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NZ Communications – Ad hoc supplier management and a decentralised procurement model

The Challenge

Executive management and stakeholders across the organisation became increasingly aware of inconsistent supplier engagement activities. They sought to increase accountability from stakeholders and consistent behaviours for outsource engagement across the various business departments.

In order to achieve this procurement and logistics needed to be able to measure the effectiveness of strategic sourcing and outsource management methodology. It was also necessary to actively centralise the procurement business model and gain rapid stakeholder support without compromising the demanding purchasing requirements of the business.  

The Solution

Vendor Management completed a Supplier Landscape Audit. This provided an independent benchmark review that captured:

  • the attitude of the organisation's stakeholders and key influencers towards it's suppliers
  • the assumptions made between departments
  • critical success factors and core business impact
  • engagement expectations
  • business unit and responsibility gaps
  • collectively this provided a measurable gap analysis of business risk and potential core business impacts.

In addition we also created a strategic sourcing and vendor management policy document that is essentially an organisational reference guide containing formal knowledge and practical tools. This has enabled organisational consistency throughout the company's strategic sourcing and vendor governance methodologies.

The Results

This benchmarking exercise has provided NZ Communications with the tools to reduce poor performing suppliers from going unnoticed and streamline processes that actively reduce current manual overheads. It also provided an environment of contestability, consolidation and leveragability within their supplier base. Coupled with the strategic sourcing and vendor management policy document this enables consistent outsource engagement behaviours and information management that aligns and measures supplier engagement with corporate strategy and performance.