Charles Kendall Australia (CKA) was engaged by NSW Health Infrastructure (HI) to review and realign the financial, contractual, procurement and project reporting requirements in its Procure-to-Pay (P2P) process. Migrating HI's $10M in projects and programs from paper-based to electronic procurement management, CKA improved efficiency both within HI's three-person team and for external stakeholders.
The Challenge
- Identification of all existing manual procurement process flows and forms.
- Identification of opportunities to streamline these existing process flows and forms.
- Development of new process flows and forms.
Our Approach
- Phase 1: Establish a baseline for existing processes and identify opportunities for improved efficiency.
- Phase 2: Based on findings in Phase 1, define requirements for improvements and optimisation across Processes, Forms and User Interface.
- Phase 3: Implement all optimisations defined and approved in Phase 2.
Outcome
- Procurement processes reduced from twelve to five.
- Remaining five processes rationalised and mapped into flowcharts for easy adherence and implementation.
- Interactive user guide and simplified printable manual, along with electronic form/audit trial tool ready for integration with HI portal.
Contract Management Training
A government organisation engaged Charles Kendall Australia (CKA) to develop and deliver customised training to all Operational Managers across the state to improve procurement and contract management skills and knowledge. CKA successfully delivered on the objectives, improving contract and procurement performance, compliance and staff skill levels.
The Challenge
- Risks due to not having dedicated procurement professionals on-site.
- Lack of procurement accountability and differing levels of understanding and compliance across divisions and regions.
- Varying grasp of procedures and objectives due to wide geographic distribution.
- Challenges associated with delivering consistent procurement training across four regions within Queensland while ensuring day-to-day operations were not affected.
Our Approach
- Review current procurement and contract management processes to identify strengths and weaknesses across the organisation.
- Develop and deliver training based on these findings, including current procurement and contract management templates, policies and procedures.
- Develop and deliver training packages to specifically address the state’s relevant procurement and other policies.
Outcome
- Successfully delivered training in segments over approximately 11 months without affecting day-to-day operations or over-compressing information.
- Reduced the organisation’s risk exposure via improved procurement and contract performance.
- Implemented consistent procurement processes across the organisation.
- Improved staff skill levels and knowledge transfer through on-site training and mentoring programs.
CPL – Choice, Passion, Life is a not-for- profit organisation providing disability, therapy, employment and aged care services across Queensland. Following a comprehensive procurement review and the provision of ad-hoc contract review and negotiation services, CPL engaged Charles Kendall Australia (CKA) to deliver procurement services on an on-going basis. The engagement started in May 2017 and is still thriving as of today. The outcomes outlined in this case study were all achieved by June 2018.
The Challenge
- No internal procurement resource to lead procurement and contract management activities.
- No sufficient workload to justify a full-time procurement manager.
- Low level of expenditure control due to decentralised procurement model.
- Key supplier contracts not consistently managed leading to contract leakage.
- Lack of capability and capacity to manage high value and complexity contracts.
Our Approach
- Deployed a procurement resource via a flexible arrangement with a mix of on-site and off-site delivery of services and supported by a team of procurement experts in areas such as dispute resolution, contract law and category specific intelligence.
- Demonstrated the value of procurement and contract management across key departments such as Corporate Services, IT and Marketing.
- Consolidated all future procurement activities in a forward procurement schedule and identified priority categories to be addressed.
- Consolidated all supplier contracts into a single database.
- Established relationships and value alignment with key suppliers.
- Continuously identified value for money and efficiency improvement opportunities by, for example, reviewing the fleet specifications and benchmarking the fleet contract.
- Acted as a trusted procurement advisor to the business for contract drafting, reviews and negotiations.
Outcome
- Delivered $317k in annualised financial savings in addition to qualitative benefits resulting in return on investment of more than 3 times.
- Increased transparency of procurement procedure, spend limits and approval authority.
- Improved planning of procurement resources to address high value categories.
- Improved contract database that includes key contract information and documentation.
- Negotiated fundraising rebates and donations as part of key supplier contracts
- Conducted 14 contract reviews and reduced risk exposure to CPL.
- Raised more than $10k for programs such as the Let’s Talk and Rai Collective programs
Category Management Uplift
The Department of Transport and Main Roads (TMR) engaged Charles Kendall Australia (CKA) to evaluate, assess and provide recommendations on potential improvements to their procurement category management function. CKA delivered a comprehensive report and offered a number of options and strategies for improvements to the department's capabilities and competency.
The Challenge
- Assess and build on category management capability.
- Identify and prioritise category management opportunities.
- Evaluate effectiveness of work allocation and team organisation.
- Use findings to build on skills and knowledge of category management staff, as outlined in TMR’s centre-led procurement operating model published in July 2013.
Our Approach
- In-depth capability assessment of 32 TMR Chief Procurement Office (CPO) staff based on 11 criteria (e.g. risk management, relationships, strategy, etc.) to establish benchmarks.
- Full report addressing findings, including shortfalls and possible remediation and improvement strategies (particularly featuring mentoring and knowledge sharing).
- Additional support actions, including documentation drafting, interpreting procedures and reviewing templates.
Outcomes
- Successful delivery of comprehensive report outlining findings and outcomes.
- Measurable value added, with significant uplift in confidence, category management capability and strategic competency across varied seniority levels.
- Detailed data provided to TMR Chief Procurement Officer for consideration and future planning.
Procurement Delivery for Various Projects
Broadspectrum is a facilities management organisation that operates in a complex matrix organisation, with five service lines across three major sectors servicing across nine industries, four of which are NSW Government. Charles Kendall Australia (CKA) was engaged for the role of a Category Specialist to service the Materials & Equipment and Supply Chain & Logistics categories whilst the organisation was undergoing significant internal restructure.
The Challenge
- Prior to engagement of CKA, staff changes led to delay and disruption, meaning that a significant workload needed expediting in order to reach targets and demonstrate value of the procurement function.
- Broadspectrum’s diverse range of service offerings, as well as the involvement of subsidiary companies, resulted in complicated and fragmented spend patterns. As such, organisation of a centralised function and consolidation of spend required significant effort.
Our Approach
A structured, realistic and sustainable approach was required to meet the stringent demands of the engagement. For this engagement, a resource was located full time on site at Broadspectrum.
CKA’s commitment included the following services:
- Significant stakeholder consultation to collect data, collaborate, facilitate approvals, and provide reporting.
- Implementation of Procurement Improvement Program, including delivery of FY16 forecast benefits.
- Development of sourcing strategies and establishment of a strategic supplier relationship management approach with a focus on innovation and outcomes.
- Business as usual tasks such as management of contract negotiations and engagement of contractors.
- Development of reliable and robust processes for rebate collection, ordering, and overdue invoices.
- Support establishment of the procurement function that operates at or better than industry best practice level based on, for example, Cost:SUM ratio, Savings:SUM ratio, Savings per FTE ratio.
Outcome
- Broadspectrum’s newly formed centralised procurement team delivered the EBITDA savings target set by the board of directors.
- CKA provided Broadspectrum with flexibility to meet resourcing demands at short notice. CKA’s relevant experience and the ability to manage multiple projects simultaneously resulted in consistent and positive progress throughout the duration of the engagement.
- Furthermore, professional advice and procurement expertise resulted in successful completion of multiple projects and delivery of target savings within Materials & Equipment and Supply Chain & Logistics categories.
Procurement Capability Review
SunWater Ltd engaged Charles Kendall Australia (CKA) to undertake a review of its procurement process to identify improvements and provide recommendations for better managing its procurement practices with regards to its $7 billion in water infrastructure assets (40% of all water used commercially in Queensland, Australia).
The Challenge
- Review end-to-end procurement processes to identify improvements.
- Increase value for money in procurement, address weaknesses in procurement culture and mitigate associated risks.
- Improve compliance and performance related to procurement practices, including legislative compliance, contractual issues and supply chain vulnerability.
Our Approach
- Desktop review of SunWater’s existing processes and 25 contracts across different departments and categories.
- Identify procurement function effectiveness, strengths, gaps and weaknesses via employee surveys.
- Map existing procurement capability against CKA’s Capability Assessment Matrix based on best practices.
Outcomes
- Recommendations and pathways for transforming SunWater’s procurement into a strategic function with prescribed medium and long-term goals.
- Recommendations for improved procurement structure and processes, including centre-led structuring supported by policies, procedures and management, plus a framework for implementing supplier/contract/spend measurements, analysis and management.
- Recommendations for equipping staff with required purchasing and contract management skills, with focus on roles/responsibilities and training needs analysis.
Human Resource Development Project
In 2011, the Millennium Challenge Corporation agreed to provide funding to the Government of Indonesia (GoI) for various projects, including the Procurement Modernisation Project (PMP) that ran from 2012 to 2018 with the objective of reducing poverty through economic growth. This project was carried out through Millennium Challenge Account Indonesia (MCA-I) and the National Public Procurement agency (LKPP) with the intention to improve the procurement function in Indonesia, through three key projects, one of which was the Human Resource Development (HRD) Project. Charles Kendall Australia was engaged to provide specialist advisory and project management services to achieve the objectives of PMP and sustain long term success.
The Challenge
The objective of the HRD project was to increase Indonesia’s procurement capacity and professionalisation across the GoI. The following challenges were identified:
- Increase the capacity and professionalisation of the procurement function through the training and mentoring of 500 full time Procurement Service Units (PSU), 450 non-PSU staff (other actors who play a role in the procurement process), with the inclusion of 50 auditors from within the audit agency in GoI.
- Coordinate effective delivery of training and mentoring across the vast geography of Indonesia.
Our Approach
- Undertake a needs assessment to determine level of procurement competency through the use of surveys, meetings and stakeholder engagement.
- Based on the needs assessment, support the development and selection of suitable basic, intermediate and advanced training courses, tailored to the needs of the staff.
- Strategically choose PSUs and non-PSUs, through criteria which includes geographic location.
- Coordinate research to identify best methods of training and mentoring.
- Recruit qualified trainers and mentors using MCA-I approved recruitment policies and processes to effectively deliver training and mentoring.
- Identify sustainability strengthening activities to provide a way to continuously promote the value of the HRD project and build on to, and expand the network of procurement professionals.
Outcome
- Completed an extensive needs assessment of procurement professionals across Indonesia.
- Managed the development of a full training curriculum containing syllabi, manuals and facilitator’s manuals (based on globally benchmarked competencies).
- Effectively delivered training and mentoring using a competency-based training and assessment approach, and an engaging mentoring plan.
- Successfully trained and mentored staff above project targets.
- Identified and managed the development of sustainability strengthening activities such as materials for a knowledge centre and a procurement industry internet forum.