburn appealed for help catching the criminals, who he said are likely to face “a long stretch behind bars” if caught.

“If your company is not a usual supplier for McDonald’s and you are contacted by an individual purporting to be placing an order on behalf of McDonald’s, please treat it with caution,” he said.

A McDonald’s spokesman said: “McDonald’s holds long-term relationships with its suppliers and any new suppliers will need to register before providing services.

“Our restaurants are not authorised to request high-value goods and any McDonald’s genuine purchase can be checked by telephoning our accounts helpdesk on 0844 736 3611.”


Commodity prices from Supply Management issue 18 March 2010

These figures have been compiled from several sources and are intended as a guide to trends. SM disclaims any responsibility for the use of this information.

*Prices are the latest freely available to SM from the following sources.

Sources: Steel: MEPS (International) Ltd European Steel Review (0114 2750570). Non-ferrous metals: Metal Bulletin (020 7827 9977) and London Metal Exchange (020 7264 5555). Plastics: London Metal Exchange (020 7264 5555). Chemicals: ICIS Chemical Business (020 8652 3187). Fuel: John Hall Associates (01403 269430). Soft commodities: The Public Ledger (01892 530120). Timber: Resource News International (+1 204 947 1700). Pulp, paper and board: PPL Research (

Global Procurement........

Consumer products giant Kimberly-Clark has set up a global procurement hub to help cut costs by as much as $500 million (£334 million) by 2013.

The US firm, whose brands include Huggies and Andrex, has appointed Cynthia Dautrich as a global procurement officer and has set to work building a global purchasing team.

It unveiled the plans at an investors’ meeting in New York yesterday.

Kimberly-Clark hopes the new centralised team will enable it to build on procurement improvements made last year, when the company began to pull together its global spend and improve data to secure better terms from suppliers. At that time purchasing also gained control of new spend areas such as marketing, which enabled it to cut category costs by as much as 30 per cent.

This, combined with better operational efficiency and improved manufacturing and supply chain practices, has helped Kimberly-Clark cut costs by $450 million (£300 million) since 2008.

Commenting on purchasing’s contribution, chief strategy officer Chris Brickman said: “It delivered terrific results last year, but it’s absolutely just the tip of the iceberg. 2009 was not a one-hit wonder

Monday, 15 March 2010

Lessons from Bill Gates

Life Lessons from Bill Gates
Bill Gates recently gave a speech at a High School about 11 things they did not and will not learn in school. He talks about how feel-good, politically correct teachings created a generation of kids with no concept of reality and how this concept set them up for failure in the real world.

Rule 1: Life is not fair - get used to it!

Rule 2 : The world won’t care about your self-esteem. The world will expect you to accomplish something BEFORE you feel good about yourself.

Rule 3 : You will NOT make $60,000 a year right out of high school. You won’t be a vice-president with a car phone until you earn both.

Rule 4 : If you think your teacher is tough, wait till you get a boss.

Rule 5 : Flipping burgers is not beneath your dignity. Your Grandparents had a different word for burger flipping: they called it opportunity.

Rule 6: If you mess up, it’s not your parents’ fault, so don’t whine about your mistakes, ‘learn from them’..

Rule 7: Before you were born, your parents weren’t as boring as they are now. They got that way from paying your bills, cleaning your clothes and listening to you talk about how cool you thought you were. So before you save the rain forest from the parasites of your parent’s generation, try delousing the closet in your own room.

Rule 8: Your school may have done away with winners and losers, but life HAS NOT. In some schools, they have abolished failing grades and they’ll give you as MANY TIMES as you want to get the right answer. This doesn’t bear the slightest resemblance to ANYTHING in real life.

Rule 9: Life is not divided into semesters. You don’t get summers off and very few employers are interested in helping you FIND YOURSELF. Do that on your own time.

Rule 10: Television is NOT real life. In real life people actually have to leave the coffee shop and go to jobs.

Rule 11: Be nice to nerds. Chances are you’ll end up working for one.

Wednesday, 3 March 2010

Increase in Perm Jobs......

Permanent placements grew at fastest pace since July 2007.

Commenting on the latest survey results, Bernard Brown, Partner and Head of Business Services at KPMG said:
“The latest figures seem to confirm that the UK jobs market is on the road to recovery: Permanent job placements are growing at their fastest pace since July 2007,with both vacancies and salaries increasing. Sectors such as IT & computing as well as engineering & construction that were particularly hit by recession are clearly on the rebound. However, this all comes with one big warning: The impact of the inevitable public sector recession on the jobs market has yet to be felt and will be played out over the next six to 12 months.”
Copies of the report are available on annual subscription from Markit. For subscription details please contact:
The Report on Jobs is a monthly publication produced by Markit Economics and sponsored by the Recruitment and Employment Confederation and KPMG LLP.
The report features original survey data which provide the most up-to-date monthly picture of recruitment, employment, staff availability and employee earnings trends available.
1 Executive summary
2 Appointments
3 Vacancies
4 Sectoral demand
5 Staff availability
6 Pay pressures
7 Special feature

Thursday, 25 February 2010

GE Buyer in new role

A senior buyer for international conglomerate General Electric (GE) has landed an influential new role.

Global sourcing manager Russell Stokes will become vice-president of global services for GE’s transportation arm. The company said in a statement it was a “critical role” that will help drive growth.

Stokes will be responsible for strengthening the transportation subsidiary, which designs, manufactures and services locomotive, signalling, communications and control products for the rail industry.

It also builds wind turbine drive systems and mining vehicles.

In his role as global sourcing manager for GE Aviation, Stokes oversaw a $7 billion (£4.6 billion) spend. He joined the company, widely considered to be the biggest in the world, eight years ago

Wednesday, 24 February 2010

Tasty benefits

Sure, there may be reasons to look at Heinz’ report of 14% growth in operating income with scepticism, or attribute it to any number of factors. But the fact remains, its procurement function has made a consistent show of the transformation it has been undergoing and you’d be hard-pressed to say it isn’t paying off.

It doesn’t seem like that long ago that Procurement Leaders was talking with John Hans, recently appointed VP of purchasing at Heinz, about the measures he would be undertaking to leverage value out of the European supply chain.

Equally, back in October, Procurement Leaders blogged on a speech by the food giant’s chief of procurement Christopher Stockwell, which highlighted the journey from bottom quartile purchasing function in 2004 to second quartile function in 2009. Delivering top-line growth was his target then.

It’s little surprise then that this latest announcement comes with no small nod to the part procurement played. Still, reading that Heinz chairman, president and CEO William R Johnson said that the business has “established a goal of delivering better than $1bn in incremental cost savings over the next five years though our global supply-chain initiatives”, does merit pause for thought.

Yet this isn’t so much an advert for Heinz as an advert for the benefits of well-targeted transformational procurement. Having a CEO enthusing about the good it has done and it’s role going forward is about as good as it gets.

The recent appointment of Bob Ostryniec as chief supply chain officer is perhaps as great a testament to this as any – Heinz means business.

And what may be better for procurement is that it genuinely seems to see supply-chain optimisation as the best way of doing it.

Monday, 22 February 2010

Joint Buying!!!!!

22 February 2010 | Jake Kanter

More than 100 companies in central London are to join forces in a shared procurement plan. It follows a pilot scheme which saved the firms more than £1 million last year.

It is thought there is huge potential for further cost reductions. The programme will cover goods and services including telecoms, couriers, stationery and water filters.

In addition, the companies hope to cut carbon emissions by 10 per cent by sharing deliveries and negotiating better energy deals. 

Participants include office-based businesses, such as law firms. A number of multinationals with locations in the area – including Warner Bros and MediaCom - are also involved.

The project is organised by not-for-profit business improvement organisation inholborn. Chief executive Tass Mavrogordato said it has “massive potential” and there are plans to increase the list of goods and services the companies purchase together.

“It makes sense on a number of levels,” she told SM. “Obviously on cost, but also on the green agenda – with services such as couriers because it gets congested around here. It’s also about a business community - people getting together to do something.”

Thursday, 18 February 2010

Flexi time works!!!!

Research has found that flexible working is good for the heart – and possibly also for mental health.

The Cochrane Library, which reviews published studies, looked at 10 relevant reports covering more than 16,000 people. They discovered employees who have control over their working hours have better blood pressure and heart rates.
Since last year parents with children under 16 have been able to ask for flexi-working. Previously it was only parents with very young or disabled children who could make the request.

Flexi-working is not practical in all parts of the working world, but where it does make sense it need not be limited to parents – and in many cases it isn’t.

Does your organisation allow for flexible working? Do you think it works? Health and happiness are good reasons to alter working hours, but would simply working the hours of a standard working week be a fine thing? Let us know your thoughts.

Read the BBC story here.

Tuesday, 16 February 2010

Women in Purchasing!!

Some of the world’s biggest companies have been commended for buying services from women-owned businesses.

A record high of 21 firms were named in an annual list of the best US firms for supporting vendors owned or run by women. These suppliers are recognised in the US as minority businesses. The list is produced by the Women's Business Enterprise National Council (WBENC).

The awards included telecoms firm AT&T, which spent more than $6 billion (£3.8 billion) with such suppliers last year, and computer manufacturer Dell, which spent more than $2.5 billion (£1.6 billion) with minority vendors in 2008. Both companies said women-owned businesses were critical to their supply chain strategies.

Ernst & Young, Marriott International, Microsoft and the Home Depot were recognised by the WBENC for the first time since the awards were created 11 years ago.

“This expanding list demonstrates that best practices prevail in even the most challenging environments,” said Linda Denny, president and CEO of WBENC.

An awards presentation for the companies recognised in the list will take place on 25 March.

No Bonus for Buyers!!!!!!

Nearly three-quarters of buyers are not rewarded for hitting savings targets, according to the latest SM100 poll.

The survey of 100 international buyers found 73 per cent did not receive a bonus for slashing costs, while 27 per cent were rewarded for their efforts in driving savings.

A number of the respondents expressed displeasure at not securing financial recognition for making cutbacks. Others said that savings were “part of the day job” and it would be unfair to expect rewards for something they were required to do.

In addition, many purchasers said savings targets formed part of a set of goals they need to achieve to release a bonus. These included customer satisfaction ratings and spend visibility.

Those that did receive bonuses said it was important for motivation, but could also result in loss of morale if targets are not hit. Recruiters told SM that bonuses were attractive to talented candidates.

A number of respondents admitted that their bonuses had been cut or reduced during the downturn.

Thursday, 11 February 2010

Designer hospital gowns....

A new fashion catalogue will land on the desks of NHS buyers next year – for designer hospital gowns.

Finally, the traditional gown, famously lacking in material at the rear, is getting a makeover. The Design Council has commissioned American designer Ben de Lisi to create a loose garment that provides easy access for doctors and nurses, but which doesn’t mean your bottom is on show when you walk the wards.
This revolution in patient dignity warranted a leader in yesterday’s Times. (The paper’s website has the story, with a picture of what the gowns might look like.)

Here is a chance for NHS buyers to make a huge difference to people’s experience in hospital, which is scary enough without having the added humiliation of inappropriate gaps in clothing. The new design is expected to be approved by the Department of Health and recommended for purchase by the health service next year. This is a little plea to buyers to take up the new gowns as soon as they come to market.

By Sarah Campbell....

Wednesday, 10 February 2010

Pinnacle Foods outsources indirect spend

Pinnacle Foods Group has outsourced its indirect procurement to ICG Commerce in a three-year deal.

Pinnacle, one of the largest food firms in the US, will hand over spend categories including advertising, logistics, capital equipment, and plant-related supplies and services.

The financial terms of the deal were not revealed, including how much the company plans to save from the move. 

CFO of Pinnacle Craig Steeneck said: “Our goal is to reduce costs associated with indirect spend, while keeping our internal resources laser-focused on generating productivity across our supply chain.” 

The company’s brands include Mrs Butterworth’s and Lender’s Bagels.

It took over Birds Eye Foods last year in a $1.3 billion (£826.7 million) deal.

Consumer goods firms Kimberly-Clark, Chiquita and Whirlpool have also outsourced purchasing to ICG.

The Conference Bug

When you’re given a free gift at a conference, you don’t expect to get involved in something resembling a John Le Carré novel.

But according to a leaked MI5 document, spies from the People’s Liberation Army and Ministry of Public Security in China have been approaching businessmen at trade fairs with “gifts” and “lavish hospitality”.
The Sunday Times reports that the freebies, such as cameras and memory sticks, contain bugs and viruses that give spies remote access to computers.

It also warns of the perils of business travel, with “hotel rooms in major Chinese cities, such as Beijing and Shanghai likely to be bugged. Hotel rooms have been searched while the occupants are out of the room.”

The goal of this subterfuge is to obtain commercial advantages, with defence, energy, communications and manufacturing companies all attacked.

Of course the Chinese strongly deny any accusations of spying – after all it wouldn’t be very “intelligent” to admit it.
Post by Paul Snell at Supply

Tuesday, 9 February 2010

UK Procurement Tenders

About UK Procurement
UK Procurement is a UK tender contract search and advice service. It provides you with the capability to search for government and local government tenders online and to tender effectively for contracts.

The two main guides currently are:

•Tendering Guide
•Procurement Guide
UK Procurement is aimed at businesses interested in supplying the public sector. We provide help and advice to suppliers on tendering for government contracts and links to Departments' procurement web pages.

UK Procurement searches through more than 600 new public sector contract opportunities from the UK every working day.

All content for the tender guides is taken from workshops provided by Larch Consulting

Monday, 8 February 2010

Capgemini and IBX deal to shake up procurement outsourcing

Capgemini and IBX deal to shake up procurement outsourcing
Posted on Tuesday, February 2 by David Rae in Procurement Outsourcing, Procurement Technology, Technology | 2 Comments While not quite on the scale of Kraft Foods' acquisition of Cadbury, news that Capgemini is to acquire Swedish procurement technology company IBX is, in its own way, a fascinating development which points to interesting times ahead for the procurement outsourcing space.

According to Hubert Giraud, global leader of Capgemini BPO, the deal means that potential clients only need seek a single partner for procurement outsourcing. "Not only does the fully integrated approach achieve significant savings faster, the required investment to recognise and achieve the saving is also less," he says.

This maybe true, but the likes of Accenture or IBM would argue that by partnering with technology companies such as Ariba and Emptoris, they are in a similarly strong position. They could also argue that, in the long term, they will benefit from the advantages an independent company brings (more focus and innovation, for example).

But if we were to don the speculative hat for a moment, could this finally be the move which triggers a wave of consolidation in the e-procurement and sourcing space?

With outsourcing/consulting firms potentially in the market to pick off specialist e-procurement players, traditional enterprise software vendors could well be forced into a move. Oracle's strategy has always been growth by acquisition. SAP's has always been organic, a trend which shifted with its acquisition of Business Objects a couple of year's ago.

But SAP already has a relationship with IBX where the latter provides some enabling capabilities for SAP software; while SAP sells on-demand technology provided by IBX (and Hubwoo, as it happens). Oracle is also a player, with its own on-demand procurement solution.

Currently, it's all a bit of a mess, with lots of small IT providers partnering with the giant software, outsourcing and consulting vendors.

But the Capgemini/IBX deal shows that at least one giant consulting and outsourcing vendor has seen the potential rewards that on-demand e-procurement can bring to its offering. And that could shake things up nicely.

Supply Chain Jobs

Supply chain jobs could be created in 11 areas of Scotland after they were selected to manufacture around 8,000 offshore wind turbines.

The sites, which include Dundee and Aberdeen, could become the future centres of the UK's offshore wind industry, cited as a key area for economic growth in Scotland.

Scottish Enterprise, with support from Highlands and Islands Enterprise, is running the project which will receive close to £20 billion worth of funding.

Identifying the sites has got the National Renewables Infrastructure Plan, set to create tens of thousands of Scottish jobs, underway.

The areas chosen are Leith, Dundee, Nigg, Hunterston, Aberdeen, Arnish, Campbeltown, Machrihanish, Ardersier, Kishorn, Peterhead and Energy Park Fife at Methil.

Scottish National Party Lothians MSP Shirley-Anne Somerville told the Edinburgh Evening News: "The Firth of Forth windfarm project has potential to create around 700 jobs in building and maintenance, and maybe thousands more further up the supply chain."

Paul Willson, of PB Power, recently told the Telegraph that shortages in the supply chain could cause the ambitious programme to stall.

Written by Kevin Clark

Buying of Timber


Defra has said that the government's new socially responsible rules on buying timber will not make life harder for the government's procurement job holders, according to TTJ magazine.

The government last month announced new regulations on procurement of timber, which will come into force in April, to ensure that it comes from a sustainable background.

Commenting on the developments, a Defra spokesperson told the news provider that larger schemes had already indicated that they could meet targets and update.

"We haven't looked at all the schemes so we have no evidence that those schemes might not comply. This is about our choice as a consumer. It's for the schemes to meet our new requirements," he added.

Sheam Satkuru-Granzella, director of the London office of the Malaysian Timber Council, said that schemes specifically responsible for social criteria were beyond the government's mandate and could have a negative impact on timber producers.

Written by Kevin Clark