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Situation
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- Major Insurance Company
- £15m annual spend
- Many suppliers exploiting markets
- Dynamic economic environment
- Stable ongoing demand
QP Group’s client, a global insurance company, had an annual spend on temporary staff in excess of £30 million.
The organisation's spend was spread between 84 different agencies, who were enjoying mark-ups varying between 15% and 40%.
Very dynamic and changeable economic environment, subject in particular to consolidation and a significant number of mergers and acquisitions.
Forecast that the demand for flexible staff would remain high.
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Solution
- Robust business engagement
- Clear specification requirements
- Key Market intelligence
- Supplier rationalisation
- Business communication and re-enforcement
Key stakeholders engagement across the business to establish business requirements:
- Skills
- Volumes
- Services required from the agencies
QP Group research experts used to provide market intelligence on a number of potential suppliers for all specialist areas of requirements.
Tender round performed whilst securing approval from the stakeholders.
A list of preferred suppliers was drawn up and implemented.
Road-show set up to inform the business of the changes and get their buy-in.
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Benefits
- £10m saving achieved
- Single consistent service level
- Supplier performance measurement
- Further strategy vision identified
Consistent pricing established across a list of eight preferred agencies, with margins reduced to £3 million per annum, or 10%.
In addition, a single service level agreement was established with the various agencies.
Key agency measurement and improvement cycle.
Strategy agreed to progress towards the rationalisation to a single managing agent, responsible for the administration and coordination of the client’s total requirements across the preferred supplier list.
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