Data identifies the focus for global rationalisation and negotiation

The Client

A UK FTSE 250 world leading provider of mobile power solutions with a staff of 6000 who deliver solutions to clients in over 100 countries.

Odesma was engaged to provide expert support and deliver savings, enhance skills and deploy technologies that would accelerate the organisation’s procurement excellence programme, a key component of a company-wide global transformation programme.

Within weeks of being appointed, Odesma had undertaken significant analysis of the procurement operation and third party spend data. This identified a number of areas where significant savings could be made.

The International power projects team in Jebel-Ali have a significant requirement to move equipment around the globe, often at short notice. Upon initial discussion with them regarding budgeting, there was a feeling that it was difficult to be able to do this, given that they didn’t know too far in advance when their next shipment will be.

The Objective

To renegotiate air and sea freight cars to benefit the organisation

Odesma Impact

After undertaking a detailed historical analysis of shipments by the International power projects team, Odesma’s team concluded that many of these lines could be covered by the local business unit and the rates already achieved. The bulk of what fell outside of these geographies could be rationalised to four key regions of the world:

  • South America
  • West Africa
  • East Africa
  • Indonesia (from Singapore east)

With this knowledge and armed with the historical volumes, Odesma’s team opened discussions with their brokers to try to negotiate the best possible rates going forward.

What came from this dialogue was a willingness to move towards better new rates, but to get there, the brokers outlined that they would need the business to do a little bit more planning to give them time to deliver.

Same day and next day deliveries were always going to be premium. However, by building a bit of time into the process, they could create opportunities for savings to be made.

  • Road – 2-3 days
  • Sea – 10-15 days If the broker could get these timelines, they could deliver better rates.
  • Air – 5 days

Working with the internal teams and business units, it was established that with a few minor tweaks to their processes, and by utilising Odesma’s e-tendering solution, Market Dojo, these timelines could be accomplished.

The Results

The organisation has come together to change, lock down new processes and capture the knowledge that makes operational efficiency and hard money savings.

Through the rationalisation of the destinations, re-organisation of the workflow, creating new roles and training of three personnel on creating and managing their e-tendering on Market Dojo, Odesma has embedded this new approach into the organisation.

The next phase of this project will see additional new suppliers added to the roster.