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.
Following a two and a half year selection process, our client was just about to conclude a contract on a significant investment in a new, industry leading Site Performance Management (SPM) system. This was part of a project to improve engine performance and reduce fuel consumption by 1% globally.
This would also help to significantly reduce the number of site maintenance visits by:
- Monitoring and optimising equipment performance.
- Creating alerts and diagnostics of any failures.
- Creating alerts for parts that were about to fail.
- Creating a culture of preventative, not consequential maintenance.
- Minimising any potential downtime on client sites.
The project had been led by the engineering function of the organisation, ensuring that technically it delivered everything they needed (and more).
Identifying the scale of the risk involved in this SPM investment – technical, financial, contractual and operational, and to quickly add value to the negotiated contract.
Working closely with the two engineering project leads, the category specialist held a number of workshops to understand all of the components of the project including the specification, the purchase of the capital equipment, installation, on-going maintenance and the planning and execution of a programme of Alpha and Beta pilot projects before full deployment.
Tough questions were asked both internally and with the preferred supplier– what/ how/ do we need/ can we substitute/ would this suffice/ can we eliminate/ do we accept? As a result, some changes were made to the specification, but more importantly, a renegotiation of the costings and terms commenced for:
- The trial Alpha (large) and Beta (smaller) sites – capex with smaller opex.
- A framework for roll out on successful completion of these across the organisation – opex with smaller capex.
The engineers leading the project welcomed the commercial rigour and support provided by the Odesma category lead at these final stages of the project.
- Enhanced payment terms were negotiated with the supplier.
- Less risk and an optimised position for the client in the contract was ensured – e.g. they could now cancel the project at any time in the process.
- The knowledge, expertise and techniques used in the negotiations were shared with the client team to build up internal capacity and competence that could be used in future negotiations of this nature.