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Procurement process outsourcing how it works
- 1. Procurement Process Outsourcing – How it Works Tutelam
- 2. About Tutelam Who are we An SCM company providing Procurement & Logistics services enabled with IT solutions 60+ years of Collective domain experience & in Demand Consolidation & Procurement StrongVendor base in Logistics, F&B, FMCG, Construction, Indirect Purchases and Packaging, etc • One stop service provider Procurement • Support in Operational excellence • Enhance Compliances • Facilitate cost reduction • Easily adaptable commercial (OpEx) What we do Strengths Benefits Partners with Corporates and takes over Indirect spend hence they focus on core areas for processes improvement leading to cost savings 2
- 3. Tutelam Procurement Portfolio 3 Tutelam AP & Freight Audit & Payment (FAP) (IT Enabled service) 8 Spend Analysis (IT Enabled) 1 Supplier Identification 2 Supplier Assessment & Rating 3 Sourcing (e Auction- Reverse, Forward, Spot ) Contract Management (IT Enabled service) 5 Indirect Spend Management (Manpower Optimization, Physical support) Order Fulfillment (Physical support) 7
- 4. Procurement Problems Customers face.. 5 4 3 2 1 01 02 03 04 05 Spend creep and cost containment Visibility of realized savings Compliance to contracts Leveraging technology effectively Insufficient skilled resources
- 5. Why procurement Outsourcing? Value creation Shareholder value increased Need to gain access to improved pricing Leverage global collaboration in people, resources and Technology Improved spend visibility Improved processes & systems Increased global competition Increased pressure to lower the cost of goods & services and transaction costs Growing acceptance of procurement BPO as a visible option Pressure to refocus personnel on more strategic activities
- 6. End to End PPO Purchase Pay Linking purchasing and financing BETTER PROCUREMENT, SPEND CONTROL & CASHFLOW VISIBILITY REDUCED COST INCREASED VISIBILITY IMPROVED SECURITY & COMPLIANCE BETTER CONTROL Procurement & payment transaction savings Improved analytics through the end-to-end process Stronger regulatory, contractual and internal compliance Unified governance across procurement & finance End to End PPO Solution 7
- 7. PPO Steps 8 Needs Analysis Market Analysis Portfolio Analysis Supplier Relationship Analysis Risk Management Supplier Selection Contracting Order & Delivery Receipt Management Receipt & Payment Supplier Performance Quality Management Continuous Improvement MIS UpstreamSourcing DownstreamSourcing
- 9. TAIL SPEND MANAGEMENT • Multiple vendors. • Low value. HighTransactions • Higher management cost • Defocus • Resources could be better utilized in core areas PROCESS OUTSOURCING forTAIL SPEND • Indirect Purchase • Non Core • Non BOM • LowValue & high volume Spend
- 10. Recognition of Needs Description of Needs Identification and analysis of possible source of supplies Supplier selection and determination of terms Negotiation and contracting Preparation and placement of POs Follow up for delivery Receipt of goods or service Inspection of goods or services and raise GRN Invoice clearing and Payment Monitor supplier performance Key PPO Steps
- 11. Single Window sourcing Multiple vendors management Optimize inbound supply chain Reduced admin cost Enhanced visibility Total Spend savings Demand Consolidation Reduce Spot buys Users’ existing efforts reduction Existing resources reallocated Improved Compliances
- 12. PostTransformation Multiple vendors Using multiple vendors is always a distracted approach; transactional cost increase; AP processing difficult; reduced chance of volume discounts Many Suppliers Consolidation Process of eliminating low capacity suppliers in favor of a smaller number of high capacity providers Reduced Suppliers PPO Tutelam handles consolidated supplier base thus managing cost fluctuation, supplier relations finally leading customer satisfaction Tutelam Outsourcing gives significant improvement 13
- 13. Value Proposition ABC Resources can do their ‘core’ job Save Time, effort, resources, Operating cost and Training cost Improved Compliance Enhanced Spend visibility, monitoring and control Access to professional, expert and high-quality services Single window approach by offloading huge vendor base to Tutelam
- 14. Overall ‘Tutelam’ to support in Rationalization and reduction in assets Efficient operational systems Improved productivity Enhanced focus on core competencies Economies of scale leading to cost reduction Maximize EBITDA
- 15. Materials proposed to handle by Tutelam1. Employee Transportation – bus /cab /TT 2. Food & Beverage – Cafeteria related (Tea & Coffee, Kitchen equipment, cafeteria facility purchase, water tankers, drinking water, etc.) 3. Facility management (Housekeeping items, Stationery items, Chemicals, Tissue papers , ladders, paints, civil requirements, plumbing items, Uniforms, work stations, electrical items , carpentry work etc.) – Housekeeping equipment, White goods (Microwave, Refrigerator, Televisions, and Audio visual Equipment etc.), Vehicles (Bikes, Cycles, and Four wheelers), workstations, cafeteria chairs & tables, Workstation Chairs etc. – Facility AMCs - Annual contracts for lifts, DG Sets, House Keeping Equipment, UPS, Laundry Equipment, Air Conditions etc. – Facility Security related purchases- CCTV, Turnstiles, Boom Barriers, walky-talky, safety shoes, Traffic cones, chains, barriers etc. – Security services – Guard services – Front Office – staff – Gardening, facility maintenance, Facade cleaning etc. – Administration: GIFTING - Backpacks, T-Shirts, Desktop Items, Indian Handicraft Items, Silver & Gold Mementos, Trophies, printing certificates etc. – Low value spend management – Civil related facility purchases – Electrical related Purchases – Carpentry related Purchases – Office equipment & stationery, printing & paper – Team out-bound related purchases – Event Management related 4. External Training, Learning & development Requirements 5. Logistics – domestic & international 6. Travel & accommodation related purchases (travel helpdesk, hotel accommodation, taxis etc.,) 4. Managed services 5. Hiring – Contract and permanent 6. Staff augmentation 7. IT hardware & software purchases 8. Telecom (mobility services) 9. Data links purchase 10. Cables, network equipment purchase & installation services 11. Sale of scrap/assets, old machinery, cars, IT Hardware etc., 12. Contract negotiation & Management for all the above categories 13. All one-time high value purchases
- 16. Thank you 1054 | | 7th Main 3rd Block | Koramangala Bangalore – 560 034 Phone: 00 91 2553 0001 | 2553 0002 www.tutelam.com U8, First Floor DLF Phase III Gurgaon – 122 002 www.tutelam.com