Joint Purchasing Project
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Joint Purchasing Project
DCCVA UpdateWednesday, November 29, 2012
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Agenda
1. Overview of Our Process2. Executive Summary
0. Who Else Is Doing This?I. Joint Purchasing Structure and ProcessII. Purchasing Policy
3. Next Steps4. What We Need From You
Track, Update, and Provide Status
q u a l i t y i m p r o v e m e n t m e t h o d o l o g y
Measure
2Analyze
3Improve
4Control
5Improvement
Project Implemented
Define
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2.0 MEASUREHow big is the current
problem?How often, when, how
many, etc?
0.0 ORGANIZE TEAMWhat’s the high-level
problem, goals, and objectives?
Who’s should be on the team?
Meeting Logistics
3.0 ANALYZEWhy is the problem
happening?How do you know?
4.0 IMPROVEDevelop SolutionsRedesign ProcessDevelop
RecommendationsApprovalImplement
Organize Team0
ProposedProject
1.0 DEFINE What’s the problem? Who’s the customer? What do they need?
5.0 CONTROLHow will you make
sure it will stick?
Improvement Approach
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Executive Summary
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II. STANDARDIZE PURCHASING POLICIESA. Standard languageB. Standard expenditure levelsC. Standard statement regarding Cooperative Purchase
AgreementsD. Language that you don’t need separate quotes and bidsE. Designated lead / representative to Opt In / OutF. Local Vendor Preference Policy
Joint Purchasing RecommendationsWe seek to establish for Dane County cities and villages a centralized purchasing system that effectively and efficiently directs the available resources
III. SET-UP SUCCESS MEASURES AND REPORTINGBy Item:
A. Last 3 year $ spendB. Primary ContactC. Interest in Cooperative BuyD. Specifications / Special RequirementsE. $ SavingsF. “Money Left on the Table” Report
0. RESEARCH WHO ELSE IS DOING THIS? State UW City of Madison Other Purchasing Groups
I. DEVELOP PURCHASING PROCESS & STRUCTUREA. Sponsor Organization, Steering Committee, Purchasing Core TeamB. Determine Primary Contacts / OwnersC. Develop Guidelines / FrameworkD. Define ProcessE. Oversee Quarterly Purchases
Who Else Is Doing This?What specific organizations are involved in the purchasing process?
1. State DOA – Vendornet2. Value4gov.org – Southeast Wisconsin Collaborative Purchasing Group3. UW Madison System – Material Distribution Service4. City of Madison5. Monona, Verona, Middleton – Records6. Monona & Verona – Shared inspector7. Dane County – we all buy salt8. Group of Municipalities in Milwaukee – Purchase Card Program9. School Systems?10. Federal – only when it’s Federal grant11. Services with Dane County12. DaneCom – buying communications system together13. WAPP – Wisconsin Association of Public Purchasers14. Case Studies
• 13 Counties did joint purchase of ballot bags• Eau Claire and Eau Clare have joint purchasing manager position
State Purchasing Program
State Purchasing Program
Example
State Purchasing Program
Example
Fuel Example
Unl87 Mid 89Madison $3.008 $3.115
State Purchasing Program
Value4gov.org
Value4gov.org
Joint Purchasing Team Structure
Joint Purchasing Core Team
Pat Marsh
Business OwnerTeam Lead
Bob Miller
Executive Sponsor
Dane County City and Villages Association
Project Sponsor
Region 5 Greater WICity Managers Association
Steering Committee
Bill Burns
Verona City Manager
Matt Giese
Cottage Grove Village
Administrator
Mike Davis
MiddletonCity Administrator
Nick Probst
StoughtonClerk / Per.
DirectorMonette McGuire
City of MadisonPurchasing
Services
The Business Owner has ultimate responsibility for the overall business success of the project (processes and systems). Owns business decisions throughout the project, ensures that stakeholders are appropriately engaged, and that the project results meets the needs of the business. Has ongoing ownership of the project deliverables/results
The Executive Sponsor ensures alignment with organizational strategies and provides high level direction to the project. Has ultimate authority over the project and is responsible to the business for its success. The Executive Sponsor secures project funding, resolves issues and risks at the executive level, and is a champion of the project across the organization.
Steering CommitteeRegion 5: Pat Marsh, City Administrator, Monona - Coordinator Counties of: Dane, Crawford, Columbia, Grant, Green, Sauk, Richland, Iowa, Lafayette. Provides overall direction and feedback on team’s recommendations. Help to execute in their city / village.
Stephen Bechler
MiddletonIntern
Walter Jankowski
FacilitatorReinvention, LLC
Brian Chapman
Co-FacilitatorCity of Oshkosh
Pam Hoffman
Co-FacilitatorState of Wisconsin
Liz Menzer
Co-Sponsor and SupportWCPE
Gary Becker
Co-Sponsor and Support
Each DCCVA Member
Project Champion
The Project Champion is the point person for the Joint Purchasing team. They ensure the appropriate people in their organization is aware / involved in the team’s efforts.
Problem StatementIn one sentence, what’s the problem?The cities and villages of Dane County have not taken advantage of market competition opportunities available through joint purchasing.
Project VisionSo, what is the desired future state or vision?We seek to establish for Dane County cities and villages a centralized purchasing system that effectively and efficiently directs the available resources.
Joint Purchasing Project 14
1.0 Define
Project Definitions
1.0 Define Project Charter: Joint Purchasing
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TeamExecutive Sponsor Mayor Bob Miller – MononaTeam Lead/Bus. Owner Pat Marsh - MononaTeam Members Bill Burns, M Davis, M Giese, N Probst, Stephen Bechler,
Monette McguireOther Res: B Chapman, L Menzer, W Jankowski, G Becker
ProjectProblem Statement
The cities and villages of Dane County have not taken advantage of market competition opportunities available through joint purchasing.
Project Mission & Vision
We seek to establish for Dane County cities and villages a centralized purchasing system that effectively and efficiently directs the available resources
Project Goals
Develop joint purchasing structure including scope, process, and methodology for a joint purchasing program among DCCVA members
Reduce the overall $ spent by participating communities on selected purchase items
Document actual savings Create an easy, “opt-in” joint purchasing program that leverages the
purchasing power of several communities Increase the cooperation among DCCVA members for joint benefit
Benefits / Business CaseReduce Expenses
• We will collect data but we anticipate significant savings
Work Packages Upcoming Tasks Define Scope of Potential Products / Services Research Best Practices and Who’s Done This Before Data Gathering / Finance Team: How much has been spent, track savings Process: Define Program Structure, Process, Policy and Procedures,
Guidelines / Ground Rules Technology: How can we make this easy, on-line for purchasers and vendors Communication / Training / Marketing
Form Steering Committee - Set-up Meeting Logistics Plan and Execute First Meetings Start Collecting Data Start Researching existing purchasing processes and Programs
TimeframeStart Date October, 2012Presentation to Sponsors December, 2012Solution Delivered Jan-Feb, 2013Estimated Costs / ResourcesTeam Member Time 4 hours / week - 6 weeksFacilitator 60 hours – FREE for 1st ProjectMisc. Expenses $500Approach• Focus on execution and follow the 80/20 rule• Perform projects like “Kaizen” events (short duration)• Challenge the status quo • Collaboration across all communities• Avoid complexity--keep it smart and simple• Follow formal, proven methodologiesRisk & Dependencies• Consensus / agreement by all government entities on
approach and program• Approval by local elected officials• Adoption by core number of members• Communities wanting to “buy local” only
Pam
Guidelines / FrameworkWhat are the fundamental guidelines / framework of the program? 1. Opt in / Opt out2. When opting in – you are committing to purchasing from contract3. Guideline: If an organization “opts out” purchase should be with 5% of joint
purchasing contract4. Price structure will be based on volume5. We will leverage existing processes and technologies when it makes sense6. Quarterly Municipal Purchasing Organization (MPO) Meetings
• What do we purchase together this quarter?• Assign lead agency – they take a % for administering contract (if
applicable)• Defined communication structure
Joint Purchasing Project 16
Joint Purchasing Program Structure
Joint Purchasing ProcessHigh-Level Process for Purchasing Common Items
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Track, Update, and Provide Status
j o i n t p u r c h a s i n g p r o c e s s
Gather Specifications
and Data
Research Existing
Contracts
Compile Best Deals, Options,
& Recomm.
Communicate to Partners
Joint purchase
Commit & Purchase /
Contract
Identify Potential
Purchase Items
1
Joint Purchasing Opportunities
2 3 4 5 6
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3.0 RESEARCH EXISTING CONTRACTS
State ContractsValue4gov.orgCity of MadisonOther
1.0 IDENTIFY POTENTIAL PURCHASE ITEMS
Select high-gain commodity items
Assign item lead on team
4.0 COMPILE BEST DEALS, OPTIONS, & RECOMM.
What are the best prices
Spec. optionsRecommendations
5.0 COMMUNICATE TO PARTNERS
Communicate to all buyers
RecommendationsWhen decision is dueNext purchase items
and date
2.0 GATHER SPECIFICATIONS AND DATA
For each Item: Identify key
purchasing lead / contact
Last 3 year $ Spend Special requirements Are you interested?
6.0 COMMIT & PURCHASE / CONTRACT
Each community commits go/no go decision
Make purchase
7.0 TRACK, UPDATE, AND PROVIDE STATUSBy CommunityParticipation Rate$ Savings$ “Left on the Table”
Draft
Potential Product Purchase Items
Joint Purchasing Project 18
Product Assigned To Comments
1 Fuel Stephen Middleton has in place a card vendor system – has state contractNeed to address bulk purchase (have tank) or non-tank options
2 Paper / Office Supplies Pam Existing State contract
3 Computers / Software Brian4 Asphalt Crack Filling / Seal Coating Stephen5 Fleet Vehicles Pam6 Lights / LED Lighting Brian7 Forestry / Trees Pam8 Street Signs Stephen Madison has own sign shop – can we sub-contract?
9 Solar Panels Later
10 Lawn Mowers Second quarter
DEPARTMENT SPECIFIC11 Emergency Radios DANECOM radios need to be purchased by June, 2013 – already group
purchase
12 Fire Equipment?
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NEED TO FIGURE OUT BULK PURCHASE OR DELIVERED
Brian
Potential Service Purchase Items
Joint Purchasing Project 19
Service Assigned To Comments
1 HR 4 communities already interested
2 IT Can we “tap into” City of Madison IT services?
3 Building Inspections Monona and McFarland already sharing inspector
4 Assessor
5 Printing
6 Cleaning
7 Building Maintenance
8 Street Painting
9 1011121314
Standardize Policies1. Develop recommended
standard policy language2. Standard statement regarding
Cooperative Purchase Agreements
3. Recommend standard expenditure levels that are compliant with State statutes
4. Include “if you buy from consortium” you don’t need separate quotes and bids
5. Designated lead / representative to Opt In / Out
6. Local Vendor Preference Policy (if opt out – local vendor must be within 5% of recommended cost)
Next Steps and Timeline
Joint Purchasing Project21
Task / Activity Who When
1 Joint Purchasing Team Meeting• Presentations by State, UW, and Madison
Available ItemsProcess for Purchasing / Joining Contracts
• Update on Research Items• Review Proposed Survey to DCCVA Members
Joint Purchasing Team Dec 10
2 Joint Purchasing Team Meeting• Finalize Survey• Review of Recommendations• Select final purchase items
Joint Purchasing Team Dec 19
3 Send Out Survey Joint Purchasing Team to DCCVA Project Champion
3rd Week of Dec
4 Surveys Completed and Due Purchasing Contacts 2nd Week of Jan
5 FIRST PURCHASE COMMUNICATION Joint Purchasing Team to Purchasing Contacts
3rd week of Jan
6 FIRST QUARTER PURCHASE / CONTRACT Joint Purchasing Team to Purchasing Contacts
Feb
7 FIRST QUARTER REPORT• Participation• $ Savings• Money “Left on the Table”
Joint Purchasing Team to DCCVA Project Champion
End of March
8 SECOND QUARTER PURCHASE COMMUNICATION Joint Purchasing Team April
Draft
What We Need From You
1. Your Feedback2. Support Our Efforts
– As Project Champion, YOU will get initial e-mail
3. Assign Primary Purchasing Contact in Your City / Village– Could be you– Coordinates filling out specific item survey– Coordinates Go / No Go decisions
4. Assign Primary Contact for Each Item5. Timely Responses from Everyone6. Participate!7. Again, Your Feedback
QUESTIONS
DCCVA UpdateWednesday, November 29, 2012
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