Managing procurement to improve front line services

Managing procurement to improve front-line servicesA guide for senior college managers

Managing procurement to improve front-line servicesThis guide is aimed at senior college managers

June 2008

Leading learning and skills

Step 1 A strong lead – getting the right people on board

l Make procurement a priority. Governors and senior managers need to actively engage and push it up the college agenda.

l Identify a procurement champion.

l Appoint a procurement liaison officer. Ensure he or she has support from senior management and gains the appropriate training and skills.

l Establish a procurement board comprising the procurement champion and the owners of significant budgets.

l Connect with the LSC FE Procurement Development Team. Visit www.felp.ac.uk or email [email protected] for help and advice on a wide range of procurement and procurement-related issues.

Step 2 Getting a clear picture – information gathering

l Audit and review existing procurement processes and procedures.

l Conduct a spend analysis, using an external specialist if necessary, and transform data into management information.

l Identify the key risks to which the college is exposed.

l Examine supplier relationships and ensure the college’s terms and conditions have been adopted.

l Explore any other procurement weaknesses.

l Prioritise procurement actions with ‘quick wins’ and medium and longer term plans.

Step 3 Putting structures in place – managing procurement

l Establish the college’s procurement vision and key objectives.

l Create a procurement strategy that will achieve the vision and objectives, which best suit the college.

l Set targets for improving procurement efficiencies. Report progress at procurement board meetings.

l Set up a procurement network.

l Establish the college’s position on key issues around procurement and create policies to support them. These should be signed off by the board.

l Ensure all staff with authority to procure goods and services are aware of the college’s procedures and processes, and that they comply with legal requirements.

l Set up and maintain a procurement site on the college’s intranet.

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http://www.felp.ac.uk

mailto:[email protected]

Step 5 Measuring, reviewing, improving

l Have the necessary competencies for procurement staff been identified?

l Are procurement staff aware that NVQs and other training are available?

l Find out what your regional procurement network offers in terms of training and knowledge sharing.

l Measure the overall value for money the college is achieving from procurement. Record improvements and report them internally and externally.

l Gather data on supplier performance.

l Compare supplier performance using data from internal audits and benchmarking information from other colleges and organisations of a similar size.

l Communicate with colleagues in your college, in institutions with which you collaborate, suppliers, consortia and the LSC FE Procurement Development Team.

Step 4 Into action – taking steps to improve efficiencies

l Decide which categories and sub-categories would be suitable for procurement through consortia or another contracting body.

l Research the different consortia and contracting bodies and decide which would fit the college’s requirements and offer the best value for money.

l Ascertain which goods/services you could buy in collaboration with other colleges and public sector organisations based on either geographical – local, regional or national – needs or areas of specialisation.

l Investigate suitable procurement ‘partners’ or framework agreements.

l Draw up a collaboration agreement and set out the terms and conditions with your collaboration partner.

l Decide which procurement methods will maximise efficiency and value for money for particular categories. Consider e-procurement and GPCs, tenders and mini tenders.

l Communicate procurement processes and methods to budget holders.

routemap

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Part 1 Procurement management: the time is right 1Using this guide 3

Part 2 Moving procurement up the agenda 4

Step 1 A strong lead – getting the right people on board 5

Find a procurement champion 7Appoint a procurement liaison officer 7Establish a procurement board 7Seek external help 8

Step 2 Getting a clear picture – information gathering 9

Audit and review existing practices 11Conduct a spend analysis 11Review or establish a contracts register 12Conduct a risk analysis 12

Step 3 Putting structures in place – managing procurement 13

Create a vision 15Set a strategy 15Establish policies 15Reduce risk 16Create a procurement network 17

Step 4 Into action – taking steps to improve efficiencies 21

Buy through consortia and contracting bodies 23Use framework agreements 23Join forces with others 24Make good use of benchmarking 24Procuring one-off, high value items 24HR, ICT, catering and facilities management 26Total cost of ownership 26Put procurement processes in place 26Agree procurement methods 27

Step 5 Measuring, reviewing, improving 29

Build knowledge and develop skills 31Monitor and evaluate progress 31Review efficiencies and value for money 31Manage suppliers 32

Part 3 More information 34Consortia and contracting bodies 35Glossary of terms 36

Contents

1 Managing procurement to improve front-line services

Part 1

Procurement management: the time is rightIn 2004 the Gershon Efficiency Review proposed that colleges which manage their procurement more effectively could each save tens, scores or even hundreds of thousands of pounds every year.

Indeed, the more prepared a college is to introduce procurement good practice the more it stands to save – releasing funds that could make a significant difference to front-line services.

What then, in real terms, could better-managed procurement mean for your college?

l It will deliver better value for money, which releases funds to invest in new facilities, attracting more learners and employers, and improving staff morale and retention.

l It will reduce exposure to risk.l It will help to improve supplier performance.l It will reduce the costs (time and effort) of doing paperwork and administration. l It will help colleges to make a greater contribution towards achieving the

government’s goals of upskilling the nation, as set out in the Leitch Review, and Raising Expectations: Staying in Education and Training post -16.

A world leader in skillsThe Leitch Review World Class Skills, published in 2006, sets challenging targets for 2011 and explains the crucial role colleges are playing in the drive to make the UK a world leader in skills by 2020, while Raising Expectations: Staying in Education and Training post -16 exhorts the education sector to keep all young people engaged with education until at least the age of 18. Improving procurement efficiencies can play a major part in achieving the reforms needed to reach these goals: better front-line services lead to more motivated and skilled learners, a more competitive workforce and increasingly satisfied employers.

Finding new and innovative ways of operating and managing business will be essential if the further education system is to play its part in meeting the ambitious goals set out in World Class Skills. As we move towards a more specialised and demand-led system it will be more important than ever for further education colleges and providers to maximise the resources available to them and to ensure all learners and employers have access to relevant, high quality provision that meets their needs.

Managing procurement to improve front-line services 2

“The task facing colleges requires a clever balancing act between the need to think commercially when managing and developing resources, while retaining the public service ethos that has served them so well. Good procurement is not only about effectively managing resources; other considerations include sustainability, the local economy, ethical working practices and meeting legal obligations. By giving procurement the attention it deserves, colleges will be better able to fulfil their vision and meet the needs of their community.”

Mark Haysom Chief Executive Officer Learning and Skills Council

“In the last few years the LSC has worked very closely with the Department to establish a small dedicated team to help colleges engage with procurement and find strategic solutions to commercial imperatives. This has helped to ensure that colleges make the most of procurement-related work to achieve best value for money and channel funds into improving front-line services. Our commitment to supporting this important work remains very strong.”

David Russell Director of Finance and Resources Learning and Skills Council

“Good procurement helps colleges make the most of their budgets by enabling them to focus on the effective and efficient management of all their resources, not just money. It contributes to achieving strategic objectives such as supporting the local economy, sustainability and corporate social responsibility. It is a way of thinking and working that helps colleges to respond to increasing demands on finite resources. It may not be a cure for all ills but it could make the difference between success and failure.”

Ian Taylor Commercial Director Department of Children Schools and Families, Past President of CIPS

Part 1


Using this guideThis guide is intended to help colleges set up an easy to maintain approach to procurement that will enable them to procure more effectively and achieve better value for money. It does not include a detailed explanation of procurement practices.1

Depending on how advanced your college’s procurement management is and whether you want to take small steps over time or to implement a more significant change, this booklet can be used as a routemap for making major improvements or for guidance on specific aspects of procurement management. Details of good practice, case studies and where more information can be found are included. The FELP – Further Education Library of Procurement – website is particularly useful and can be found at www.felp.ac.uk.

This document draws on the work of the Learning and Skills Council (LSC) FE Procurement Development Team and the recommendations outlined in the National Audit Office2 and Public Accounts Committee3 reports that were published in 2006 and 2007 respectively to help the FE sector strengthen and develop its management of procurement.

Below is the outline ‘routemap’ diagram showing the various stages of procurement management, see inside the front cover for the complete version.

1 To find out about procurement processes, procedures and policies, go to www.felp.ac.uk 2 Improving procurement in further education colleges in England, Report by the comptroller

and auditor general, HC1632 Session 2005–2006, 25 October 2006, National Audit Office. 3 House of Commons, Committee of Public Accounts, Improving procurement in further education

colleges in England, Forty-first Report of Session 2006–2007, 4 October 2007.

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Part 2

Moving procurement up the agendaEvery college needs to source and purchase a common range of goods and services such as maintenance services, utilities, IT, stationery and catering supplies. And all are faced with making commercial decisions around which services should be delivered using college staff and which should be contracted out.

Each college has its own way of managing procurement – some are already using best practice methods such as consortia and e-procurement, while others are still relying on more traditional methods.

While establishing a procurement management structure can require an initial investment of time and money, it can be a relatively straightforward process that builds in complexity over time. Small changes, such as directing some procurement through a consortium, can quickly deliver major benefits and cost savings.

The ultimate procurement goal is to help students achieve more as they benefit from enhanced quality, services and facilities as a direct result of colleges actively managing their spending and reducing their exposure to risk.

Improving procurement in Further Education Colleges in England identifies five key steps for improving procurement efficiencies:1 A clear lead from governors and senior managers.2 Information that will inform decisions on appropriate procurement methods.3 Making the most of opportunities for collaboration.4 Robust processes and good supplier management.5 Review of the value for money of procurement.

Part 2


Getting the right people behind procurement management is crucial. Bringing together a group of senior individuals who will provide a strong lead in procurement will help to ensure success.

Governors can also play an important role by drawing on their business experience and challenging managers on their spending and planning.


Step 1A strong lead

getting the right people on board

Find a procurement championAppoint a procurement liaison officer

Establish a procurement boardSeek external help


Find a procurement championIdentify a member of the senior management team such as the finance director, the director of estates or director of resources to be the college’s procurement champion. This senior manager needs to commit to taking responsibility for procurement by supporting and driving through new initiatives, as well as working closely with employees involved in the procurement process. He or she may well represent the college externally by, for example, attending procurement network meetings.

Appoint a procurement liaison officerColleges that do not have a specialist procurement member of staff will need a procurement liaison officer (PLO). This individual needs to be formally appointed to the role and to be given the time to support the procurement champion, even if it is only one of their responsibilities. In addition to being interested in procurement and having good influencing skills, the PLO will require the backing and support of the procurement champion and the senior management team. His or her duties will include:l Providing support to the champion.l Co-ordinating the management of procurement across the college; collecting

and organising information as necessary.l Drawing on expert advice from in-house or external specialists.l Developing their procurement skills and knowledge through training, NVQ

accreditation and CPD.l Acting as the link between college budget holders and purchasers and the LSC

to ensure advice and guidance are correctly disseminated and that good ‘deals’ are passed on to the right people.

Establish a procurement boardMany colleges have a procurement board4, which can be an informal forum. The point is to establish a group of senior people who are committed to improving procurement and play a key role in developing the procurement strategy, policies, procedures and processes.

The board should comprise the procurement champion, and faculty heads and senior individuals who hold substantial budgets and are responsible for areas of spend such as IT, catering and estate management. Some colleges invite representatives from colleges they collaborate with to board meetings or sub-groups.

The decisions made by the board are disseminated throughout the college via a procurement network (see pages 19–20) which facilitates the free flow of information to aid future decision-making at all levels.

4 Also known as efficiency boards or value-for-money boards.

Need more information?To find out more about PLO job descriptions and the NVQ in procurement and supply chain management visit www.felp.ac.uk

In practiceWhen David Grocock, Vice Principal Finance and Business Operations, joined Leicester College, one of his first moves was to establish a ‘value-for-money’ group, which he chairs. The group comprises the college’s major budget holders and is responsible for overseeing the implementation of the procurement strategy, which means ensuring the college achieves value for money for every pound spent.



Seek external supportThe LSC has a small team of procurement professionals who work directly with colleges providing advice on how to make savings and improve efficiencies.

In addition to this specific support for colleges there is a whole range of support available from bodies such as the OGC and OGCbuying.solutions, to the Chartered Institute of Purchasing and Supply (CIPS).

1 A strong lead

Step 1 Action points

l Make procurement a priority. Governors and senior managers need to actively engage and push it up the college agenda.

l Identify a procurement champion.

l Appoint a procurement liaison officer. Ensure he or she has support from senior management and gains the appropriate training and skills.

l Establish a procurement board comprising the procurement champion and the owners of significant budgets.

l Connect with the LSC FE Procurement Development Team. Visit www.felp.ac.uk or email [email protected] for help and advice on a wide range of procurement and procurement-related issues.




To finalise the procurement governance structure and strategy it is necessary to know exactly how procurement is currently being conducted and what opportunities for improvement exist.

This will involve an information-gathering process that will inform future procurement decisions. It will also help you to decide what information will be needed for the procurement board to monitor procurement activity effectively.


Step 2Getting a clear picture

information gathering

Audit and review existing practicesConduct a spend analysis

Review or establish a contracts registerConduct a risk analysis


Audit and review existing practicesAuditing and reviewing existing financial regulations and procedures and processes related to expenditure is critical. The procurement board needs to address the following questions (FELP has more information):l Are the college’s rules governing procurement expenditure ‘fit for purpose’?l Do existing processes and procedures encourage and support good procurement

practice, such as using consortia and government procurement cards? (GPCs)l Do the existing processes encourage procurement staff to monitor and review what

is being bought, spotting trends and anomalies to identify opportunities and manage risks better?

Conduct a spend analysisA spend analysis enables colleges to ascertain what they are buying, how much they are spending with suppliers and the number of transactions being processed. This delivers a number of benefits:l It improves management information.l It allows the identification of expenditure patterns as well as suppliers and prices

for basic high-volume, low-cost items such as fuel, catering and stationery.l It helps colleges prioritise procurement tasks to maximise opportunities for savings

and efficiencies.

The spend analysis can be analysed in terms of ‘categories’ – a collection of related goods and services such as IT – and sub-categories which, in this case, would include laptops, scanners, consumables and printers.

A spend analysis helps identify the top suppliers together with areas of procurement that are weak, inefficient, costly and which do not conform to the agreed use of contracts.

A spend analysis involves looking at:l The number and range of suppliers used.l The number of transactions the college conducts.l Spends for individual categories and sub-categories.l Procurement methods.

Once the spend analysis is complete a plan for each category of spend can be developed before selecting the appropriate sourcing and procurement model, such as a consortium. Analysing expenditure by type, value and procurement method leads to a clearer understanding of how to reduce prices and transaction costs most effectively.

This information can be refined and developed on an ongoing basis to obtain the best possible quality management information. A spend analysis becomes a useful tool for managing suppliers through reviewing their performance against data provided in-house or by consortia or external benchmarks.

In practice“In 2006 I helped Hartpury College to do a spend analysis. The results motivated them to take on a full-time procurement officer, especially when they realised the significance of the aggregated amounts of particular commodities.”

Helen Baker Head of Procurement, University of West England

“I analysed all spending over a 12-month period. Then, working with the Crescent Purchasing Consortium supplier list, I got quotes from three new suppliers plus the existing suppliers for the top thirty items in each budget area. What surprised me was the extent to which some of our existing suppliers reduced their prices simply as a result of being placed in a genuinely competitive environment. It really shocked them out of their complacency.”

Elizabeth Smith Procurement Liaison Officer, Leeds College of Building

Need more information?The LSC FE Procurement Development team published the Management Guide – How to manage influenceable spend within FE colleges in 2006 to help colleges conduct a spend analysis. The guide can be found at www.felp.ac.uk



If you do not feel you have the right expertise in-house, ask an external specialist to conduct the initial spend analysis for you. A number of companies offer this service, which involves taking data from a college finance system and re-presenting it in a format that allows it to be manipulated and analysed. For further information on suppliers contact the LSC FE Procurement Development Team.

Review or establish a contracts registerA contracts register provides easy access to relevant contract information and can help you plan procurement activity by, for example, putting in place a new contract (if necessary) before the current one finishes. A contracts register includes the following information:l What the contract is for.l Contract manager’s name.l Supplier name.l Start and finish dates of the contract.l At what intervals the contract is to be reviewed.l Value of the contract (sometimes known, sometimes an estimate).

Conduct a risk analysisA key priority for every college is to ensure it is exposed to as little risk as possible. A clear view of the risks and any potential consequences that could arise from procurement malpractice is essential. Financial and legal risks will almost certainly be high if: l Large numbers of untrained staff are authorised to make purchases and negotiate

contracts.l Procurement processes are not compliant with EU public procurement regulations.l The college does not have an established process for dealing with contracts if,

for example: procurement contracts are verbal; it does not operate an electronic purchasing order system; and supplier relationships are based on their terms and conditions rather than

those of the college.

Need more information?A full list of spend categories and sub-categories can be found in Improving Procurement in Further Education Colleges in England, Appendix Five, page 36.

Go to www.nao.org.uk/publications/nao_reports/05-06/05061632.pdf

2 Getting a clear picture


l Audit and review existing procurement processes and procedures.

l Conduct a spend analysis, using an external specialist if necessary, and transform data into management information.

l Identify the key risks to which the college is exposed.

l Examine supplier relationships and ensure the college’s terms and conditions have been adopted.

l Explore any other procurement weaknesses.

l Prioritise procurement actions with ‘quick wins’ and medium and longer term plans.

www.nao.org.uk/publications/nao_reports/05-06/05061632.pdf




Backed by the right people and the necessary information, a procurement strategy can be formulated to ensure compliance and mitigate risk.

Simultaneously, the college procurement champion can establish a procurement network which allows for a two-way flow of information between the board and the departmental lead buyers.

Step 3Putting structures in place

managing procurement


Step 3Putting structures in place

managing procurement

Create a visionSet a strategy

Establish policiesReduce risk

Create a procurement network


Create a visionBefore setting the strategy, establish the procurement vision. Is the college’s aim solely to achieve value for money? Or are there broader objectives such as supporting the local economy, developing partnerships with the local business community and contributing to the sustainability agenda?

Set a strategyThe procurement champion is responsible for the strategy. He or she should consult with as many procurement stakeholders as possible and may want to take soundings from other procurement champions in colleges you collaborate with to gain an idea of the issues they face, good practice and to identify further procurement opportunities. A number of elements are involved in setting a strategy:l Drawing on the information provided by the spend analysis and determining how

each category is best purchased.l Establishing policies (see below).l Establishing the procedures and processes for managing procurement activity,

including implementing thresholds that trigger the use of a particular procedure or process such as a competitive tender or GPCs (see page 27). These must also ensure that a college complies with UK and EU procurement legislation.

l Ensuring finance regulations are up to date and support modern procurement methods, and that the college’s spend thresholds and procurement processes are fit for purpose. For example:

are spend thresholds achieving what is necessary? is the approval of the procurement board required above certain thresholds? which purchases and values of spend should be made through a GPC? at what thresholds of spend are a full tender or a mini competition required? when and for which products and services should consortia and contracting

bodies be used?l Setting targets for improving procurement efficiencies.l Developing a method for measuring value for money and efficiencies against targets

(see page 31 for more about the EMM).l Creating a sustainable and effective management information system to support

procedures and check compliance.l Including large scale activities that involve procurement – such as construction,

refurbishment, IT replacement.l Using the contracts register to plan procurement activity.l Ensuring the procurement board agrees the strategy.

Establish policiesProcurement management in every college is driven by a single overarching policy: to achieve the best value for money while minimising risk. The following normally need to be clarified by a policy which should always be signed off by the procurement board:l Areas of responsibility for governors, the principal, the procurement champion,

director of finance, procurement liaison officer, budget holders and general staff.

Need more information?A template for a procurement strategy and guidance can be found at www.felp.ac.uk

In practice“A review of the strategic options for procurement was undertaken between 2003 and 2004. This considered purchasing cards, e-procurement, partnership with De Montfort University, consortia arrangements and the use of consultants. The review resulted in a programme to introduce purchasing cards and sanctioning the use of consortia.”

David Grocock Vice Principal Finance and Business Operations, Leicester College

Need more information?Go to www.felp.ac.uk for more information about the following:

l Policy information and templates

l Sustainability policy guidancel Information on using local

suppliers

Guidance on ethical business practice can be found at: www.cips.org/documents/Ethical_Business_Practices.pdf

www.cips.org/documents/Ethical_Business_Practices.pdf

www.cips.org/documents/Ethical_Business_Practices.pdf




l Value for money, quality and service agreements, risk management.l Ethical standards such as how to deal with gifts from suppliers, taking

into account the CIPS code of conduct.l Sustainability – for example, stationery and energy efficiencies.l How and when to use small businesses and local suppliers to support

the local economy. l Use and management of approved suppliers – keep your supplier base

small and ensure new additions are carefully controlled.l Collaboration – the who, how and when of working with colleges and

other organisations.l Supplier relationships – covering, for example, payment terms and training

and apprenticeship arrangements.l Equal opportunities – ensuring all employees are treated equally and fairly.l Use of terms and conditions.

Reduce riskTerms and conditionsThe supply of any goods or services should always be based on the college’s terms and conditions, rather than those of the supplier. If you buy through a consortium or a framework agreement, the terms and conditions will already have been agreed.

CompliancePublic sector and EU requirements are strict and the consequences for not adhering to them can be severe.

If you are buying goods and services that cannot be bought through a consortium and whose value exceeds a certain threshold, appropriate suppliers must be invited to tender for the supply. From 1 January 2008, the threshold levels prescribed by the European Union Commission are £139,893 for supplies and services and £3,497,313 for works. These totals refer to the total value of a contract, so if the contract lasts three years and is worth £139,893 over the course of those three years the EU public sector tendering rules would have to be complied with.

Procurement legislation must be complied with in addition to other legal requirements. If college suppliers are in breach of legal requirements, for example relating to age or race discrimination, the college would be found guilty as well.

In practiceTo embed sound ethical, social and environmental policies within its procurement function, Leicester College’s value-for-money group maintains links with the college’s sustainability group. For example, by involving the sustainability group in a re-tender for waste management services, Leicester ensured the new deal would be environmentally sustainable as well as financially beneficial.

3 Putting structures in place

Need more information?You can find templates of terms and conditions at www.felp.ac.uk in the Sample Documentation section.

Need more information?To find out more about EU and other financial regulations, go to the Good Practice section at www.felp.ac.uk

More helpful reading can be found at:www.equalityhumanrights .com/en/forbusinessesand organisation/pages/default.aspx

www.ogc.gov.uk/documents/Social_Issues_in_Purchasing.pdf

www.equalityhumanrights.com/en/forbusinessesandorganisation/pages/default.aspx








Create a procurement networkA procurement network is one of the most successful ways of managing procurement. It allows purchasing at a decentralised level where each department has its own budget and a ‘lead buyer’ who is the departmental head of the network buying team and knowledgeable about the products and services being bought. Processes governing accountability, policy and practice are agreed by the procurement board and the procurement liaison officer can provide support and guidance about the right procurement approach from the centre.

Some colleges use a decentralised model when each department manages its own budget; however, local interests can be put before those of the college, spend is uncoordinated and too many untrained people can get involved in procurement. In the centralised model heads of department have to request procurement from a central point; this can be bureaucratic and result in long waits, bottlenecks and maverick buying.

The procurement network offers the best of both worlds – the departments deliver results while the procurement champion and PLO provide support – ensuring procurement is efficiently managed at every level.

The procurement network – benefitsl Demonstrates a clear commitment to procurement.l Helps to ensure that a consistent procurement message is delivered.l Sends the correct messages to staff and external colleagues.l Uses specialist product/service/market knowledge to best effect.l Up-skills key buyers.l Secures ‘buy-in’ from those who purchase.l Avoids fragmentation and creates leverage for best value.l Releases resources.l Delivers procurement management efficiencies.l Minimises risk.

The procurement network – who does whatThe procurement champion and procurement liaison officer work together to: l Co-ordinate the network – convening meetings, agendas, actions, contracts etc.l Provide leadership, focus and coaching through training and workshops.l Provide all terms and conditions, templates and tools.l Maintain the procurement section of the intranet and communicate with

network members.l Assist with all major purchases.l Disseminate management information.

In practiceSouth Nottingham College has been operating a procurement network for about three years.

Keith Gregory, financial controller, identified the need to centralise and standardise the purchase of a range of categories of spend which had previously been devolved to individual departments and curriculum areas. These included: stationery, IT, audio visual materials, books and paper.

In the area of IT, for example, the college benefits from having a standardised kit in every department. Savings are achieved through economies of scale and a maintenance contract is negotiated through a single supplier.

The network of buyers meets every four months to share best practice and discuss a range of procurement issues.


And, depending on requirements, they:l Forecast demand and whether suppliers and sometimes markets, such

as the construction industry, are able to meet it.l Develop the network to keep it relevant.l Run a risk management programme.l Represent the college externally.

The network buyers are departmental staff with authority to place orders and contracts. A lead buyer will execute the college’s procurement strategy with regards to a specific category, and will draw on the supplier and product knowledge of other buyers. He or she is also responsible for:l Promoting good deals to the staff who place the orders.l Facilitating training – e.g. ‘how to…’, ‘why we…’, or ‘get the most from…’.l Making sure the college gets the ‘best deal’.l Managing relationships with suppliers.l Providing feedback on supplier performance.l Working with buyers in other teams.

Other ways to organise a procurement network include:l By college department rather than spend category.l Through creating a hybrid model that combines departmental structures

and category management techniques for significant cross-cutting categories such as ICT, catering and books.

What matters is that a network of leads is established to gather and disseminate information throughout the college, working with the PLO to actively manage and co-ordinate procurement activity.



l Establish the college’s procurement vision and key objectives.

l Create a procurement strategy that will achieve the vision and objectives which best suit the college.

l Set targets for improving procurement efficiencies. Report progress at procurement board meetings.

l Set up a procurement network.

l Establish the college’s position on key issues around procurement and create policies to support them. These should be signed off by the board.

l Ensure all staff with authority to procure goods and services are aware of the college’s procedures and processes, and that they comply with legal requirements.

l Set up and maintain a procurement site on the college’s intranet.


A typical procurement network

Procurement board Champion, Director of Estates, Director of IT, other senior, major budget holders

Procurement liaison officer

Catering category Lead buyer

IT category Lead Buyer

Fresh food Sub-category

Laptops Sub-category

Kitchen equipment Sub-category

PCs Sub-category

Dried food Sub-category

IT consumables Sub-category

Frozen food Sub-category

IT perishables Sub-category

Procedures, strategy, policies

Feedback


Office category Lead buyer

Janitorial supplies category Lead Buyer

Office equipment Sub-category

Cleaning products Sub-category

Stationery Sub-category

Sanitary ware Sub-category

Office furniture Sub-category

Cleaning equipment Sub-category



The best way to achieve savings and to reduce the college’s administration is to buy through consortia or other bodies that set up contracts with suppliers.

If the right contract or framework is not in place, you can join forces with other organisations including colleges, schools and universities.


Step 4Into action

taking steps to improve efficiencies

Buy through consortia and contracting bodiesUse framework agreements

Join forces with othersMake good use of benchmarking

Procuring one-off, high value itemsHR, ICT, catering and facilities management

Total cost of ownershipPut procurement processes in place

Agree procurement methods


Buy through consortia and contracting bodiesProcurement consortia and other contracting bodies carry out collective purchasing on behalf of a number of different organisations. By leveraging their buying power they are able to deliver value for money, professional and cost-effective purchasing, and support services.

Many colleges buy from contracts that have been negotiated and are managed by consortia. The products and services are delivered to the college, which pays the suppliers directly.

By using a consortium or contracting body colleges stand to benefit from:l Better prices and quality.l Reduced duplication of time and effort.l Reduced transaction, administration and sourcing costs.l Access to procurement expertise.l Compliance with legislation and regulations.l Good management information.l Pre-agreed service and delivery conditions.

Using a consortium or a contracting bodyIn terms of volume, colleges should be able to buy most of their commonly and frequently bought items through consortia. These include routine categories of spend such as IT equipment, stationery and energy, together with many less frequently bought items, which involve significant spend exceeding EU public procurement thresholds.

As with any other supply source, you will need to review the consortia you use on a regular basis to ensure they continue to deliver value for money; the benchmarking exercises that the LSC team run will help you do this. A list of consortia and contracting bodies can be found on page 35.

Use framework agreementsMany consortia and contracting bodies such as OGCbuying.solutions negotiate and operate framework agreements which allow colleges to buy routine items and create contracts with suppliers within the terms of the agreement. These agreements can be used to ‘call off’ goods and services on a regular basis or as and when they are needed. The benefit is that the contract has been negotiated and pre-agreed by professionals, ready for college use. Other benefits include:l Better prices.l Flexibility – colleges are not committed to buy.l Reduced administrative costs.l Fosters long-term relationships with suppliers, leading to better service and value

for money.l Legal compliance assured.

In practice“One of the main attractions of using the insurance framework set up by the Crescent Purchasing Consortium is that it offers automatic compliance with EU tendering regulations. The result of our mini competition was that we stayed with our existing supplier but managed to save 13 per cent.”

Andrew Lefley Director of Facilities, Peterborough Regional College.

Need more information?To find out more about procurement consortia, visit www.felp.ac.uk

Need more information?To find out more about existing framework agreements contact your local consortium, contracting body or OGCbuying.solutions, an executive agency of the Office of Government Commerce.



If you cannot find a framework agreement that meets the college’s requirements, collaborate with other colleges or public sector organisations to create one. Some framework agreements use rankings that allow the top ranked supplier to be selected directly without a mini competition. All suppliers have to be included in the mini competition if the framework being used was put in place after 1 January 2006. More guidance can be found on FELP.

Join forces with othersIf a consortium is not available for specific items, find out if other colleges, schools, universities or local authority offices in your area have a similar need. Collaborating with other institutions can deliver major benefits: l Lower unit prices through ‘bulk buying’.l Lower transaction costs from sharing tasks such as ordering, negotiation and

design of specifications.l Improved quality as a result of better procurement expertise and processes.l Sharing expertise and market intelligence.

Your region will have its own LSC FE team facilitated procurement network which allows local colleges to share information, source items jointly and establish price and service benchmarks.

Make good use of benchmarkingBy benchmarking high value contracts against those of consortia, colleges can gauge whether they are receiving value for money and switch to the best contract if necessary. If a consortium does not offer better value, provide them with feedback so they can improve their offering.

The LSC FE Procurement Development Team conducts a national benchmarking exercise on some of the main commodity areas of college spend. Colleges can complete templates for certain commodities and the team benchmarks this data against nationally recognised best value framework agreements. The results are fed back to the college.

Procuring one-off, high value itemsColleges also procure one-off, high risk, high value items such as a new building or a strategic project. This would be handled by the head of the department concerned, with support from the procurement liaison officer to ensure both internal and external compliance.

If your college is embarking on such a project, talk to the LSC FE Procurement Team or raise it at the local regional procurement network meeting. It may be worth consulting other related establishments about either joining forces to achieve economies of scale or for advice on best practice.

In practiceHaving run a waste, refuse and recycling tender, Mike Pearce, Procurement Contracts Officer from the University of Exeter, set up a contract that would allow other universities and colleges to participate. The result of this collaboration has been a combined saving for all participating institutions of £1.9m over the lifetime of the two agreements.

“The new waste management contract has reduced our general spend by over 20 per cent.”

John Ward Procurement Officer, Cornwall College

Good practice tipAvoid setting up contracts and competing with consortia. If you feel you can improve on a consortium deal, let the LSC team know so they can gain the benefits for all.

Need more information?To find out about regional and national networks, email [email protected]

4 Into action

Need more information?To find out about the National Benchmarking exercise go to: www.felp.ac.uk




Advantages and potential sources of collaboration Source National Audit Office

Department for Children, Schools and Families

Department of Innovation, Universities and Skills

Learning and Skills Council

College

Guidance and advice

Operational expertise

Sustainability

Market intelligence

Economics of scale

SchoolsProfessional bodies

Office of Government Commerce

Chartered Institute of Purchasing and Supply

UniversitiesOther colleges


HR, ICT, catering, facilities managementProcurement is not just about how colleges manage buying commonly and frequently required goods and services, it is relevant to all commercial decisions. The decision whether to deliver a service such as HR, ICT support, catering and facilities management in-house using college staff or to contract it out is a procurement decision that involves a procurement ‘strategic options appraisal’.

A strategic options appraisal involves identifying and evaluating options that will deliver and meet the agreed specification. Once an option has been identified it may be necessary to run a tender.

Total cost of ownershipThe total cost of any goods or service is rarely the ‘label price’. The components of the ‘total’ cost are:l Environmental cost. l Specification cost. l Installation cost. l Running cost (consumables, energy and maintenance).l Disposal cost.

For a surprising number of purchases the ‘running costs’ can exceed all the other costs combined. Good procurement practice will help to ensure that the college takes into account the total cost. Go to www.felp.ac.uk for more information.

Put procurement processes in placeEven if you are doing most procurement through consortia, you will still make some purchases direct with suppliers and need to have robust processes in place. In addition to being aware of the various regulatory requirements, including EU public sector tendering rules (see page 16), you also need to ensure college policies are followed. These will probably include:l A competitive process that involves seeking three quotes and a full tender

for all orders over a certain amount.l Reviewing contracts on a regular basis.l Ensuring budget holders only purchase within the limits of their authority.l A list of approved suppliers (see Manage suppliers, page 32).

Also available to colleges are online systems for managing the tendering process; more information can be found on FELP.

In practice“We were already using localised consortia for some categories of goods and were not expecting to see much variance between what we were paying and the CPC and OGC deals. To my surprise we discovered we could make savings in six out of the eight categories we benchmarked. On our stationery contract for example we’ve managed to save 30 per cent by switching from our Local Authority deal to Lyreco.

“Over and above the savings we’ve accrued we’ve also experienced less tangible benefits. The exercise has helped to raise the profile of procurement in the college and given the finance team the confidence to challenge departmental budget holders. Where authorising purchase order requisitions was largely a bureaucratic exercise, we now have the confidence, and evidence, to challenge the choice of supplier.”

Frank Adams Dudley College

4 Into action



Agree procurement methodsThere are a number of different procurement methods. Each needs to be suited to the type, value and inherent risk of the products or services you are purchasing. All staff members involved in procurement should stay up to date with the uses, limitations, risks and techniques of these methods.

e-procurementIf you are currently using a system that is mainly paper-based, opting for e-procurement requires a wholesale change. This procurement method involves embedding an electronic system into every stage of the purchasing process across a wide range of contracts.

Installing an e-procurement system does require upfront investment. However, it can gradually be phased in and applied to different parts of the procurement cycle such as transactional or payment processes.

e-procurement – the benefitsl Improves efficiency and financial rigour – spend limits are imposed consistently

at departmental level.l Saves time – eliminates paper-based requisitions and duplicating data handling.l Faster order-to-delivery times – users know exactly where their request is in

the process.l Purchasers are automatically directed to approved suppliers, improving compliance

and reducing time sourcing items.l Greater price leverage.l Reduced costs of stationery, postage, copying and associated administration.l A more environmentally friendly way to procure.l High quality, detailed management information.

Government procurement cards (GPCs)GPCs are charge cards that authorised staff can use to make college purchases direct with a supplier. They are a relatively simple and cost-effective method of procurement that work best for purchasing low value items, such as books or small items of equipment, where the cost of processing the transaction is disproportionate to the cost of the item itself.

GPCs work much like a credit card, although the outstanding balance has to be paid in full each month. Each card has an individual transaction limit and a monthly expenditure limit, and it can only be used to purchase certain categories of goods and services.

GPCs – the benefitsl Budget holders can order directly with suppliers, without having to raise and

get approval of purchase orders.l Strengthen expenditure controls and reduce the risk of improper purchasing

and fraud.l Better access to online goods and services, resulting in better prices and deals. l Simplify the purchasing process and significantly reduce the number of low value,

paper-based transactions, and the associated time and costs processing them, resulting in better use of resources and reduced staff costs.

In practice“We didn’t have the time or the money to develop our own e-procurement system so we adopted the EGS Unity system for higher education. The advantages are time savings, reduced administration, no need to re-key data and management of supplier payments. What’s more, Unity interfaces directly with our core financial system from Symmetry. We estimate that this system is saving us 10 to 15 minutes for each transaction.”

Julie Grace Team leader of e-procurement, St Helen’s College.

“The hardest part [of implementing an e-procurement system] was getting the system up and running, deciding on the parameters, writing the manual, liaising with department heads and training designated purchase order placers and authorisers – but it was thoroughly worthwhile. We now have a much slicker method of managing purchase orders, authorisation and receipts across the organisation. Also, we have practically eliminated the time spent in finance contacting staff to clear invoices or order queries, and in dealing with supplier phone calls and issues.”

Angie Pilgrim Purchasing, Contracts and Compliance Manager, West Nottingham College

Need more information?To find out more about e-procurement and introducing GPCs into college, go to: www.felp.ac.uk; www.purchasingcard.info/esolutions.php; www.barclaycardbusiness.co.uk

www.felp.ac.uk

www.felp.ac.uk

www.purchasingcard.info/esolutions.php

www.purchasingcard.info/esolutions.php

www.barclaycardbusiness.co.uk


l Savings from reduced cheque payments and associated postage: prompt payment of suppliers, improving relationships; monthly statements and better management information that can

be linked to college systems, especially when supplier codes are used; less need for petty cash; and provides a clear audit trail with open and transparent procedures.

Once GPCs have been rolled out it may be possible to redefine some staff roles and responsibilities as tedious, time-consuming tasks will have been reduced or even eliminated.

National Audit Office reports have estimated that an average saving of £28 per transaction has been made by some central government departments that switched from paper-based purchasing to GPCs. 5

the

In practice“For me, GPCs made sense. Analysis of our expenditure showed a high percentage of high volume, low value transactions of the type appropriate for card payment. There was a growing demand for buying over the internet and I could see that GPCs were a quick win in terms of reducing workload, meeting colleagues’ needs and at the same time responding to the NAO report and the obligations it was placing on the sector…Feedback has been positive with the team reporting no operating issues and a definite time saving.”

Pat Eagle Stafford College

“A quick analysis of the college’s expenditure revealed that 80 per cent of the invoices we were receiving were for less than £250. Hours of staff time were being wasted chasing paper around the organisation. It was immediately apparent that there was a tremendous merit in adopting the cards. We brought Barclays in to talk to the appropriate staff, established some internal controls and then issued 15 cards to the principal buyers across the organisation. The ease of using the card, particularly purchasing over the phone and via the web, is encouraging everyone to seek out the best deals.”

Keith Gregory Financial controller, South Nottingham College

5 Improving procurement in further education colleges in England, 25 October 2006, National Audit Office, p. 18

4 Into action

Good practice tipEstablish a policy that ensures the procurement champion or a procurement liaison officer is always present at a supplier meeting when contracts are being discussed.


l Decide which categories and sub-categories would be suitable for procurement through consortia or another contracting body.

l Research the different consortia and contracting bodies and decide which would fit the college’s requirements and offer the best value for money.

l Ascertain which goods/services you could buy in collaboration with other colleges and public sector organisations based on either geographical – local, regional or national – needs or areas of specialisation.

l Investigate suitable procurement ‘partners’ or framework agreements.

l Draw up a collaboration agreement and set out the terms and conditions with your collaboration partner.

l Decide which procurement methods will maximise efficiency and value for money for particular categories. Consider e-procurement and GPCs, tenders and mini tenders.

l Communicate procurement processes and methods to budget holders.


Once a robust procurement strategy and processes are in place, ensuring they continue to meet your ongoing objectives is crucial. In addition to keeping staff up to date with new developments through training and developing their knowledge, the delivery of the strategy needs to be monitored and evaluated to ensure that it is being successfully implemented, and that its objectives including delivering value for money are achieved.


Step 5Measuring, reviewing,

improving

Build knowledge and develop skillsMonitor and evaluate progress

Review efficiencies and value for moneyManage suppliers


Build knowledge and develop skillsEffective procurement management requires constant knowledge development through training and learning best practice in areas such as negotiation, legal aspects of purchasing, ethics, e-sourcing, project purchasing, tools and techniques.

This makes the procurement process sustainable and continuous, enabling colleges to constantly make greater efficiencies and savings that benefit all parties over the long term.

In addition, LSC funding may be available for NVQs in Supply Chain Management at a level appropriate to the applicant’s job role. This is a work-based qualification that focuses on procurement competence, ability, knowledge and understanding. Having achieved Supply Chain Management NVQ Level 4, employees can apply for membership of the Chartered Institute of Purchasing & Supply.

Monitor and evaluate progressImplementing a new procurement infrastructure is likely to be challenging. Progress and targets should be monitored, with the college frequently asking:l How extensively are GPCs being used?l Are consortia contracts being used when they should be, for example for library

books, insurance, and hair and beauty products?l Are the college’s preferred suppliers being used extensively?l Is significant expenditure being committed without the procurement board’s

knowledge and support?

Review efficiencies and value for moneyIn order to increase negotiating leverage, transaction costs and value for money need to be measured and monitored on a regular basis.

A new version of the Efficiency Measurement Model (EMM2-FE) is available from the LSC FE Procurement Development Team and can be downloaded from FELP. A Microsoft Access database, the EMM2-FE has been developed to help public sector organisations to understand, quantify, record and report efficiency savings. Included with the software is guidance on how to measure efficiencies, which are classified into five types:l Price reduction.l Added value.l Risk reduction.l Process re-engineering.l Sustainability.

Need more information?Assistance is available on the FELP and CIPS websites. Regional network groups also provide colleges with an excellent opportunity to learn from each other.

To apply for the NVQ in Supply Chain Management, email [email protected] with the college name and the candidate’s name, job title, telephone number and email address.

Need more information?The LSC is there to help colleges apply the EMM to their procurement programme. To find out more about EMM, visit www.felp.ac.uk

In practice“The electronic system works, in part, because we keep tight control over suppliers. We conduct regular review meetings and produce reports to monitor performance against KPIs and SLAs. These have proved very successful in both management and development of the account and bringing about continuous improvement. And [since we implemented e-procurement] we can now access management information from the system. Drawing on the Efficiency Measurement Model (EMM), we have produced the college’s first Procurement Cost and Efficiency Savings Report.”

Angie Pilgrim Purchasing, Contracts and Compliance Manager, West Nottingham College


[email protected]



Colleges should also monitor Key Performance Indicators (KPIs), for example:l On-time delivery.l Invoice accuracy.l Percentage spend via consortia.l Percentage spend covered by contracts.

The EMM software records efficiency gains and generates reports which provide useful indicators of progress for the senior management team and the procurement board.

Colleges must include information about procurement efficiency in their annual college return and financial plans. For more information and details see Efficiency Measurement Model, Users’ Guide, at www.felp.ac.uk

Manage suppliersTo help manage supplier performance, reduce costs and improve efficiency you should work towards developing approved supplier lists. Approved supplier lists are a more formal way of working with suppliers where they are assessed using a pre-qualification questionnaire (PQQ). This is typically a standard form completed by the supplier to ensure fair, open treatment and aid consistent evaluation. Information included in a PQQ are company details, insurance cover, policy and procedures, summary of goods and/or services and pricing.

The period of time you work with a particular supplier will depend on the outcomes from your information gathering and spend review; normally it is between one and three years. It is critical to manage the suppliers over this period to ensure you are taking advantage of their specialist knowledge and market developments, as well as working together to minimise costs and improve service.

Compare supplier performances using internal data and benchmarking information from other colleges and organisations, and use this information to inform further procurement and collaboration opportunities.

Suppliers include consortia and organisations with framework agreements. They should be tested every now and again to ensure they continue to deliver value for money.

Need more information?See the CIPS ‘How to’ series at www.cips.org

Good practice tipAsk suppliers to provide management information data as part of the contract.

5 Measuring, reviewing, improving

In practiceA number of colleges were surveyed by the LSC and asked to provide details of the prices they were paying against 12 categories of goods and services. The data was analysed and compared with the prices quoted in CPC and OGCbuying.solutions framework deals. The results demonstrated the potential to make massive savings by switching locally negotiated contracts to consortia framework agreements. Approximately 85 per cent of benchmarked, locally negotiated prices were bettered by consortia and, on average, across all regions; the categories of goods and services surveyed were shown to be 18.67 per cent cheaper when sourced through consortia rather than individually. Of the 12 categories, only two failed to show a potential saving, and the consortia used this information to re-tender the contracts for the categories concerned. At the time of publication this work had already resulted in a new contract that beat the benchmark.

More information can be found at www.felp.ac.uk

www.cips.org





l Have the necessary competencies for procurement staff been identified?

l Are procurement staff aware that NVQs and other training are available?

l Find out what your regional procurement network offers in terms of training and knowledge sharing.

l Measure the overall value for money the college is achieving from procurement. Record improvements and report them internally and externally.

l Gather data on supplier performance.

l Compare supplier performance using data from internal audits and benchmarking information from other colleges and organisations of a similar size.

l Communicate with colleagues in your college, in institutions with which you collaborate, suppliers, consortia and the LSC FE Procurement Development Team.


Part three

More informationThere is plenty of information available to help push procurement up the agenda. Check out the following:l Further Education Library of Procurement (FELP) – www.felp.ac.ukl LSC Procurement Development team. Email: [email protected] l Association of Colleges (AoC) – www.aoc.co.uk l CIPS (Chartered Institute for Purchasing and Supply) – www.cips.org l Office of Government Commerce (www.ogc.gov.uk) for general, high-level

guidance on matters such as efficiency, supplier relations, sustainability and e-procurement.

l www.OGCbuyingsolutions.gov.uk for a variety of framework agreements as well as information on purchasing cards and e-procurement

l The British Institute of Facilities Management has a database of facilities management contracts – www.bifm.org.uk

l Environmental Association of Universities and Colleges – www.eauc.org.uk/home

l Forum for the future – www.forumforthefuture.org.uk l Improvement and Development Agency (IDeA) – www.idea.gov.ukl LSC sustainability resource – www.lsc.gov.uk/whatwedo/sustainable-

development.htm l Sustainable Procurement Information Network (Spin) – the Regional

Improvement and Efficiency Partnerships’ (RIEPs) sustainability resource – www.s-p-i-n.co.uk/index.asp

l National Audit Office (NAO) report – www.nao.org.uk/publications/nao_reports/05-06/05061632es.pdf

l Public Accounts Committee (PAC) report – www.publications.parliament.uk/pa/cm200607/cmselect/cmpubacc/477/477.pdf

Using FELPTo use FELP you first need to register. This is a quick and easy process: simply go to www.felp.ac.uk and click on the link to register. Remember to tick the box marked FELP, which is one of the options available after you have filled in your name etc.

Within a week you will receive a user name and password. If it does not arrive please email [email protected]

Once you are inside FELP you will quickly notice that all content is organised into a number of books (upper left corner of the page) which you can browse for content. Alternatively you can use the search facility; when doing so we recommend that you tick the option ‘Include Document Content’ so as to get as full a response to the search as possible.

Part 3


www.OGCbuyingsolutions.gov.uk

www.bifm.org.uk

www.lsc.gov.uk/whatwedo/sustainable-development.htm

www.lsc.gov.uk/whatwedo/sustainable-development.htm

www.nao.org.uk/publications/nao_reports/05-06/05061632es.pdf

www.nao.org.uk/publications/nao_reports/05-06/05061632es.pdf

www.publications.parliament.uk/pa/cm200607/cmselect/cmpubacc/477/477.pdf

www.publications.parliament.uk/pa/cm200607/cmselect/cmpubacc/477/477.pdf


http://www.aoc.co.uk

http://www.cips.org

http://www.ogc.gov.uk

http://www.eauc.org.uk/home

http://www.forumforthefuture.org.uk

http://www.idea.gov.uk

http://www.s-p-i-n.co.uk/index.asp




Consortia and contracting bodiesl Becta (the British Educational Communications and Technology Agency) –

www.becta.org.ukl Black Country Consortium – www.blackcountryconsortium.co.ukl Central Buying Consortium – www.cbconline.org.ukl Crescent Purchasing Consortium – www.cpc.salford.ac.uk l Eduserv Chest (e-resource licences) – www.eduserv.org.uk/chestl Eastern Shires Purchasing Organisation – www.espo.orgl London Universities Purchasing Consortium – www.lupc.procureweb.ac.ukl North Eastern Universities Purchasing Group – www.neupg.procureweb.ac.ukl North East Purchasing Organisation – www.qtegov.coml North Western Universities Purchasing Consortium – www.nwupc.man.ac.ukl OGCbuying.solutions – online.ogcbuyingsolutions.gov.uk/l Southern Universities Purchasing Consortium – supc.procureweb.ac.uk/home.jspl The Energy Consortium – www.energyconsortium.org.uk/l West Mercia Supplies – www.westmerciasupplies.co.uk/l Yorkshire Purchasing Consortia – www.ypo.co.uk

online.ogcbuyingsolutions.gov.uk/

supc.procureweb.ac.uk/home.jsp

http://www.becta.org.uk

http://www.blackcountryconsortium.co.uk

http://www.cbconline.org.uk

http://www.cpc.salford.ac.uk

http://www.eduserv.org.uk/chest

http://www.espo.org

http://www.lupc.procureweb.ac.uk

http://www.neupg.procureweb.ac.uk

http://www.qtegov.com

http://www.nwupc.man.ac.uk

http://www.energyconsortium.org.uk/

http://www.westmerciasupplies.co.uk/

http://www.ypo.co.uk


Part 3

Glossary of termsBenchmarkingA standard against which things – such as price or service standards – can be measured.

Category of spendA group of related items, such as IT.

CategoryA group of items.

ConsortiumCarries out collective purchasing on behalf of a number of different organisations.

Contracting bodiesSimilar to consortia, third parties purchasing on behalf of others.

CPDContinuing Professional Development.

Efficiency Measurement Model (EMM)A Microsoft Access database that helps public sector organisations to understand, quantify, record and report efficiency savings.

Framework agreementAn agreement that allows colleges to buy routine items and create contracts with suppliers within the terms of the agreement.

Government Purchasing Cards (GPCs)Government Purchasing Cards.

Key Performance Indicator (KPI)Key Performance Indicator.

Lead buyer In charge of a category of spend.

LSCLearning and Skills Council.

Network buyerResponsible for a sub-category of spend.

Procurement boardA group of senior people committed to improving procurement within the college.

Procurement championA member of the senior management team who takes responsibility for procurement by supporting and driving through new initiatives.

Procurement liaison officer (PLO)A member of staff who manages the day-to-day coordination of procurement across the college.

Procurement networkAllows for the two-way flow of information between the board and departments, as well as facilitating purchasing at a decentralised level.

SLAService Level Agreement.

Spend analysisEnables colleges to ascertain what they are buying, how much they are spending and the number of transactions being processed.

Sub-categorySub-category: a sub-category (e.g. PCs) of a main category of spend (IT).

Learning and Skills Council National Office

Cheylesmore House Quinton Road Coventry CV1 2WT T 0845 019 4170 F 024 7682 3675 www.lsc.gov.uk

Further Education Library of Procurement www.felp.ac.uk [email protected]

© LSC June 2008 Published by the Learning and Skills Council

Extracts from this publication may be reproduced for non-commercial educational or training purposes on condition that the source is acknowledged and the findings are not misrepresented.

This publication is available in electronic form on the Learning and Skills Council website: www.lsc.gov.uk

If you require this publication in an alternative format or language, please contact the LSC Help Desk: 0870 900 6800

Publication reference: LSC-P-NAT-080104

Printed on FSC certified paper stock

http://www.lsc.gov.uk



http://www.lsc.gov.uk

Managing procurement to improve front line services

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