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 business employs over 5000 staff across the globe, therefore it has a significant requirement for the procurement of IT hardware, laptops and peripherals to keep its workforce equipped, efficient and connected. Working through a managed service desk and an online platform with catalogues from two primary suppliers Zones & Kelway. Both were HP resellers.
Not with standing the infrastructure that was in place to facilitate the ordering of new pieces of technology, the products were not managed, prices were just accepted and there were no real KPI’s in place on creating value within this area of the business.
To identify stakeholder needs for IT and to source suppliers and negotiate contracts for new IT systems.
To begin with Odesma undertook a pre-determined technology specification for each job function within the organisation, for example sales engineers get five pieces of equipment and a senior executive gets eight pieces of equipment. This will ensure that each new employee will get the appropriate equipment at a pre-negotiated price. This also ensured that upon leaving a position, the organisation knew which equipment the employee was due to hand back.
Odesma then took a two-stranded approach, firstly, they negotiated with both existing re-sellers of HP. Secondly, Odesma opened discussions directly with HP. The previous research into the needs of the stakeholders identified that they had a Global account with HP that was worth more than $1m per annum. As a result, the company became recognised by HP as a Global Account and a special OPG discount code was provided to them. This meant that when their chosen resellers went to HP for the base price of any new pieces of equipment, this base price of this would be served at a reduced rate.
As a direct result of the negotiations with the resellers, ODESMA managed to reduce the reseller margin by 18%. Whilst both resellers were retained, more than 80% of the business now flows through one of these vendors.
On top of this and because of the direct relationship and Global Account status now in place with HP, ODESMA created a further 14% reduction on the base price costs for their productsThis status has also meant that imaging costs have been reduced and aligned globally, as well as the introduction of asset tagging.