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1 North Highland College Procurement Strategy Strategic Context North Highland College s expenditure on bought-in goods and services is approximately 2.2M per annum. At all times the College has an obligation to ensure that all income, regardless of source, is expended wisely in the best interest of the future direction of the institution with operational evidence of having procured best value. Best value procurement will; be transparent; be driven by desired results; create the most economically advantageous balance of quality and cost; reduce the burden on administrative and monitoring resources; lead to simplified or routine transactions; encourage open and fair competition; follow all appropriate regulations and legislation. The Public Procurement Reform Programme will focus on targeted efficiencies through use of appropriate models and information systems, of effective procurement policies and practices and collaborative contract arrangements. Cost-effective and best practice procurement is an essential factor in ensuring that the College makes the most of its limited resources to attract the best students and staff. By purchasing appropriate and reliable goods and services, the College is able to stretch budgets in support of its teaching, community and business support objectives. There is currently no specifically assigned responsibility in the form of a procurement specialist within the College. While purchasing activities are undertaken in a variety of ways within academic and support functions the Director of Finance has overall responsibility for the role and purpose of the procurement process within the College.

2 The intention of the Procurement Strategy is to set out a number of key objectives to encourage, monitor and deliver the most effective procurement process. Strategic Objectives 1. To promote the delivery of value for money through good procurement practice. 2. To facilitate the development of an effective and co-ordinated purchasing effort within the College. 3. To analyse the College s non staff expenditure and apply appropriate procurement strategies to deliver value for money and reduce commercial risk. 4. To develop appropriate management information in order to measure the performance and value for money achieved by the College. 5. To embed sound ethical, social and environmental policies within the College s procurement function and to comply with all relevant UK Legislation in all aspects of College purchasing. Strategic Development The Director of Finance will be responsible to the Principal for the implementation of the Procurement Strategy, reporting annually on progress to the Board of Management. Implementation Plan STRATEGIC OBJECTIVE 1 - to promote the delivery of value for money through good procurement practice and optimal use of procurement collaboration opportunities Support for Category A and B contracts where appropriate. Aggregated purchases (time and volume) to tender at institutional level. Systematic use of output specifications. Procurement practice referenced to Procurement Embed procurement policy. Conduct expenditure analysis. Establish a contracts register. Identify key purchases and key suppliers through development of supplier and contract management processes. Use APUC account manager expertise in helping to develop specifications and conduct market analysis. Review procurement processes and Measures of % of spend on Cat A, B and C contracts. Reduction in tenders, supplier base, orders, invoices, maverick spend.

3 Journey responsibilities for appropriateness. STRATEGIC OBJECTIVE 2 - to facilitate the development of an effective and co-ordinated purchasing effort within the College Co-ordinated purchasing activity with advice on process communicated internally and externally to present and potential suppliers on how to do business with the College directly or through APUC. Maximise use of approved contracts and opportunities for collaboration. Efficient procurement processes in terms of e.g. requisitions, approvals, order and invoicing processes. Develop intranet and internet communications pages to explain contracts availability, access and implementation (intranet) and ways of doing business with the College (procurement web page) Make best use of internet and website and head of procurement process to engage APUC account manager for support. Establish a contracts register and monitor usage of contracts. Consider and exploit potential of collaborative contracting opportunities with neighbouring institutions or other publicly funded contracting authorities (LA, NHS, blue light services). Liaise with APUC account manager. Optimise the use of : electronic requisitioning and approval, e- procurement, e-tendering, procurement cards, consolidated invoicing. Overall time spent on procurement activity in departments reduced. Reduction in tenders, supplier base, orders, invoices, maverick spend. % of spend with contracted and new suppliers. Reduction in supplier base. Transaction cost of procurement process reduced. Number of orders / invoices reduced.

4 STRATEGIC OBJECTIVE 3 to analyse the College s non-pay expenditure and apply appropriate procurement strategies to deliver value for money and reduce commercial risk Detailed understanding of institutional expenditure profile on bought-in goods and services. Improved, accurate and comprehensive management information.. Work with APUC account manager to develop analysis of expenditure in key categories with individual suppliers. Evaluation of outsourcing or shared service opportunities. Conduct risk assessments on strategic procurement Establish measurement and monitoring processes in respect of procurement function and process costs. % of expenditure with approved contract and non-approved contract suppliers. Managed reductions of maverick spend. Reduced risk exposure. Regular performance measurement reports produced for management. STRATEGIC OBJECTIVE 4 - to develop appropriate management information in order to measure the performance and value for money achieved by the College Regular review of benefits and outcomes agreed with APUC account manager. Improved management of suppliers by means of performance review with key suppliers.. Develop benefits measurement appraisal to record efficiencies generated by procurement activity. Performance data collated on key suppliers using contract management data this data regularly discussed with suppliers to manage areas for service improvement or opportunities for innovation. Support from APUC account manager useful here. Enhanced supplier performance e.g. Higher % on time deliveries, Higher % invoice accuracy etc., Lower % faults/complaints.

5 STRATEGIC OBJECTIVE 5 - to provide leadership and policy guidance to ensure that corporate and social responsibilities are appropriately reflected in the College s procurement objectives and practices. The College gives appropriate consideration to corporate and social responsibility issues throughout the procurement cycle. Regular reviews made of the College s procurement strategy, initiatives and achievements. The Procurement Journey is used as a reference for procurement strategies and operations. The Suppliers Charter is a reference for procurement practice. Progress on sustainable procurement is referenced against the Flexible Framework. Work with APUC and sector representative bodies to strengthen good practice. Liaise with APUC account manager to ensure that the procurement process remains consistent with good practice and regulatory compliance Results of self-assessment of capability using the Flexible Framework. Gap analysis results emerging from reviews such as capability assessments or with peer institutions through the APUC account manager network. Roderick M Ferrier Director of Finance 01 November 2012

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