Following an extensive rebuild of its 600-strong procurement team, this major bank, which had 4,750 branches in 55 countries, turned its focus to savings.
challenge
As part of a more comprehensive restructuring program, the bank relocated its procurement function. Very few staff relocated with it, creating a knowledge vacuum and a capacity and capability challenge in the face of an immediate and demanding cost challenge.
The bank was looking for a partner to quickly extract knowledge from the departing team and to bring external insights to identify new opportunities to drive savings. Supplier savings and expenditure were complex and extended into $billions. Savings needed to be evidenced and prioritized, allowing incoming staff to settle immediately and accelerate delivery.
Approach
Over ten weeks, our team of FS and category procurement specialists immersed themselves in
the operation. Working at pace, this team delivered a deep dive Opportunity Assessment, providing a detailed analysis of the bank’s supplier spending and potential supplier savings initiatives. The team assessed data, reviewed contracts, discussed needs, and used Proxima insights and benchmarks to identify opportunities. Each opportunity was evidenced in a reporting pack, and incoming team members were coached on delivery.
Results
The assessment delivered a qualified pipeline of opportunities across a broad range of expenditure categories, including IT, Facilities, HR, Professional Services, and Marketing. These were translated into short playbooks identifying the projects, evidence, approach, likely resources, and quantum of return.
Heads of Sourcing then received detailed feedback on the playbooks and coaching (where a need was identified) on presenting their work to senior stakeholders. This would help Procurement build credible relationships and elevate working relationships.
Further, we ran collaborative workshops to validate the initiatives, and we looked at prioritization according to available benefits and resources. The incoming team could then use the sourcing plans and playbooks to accelerate delivery immediately.
Overall, the business gained a new Procurement function, staffed with the right number of people, and with the right skills. Once in place, they could hit the ground running with projects and a playbook to help them realize rapid results, including the benefits of:
- 300 contracts assessed, representing > £3bn of spend
- 180 agreed projects documented identifying > £200m in savings
- A stakeholder-approved wave plan for the Procurement function
- Gap closed and accelerated delivery of annual savings target
For more information about how our procurement consultants can help you with supplier savings, contact us here.