NDA Estate SME/Tier 2 Supply Chain Initiatives. Sam Dancy Supply Chain Manager

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1 NDA Estate SME/Tier 2 Supply Chain Initiatives Sam Dancy Supply Chain Manager

2 Our supply chain 2

3 What our Strategy says Open, transparent, timely and consistent communications at all levels Assist Small and Medium Enterprises (SMEs) and Tier 3/4 Suppliers by requiring the NDA estate to provide information on: smaller packages of work (as a minimum 50k - 100k) in Procurement Plans, details of work packages within larger projects to assist in the identification of potential subcontracting opportunities. suppliers who have won work, particularly for larger projects and frameworks, tendering opportunities to Regional Development Agencies for use within their Supply Chain networks, where possible, bidders for major procurements; and encourage Tier 2 Suppliers to advertise subcontracting opportunities; ensure appropriate policies and procedures which support this group of suppliers. 3

4 The Challenge Plans to open up Government to small businesses Aspiration to award 25% of Government contracts to SMEs Action plans published by Departments 4

5 What are others doing? 5

6 Tier 2 Questionnaire/workshop 30 out of 32 questionnaires returned 6% 94% Companies responded Companies not responded 6

7 There may not be many policies but. Q1 Policy on use of SMEs? 17% 83% Yes No there is consideration of SMEs in the supply chain Policies and Preferences re SME usage 12 Number of responses CSR/Procurement Policy Preferred Supplier Database/Pre-qual Look for 'best athlete' / fitness for purpose Where possible buy from local supply chains Include SMEs on tender list Majority of subcontracts placed with SMEs Engage with SMEs for specialist services 7

8 Location, Location, Location Some of the comments made: Engage with suppliers at various geographical locations as they can assist with local knowledge Preferred use of local suppliers in our operations automatically lends bias to SMEs Q3 Does approach change depending on location? Proximity of specialist services to site is essential to fulfil contract 31% Have a higher use of SMEs in geographically challenging areas Do consider time and cost in managing contractors based long distances away 69% Yes No Dependant on discipline not location, and not in in-house capability 8

9 Targets Q4 Do you have targets for the percentage use of SMEs on contracts? 7% 93% Yes No So how should we address Government s aspiration for 25% of contracts to SMEs? 9

10 Opportunity awareness Making SMEs aware fo tendering opportunities 20 Numberf of responses Preferred Supplier Database/pre-qual/supplier assessment Direct contact and invitation Online registration portal/procurement supply chain page Meet the Buyer 10

11 Wider markets Whatever we do, we mustn t lose this: Q6 Have you taken SMEs to other parts of the NDA estate or introduced them to wider markets? 28% 72% Yes No 11

12 How much opportunity is there? Percentage of Tier 2 Subcontracting against Turnover in NDA Estate Number of Tier 2s % subcontracting range 588m reported Tier 2 turnover v 220m subcontracted 12

13 Measuring spend with SMEs Not something that is generally measured 9a Do you measure spend with SMEs? 28% Q9b Do you measure spend with local suppliers? 72% 24% Yes No 76% Yes No But should it be? 13

14 Supply Chain Charter Signed up to the Supply Chain Charter 47% 53% Promote the Supply Chain Charter Yes No 33% Not so great! 67% Yes No 14

15 Tools Tools that would assist 8 Numberf of resp onses List of approved SMEs/list of SME Charter signatories Improving awareness of tendering opportunities Website development for supply chain Directory of suppliers local to area Single Pre-qual for SMEs across estate for SLC/Tier 2 access Continuation of supplier forums/meet the Buyer 15

16 Workshop 2 What we heard Session 1 - Principles Principles v Policy Aspirations v targets Benchmark/Measurement where are we now Visibility of opportunities important Is it just a tick in the box? Behaviours need to align with principles Access to entire estate Value for all parties Nuclear language and culture complex League table of Tier 2s SME usage Procurement strategy/packages targeted for SMEs 16

17 Where we ve got to Initiatives: Supply Chain Event Nov 2011 Simplify NDA Flowdowns Simplify generic PQQ Single supply chain portal 17

18 NDA Flowdowns M&O Contracts requires its SLCs to incorporate fairly comprehensive contract terms into all of its subcontracts. In the early M&O Contracts these provisions, the so-called Flowdown provisions, were particularly onerous NDA has since revised the flowdowns in 2009 and we are currently undertaking a further review. Aim to limit the Flowdowns to contract terms which the NDA absolutely requires to be incorporated into subcontracts for one of two reasons: Flowdowns required to allow the NDA to manage the estate (i.e. change of control, novation and assignment provisions); and Flowdowns which are required in order to enable the NDA to comply with its own statutory obligations (i.e Anti Bribery, FOI, EIR and Data Protection). 18

19 Generic PQQ Multiple procurement systems and PQQ questions Proposing core set of generic questions to be used by all SLCs Based on HMGs standard PQQ Basic Company Information Criteria for rejection of economic operator eg corruption charges Information as to economic and financial standing Considering use of Dunn & Bradstreet rather than requesting annual accounts May require balance sheet for smaller companies Information as to technical or professional ability Skills, experience Processes & systems for managing Environmental, Health, Safety & Quality 19

20 Single Portal proposal Homepage NDA Estate Suppliers page Overview Supply Chain Opportunities SSA/Collaborative Procurement Supply Chain Charter News/Achieve ments Legal/Contract/ Flowdown issues SLC/NDA Procurement Plans Contracts Let Contract Opportunities a link to Contract Finder (news feed from Contracts Finder with current opps) Link to Contracts Finder Linked-In Company Profiles 20

21 Contracts Finder Increasing focus on SME usage and Contracts Finder from HMG Letter to suppliers from John Collington Chief Procurement Officer Need to monitor SME spend and numbers Directly: short term Via Tier 2: longer term Single Portal Initiative must not replicate HMG systems already in place Contracts Finder provides required functionality: available to SLCs AND Suppliers search facility allows suppliers to receive alerts for opportunities newsfeed back to NDA/SLC website on what is being advertised allows suppliers to post a capability statement and geographical locations added advantage: will provide wider Government opportunities, not just those within the NDA Estate Issues: Ease of use with existing systems; approval/management structure 21