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AoC procurement newsletter spring 2011

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AoC procurement newsletter spring 2011

  1. 1. Procurement NewsletterSpring 2011 Contents Introduction............................................................................................................................................... 2 About us / About the AoC FE Procurement Efficiency Team.................................................... 3 New Spend Analysis................................................................................................................................ 4 Benchmarking and How AoC can Help............................................................................................ 5 Case Studies............................................................................................................................................... 7 • A Day in the Life of a Buyer............................................................................................................ 7 • Informal College collaboration swaps ideas to save time and money.......................... 7 • Filton tests going green to generate new revenue.............................................................. 8 • West Notts slash computer costs by using consortia – again and again!..................... 8 Shared Services Update......................................................................................................................... 9 Announcements....................................................................................................................................... 10 • Procurement Regulation - What’s New?.................................................................................... 10 • New FE Library of Procurement (FELP) launching this summer....................................... 11 • College’s annual return on EU contracts awarded during 2010....................................... 11 • Filton’s procurement courses judged excellent for fourth year in a row...................... 12 . Contracts Finder....................................................................................................................................... 12 Take our online survey to win chocolates....................................................................................... 13 1
  2. 2. IntroductionWelcome to the Spring 2011 edition of the AoC FE Procurement Efficiency Team Newsletter. Readon for news about innovative procurement projects from across the sector, advice from colleagueson how to get buy-in for cost-saving measures in your College, tips on easy-to-implement ways tocut costs and updates on consortia deals.In the first half of 2011, your College like all others will have found its budget stretched. But you’re havingto operate on less whilst still continuing to drive up standards. It’s a conundrum but it’s also one whichColleges, with their long histories of responding to the demands of the marketplace, are well able to absorband grow within.Tough as it is, we urge you to keep viewing the continuing period of austerity as a ‘challenge’ ratherthan as a ‘problem’. Better procurement processes, as you know, can make a major difference to theimpact of Spending Review cuts. You and your College may well be already in the middle of long-term procurement projects, which will bring significant savings. But don’t forget about the ‘quickwins’ too – there are often some relatively simple ways to make minor savings that take little time tointroduce.You can find examples of both short- and long-term cost-saving ideas here. We’re here to help inspireyou and offer support to College procurement teams, so you make the very best of the budget youhave.Contact usWe’re here to help! Whether you’ve got a procurement problem or a success story you’d like to share,email us at procurement_team@aoc.co.uk or call our helpdesk number on 0808 178 1669.And let us know via procurement_team@aoc.co.uk what you think of this newsletter – what wouldyou like to see more of? Do you have a story you’d like us to feature in the next issue?For previous issues and details about the AoC FE Procurement Efficiency Team, see www.aoc.co.uk/en/aoc-procurement-team/Stop press: we’ve set up a simple online survey so you can let us know what you think of ourwork in the Procurement team – complete it and you could win a box of chocs. See the end of thisnewsletter for details. 2
  3. 3. About us/About the AoC FEProcurement Efficiency TeamAs a team of procurement professionals, we work Some of the things we can do for you or supporthard to identify procurement efficiency initiatives you with are:and to help implement them in FE Colleges. Wework alongside other professional services within • Visit your College to do a procurementeach College, such as the college’s finance, IT, HR reviewand estates departments. • Offer detailed advice about procurement issues – from general to specific queriesThe team was set up in 2005 as part of theformer Learning and Skills Council (LSC) to • Give hands-on support with tendering anddevelop procurement knowledge and expertise contractingspecifically for the FE sector. We became a • Support and co-ordinate collaborativepart of the AoC in April 2010. We’re based projectsthroughout England and are able to supportColleges across the country. • Provide training and guidance • Disseminate the latest procurement policiesTony Watmough, AoC Regional Director for theNorth West region states; • Send out market updates.“Efficient procurement and the developmentof shared services has become an increasingly Most of these services are free to memberimportant area for Colleges to explore in the Colleges or offered at discounted rates. You’llcurrent financial climate. The AoC Procurement find out about other things we do as you readTeam offers invaluable advice and support this newsletter.to Colleges in this field, helping to developbest practice. I would urge all Colleges to take We’re very friendly so get in touch by emailingadvantage of the services they provide.” us at procurement_team@aoc.co.uk or by callingRegardless of who is responsible for our advice/helpline on 0808 178 1669.procurement at your College, how long it’s beenestablished and how well it’s embedded intoCollege activities, our role is to help make yourlife easier. 3
  4. 4. New Spend AnalysisAoC embraces cloud-based spend analytics to Costdeliver value for money to Colleges Organisations usually pay for cloud analyticsCloud analytics involves elements of the data applications and services by subscription oranalytics process being provided through a through pay-per-use. The cost for an FE College,public or private ‘cloud’. Cloud in this context following negotiations by AoC with Exor, ismeans not a fluffy white collection of water £2,097.50 plus VAT for the complete package.droplets up in the sky, but an invisible, remote This includes analysis, the online tool, a reporthosting platform that holds complex information and an individual visit. Colleges may be able tosecurely. secure a reduced cost by working together and approaching Exor as a group or collaboration.To support the spend analysis work they arecarrying out for the AoC, Exor Management To sign up and get started please email eitherServices has picked Rosslyn Analytics, a Carl Johnson at AoC via carl_johnson@aoc.co.ukleader in cloud-based spend data management or Andy Johnson at Exor, who can be reached atsolutions, to help Colleges track and analyse andy.johnson@exorms.co.ukspending. More informationBenefits Email us at procurement_team@aoc.co.uk orUsing Rosslyn’s platform (called RA.pid), call the helpdesk on 0808 178 1669 if you wantColleges will be able to consolidate and analyse to know more about spend analysis in generaltheir spend data quickly and efficiently. The or about the electronic RA.pid spend analysiscompany predicts in fact that you will halve platform before you make a decision.the time you spend “obtaining, enriching andanalysing data”. This includes identifying cost Exor Management Services website can be foundsavings and meeting EU and UK regulatory at www.exorgroup.co.uk/analyticscompliance requirements.Through RA.pid, Colleges will have 24-houraccess to their cleansed and enriched spend dataat line item detail. This means that you will beable to see what you have spent item by item –what you bought from whom, when and how “ We are excited to be given themuch it cost. opportunity to work with AoC to introduce powerful, yet easy-to-use spend dataAbout RA.Pid management technologies to procurementA secure web portal, this enables users to createexecutive dashboards, drill-down analytical professionals. ”reports and alerts based on a range of data-driven dimensions including: Charles Clark, CEO of Rosslyn Analytics • spend by transaction, • spend by supplier, • spend by category using Thompson, ProClass and UNSPSC classifications, and • spend by parent. 4
  5. 5. Benchmarking and How AoC can HelpDid you know that the AoC FE Procurement Some Colleges are still putting tenders out direct toEfficiency Team provides a national purchasing suppliers whereas others are using consortia almostbenchmarking service? Learn more about the value exclusively. On the ground, it’s a mixed pattern –of benchmarking and how we can do some of it for but some Colleges are missing out on better deals.you, saving you time and money. We wanted to help more Colleges get the best value for more products and services.So what exactly is benchmarking?Benchmarks are actually things you might find The service aims to benchmark Colleges’ unitwhen out on a weekend ramble. Surveyors cut costs of procurement against price structuresarrow-shaped marks into rocks to indicate points from CPC and Buying Solutions, so that we can:they have measured, so they can work out theelevation of other points nearby. These days the • Highlight alternative, better value for moneyword is more commonly used to describe a point consortia contracts to Colleges.of reference, but the idea of a ‘mark’ is a useful • Let consortia know which contracts don’tone to keep in mind. We test and check how offer best value for money so they canthings compare to a particular benchmark or improve these.industry standard. • Find out how local suppliers are performing.Benchmarking helps you do things better andmore cheaply How the service can help youIn business, benchmarking means comparing If you’re unsure whether you’re getting bestbusiness processes and performance to industry value for a particular product or service, we’ll dobest standards or to best practices from other a benchmarking exercise for you so you can getindustries by measuring quality, time or cost. on with your job while we work out the results.This results in a ‘performance metric’ (i.e. a It takes us on average two weeks to get back tomeasure of an organisation’s activities and you, though occasionally it’s a little longer if aperformance), which can be compared against new pricing structure is being introduced.others. We give you feedback directly and confidentially,Benchmarking’s ultimate aim is to find out so you can make the right decision forhow to do things better, faster or more cheaply. your College. AoC carries out the exercisePerformance is measured using a specific anonymously, which means that we never tellindicator: in procurement, we use a ‘unit cost of the consortia which College has requested theprocurement’. It enables organisations to plan benchmarking. We won’t use your informationhow they can improve aspects of their processes publicly, just aggregate the cost savings for aor adapt others’ best practices to enhance an particular product or service.aspect of their own performance. Benchmarking exercises we’ve carried out soIt can be something your team does as a far show the following cost savings made toone-off but it’s better if you’re continuously individual Colleges by using CPC or Buyingbenchmarking. Solutions:Why we set up the AoC’s national purchasingbenchmarking serviceWe set up the service to test College and consortiapricing to find out how consortia contracts compareto Colleges negotiating on their own. 5
  6. 6. Cost saving identified by AoC’s national bench-Product or service marking service through using a consortium Computer consumables – virgin ink and toner 18.6% cartridges Mobile solutions 37.5% Sanitary disposal equipment and related services 21.1% Stationery 30.4% Telecom networks 14.2% Supply of hair consumables, equipment and 19.3% supplies Vehicle hire 2.8% Virgin and recycled photocopier paper 2.5%How to request a benchmarking exercise How much does it cost?Simply email us at procurement_team@aoc.co.uk Our benchmarking service is currently free to AoCand we’ll give you a timeframe for completing the member Colleges.exercise. Or go to www.felp.ac.uk entering ‘nationalbenchmarking exercise’ into the search field,complete a template and email that to us instead.There are 21 commodity areas with templatesalready created so you can simply input your data– or get your existing supplier to complete it. If weneed more information, we’ll be in touch. 6
  7. 7. Case StudiesA Day in the Life of a Buyer...Paul Rumble currently works How long have you worked in procurement?as Procurement Officer at It’s been 25 years man and boy! I startedCity of Bath College and asProcurement Manager at New off in the Post Office’s supply centre whereCollege Swindon, while also their purchasing function was, and movedjuggling a further contract into the College sector around eight yearswith Swindon College. ago. We’d moved back to Swindon from Cornwall, I was looking for a procurement position and a full-time contract at Swindon College became available.How do you manage so many jobs at once?I work three days a week at New College In what ways is the College sector different?and two at the City of Bath and I’m also There are lots of things you need todoing some work for Swindon College. understand that are completely unique. YouI work on fixed-term contracts. The make a lot of contacts in this sector. Forrequirements for the Colleges are all slightly instance, I’m in close contact with Rogerdifferent and I’m working on different Coles: we talk about what’s going on in theprojects, so it does get tricky to differentiate; marketplace and what’s coming up. A lot ofyou just have to be organised. Basically, it is...For full article visit our websitethey’re all the same role, just with differenttitles.Informal College collaboration swaps ideas to save time andmoney.The M4 Collaboration Group, so-named “We speak a lot or email and only meet up whenbecause all the Colleges involved – Wiltshire, we have a concrete proposal to work on. If oneFilton, Swindon, City of Bath and New College of us is thinking of doing something, we ask theSwindon – are based around the M4 motorway, others if they’re interested so there isn’t a fixedwas set up to share expertise as much as money. number of Colleges involved in each project. ForIt’s an innovative idea based on networking, each project, one College will take the lead, do abuilding excellent long-term relationships lot of the donkey work and then the others willand local sharing, and that works successfully hop on board. We take it in turns. For instance,alongside more formal groups. And it’s led we identified one college that had a very goodto some impressive savings. Member Paul price for paper supplies so we discussed thatRumble explains: and decided we could aggregate usage for the four...For full article visit our website“It’s an ad hoc collaboration that was neverintended to be formalised; we felt we could reactmore quickly to the individual and collective needsof the Colleges that way. It originated because Iknew the Purchasing personnel at both Swindonand Wiltshire Colleges and we wereused to throwing ideas about. It grew from that. 7
  8. 8. Filton tests going green to generate new revenueFilton College is currently tendering through across the College. We have a Green Teamthe EU for wind turbines and photo-voltaic Committee that meets on sustainable issues and(solar) panels. The College would like to these projects came up from looking at energyinstall small-form wind turbines at their Wise saving initiatives. We also have a new renewableCampus. This could create revenue through centre, which has recently opened within therental for the land. In addition, the wind College, so we felt it would be beneficial to haveturbine company could give Filton some of the some of the technologies here that are beingenergy generated for the campus or the College taught.could sell it back to the grid. They also planto install photo-voltaic panels on roofs at both “We’ve gone through the competitive dialogueWise and Main Campus. The solar energy route for both projects. We initially advertisedbrings in revenue through roof rental and/or in OJEU for expressions of interest, whichenergy used in the buildings. generated a lot of responses nationally. We then invited interested parties to come to view theFilton’s Procurement Officer, Andrew Williams- sites and put a rough proposal together. FromLock, explains: “We’ve been looking at ways we the proposals we wrote a specification in the bestcan reduce energy consumption and save money interests ...For full article visit our websiteWest Notts slash computer costs by using consortia –again and again!Since Angie Pilgrim, West Nottinghamshire “When I started here the college were buyingCollege’s Procurement Manager, arrived at expensive, non-branded computer products, thethe college in 2004, the college has saved over staff didn’t like them as they weren’t reliable£1m in computer hardware such as desktops, and when they broke down, the item had toAppleMacs, laptops, printers and consumables. be shipped back to the supplier at the college’sThey’ve made year on year savings and expense, which took months to repair them.continue to do so – last year alone, West Notts This was completely turned around at the firstcut £61,000 (including VAT) off their bill. time...For full article visit our websiteAngie explains how they keep doing it: 8
  9. 9. Shared Services UpdateGovernment funded shared services projects Until recently, the FE sector lagged behind otherinvolving over 200 Colleges now underway. public sector organisations in exploiting the benefits of shared service solutions.The Efficiency and Innovation Fund (EIF) isan initiative arising from £15 million allocated The AoC Shared Services team is working withby Vince Cable, Secretary of State for Business the Colleges involved to find out in detail aboutInnovation and Skills, to the SFA in June 2010 to the projects and gather information. We plan tosupport the AoC and the FE sector in delivering disseminate learning materials to the sector in“an innovative suite of shared service solutions”. the near future. This will cover:A shared service is basically the shared provisionby one or more organisations of a specific service • lessons learntor function – from waste management to exam • successesadministration, finance and HR. • challenges and how to overcome themEIF funding has since been released in two • advice on how to approach collaboration androunds to support 41 shared service projects shared services.involving over 200 Colleges. All these are nowunderway. We talked to managers working on a few of these diverse projects to find out how they’re getting onThe aim of EIF is to help Colleges – at a time and what they see as the successes and challengesof austerity and cutbacks – to develop and test so far.different collaborative models to: For further details on this visit our website. • identify ways of improving service delivery of both back office functions and frontline services; • determine where efficiency savings can be made; and • find solutions to barriers and problems that collaborating groups can come up against. 9
  10. 10. AnnouncementsProcurement Regulation - What’s New?Credit checks no longer satisfy legal stringency of this test.” In other words, Collegestransparency tests, warn solicitors must supply bidders with all this information upfront – clearly and transparently – and notColleges, like all other organisations in the hide the fact that they intend to run a check onbusiness of awarding contracts, can be heavily the bidding firm.reliant on credit checks from one of numerouscredit reference agencies to assess bidders’ If a College doesn’t give bidders full informationfinancial strengths. The demand for these checks on how bids will be assessed, then bidders haveis intense, especially in the current economic the right to challenge them legally. To preventclimate. As we all know, awarding a contract to this, “the contracting authority must not onlya firm that’s on the brink of ‘going under’ could disclose the fact that it will conduct a credithave major legal as well as financial implications check but it must also disclose what information– not to mention embarrassment to the College will be assessed and how it will be assessed”.and the cost of wasted time. ‘How it will be assessed’ is the formula used to create the credit score.Now Mace & Jones, a firm of solicitors basedin the North West (recently merged with But this causes a bit of a tricky problem: eachWeightmans) who’ve been involved in long- formula is the intellectual property of anrunning litigation related to the use of such individual credit reference agency, which willagencies, warn that credit checks may no be “very reluctant” to disclose it. And if thelonger “satisfy the transparency test mandated contracting organisation can’t disclose theby the Public Contract Regulations 2006 and formula, the assessment is at risk of a successfulsubsequent case law”. And this might extend challenge by any bidders who are excluded as aalso to ‘part B’ services. result.Mace & Jones say (in April 2011) that the law So how do you get round this? Mace & Jonesis now clear: “Bidders must know all criteria, believe that many finance departments will gosub-criteria and weightings used in assessing back to running the standard accountant’s rangetheir bids so that they can prepare their best bid. of ratios and formulae themselves to determineNo surprises are allowed when it comes to the bidders’ financial strengths. Either that, theymarking regime. The use of a credit reference say, or you have to “accept the increased risk ofagency does not, in any way, alleviate the successful challenge”. You have been warned! 10
  11. 11. New FE Library of Procurement (FELP) launching this sum-mer – www.felp.ac.ukYou may be aware that we at the AoC FE • the option to personalise the site, i.e. to createProcurement Efficiency team host the FELP a ‘My FELP’ page, where you’ll find the latestwebsite, a collection of practical procurement news and be able to access documents you’veresources. We’re now redeveloping the site so recently used;it’s got a fresher design, is more user-friendlyand better meets College business needs. Once • more videos delivering training andwe’ve finished transferring data and testing it, guidance;we’ll launch the new version this summer. • ‘whole-Life’ costing models, which you can either use on-screen or download; andAs well as the advice, good practice guidanceand sample documentation on the existing site, • better opportunities to collaborate and getthe new version of FELP will provide: involved in shared services projects. • a better ‘journey’ through the site’s advice We’ll let you know when it’s ready! and guidance sections;Advance notice to start preparing your College’s annual returnon EU contracts awarded during 2010All Colleges have a legal requirement to 3. CPV code (as listed in the OJEU notice)report the contracts they awarded during 4. Contract award type (i.e. open or2010 (that’s the 2010 calendar not financial restricted etc.)year) to the EU. This is to comply with theEuropean Community’s Directives on Public 5. Total contract value in pounds sterlingProcurement. Please note: this requirement applies only toWe’ll send round full details as soon as we those contracts awarded by your College underreceive them from the Department for Business, the EU regulations; you won’t have to submitInnovation and Skills (BIS). This will include information on call-offs relating to consortiadeadlines and where to send your reports. framework agreements.But, to save time, you should start preparing Not had to do this before? Email us atyour submissions now. Based on past years, procurement_team@aoc.co.uk if you’re unsureyou’re likely to be asked for the following what to do or if you need to know more aboutinformation: EU Procurement regulations.1. Nationality of supplier2. Type of supply (supply, works or service) 11
  12. 12. Filton’s procurement courses judged excellent for fourth yearin a rowFollowing an audit by the Chartered Institute experienced team of lecturers, who have allof Purchasing and Supply (CIPS), Filton had first-hand experience of supply chainCollege has been again been given a Centre of management.”Excellence award. This confirms the College’sstatus as among the UK’s leading providers of Filton teaches the level 4 Foundation Diploma,procurement training. the level 5 Advanced Diploma and the level 6 Graduate Diploma. Kelly Gillett, Director ofOrganisations have to be well-established Curriculum 19+ at the College, says that theirproviders to receive the CIPS award. They must courses no longer attract only those looking toalso have excellent course management, a strong build a career in procurement: “We’ve also seen ateaching team, above average exam results, rise in students from smaller companies who areexcellent teaching facilities and happy students. looking to save money through procurement”. She says it makes a real difference: “it really doesCourse Leader for Procurement, John Bone give our provision great credit when completingOBE, comments: “College exam results continue against universities or for tenders”.to be above the national average thanks to thecontinued support of our motivated andContracts FinderBusiness Link hosts Government’s new BackgroundContracts Finder portal All Government bodies have a duty to make theIf you’ve been using the Government’s way they spend public money transparent. Theycontract opportunity portal www.Supply2.gov. are more accountable than private organisationsuk to advertise OJEU and non-OJEU tender for their procurement and contracting activities.requirements, please note that this website is nolonger live. All public spends above a certain threshold (£156,442 for Part A Good and Services) haveYou can access the Government’s new Contracts to be advertised in the Official Journal of theFinder portal (and replacement for Supply2.gov), European Union (OJEU). For public spendson the Business Link website at http://www. below this threshold or for Part B Goods andcontractsfinder.businesslink.gov.uk/ Services, public bodies are not required to advertise through OJEU but they still have toTo register for an account as a Buyer, you be open and ‘transparent’. Advertising yourneed to go to: http://www.contractsfinder. requirements through Contracts Finder will helpbusinesslink.gov.uk:80/Buyer%20Overview. your College fulfil this requirement.aspx?site=1000&lang=en To find out more about the need to showAs before, the new Contracts Finder portal transparency, please see http://transparency.gives you easy access to lower-value contract number10.gov.uk/opportunities (typically worth under £100,000)offered by the public sector, and to find liveopportunities to tender for. 12
  13. 13. What do you think of what we do? Take our online survey towin chocolatesWe really value your feedback on the work The first 10 people to finish the surveyof the AoC FE Procurement Efficiency Team. (including their name and contact details) wins aAre we meeting your needs? What else could box of chocs! You’ve got until 30 June.we do to make your life easier? We’ve createdan online survey that will take you at most 10 Want to feed back on this newsletter? Got aminutes to complete. success story you’d like to shout about? Email us at procurement_team@aoc.co.uk WeTake it now at https://www.surveymonkey. welcome all your comments and ideas.com/s/QGSJDBH or by 30 June at the latest. 13
  14. 14. Contact usAssociation of Colleges Procurement Team Helpdesk Number:Procurement 0808 178 16692-5 Stedham PlaceLondon Ray PoxonWC1A 1HU Senior FE Procurement Manager 07917 266 082 Carl Johnson FE Procurement Manager 07767 323 191 Martin Toomey FE Procurement Manager 07818 533 393 Beverly Aboagye FE Procurement Manager 07584 528507 Roger Coles FE Procurement Manager 07920 720651 James Durcan FE Procurement Analyst & Customer Advisor 07917 426 077 Lesley Templeman Shared Services Project Manager, 07827 277 096 Roanita Burke Shared Services Project Manager, 07584 528727 Morag Henderson FE Procurement & Shared Services Administrator General enquires: procurement_team@aoc.co.uk EMM queries: emmfe@aoc.co.uk AoC procurement pages: www.aoc.co.uk FELP website: www.felp.ac.uk Shared Services enquries: sharedservices@aoc.co.uk 14

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