Recent procurement headlines from around the world.
UK Government Uses BravoSolution to Identify £2.5 billion ($3.98 billion) in Savings
CPO Rising has been covering the UK government’s pursuit of a centralized procurement strategy since the appointment of its first Chief Procurement Officer in 2011. Last week, the Government Procurement Service (“GPS”), an executive agency of the Cabinet Office of the UK Government, announced that it has achieved visibility of spend across the entire UK central government. The project, according to the announcement, is “one of the largest and most high profile spend analysis projects ever implemented [Publisher’s note: we agree], covering approximately £60 billion ($95.69 billion) in annual spend, more than 500,000 suppliers and tens of millions of invoices and contracts. The program was rolled out across all 17 central departments, including the Ministry of Defense, Department of Transport, and the Department of Work and Pensions.”
GPS has worked with BravoSolution, the Spend Analysis company (and site sponsor), on this initiative which is aimed at driving savings, tracking small business (“SMB”) spend, and identifying categories that could be collaboratively sourced across different government departments/agencies.
“For the first time, we have achieved a detailed, accurate, and up-to-date reporting capability enabling visibility and control over spending across the whole of central government. This has enabled us to document savings of £2.5 billion ($3.98 billion) of combined price and demand savings in 2011-2012 and identify further opportunities for 2012-2013,” said David Shields, Managing Director of GPS.
In 2013 and beyond, this initiative will continue continue its drive for savings and focus on improving data quality and contract compliance as well as gaining a better understanding of the government’s SMB spend. BravoSolution will remain involved in the spend analysis initiative and continue to advise public procurement teams on best practices for spend analysis and sourcing and support the GPS in its role of supporting best practice procurement in public sector.
EU Committee Reiterates Support for eProcurement
At its November 14th plenary session, the European Economic and Social Committee (EESC) called for better access to public procurement and endorsed the EU’s opinions on e-procurement. At a time of public budget cuts and increasing global competition, the EESC wants to ensure that EU companies enjoy equal access to public funding in procurement bids. “In spite of EU efforts to promote eProcurement among Member States, some of them are reluctant to cooperate and open up the public procurement market to competition. The level of eProcurement remains very low in countries such as Italy, where it represents 4% of overall procurement”, says Edgardo Maria Iozia (Workers’ Group, Italy), who was assigned to report the EESC opinion on e-procurement. In its press release announcing its “opinion,” the EESC noted that “administrations which have already switched to eProcurement report savings of between 5-20%….. [and] if eProcurement were to be applied to all EU procurement, savings would amount to more than EUR 100 billion.”
According to its website, the EESC is “a consultative body that gives representatives of Europe’s socio-occupational interest groups, and others, a formal platform to express their points of views on EU issues. Its opinions are forwarded to the larger institutions – the Council, the Commission and the European Parliament. It thus has a key role to play in the Union’s decision-making process.”
Supplier Collaboration: Boeing To Expand Relationship with Key Supplier
US aircraft manufacturer Boeing and the State Corporation Russian Technologies (“Rostech”) are working on an agreement to expand collaboration in titanium procurement and technology development, the two companies said. Boeing and Rostech, which is a majority shareholder in Russian titanium producer VSMPO-Avisma, are also seeking to increase their cooperation in commercial aviation services.
In July 2009, Boeing and VSMPO-Avisma (the largest global supplier of titanium) opened “Ural Boeing Manufacturing,” a 50:50 equity joint venture based in Verkhnyaya Salda, Russia, to support ongoing production increases for Boeing’s “Next-Generation 737” aircraft. Boeing and the Russian aerospace industry enjoy a mutually beneficial partnership that began more than 15 years ago. Two key Boeing centers are located in Moscow. Now, the partners are in talks to expand capacity for titanium components in the 737s in 2013. Boeing forecasts that over the next 30 years it will spend as much as $27 billion on Russian titanium, aerospace design-engineering services, and a variety of other services and materials.
“Rostech has been a reliable and valuable partner to Boeing in Russia for many years, and together we achieve results that allow us to grow our businesses,” said Ray Conner, Boeing Commercial Airplanes president and CEO. “Boeing and Rostech are working hard to further expand our partnership and our mutually beneficial cooperation.”
“Cooperation with Boeing allows us to offer new technological solutions for the global market. Today VSMPO-Avisma is one of the largest titanium suppliers to Boeing and is a key partner in the field of new alloy development,” said Sergey Chemezov, chairman of the board of VSMPO-Avisma and CEO of Rostech. “In recent years, the partners have developed three new technologies in a joint innovation center. Extending cooperation with Boeing will help us create even better and more competitive solutions for the global aviation industry.”
CPOs on the Rise
From CPO to CPO (Chief People Officer)
Belgian mobile operator, Mobistar, has appointed Anne Cambier its new chief people officer from 1 October. Cambier, who joined Mobistar in 1999, was previously Chief Procurement Officer.
From CPO to Board Member
Curtis White, chief procurement officer and senior vice president, worldwide logistics and international operations for Mattel Corporation in El Segundo, Calif., was elected vice chair of the Morningside College board. White is a 1976 Morningside graduate.
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