Procurement Solutions. Business Plan

Transcription

1 Procurement Solutions Business Plan

2 CONTENTS Vision 1 We will 1 Procurement Solutions Business Values 2 Probity 2 Innovation 2 Transparency 2 Flexibility 2 Equity 2 Professionalism 2 Our Strategic Plan Strategic Framework 4 Our Priorities 5 1. CUSTOMER CENTRIC PROCUREMENT SUPPORT 5 2. VALUE, INNOVATION AND SOCIAL RESPONSIBILITY IN CONTRACTS 6 3 STRONG & TRANSPARENT GOVERNANCE FRAMEWORK 7 4 CATEGORY MANAGEMENT FRAMEWORK 9 5 DYNAMIC PROCUREMENT TECHNOLOGY SOLUTIONS 10 6 EFFECTIVE PROCUREMENT CAPABILITY 11 Business Summary 12 Procurement Solutions 12 Planning Context 13 Current Objectives 15 Strategy and Governance 15 Customer Support and Communications 15 Stakeholder Engagement 16 Category Plans 16 Program of Works and Contracts Database 17 Savings and Benefits Realisation 17 Supplier Performance 17 Staff Capability and Development 18 Operational Performance 18 Key Performance Indicators 19 Customer-centric procurement support 20 Value, innovation and social responsibility in contracts 20 Strong and transparent governance framework 20 Category management framework 20 NSW DEPARTMENT OF EDUCATION AND COMMUNITIES

3 Dynamic procurement technology solutions 20 Effective procurement capability 20 Business Environment 21 External factors impacting Procurement Solutions 21 Political environment 21 NSW Procurement Reforms 21 Stakeholder relations 21 NSW DEPARTMENT OF EDUCATION AND COMMUNITIES

4 Our vision Supporting quality education, communities and government services with procurement excellence We will Enable Education and Communities agencies to meet their outcomes through strategic, innovative and secure procurement solutions that are customer focused and deliver value.

5 Procurement Solutions Business Values Procurement Solutions operates within an environment of a defined set of business values to ensure ethical business practices; consistent, defensible, repeatable outcomes; and credible and sought after expert advice on procurement matters across the NSW Education & Communities Cluster (the Cluster). Probity Managing the integrity of process according to government policy. Acting impartially and fairly. Being accountable for all our decisions and actions. Innovation Daring to think differently to seek new and better ways of doing things. Overcoming obstacles creatively to achieve our customer s objectives and optimise value. Transparency Conducting all activities openly with clear audit trails. Documenting all tasks and discussions. Making available all information for collaboration and collective decision making. Equity Providing equal benefit and service across the Cluster regardless of size or location. Ensuring the supply market has equal access to our businesses. (We have a requirement under the Australian Constitution to provide access to all Australian states, and under the Free Trade Agreement access to the USA). Flexibility Being ready to vary the objective, process or procedures (within probity) to achieve: o Maximum customer and stakeholder outcomes, and o Optimised local decision making solutions. Professionalism Dealing with customers, suppliers and other stakeholders respectfully, courteously, honestly, punctually, and responsibly. Applying research, analysis, experience, expertise and procurement leadership. Delivering work outputs that are accurate, timely and presentable. Taking accountability for our work and our decisions. Adding value to the outcome for every activity we undertake. DEC s Interpersonal Values The Department s values of fairness, respect, integrity and responsibility are both encouraged and expected of Directorate staff in all interpersonal dealings both internally and externally. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 2

6 Our Strategic Plan Our vision of supporting education, communities and government services through procurement excellence will be supported by focussing on the following priorities. Value, innovation & social responsibility in contracts Effective procurement capability Customer centric support Strong & transparent governance framework Dynamic procurement technology solutions Category management framework Customer centric procurement support To provide a customer-centric focus, listening and adapting to the Communities service delivery needs while maintaining policy compliance. Value, innovation and social responsibility in contracts To provide the best value supply solutions that deliver savings, bring innovation to Government services and support the Community. Strong and transparent governance framework To establish a clear governance framework that provides direction and oversight to procurement activities and performance across the Cluster. Category management framework To provide a category management framework that supports business alignment, decision making and Government procurement objectives. Dynamic procurement technology solutions To specify technology solutions that simplify procurement activity, support compliance and reduce red tape. Effective procurement capability To attract and retain professional and capable people to deliver efficient procurement services. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 3

7 Strategic Framework Vision Priorities Business Plan Key Performance Indicators Capability & expertise Risk Management NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 4

8 Our Priorities Details of the key strategic priorities, aligning operational deliverables with Government and the NSW Education and Communities objectives follow. Contemporary best practice procurement practice will be utilised to optimise value and reduce risk. 1. CUSTOMER CENTRIC PROCUREMENT SUPPORT In we will: Build PSD's value proposition as a trusted advisor/business enabler Identify, build and maintain relationships with stakeholders and subject matter experts. Review and update stakeholder engagement plan. Review services and delivery framework. Build development and distribution of spend, market and performance data to highlight opportunities. Engage proactively with customers Continue to respond to bi-annual satisfaction survey and support issues identified by customers. Refresh and implement communications plan. In we have: MEASURES BY 2018 OUR SUCCESS WILL BE MEASURED BY: THE INCREASED FREQUENCY WITH WHICH PSD IS ENGAGED IN THE PLANNING STATE OF PROJECTS. HAVING PROCESSES FOR PROACTIVE CUSTOMER ENGAGEMENT IN PLANNING CYCLES. ENSURING SOUND SPECIFICATION DEVELOPMENT AND ONGOING SUPPLIER MANAGEMENT PROCESSES. MAINTAINING COMMUNICATION PLANS AND CHANNELS. MONITORING PROCESSES, PROGRAM DELIVERY AND SATISFACTION. Provided customers with timely information about new contracts, products, processes and policies that affect them. Continued to work with customers to deliver best value solutions to meet their needs in a timely manner. Educated customers about DEC s accreditation, their obligation and garnered support at many levels across the education and communities cluster. Increased overall satisfaction with PSD from 75% to 84%, against a target of 81%. Completed 90% of sourcing projects on time and with 92% satisfaction. Achieved 98% satisfaction with the Workplace Supplies contract. Customers will more readily employ services and processes when they like them. We strive to deliver services and solutions that our customers are happy with. We encourage and act on feedback for continual improvement. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 5

9 2. VALUE, INNOVATION AND SOCIAL RESPONSIBILITY IN CONTRACTS MEASURES BY 2018 OUR SUCCESS WILL BE MEASURED BY: In we will: Build our stewardship of the markets we influence Enhance and implement market and stakeholder engagement plan. Include opportunities for transformation within contracts Develop new contracts to allow for innovation, including budgets for proof of concept. Pursue policy options to promote innovation. Develop staff capabilities to build innovation (contract managers capability development program). Increase effectiveness of market and supplier engagement Continue to build processes to ensure sound specifications in areas of training, market engagement and ongoing management. Reduce costs of doing business with us Monitor and track business costs. Continue to improve processes and templates for on-time delivery. Engage with DEC's Program Management Office. DEVELOPING AND MAINTAINING CATEGORY PLANS THAT ARE INFORMED BY INTERNAL AND EXTERNAL FACTORS. DEVELOPING CONTRACT AND VENDOR MANAGEMENT SKILLS AND DISCIPLINES ACROSS THE CLUSTER. MAINTAINING SAVINGS CAPTURE AND REPORTING PROCESSES. ESTABLISHING KEY STAKEHOLDER AND VENDOR ENGAGEMENT PROCESSES. WORKING WITH VENDORS TO ACHIEVE SUSTAINABILITY TARGETS AND IMPROVE SUPPLY CHAIN PRACTICES. PROMOTING THE USE OF ABORIGINAL AND TORRES STRAIT ISLANDER AND DISABILITY SUPPLIERS AND SMALL TO MEDIUM ENTERPRISES IN LINE WITH POLICIES AND STATE PLANS. In we have: Negotiated $34m in contract life savings and tracked $39m in savings to realisation. Provided opportunities to small to medium enterprises who were appointed to 48% of tenders run by PSD. Implemented and documented a formal supplier engagement schedule to enhance supplier relationship management across centrally managed contracts. Implemented initiatives to seek innovation within contract terms, allowing flexibility for technology advancement and specification changes previously not able to be accommodated resulting in aging products. Worked with key suppliers to drive social responsibility projects to be considered for implementation in 2014/15. Continued / NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 6

10 In we have (continued): Implemented initiatives to seek innovation within contract terms, allowing flexibility for technology advancement and specification changes previously not able to be accommodated resulting in aging products. Supported Supply Nation, the NSW Indigenous Chambers of Commerce and National Disability Services (NDS) through membership and by issuing newsletters and promotions to encourage supply from Aboriginal and disability suppliers. Continued monitoring and reporting of key aspects of WRAPP, providing relevant information on recycled paper and toner cartridges. The right procurement approach can significantly and positively influence our business and the community. We will research and collaborate to identify opportunities and manage and promote outcomes to ensure benefits are realised. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 7

11 3 STRONG & TRANSPARENT GOVERNANCE FRAMEWORK MEASURES BY 2018 OUR SUCCESS WILL BE MEASURED BY: In we will: Deliver sourcing program on time Clarify roles and accountabilities around sourcing process and contracts. Continue to monitor through program and supplier KPIs. Build policy and process compliance Build range and access to policy resources. Continue to build approaches to measuring and reporting compliance. Review and refresh communications plan and channels. DELIVERY AGAINST A WELL DEFINED PERFORMANCE REPORTING FRAMEWORK THAT COVERS SAVINGS, SERVICE DELIVERY, COMPLIANCE, RISK, AND SOCIAL AND ENVIRONMENTAL RESPONSIBILITY. DELIVERY TO A WELL DEFINED REVIEW SCHEDULE. ESTABLISHMENT AND MAINTENANCE OF PROJECT MANAGEMENT DISCIPLINES AND A PROGRAM MANAGEMENT FRAMEWORK. In we have: Achieved Level 3B accreditation for the NSW Department of Education & Communities, effective 1 July Established a planning framework, and delivered performance reports against KPIs, including new reports for negotiated savings and contracts compliance. Implemented procurement related legislative changes (incl. new Public Works and Procurement Act 1912, Government Sector Employment Act 2013), board directions and delegations. Built policy awareness and compliance through a comprehensive suite of documentation, a new website, communications and training. Developed strategic, business and category management plans through consultation with business stakeholders. Increased membership to and administered the Education and Communities Procurement Governance Committee. Clear directions, roles, responsibilities and skills in procurement will foster a probity rich environment and minimise risks. We will work with business leaders to provide a framework, generate awareness and encourage skill development across the Cluster. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 8

12 4 CATEGORY MANAGEMENT FRAMEWORK In we will: MEASURES BY 2018 OUR SUCCESS WILL BE MEASURED BY: Identify and support strategic opportunities Present strategic and category opportunities at the Executive level. Support initiatives to support strategic commissioning. Deliver and manage category plans Continue to secure more resources to relieve staff to undertake category management. Engage across the Cluster to build participation in and support for category management. In we have: Formed a category management framework to integrate more closely with business areas, which will continue to support delivery of procurement policy awareness and support. WELL DEVELOPED AND DEFINED CATEGORY PLANS WITH MAJOR SPEND / KEY AREAS BEING LONG TERM. DELIVERY AGAINST A FORMAL STAKEHOLDER AND SUPPLIER ENGAGEMENT PLAN. CATEGORY OVERVIEWS AND PLANS ARE NOW SPONSORED BY SENIOR EXECUTIVES WHO REPORT STATUS UPDATES TO THE QUARTERLY PROCUREMENT GOVERNANCE COMMITTEE. KEY STAKEHOLDERS OF SENIOR MANAGEMENT ACROSS THE ORGANISATION HAVE UNDERGONE CATEGORY MANAGEMENT TRAINING AND HAVE RESPONSIBILITY FOR SETTING CATEGORY PRIORITIES IN LINE WITH THEIR BUSINESS NEEDS AND FOR UPDATING SPONSORS. Appointed senior executives as sponsors of the four major categories who provide strategic leadership to category planning and initiatives. Conducted category management training for senior management and key stakeholders of each category across the organisation. Team members are now helping set category priorities in line with their business needs. Educated customers about the value that can be achieved via the category management framework, adopting contract management planning and formalising benefits realisation reporting. A framework that brings business and procurement expertise together to plan, strategise, innovate and learn. We will consolidate and present information to support sound decision making and grow procurement and category awareness in the process. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 9

13 5 DYNAMIC PROCUREMENT TECHNOLOGY SOLUTIONS In we will: MEASURES BY 2018 OUR SUCCESS WILL BE MEASURED BY: Establish source to contract and prequalification solutions Specify requirements, implement and establish support for S2C and PreQual across the Cluster. Establish and implement improved system for managing Contingent Workforce Labour Specify requirements, implement and support VMS across the Cluster. Build electronic purchase orders (Schools eprocurement and LMBR) Continue to enable more suppliers and products to connect to the Online Catalogue for staff to purchase products and services electronically. Continue to work strategically with suppliers to promote the Online Catalogue to users. HAVING AN ELECTRONIC CATALOGUE WITH MULTIPLE PRODUCTS AND CATEGORIES THAT IS EXTENSIVELY USED. HIGH NUMBERS OF TRANSACTIONS AND SPEND BEING ORDERED ELECTRONICALLY. PERFORMANCE AGAINST A DETAILED TOOLS AND SYSTEMS ROADMAP. Provide excellent customer service to catalogue users for purchasing connectivity and support. Enable SME's with external catalogues and relevant capability to connect to Catalogue on a regional basis. Establish DEC Aboriginal and Torres Strait Islander Directory Set up and establish resources to support Aboriginal and Torres Strait Islander Directory (including recruit Aboriginal cadets and improve processes to maintain business content). Go-to-market for integrated eprocurement technology solutions and Partner Engage consultancy with end-to-end eprocurement expertise to help develop go to market strategy Implement strategy to test: ecatalogues/directory; S2C;content services; electronic transaction services; supplier enablement; change management; reporting and support, and account management. In we have: Achieved best ever seen tools and systems in accordance with procurement accreditation requirements. More than 1.2 million items catalogued on online catalogues with 50 suppliers catalogued and trained. DEC Catalogues integrated with LMBR/SAP and Schools eprocurement, integrated with the whole of government transactions ehub for sending purchase orders to suppliers electronically. 40,000 buyers and thousands of staff and teachers purchasing from the catalogues with an average of 35,000 hits per month. Aligning electronic solutions to the procurement lifecycle is the most effective way of embedding desired behaviours and managing compliance. It also reduces costs by streamlining processes for staff and suppliers. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 10

14 6 EFFECTIVE PROCUREMENT CAPABILITY In we will: MEASURES BY 2018 OUR SUCCESS WILL BE MEASURED BY: Develop a PSD staff engagement and retention plan Develop work plans and capability assessments. Develop training and development plan for 2014/15. Develop PSD staff engagement and retention plan. Develop DEC procurement capability and career path programs Expand scope for delivery of capability development programs through external partners and online channels. Develop new modules for contract management and quote facilitation. Develop a capacity plan for PSD Identify skills and develop staff capacity through resource modelling and planning. Enhance systems, processes, templates, and tools. In we have: PERFORMANCE AGAINST A WELL DEFINED STAFF PLAN AND CALENDAR INCLUDING CAPABILITY ANALYSIS, PRIORITISED TRAINING PROGRAM, WORK AND PERFORMANCE PLANS, ESTABLISHMENT OF A PROFESSIONAL CAREER PATHWAY DEVELOPMENT PROGRAM ACCESSIBLE AND DESIRABLE CAPABILITY PROGRAMS WELL ATTENDED BY EDUCATION AND COMMUNITIES STAFF ACROSS NEW SOUTH WALES. Established a capability development program for managers and staff across the organisation. An etendering publisher course and a Procurement Practitioner Program are already in place. Procurement and category team members have undergone considerable training and development in areas including category management, strategic thinking, benefits realisation, procurement policy, and contract law. Encouraged innovation in all practices and projects, with improvements ranging from automating reports to a shift in thinking for the future of imaging. Established a capability analysis and development plan process and report and new processes, documented procedures, systems and controls have been and continue to be developed. Commenced working with business based contract managers regarding capability development and aligning contract management functions to accreditation. Developed a capability development strategy and piloted a Procurement Practitioners program. Managed consolidated spending for central contracts of $105m and maintained a weighted average of 93% supplier compliance to service levels. Supporting resources with the right skills is critical to meeting our customer expectations and our procurement related obligations. We will build, enhance and support staff capability to most efficiently meet requirements. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 11

15 Business Summary Procurement Solutions Procurement Solutions is headed by the Chief Procurement Officer who reports to the Deputy Secretary Corporate Services within NSW Department of Education and Communities. Procurement Solutions exists to support the Education & Communities Cluster (the Cluster) to design and deliver business solutions that bring innovation and greater value to education and community services. On a day to day basis it reduces operating costs through best value goods and services acquisition and maximises compliance to Government procurement policies. On its inception in July 2008, Procurement Solutions was charged by the then Director-General to implement and manage the Procurement Reform Savings Program. At the end of December 2012, $345 million in procurement savings had been achieved. During quarter 4, 2012 a Category Management framework was developed in response to the requirements of NSW Government procurement reforms. The Category Management framework incorporates business experts within other directorates and entities to establish and manage procurement plans across categories. In , the Procurement Solutions Directorate achieved total savings of $38.8 million with a return on investment of 5 to 1. It also achieved 111% satisfaction with its sourcing projects and 84% satisfaction overall with its procurement services. The new centre-led procurement model aims to lead and support major procurement and probity risk management activity on behalf of, and across, all sectors of the Cluster. This can be achieved through its prioritised focus on: Design and implementation of standard processes and procedures. Managing compliance with NSW Government Procurement policies. Identifying and developing strategic supply solutions that support local decision making through category management disciplines. Establishing contracts, services and tools to provide best value goods and services for the Cluster and NSW Government as required. Through its category management, contract management, governance and electronic procureto-pay expertise, Procurement Solutions has the structure, management capability and technical expertise to support the Cluster s procurement obligations. Procurement Solutions comprises the following areas reporting to the Chief Procurement Officer: Category Management Teams Designs strategic solutions and supports sourcing for Goods and Services, Facilities Management, Information Technology, and Professional Services. Contract Services Performance manages and supports shared contracts and provides expertise and assistance to contract managers across Education and Communities. esolutions Designs, delivers and supports strategic eprocurement solutions. Program Management Manages and administers sourcing program, etendering and the Education and Communities contracts database and benefits realisation. Procurement Governance Administers, manages and reports policy, communications and awareness, capability development, finance and performance. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 12

16 Planning Context Procurement Solutions was established specifically to identify and return savings to Corporate Finance. The inaugural three year Procurement Strategic Plan set out the fundamental purpose, directions, objectives and strategies for this period. In mid-2010 Procurement Solutions was transferred from the Director General s office with the Chief Procurement Officer reporting to the Deputy-Director General (DDG), Finance and Infrastructure. The second Procurement Strategic Plan was developed through a multi-faceted planning process. During 2012 a merger of Portfolios saw Procurement Solutions reporting to the DDG, Corporate Services Portfolio. Also in 2012, Procurement Solutions began preparation for becoming accredited under the NSW Government Procurement framework. In 2013, the Procurement Strategic Plan was reviewed, updated and extended to a five year plan for in line with procurement accreditation requirements. This update of this plan for was conducted following a business maturity assessment which involved staff and key stakeholders, and a planning session with the Procurement Solutions management team. It notes achievements from the first year and identifies activities for the upcoming year. It supports and is formed within the contextual framework of: The NSW State Plan 2021 o Rebuild the economy o Return quality services o Renovate infrastructure o Strengthen our local environment and communities o Restore accountability to government The NSW Department of Education Corporate Plan o Quality teaching and leadership o High expectations, closing the gaps o New and better ways of doing business The NSW Government Procurement Strategic Directions o Driving value for money o Delivering quality government services o Aligning with business needs DEC s Strategic Procurement Plan o Customer-centric procurement support o Value, innovation and social responsibility in contracts o Strong and transparent governance framework o Category management framework o Dynamic procurement technology solutions o Effective procurement capability NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 13

17 The Customer Market Any employee, student or community member who purchases, approves a purchase, or uses products and services acquired by education and communities agencies, is a customer of Procurement Solutions. Over 100,000 employees supporting more than 1 million students collectively form the Procurement Solutions customer market. The Procurement Solutions customer base is spread across NSW and is made up of: More than 20 corporate business units; Over 2,300 schools; And independent entities such as o 10 TAFE Institutes comprising approximately 130 campuses; o The Community Relations Commission (CRC), and o The Board of Studies, Teaching and Educational Standards (BOSTES). While these customers have a wide range of overlapping procurement requirements, they are also discrete entities with a variety of specific requirements, particular business environments and varying government objectives and responsibilities. Procurement Solutions works actively to develop solutions to meet the individual needs of its customers. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 14

18 Current Objectives To achieve its objectives Procurement Solutions engages extensive planning and ongoing monitoring processes as detailed below: Strategy and Governance A Governance Manual sets out the procurement governance structure, delegations and the calendar for reviewing and updating key documents and reporting. A Governance team is responsible for monitoring, maintaining and communicating procurement policy, risks, plans, actions and reports. This includes but is not limited to: Strategic Procurement Plan, Procurement Solutions Business Plan, Procurement Manual, PSD Operations Manual, Simple Procurement Guide, Procurement Risk Management Plan, Communications Plan, PSD Scorecard and Executive Engagement Reports, and reporting schedule. The Governance Team is also responsible for administering the Education and Communities Procurement Governance Committee. Customer Support and Communications The Procurement Solutions Directorate has a strong customer service focus and strives to deliver contracts and services that will engage them into the future. Common use contracts and processes that support them are developed with input and involvement of the end-users. Extensive effort is applied to implementation and ongoing support and management of contracts to ensure they continue to meet the customer needs. Communications Plans are developed to manage the needs of customers across all levels of procurement including information on contracts, products, process, policies and other areas of awareness (e.g. Promoting use of disability enterprises or Aboriginal and Torres Strait Islander suppliers). Communications include regular professional publications, targeted s, internet and intranet sites, and face to face through meetings and conference presentations. A support team (DETBuy) is able to answer general queries about procurement policy and process and contract and product support. Further customer support and communications are delivered through the following stakeholder engagement processes. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 15

19 Stakeholder Engagement As well as end-user customers, procurement s stakeholders include business and contract managers, entity and portfolio leaders, the business community and other government agencies. A Stakeholder Engagement Plan has been developed which includes processes for both reactive and proactive engagement. The main focus of this Plan is the portfolio and entity managers and leaders. This is supported by a newly published Executive Engagement Report which updates Executive Managers on compliance and opportunities for their individual Portfolios. A category management framework has been established to support integration between the procurement leaders and other business managers. Engaging the supply network for market research and development of more flexible and innovative business solutions has commenced. Collaboration with other Government agencies is being strengthened through procurement leadership, working and category groups and will continue as agencies take on contract leadership roles and more contracts are shared. Category Plans The process of category management is described in the Procurement Solutions Operations Manual. At a high level it incorporates the development of detailed category plans in consultation with Education and Communities business experts. Four category management teams have been established encompassing Goods and Services, Facilities Management, Information Technology, and Professional Services. Category Plan overviews are developed for each of these categories that highlight the priorities for establishing more detailed category plans for sub categories. These plans utilise internal and external factors including market maturity, product and technology evolution, supplier positioning, contract expiries, spend analysis, political, business and educational needs. Identified opportunities are presented to business managers and leaders and projects developed to improve savings, compliance and / or service delivery. Category plans will also identify contract leakage or compliance issues and allow targeted communications and support and may provide input to entities Audit plans. Category plans inform Procurement management plans and annual reporting. Executive sponsors have been appointed from major business areas to lead the development of planning for each category. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 16

20 Program of Works and Contracts Database A system for the management of the Cluster s procurement program of works has been established that includes documented processes, tools and monitoring of projects from concept to benefits realisation. This is documented in the Procurement Solutions Operations Manual. A Program Manager is responsible for the maintenance and management of the Program and Contracts Databases. The Program Manager oversees the status of all projects and ensures updates and reports are completed regularly and processes are followed. Supported by the Contracts Compliance Officer the Program Manager administers the Projects Acceptance Committee and Project Review Meetings (PAC and PRM). These committees assess and approve procurement strategies and review and support the Program, forming an integral part of the overall procurement governance processes. Savings and Benefits Realisation Delivering savings continues to be a core procurement focus and robust processes for identifying, tracking and reporting savings are in place and documented in the Procurement Solutions Operations Manual. Procurement s senior management regularly review performance to savings targets and establish actions for filling shortfalls or generating new opportunities. Data analysis has shown that the Goods and Services category where many contracts are managed by Procurement Services delivers the lion s share of the procurement savings highlighting significant opportunities for increasing this capability across the other Categories. Category Managers are charged with the responsibility of ensuring benefits realisations plans are developed for all projects and support provided to contract managers across the Cluster. This is tracked through the Program of Works and Category Planning processes and savings reports. Supplier Performance Managed contracts, mature supplier management processes are in place and are documented in the Procurement Solutions Operations Manual. This includes negotiation of KPI standards and measures, detailed induction, implementation, and reporting and review processes. Procurement Solutions ensure a standard suite of supplier reports are received for all key suppliers which support supplier and contract performance reporting, along with input from customers and other internal intelligence. Procurement Solutions proactively manages suppliers with regard to day to day matters, regular operational meetings as well as formal strategic review meetings. This expertise will be transferred to contract managers across the Cluster through the category management framework. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 17

21 Staff Capability and Development Procurement Solutions is actively working to raise procurement capability across NSW Education and Communities. This is occurring through promoting the Capability Development Program, including the Procurement Practitioner certification, through its Procurement Essentials Newsletter and the category management framework. Procurement Solutions also supports and develops its own staff through a range of formal and informal processes: A template induction program to help orientate staff in how the Directorate operates and expectations. Along with WHS matters, it includes the Strategic Procurement Plan, this Business Plan, Procurement and Operations Manuals and Code of Conduct. A program of meetings with key team members and stakeholders, where applicable, is also arranged. Procurement staff are asked to sign the Department s Code of Conduct each year as a reminder of requirements. An annual capability analysis process is conducted which informs the year s training budget and sets the priorities along with development plans highlighted through performance reviews. Details of the process, templates and training reports are documented in the Procurement Solutions Operations Manual. A staff newsletter, the Juggler, is issued and a whole Directorate meeting held each fortnight to share latest policies, processes, projects, learnings, Department and Government information, and general housekeeping and staff news. This is in addition to regular management and team meetings which focus on specific work and strategic plans and actions. A formal development pathway is being established for procurement professionals with Procurement Solutions and other procurement related staff encouraged to participate with the aim of increasing the Cluster s procurement skills. Operational Performance The Procurement Governance Team ensures that work plans are established annually and reviewed biannually by issuing templates, guidelines and deadlines to managers and staff. Procurement Solutions work plans incorporate shared goals and targets and ensure individual targets reflect the Directorate s objectives. The Directorate s KPIs are reviewed annually against the CPO s performance targets, the Directorate s strategic objectives and aligned to the Department s and Government Plans. Operational reports are established for the whole Directorate and for each team to report against monthly. The Procurement Solutions performance scorecard is produced each month and presented to the Senior Team with the team providing explanations and action plans discussed where any issues are highlighted. Each senior team member also presents their team report with recognition and support provided as required. The performance reporting processes are documented in the Procurement Solutions Operations Manual. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 18

22 Key Performance Indicators As detailed in current objectives and the Procurement Solutions Operations Manual, the Procurement Key Performance Indicators (KPIs) are reviewed and set annually. At a high level the Directorate s KPIs incorporate metrics as follows: A general overview of KPI management is provided below: NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 19

23 Customer-centric procurement support Customer-centric procurement support measures how Procurement Solutions proactively engages with customers through the delivery of its communications plan, and bi-annually surveying customers to measure satisfaction with service and support. Satisfaction with sourcing projects is also measured upon completion of each project. The scores are assessed at the Category Management team meeting and learnings discussed. On time project delivery is calculated monthly from the Program of Works actual performance. The Program is monitored daily and reviewed by the Program Review Committee each fortnight to help keep projects on track. Value, innovation and social responsibility in contracts Value, innovation and social responsibility in contracts are measured through the delivery of total savings, benefits realisation performance, supplier relationship management, and social responsibility benefit. Social responsibility benefit includes engagement with SMEs, improvement in spend with Aboriginal suppliers and disability organisations, and sustainability through the purchase of recycled paper and green energy. Strong and transparent governance framework Str0ng and transparent governance framework is measured by contract compliance in both aspects of spend through managed contracts and process compliance with Procurement Solutions contracts register. Category management framework Category Management plans identify and support strategic opportunities. The category management framework is measured first by the development of category management plans then by measurement of on time delivery against the plans. Dynamic procurement technology solutions Dynamic procurement technology solutions aligned to the procurement lifecycle reduces costs by streamlining processes and managing compliance. This is measured through the development and on time delivery against the procurement technology solutions plan. Effective procurement capability Effective procurement capability is measured for both PSD staff as well as developing procurement capability within the Cluster. This is measured through the development and delivery of a PSD staff engagement and retention plan, and the procurement capability and career path programs. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 20

24 Business Environment An environmental scan identified issues that have the potential to impact Procurement Solutions performance and will need to be proactively forward managed. External factors impacting Procurement Solutions NSW Procurement Reforms The NSW Government changes to the procurement policy framework presents a challenge to Procurement Solutions as it not only adapts its own processes and structure to align, but is required to communicate and implement the changes across NSW Education and Communities. Elements of the reforms that have had a particular impact on the Cluster are the implementation of category planning, together with the devolution of Whole of Government contracts to manage at agency level. Other reform initiatives relate to access to government business by SMEs, tools and systems, purchasing (eg P-Cards) and innovation. The objective of raising procurement capability in Government presents both opportunity and risk in regard to skilled procurement personnel. Developing and retaining skilled resourced needs to be a key Department priority if it hopes to secure and maintain a high level of accreditation. Political environment The next State election is being held in early 2015 so creates an environment of potential policy change and transformation. The Government as a whole is facing intense budget pressure which impacts on all agencies. Significant budget cuts and constraints on the Cluster will require more broad, holistic, integrated, and more entrepreneurial procurement initiatives. Accordingly this requires an increased reliance on technology managed solutions to trap expertise and risk manage the impact of the loss of corporate knowledge retained in individuals. Service delivery The NSW Government is evaluating more efficient models for delivering services in line with international and national trends to introduce competition into the government marketplace. It is exploring opportunities for strategic commissioning to leverage opportunities across agencies, as well as for rationalising the delivery of its shared services. Stakeholder relations The development of engagement plans for internal and external stakeholders and interest groups is needed to help in the design of relevant procurement strategies that best meet the Cluster agencies business objectives. The Procurement Solutions charter of centrally leading procurement for the Cluster requires proactive development to stakeholder and customer understanding of the procurement process and benefits. NSW DEPARTMENT OF EDUCATION AND COMMUNITIES 21

25 Appendix 1: Financial Year Performance Scorecard NSW DEPARTMENT OF EDUCATION AND COMMUNITIES