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Situation
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Newly merged global company
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Procurement integration critical to three-year merger synergy programme
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Half of synergy savings expected from procurement
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1000 procurement professionals required training
A major global pharmaceutical company, newly merged, needed to improve its
procurement processes and practices to achieve significant savings across all
spend - not only raw materials but also non-inventory items including capital,
IT, marketing, facilities management and travel.
The programme was a critical and integral element of the Company’s three-year
merger integration programme, with huge targets for synergy savings, half of
which were expected to come from procurement improvement.
QP Group was selected to work with the business to design a procurement
education programme and deliver it to 1000 procurement professionals located
around the world. Following delivery, QP Group was required to facilitate
implementation and adherence to the practices introduced.
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Solution
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QP Group tools and processes endorsed by business
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Sourcing Management adopted as new "way of working"
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e-Business solutions used for defined categories
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Supplier forums conducted with key suppliers
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Focus on strategic relationship management
QP Group designed and delivered a bespoke set of processes, practices and
tools for all procurement professionals, which received endorsement and
sponsorship at the top of the business and was led by the Global Head of
Procurement.
The programme was based upon Sourcing Management, with the normal process of
spend analysis and wave planning being created to enable the key categories to
be tackled over a period of time.
e-Business tools including e-Auctions were part of the process, with QP Group
helping to define which categories of spend were appropriate and assisting in
implementing the results.
To meet its objectives and to emphasise its supplier concentration programme,
the Company invested in its key suppliers by holding forums and focusing on
strategic relationship management (SRM) to key them more strongly into its core
long-term business objectives.
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Benefits
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Rapid increase in capabilities through QP Group education
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Knowledge assessments through 2-level certification programme
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$9.5 billion saved
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Savings targets exceeded by 63%
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More investment money released to R&D
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Company now recognised as one of top 5 procurement organisations in the world
By devising and delivering the procurement education programme, QP Group helped
raise the capability of the procurement team, developing their skills by
working alongside them and enabling them to achieve ongoing cost savings.
QP Group assisted with ensuring adherence to the processes, practices and
tools, monitoring implementation for particular milestones. Additional help was
provided in specialist areas where requested.
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