Fact Sheet

Modules

Procurement Operating Model ,Training: Strategic Sourcing & Negotiation,Strategic Sourcing

KPIs

Adressed organisations

70

Cost Savings

6-9%

Reduced Time Investment

23%

Value Added

• Improved capabilities and processes of the local procurement organisations through intensive training
• New PMO structure to better monitor and continuously integrate the activities of the individual locations

Contact

Florian Dederichs

Founder & Partner

M.+49 160 93882573​

E.florian.dederichs@ocmconsulting.de

W.www.ocmconsulting.de​

Training and Enablement in Procurement Consulting addressing Geographically Fractured Spend

Geography presents significant challenges for procurement departments.

Customer location, resource access, local product requirements - all of these factors, and more, cause companies to split their operations geographically. This is particularly true for procurement, where the likes of border controls and logistics costs strengthen the divide between locations. The result: siloed procurement departments, inconsistent approaches, and a fractured spend that remains unaddressed.

A global technical services provider with over 10,000 employees situated across 70 countries engaged us to address their global cost base. But how, with a single procurement consulting team, could we make an impact on such a heterogeneous, fragmented spend? How could we operate effectively in an organisation divided between so many countries, each with its own procurement management and differing category maturities?

The answer was: procurement consulting through training and enablement of the procurement departments.

In this article, we explain how we combined rigorous strategic sourcing training with a new global PMO structure to empower the local procurement departments and help the company achieve over 3.3m in annual cost savings.

A Decentralised Organisation and a Globally Disparate Spend

The client was a multinational technical services provider, offering inspections and certifications to industrial and technical systems. Their operations were spread worldwide, with a presence in over 70 countries.

Each location had its own procurement department handling a spend of 1m-30m EUR. Between the departments, there was no standardisation of procurement processes, few cross-country synergies, and no cultural integration or knowledge-sharing. With little in the way of training, many local procurement operatives made important decisions based on ‘gut feel’.

Compounding the issue was the global management structure, which was heavily top-down. The global or regional procurement executives would meet with country leadership on a country-by-country basis, and country leadership would report to their teams in an onward chain. This exacerbated the operational separation of the countries and reinforced silo working.

In short, the local procurement departments were immature. They carried out transactional buying processes that sought little in the way of savings and operational improvement.

Training and Enablement: Individual Project Approach in Procurement Consulting

In a typical procurement consulting project, the consulting team performs in-depth analysis of a category, develops a procurement strategy, and implements that strategy, often through a rigorous tender process. When working with the spend of over 70 countries, each with an array of spend categories, it is immediately clear that this ‘standard’ approach doesn’t work.

By analysing the spend databases and conducting stakeholder interviews for the 25 largest countries, we identified that the biggest and quickest improvements could be made by training the local teams to run effective procurement processes themselves. Additionally, a new management structure would help improve collaboration and accountability, bringing together the siloed operations of the past.

The project was split into three parts:

• Improve the skills and processes of the local procurement departments through training
• Introduce a new Project Management Office (PMO) to better oversee and integrate the activities of the locations on an ongoing basis
• Comprehensive handover under the core values: Implement, Deliver and Sustain

With a team of consultants writing and delivering the training, the project was completed within the following time horizon:

• Months1-2: Preparation of materials and content
• Months 3-6: On-site training across the locations
• Months 6-12: Introduction of new PMO structure and further coaching support

A Comprehensive Procurement Training Regime

The training had two main objectives: to equip employees with the skills to run effective procurement processes and to embed a more advanced procurement methodology in the local procurement departments.

The training was carried out on-site or through online workshops, depending on the size and spend of the country. It lasted between 3 and 5 days. The training sessions followed the seven-step strategic sourcing process and included the following modules: